September, 2023
The portfolio performed roughly in line with the MSCI World Small Cap Index in the period, net of fees and in Australian dollar terms. Stock selection was slightly positive on a regional basis and slightly negative on a sector basis. US stock selection was particularly strong in the period, while Japan proved to be more challenging. On a sector basis, positive stock selection in healthcare was a notable contributor after detracting from performance earlier in the year. Allocation meanwhile was slightly negative on a regional basis and slightly positive on a sector basis.
Helped
Hostess Brands, a US-listed baker and distributor of sweet baked goods, performed well in the period. The share price rose sharply following an offer from S.J. Smucker to purchase the company. The portfolio no longer holds the shares.
Array Technologies, a US-listed manufacturer of ground mounting systems used in solar energy projects, performed well after our early August purchase. The share price rose after the release of better-than-expected quarterly results that demonstrated robust order development, strong pricing power, and improved profitability. The portfolio continues to hold the shares.
Hurt
ZoomInfo Technologies, a US-listed provider of business-to-business (B2B) contact data, intelligence, and analytics for sales, marketing, operations, and recruiting teams, performed poorly in the period. The share price fell after the release of weaker-than-expected quarterly results and somewhat cautious guidance from corporate management for the rest of the year. Although cyclical headwinds should abate in the medium-term, some investors remain concerned about near-term growth dynamics. The portfolio continues to hold the shares.
CAB Payments, a UK-listed provider of B2B cross-border payment and foreign exchange services to international development organizations (e.g., the United Nations), banks, and central banks, and other “blue-chip” customers, performed poorly in the period. Following the company’s July initial public offering (IPO), the shares broke below the price when they were issued and continued to weaken despite the release of better-than-expected quarterly results and an optimistic outlook from corporate management. The portfolio continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2023-07-1.pdfAugust, 2023
The Lazard Global Small Cap Equity Fund performed roughly in line the MSCI Global Small Cap Index in the period. On a regional basis, stock selection and allocation both contributed marginally to relative performance. On a sector basis, stock selection detracted modestly while allocation contributed moderately.
Shares of Array Technologies (industrials), a US-listed manufacturer of mounting systems used in solar energy projects, performed well during the month after the release of a well-received quarterly results that demonstrated better-than-expected profitability development. The portfolio continues to hold the shares.
Shares of Hostess (consumer staples), a US-listed baked goods manufacturer, performed well amid press speculation regarding possible bids for the company from industry peers. The portfolio continues to hold the shares.
Shares of AbCellera (healthcare), a US-listed contract research organization that offers antibody discovery services, fell after the release of lower-than-expected quarterly earnings. Concerns over the industry-wide demand outlook for research and development (R&D) also hurt the stock amid a softer economic environment. The portfolio continues to hold the shares.
Shares of ZoomInfo Technology (communication services), a US-listed sales and marketing data provider, fell after the release of lower-thanexpected quarterly earnings and a more cautious near-term outlook from corporate management. The portfolio continued to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2023-07.pdfJuly, 2023
The Lazard Global Small Cap Equity Fund rose on an absolute basis, but modestly underperformed the MSCI Global Small Cap Index (net of fees) in the period. Stock selection was roughly neutral while allocation detracted.
Shares of Helen of Troy (consumer discretionary), a US-listed personal care and household products manufacturer, performed well during the month after the release of better-than-expected quarterly results. Continued investor optimism on the corporate management’s outlook for the company also boosted the stock price. The portfolio continues to hold the shares.
Shares of Comerica (financials), a US-listed bank, continued to perform well after the release of better-than-feared quarterly results. The portfolio continues to hold the shares.
Shares of Trisura (financials), a Canada-listed property and casualty insurer, fell amid increased industry-wide concerns regarding counterparty exposure following fraud allegations against a competitor’s reinsurer. The portfolio continues to hold the shares.
Shares of SeSa (information technology), an Italy-listed value-added information technology solutions provider, gave back in July the gains it posted in June amid investor concerns over the company’s cash flow as it continues to invest heavily in mergers and acquisitions and capital expenditures. Worries overshadowed the release of quarterly results that were in line with analysts’ expectations. The portfolio continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2023-05-1.pdfJune, 2023
The portfolio underperformed the MSCI World Small Cap Index (net of fees, in Australian dollar terms) in the period as positive allocation was more than offset by negative stock selection. Stock selection in healthcare accounted for largest portion of negative attribution. Several holdings in this sector faced idiosyncratic challenges in the quarter that detracted from relative performance. For the most part, we continue to believe in the investment theses that underpin these holdings and maintained or added to these positions.
