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Wasatch International Micro Cap Strategy

Wasatch International Micro Cap Strategy
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Strategy Overview

Objective

Long-Term growth of capital

Highlights
  • Seeks undiscovered micro-cap growth companies at attractive valuations
  • Truly active, collaborative, bottom-up, fundamental process
  • Systematic coverage of the developed and emerging markets micro-cap universe
  • Broad sector and country approach
Investment Approach

We use a bottom-up approach that seeks to identify companies with outstanding long-term growth potential. We look for companies with:

  • Strong financials
  • A sustainable competitive advantage
  • Industry-best management teams
  • Price-to-earnings ratios around our expected 5-year earnings growth rate

Primarily invests in companies outside the U.S. with market caps of less than $1.5 billion at the time of purchase

Approximately 80-120 positions

Portfolio Managers
Linda Lasater Linda Lasater Lead Portfolio Manager
4 years on strategy
14 years at wasatch
Dan Chace Dan Chace Portfolio Manager
1 year on strategy
18 years at wasatch
Allison He Allison He Associate Portfolio Manager
3 years on strategy
8 years at wasatch
Quick Look
As of 03/31/21
Total Assets*
$1,337M
Mutual Fund
$748.7M
Separate Accounts
$588.6M
Inception Date
01/27/05
Account Minimum
$10m
Primary Benchmark
MSCI AC World Ex-U.S.A. Small Cap Index

*Total strategy assets across all vehicles and composites

Documents
Fact Sheet
Commentary

We rely on our investment process and bottom-up company research to find the best opportunities in a big and diverse universe of micro-cap companies.”

—Linda Lasater, Lead Portfolio Manager

Performance

Average Annual Total Returns AS OF 03/31/21 AS OF 03/31/21
Quarter-End Month-end
1 Month
3 Month
ytd
1 yr
3 yr
5 yr
10 yr
Since
Inception
International Micro Cap Composite (Gross)
-2.19%
-1.71%
-1.71%
73.47%
17.60%
17.53%
14.09%
13.71%
International Micro Cap Composite (Net)
-2.31%
-2.06%
-2.06%
71.12%
15.96%
15.78%
12.15%
11.61%
MSCI AC World Ex-U.S.A. Small Cap Index
2.03%
5.53%
5.53%
69.82%
6.61%
10.40%
6.32%
7.56%
MSCI World Ex-U.S.A. Small Cap Index
2.18%
4.88%
4.88%
65.17%
6.89%
10.55%
7.14%
7.15%

Returns for periods less than one year are not annualized. Since inception performance is calculated from 01/31/2005.

Calendar Year Returns (%) NET OF FEES (AS OF 12/31/20)
International Micro Cap Composite
MSCI AC World Ex-U.S.A. Small Cap Index

Performance is preliminary and subject to change. Past performance is not indicative of future results. Wasatch Global Investors is an independent registered investment advisor. Registration does not imply a certain level of skill or training. Wasatch claims compliance with the Global Investment Performance Standards (GIPS®). GIPS® is a registered trademark of CFA Institute. CFA Institute does not endorse or promote this organization, nor does it warrant the accuracy or quality of content contained herein. To receive a complete list of composite descriptions of Wasatch composites and/or a GIPS Composite Report, e-mail inforequest@wasatchglobal.com. The U.S. Dollar is the currency used to express performance.

The International Micro Cap Composite contains fully discretionary equity accounts following the International Micro Cap style.  The composite primarily invests in foreign micro cap companies with the goal of long-term growth of capital.   For comparison purposes the composite is measured against the MSCI AC World Ex-U.S.A. Small Cap Net TR and MSCI World Ex-U.S.A. Small Cap Net TR indices.

The MSCI AC World Ex-U.S.A. Small Cap Net TR Index is an unmanaged index representing developed and emerging markets, excluding securities of U.S. issuers.

The MSCI World Ex-U.S.A. Small Cap Net TR Index is an unmanaged index representing 22 developed markets, excluding the United States.

MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used to create indices or financial products.

