Products: Small Cap Growth Equity

Small Cap Growth Equity   •   Large Cap Growth Equity   •   Core Fixed Income   •  Intermediate Fixed Income   •   Short-term Fixed Income  •   Balanced

Investment Managers:

Dean McQuiddy, CFA
Principal, Director of Equity Investments
25 Years of Investment Experience

Patrick A. Riley, CFA
Partner, Equity Portfolio Manager
18 Years of Investment Experience

Phone: (904) 493-5500
Fax: (904) 493-5524

Philosophy
Sawgrass Asset Management's small cap growth product has had a defined investment philosophy since its inception in 1987. The product emphasizes domestic stocks with greater earnings potential than the market. We add value over time by combining quantitative models with bottom-up fundamental research into a consistent and structured investment discipline. Our process identifies small companies with strong earnings momentum, rising earnings estimates, and reasonable valuations relative to the Russell 2000 Growth Index. We believe that in combination, these three elements allow us to identify companies early in their cycle of positive change, which offers above average appreciation potential.

Process
Sawgrass applies a time-tested quantitative approach to the liquid portion of the Russell 2000 Index to evaluate securities based on bottom-up factors such as earnings momentum, earnings estimates, and valuation.

In addition, we evaluate financial statement data. This approach builds a list of purchase candidates consisting of 150-200 stocks that all have favorable attributes and have demonstrated their ability to be successful companies. This list is then researched on a fundamental basis to evaluate the viability of continued earnings growth and to uncover influential qualitative elements of each security.

We construct a well-diversified portfolio of 45-55 of our best ideas based on portfolio attribution and fundamental analysis. Our process focuses on specific stock selection and factor emphasis while paying close attention to industry and sector weightings relative to the Russell 2000 Growth Index.

Our sell discipline focuses on five main areas. Companies are sold when earnings expectations start to decline, fundamental factors begin to experience significant changes, more attractive companies are identified, risk profile realignment is necessary, or the market cap exceeds that of our benchmark. Particular attention is paid to a stock's change in earnings estimates. Our strategy seeks to avoid stocks with weakening earnings or price trends.

We maintain an active portfolio that seeks to be fully invested with less than 5% in cash. No options or leverage is employed.

Why Small Cap?
Smaller companies have historically been the best performing segment of the stock market. Small cap stocks can be an extremely positive way for investors to diversify their larger cap portfolios by offering a lower risk, higher return profile when combined with a large cap portfolio. We believe that smaller companies currently offer some of the most attractive opportunities in the last 70+ years. Whether used in combination with larger companies or as an aggressive investment approach, small cap stocks should be given strong consideration.