Helen of Troy, a US-listed personal care and household products manufacturer, performed well during the period. The share price bounced back strongly in the second quarter following a challenging performance in the first quarter. Better-than-feared quarterly results, clarity on executive succession plans, and a more-optimistic-than-expected outlook for next year from corporate management all worked to improve investor sentiment. The portfolio continues to hold the shares.
Stevanato, a US-listed manufacturer of drug containment (e.g., vials) and delivery (e.g., syringes) systems, performed well in the period. The share price continued to rise after reporting quarterly results that were in line with market expectations and a strong orderbook. The stock was also boosted by investor optimism on the demand potential for obesity and Type II diabetes-related drugs (e.g., glucagon-like peptide-1 known as GLP-1) and delivery systems (e.g., auto and pen injectors). The portfolio continues to hold the shares.
Catalent, a US-listed contract development and manufacturing organization (CDMO) serving the pharmaceutical industry, performed poorly in the period. The share price fell following the announcement of further operational issues at three facilities, the unexpected departure of the company’s chief financial officer, a dropped takeover bid from an industry peer, and the delayed release of quarterly results. The portfolio no longer holds the shares.
Envista, a US-listed leading manufacturer of dental implants, orthodonture products (brackets & wires, clear aligners), consumable products, and equipment, performed poorly in the period. The share price fell after the release of weaker-than-expected quarterly results due to demand headwinds in emerging markets and soft equipment volumes. The portfolio continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2023-05.pdfMay, 2023
The portfolio underperformed the MSCI Global Small Cap Index in the period (in Australian dollar terms, net of fees) as allocation’s positive impact was more than offset by stock selection. Shares of Crayon (information technology), a Norway-listed value add software reseller, performed well during the month after the release of strong quarterly results that demonstrated robust growth, higher profitability, and improved free cashflow.
The portfolio continues to hold the shares. Shares of CyberArk Software (information technology), a US-listed security software solutions provider, performed well after the release of better-than-expected quarterly results, an optimistic outlook from corporate management, and a well-received capital markets day led by the company’s new chief executive officer (CEO). The portfolio continues to hold the shares. Shares of Ingevity (materials), a US-listed manufacturer of carbon-based products used in automotive emissions reduction systems and food, water, and beverage purification processes, fell in the month following the release of quarterly earnings that included a worse -than-expected outlook from corporate management due to rising input costs and increased recession concerns.
The portfolio continues to hold the shares. Shares of Envista (health care), a US-listed dental products manufacturer, fell after the release of mixed set of quarterly results and heightened concerns among some investors regarding demand durability in the face of slower economic growth. The portfolio continued to hold the shares.
File:April, 2023
Global small cap equities fell marginally in the month. Stocks in more defensive sectors such as healthcare, consumer staples and communication services outperformed on a relative basis. On the other hand, stocks in the information technology sector, and to a lesser degree, the materials sector, lagged. On a geographic basis, the United Kingdom outperformed significantly while the United States trailed.
File:March, 2023
The portfolio rose in absolute terms but underperformed the MSCI World Small Cap Index somewhat in the quarter on a net of fees basis.
Allocation impact was positive on regional basis and negative on a sector basis. Stock selection detracted from relative performance in the quarter.
JD Sports Fashion (consumer discretionary), a UK-listed branded sports apparel and footwear retailer, contributed positively to relative performance in the period. The shares rose after a well-received capital markets day led by the company’s new chief executive officer (CEO), and the release of strong results that demonstrated robust demand during the key holiday season. The portfolio continues to hold the shares.
Dream Industrial REIT (real estate), a Canada-listed industrial real estate investment trust, contributed positively to relative performance in the period. The shares rose after the release of solid quarterly results that reflected strong rental rate increases. The portfolio continues to hold the shares.