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Portfolio

Characteristics AS OF 03/31/21
Portfolio
Index
Number of Holdings
91
4213
Average Market Cap
($ Weighted)
$1.75B
$2.79B
Median Market Cap
$1.29B
$1.10B
EPS Growth (%, est. 5 yr)
23
15
P/E (Forward)
33
16
Portfolio Turnover (%)
36.89
N/A
Active Share (%)
99
N/A
Performance Statistics AS OF 03/31/21
5 yr
Alpha
8.12
Beta
0.81
R-Squared
0.73
Standard Deviation
16.03
Upside Capture
88
Downside Capture
62
Top 10 Holdings AS OF 12/31/20
Company
% of Net Assets
Fortnox AB (Sweden)
3.4%
Esker SA (France)
2.5%
IR Japan Holdings Ltd. (Japan)
2.4%
YouGov PLC (United Kingdom)
2.3%
Japan Elevator Service Holdings Co Ltd. (Japan)
2.3%
Rakus Co Ltd. (Japan)
2.2%
Metropolis Healthcare Ltd. (India)
2.2%
Atoss Software AG (Germany)
2.2%
LEENO Industrial Inc. (South Korea)
2.1%
Qualitas Controladora SAB de CV (Mexico)
2.1%
91 Number of holdings
99% Active share
Sector Allocation AS OF 03/31/21
Sector
Portfolio
Index
Information Technology
34.2
11.6
Industrials
17.1
21.0
Financials
16.1
10.6
Health Care
12.8
7.2
Communication Services
6.9
4.1
Consumer Staples
5.0
5.7
Materials
3.0
11.0
Consumer Discretionary
2.8
12.8
Cash & Cash Equivalents*
2.1
0.0
Real Estate
0.0
10.2
Utilities
0.0
3.4
Energy
0.0
2.4
Country Allocation AS OF 03/31/21
Portfolio (%)
Developed
65.1
Japan
23.6
United Kingdom
14.8
Germany
7.3
Sweden
3.9
Norway
3.3
France
3.3
Australia
2.1
Other
6.9
Emerging & Frontier
32.7
India
11.0
Taiwan
4.7
South Korea
4.7
Egypt
2.6
Mexico
2.1
Thailand
1.7
Indonesia
1.6
Other
4.4
65.1% Developed
32.7% Em and Frontier

Country weights are calculated as a percentage of total portfolio including cash & cash equivalents.

Commentary & Literature

Commentary
Fact Sheet
News & Updates

Wasatch Advisors Rebrands as Wasatch Global Investors

September 24, 2019

Salt Lake City, Utah, September 24, 2019—Independent investment manager Wasatch Advisors has…

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India’s Virtuous Circle of Amazing Progress

September 24, 2019

In India, the Hindi term “jugaad” is used to describe an improvised…

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Important Disclosures

Portfolio Characteristics, Allocations and Top Ten Holdings are derived from a representative account.

Est. 5-year EPS Growth %: Estimated percentage increase in earnings per share (EPS) per year of the fund's holdings over the next 5 years. Returns are not guaranteed and may be higher or lower. Source: Wasatch and FactSet. P/E Ratio (forward and trailing): Sum of stock prices of the fund's holdings divided by the aggregate earnings per share of those holdings for the next 12 months (forward), or past 12 months (trailing), calculated as a weighted harmonic average. P/E to Growth Rate: Forward 12-month P/E ratio divided by the estimated 5-year EPS growth rate. Portfolios with a number less than 1.0 would be considered undervalued, around 1.0 would be considered fair valued and significantly greater than 1.0 would be considered overvalued. Weighted Average Market Cap: Average market capitalization of companies held by the fund, weighted by their percentage of fund net assets. Portfolio Turnover: A measure of trading activity in a fund's portfolio over the past 12 months expressed as a percentage of the fund's average total assets. Alpha measures a fund's risk/reward potential. A positive alpha means the fund outperformed the index. A negative alpha means the fund underperformed the index. Beta measures a fund's risk in relation to the market. A beta of 0.8 means the fund's total return is likely to move up or down 80% of the market change; 1.25 means total return is likely to move up or down 25% more than the market. R-Squared measures (from 0 to 1.0) how closely a fund's movements are correlated with movements of its benchmark. An R-squared of 1.0 would mean that the fund's movements are completely correlated with the movements of its benchmark. Active Share measures the difference between portfolio holdings and the benchmark. It is the sum of the absolute values of the different weightings of each holding in the fund versus each holding in the benchmark, divided by 2. Standard Deviation measures the degree to which a fund's performance has varied from its average performance over a particular time period. The greater the standard deviation, the greater a fund's volatility (risk). Upside Capture explains how well a fund performs in time periods where the benchmark's returns are greater than zero. Downside Capture explains how well a fund performs in time periods where the benchmark's returns are less than zero.

Portfolio holdings are subject to risks and may change at any time.

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