Commerce Bancshares (financials) and East West Bancorp (financials), two US-listed regional banks, detracted from relative performance in the period. The share prices of both companies fell alongside those of other banks following the failures of Silicon Valley and Signature. The portfolio continues to hold Commerce Bancshares shares, but it no longer owns a stake in East West Bank.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2023-03.pdfFebruary, 2023
Lazard Global Small Cap Equity Fund slightly outperformed the MSCI Global Small Cap Index on a net of fees basis in February. On a sector basis, stock selection was the primary contributor to positive attribution in the period. Shares of Catalent (health care), a US-listed contract development and manufacturing organization (CDMO) for the pharmaceutical industry, rose in the period after press speculation regarding a potential bid for the company by Danaher, the release of better-than-expected quarterly results, and an optimistic outlook from corporate management. The portfolio continues to hold the shares. Shares of Atkore (industrials), a US-listed manufacturer of electrical conduits, cables, and installation accessories for the construction industry, performed well in the period as the company released strong quarterly results and a more-optimistic-than-expected outlook. The portfolio continues to hold the shares. Shares of AbCellera (health care), a Canada-based contract research organization (CRO) for the development of therapeutic antibodies, fell in the period following the release of a mixed set of quarterly results. The portfolio continues to hold the shares. Shares of Leslie’s (consumer discretionary), a US-listed pool and spa retailer, gave back some of their very strong January gains in February following the release of a mixed set of quarterly results. The portfolio continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2023-02.pdfJanuary, 2023
Although the portfolio performed well on an absolute basis, it trailed the MSCI Global Small Cap Index (“the Index”) moderately this month. Both allocation impact and stock selection impact detracted from relative performance in the period. Shares of East West Bancorp (financials) – a US-listed bank – rose in the period alongside the release of better-than-expected quarterly results and an optimistic outlook for the coming year from corporate management. The portfolio continues to hold the shares. Shares of JD Sports Fashion (consumer discretionary) – a UK-listed branded sports apparel and footwear retailer – performed well in the period alongside the release of a strong trading statement and optimistic outlook for the coming year from corporate management.
The portfolio continues to hold the shares. Shares of Halozyme Therapeutics (health care)—a US-listed biopharmaceutical company —fell in the period following the release of a moderately lower-than-expected outlook for the coming year from corporate management. The portfolio continues to hold the shares. Shares of Commerce Bank (financials) – a US-listed regional bank – fell modestly in the period following the release of a mixed set of quarterly results that included slightly higher-than-expected operating costs alongside slightly lower-than-expected net interest income and service fees. The portfolio continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2023-01.pdfDecember, 2022
The Lazard Global Small Cap Equity Fund outperformed the MSCI World Small Cap Index (net of fees) for the quarter. On a sector basis, positive stock selection impact was the primary attribution driver. On a geographic basis, the fund’s overweight in Continental Europe and underweight in the United States accounted for the majority of outperformance. A falling USD also contributed positively to relative performance in the period given the fund’s underweight in USD-denominated stocks. Atkore (industrials), a US-listed manufacturer of electrical conduits used in the construction industry, contributed positively to relative performance in the period. The shares rose alongside the release of strong quarterly results, an optimistic outlook from corporate management, and expectations for continued deployment of excess capital via M&A and shareholder returns (e.g., buybacks and dividends). United Therapeutics (health care), a US-listed biotech company serving patients with chronic and life-threatening diseases, contributed positively to relative performance in the period. The shares rose alongside the release of strong quarterly results that included better-thanexpected growth from a key treatment. Leslie’s (consumer discretionary), a US-listed pool and spa supplier, detracted from relative performance in the period. Despite the release of strong quarterly results, the share price fell alongside a more conservative than expected outlook for next year from corporate management. Catalent (health care), a US-listed Contract Development Manufacturing Organization (CDMO) serving pharmaceutical customers, detracted from relative performance in the period. The share price continued to fall alongside a mixed set of quarterly results that included a somewhat pessimistic outlook from corporate management due to weakening demand among some customers and lingering supply chain bottlenecks.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-12.pdfNovember, 2022
The Lazard Global Equity Small Cap Equity Fund performed well on an absolute basis and outperformed the MSCI Global Small Cap Index (net of fees) this month. Stock selection impact was the primary driver of positive attribution in the period. Shares of Atkore (industrials) – a US-listed manufacturer of electrical raceways for the construction industry – rose in the period alongside the release of strong quarterly results and a more-optimistic-than-expected outlook from corporate management.
The fund continues to hold the shares. Shares of United Therapeutics (healthcare) – a US-listed biotech company providing therapies for people with chronic and life-threatening diseases – performed well in the period alongside the release of better-than-expected quarterly results and strong growth from new products, delivery systems, and access to treatment.
The fund continues to hold the shares. Shares of Spin Master (consumer discretionary)—a Canada-listed toy manufacturer—fell in the period following the release of worse-thanexpected quarterly results and a somewhat pessimistic outlook from corporate management. The fund continues to hold the shares. Shares of Sterling Check (industrials) – a US-listed background check and identity verification provider – fell in the period alongside the release of quarterly results that included a softer-than-expected outlook from corporate management. The fund continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-11.pdfOctober, 2022
The Fund underperformed the MSCI Global Small Cap Index (“the Index”) this month. Allocation impact was modestly positive on a regional basis and modestly negative on a sector basis. Stock selection impact also detracted somewhat. Shares of Cactus (energy) – a US-listed manufacturer of wellhead and pressure control equipment – performed well in the period alongside continued strength in the energy complex, increased capital expenditure plans from customers, and positive commentary from sector peers. We continue to hold the shares. Shares of Atkore (industrials) – a US-listed manufacturer of electrical raceways for the construction industry – rose in the period alongside moderating input cost inflation (e.g., steel and resins) and expectations for continued pricing power. We continue to hold the shares. Shares of Carlisle (industrials)—a US-listed leading commercial roofing manufacturer—fell in the period following the release of a mixed set of quarterly results that included better-than-expected earnings but a somewhat conservative outlook for the rest of the year from corporate management. The Fund continues to hold the shares. Shares of MastukiyoCocokara (consumer staples) – a Japan-listed pharmacy operator – gave back some strong year-to-date gains in the month following the release of slightly softer-than-expected September sales data. The Fund continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-10.pdfSeptember, 2022
Portfolio outperformance during a difficult September was offset by underperformance in July and August, resulting in negative attribution for the quarter. Currency and industry headwinds, as well as negative stock selection impact, detracted from relative performance in the period. The portfolio’s underweight to USD stocks–via EUR stocks in particular–detracted as the EUR fell to a 20-year low and broke parity. The portfolio’s underweight in fossil fuels and related industries (due both to sustainability risks as well as to frequently low financial productivity) continued to serve as a headwind in the current environment.
Positive stock selection impact in the financials and industrials sectors was offset by negative stock selection impact in the health care and information technology sectors. PGT Innovations (industrials) – a US-listed window and door manufacturer – contributed positively to relative performance in the period. The shares rose alongside the release of strong quarterly results that demonstrated robust pricing power, solid demand, and disciplined cost control in an inflationary environment. The portfolio continues to hold the shares. Jafco (financials) – a Japan-listed venture capital and private equity manager – contributed positively to relative performance in the period. The shares rose following the disclosure of a large holding by an activist investor.
The portfolio continues to hold the shares. Catalent (health care) – a US-listed Contract Development Manufacturing Organization (CDMO) serving pharmaceutical customers – detracted from relative performance in the period. The share price fell alongside a mixed set of quarterly results that included a larger-thanexpected decline in the company’s COVID-19 related operations and a subsequent FDA notice regarding operations at a production facility for the Moderna vaccine. The portfolio continues to hold the shares. Crayon (information technology) – a Norway-listed value-added software reseller – detracted from relative performance in the period. The share price fell following the release of a mixed set of quarterly results that included weaker-than-expected profitability. The portfolio continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-09.pdfAugust, 2022
The Lazard Global Small Cap Equity Fund underperformed the MSCI Global Small Cap Index (“the Index”) this month. Allocation impact was roughly neutral on a sector basis and detracted on a regional basis due mainly to the portfolio’s overweight in Continental Europe. Stock selection impact also detracted from relative performance in the month. Shares of
JAFCO (financials) – a Japan-listed venture capital firm – performed well in the period following the disclosure of a large shareholding by an activist investor. The portfolio continues to hold the shares.
Shares of Sterling Check (industrials) – a US-listed background check and identity verification services provider – rose in the period alongside the release of strong quarterly results and an optimistic outlook from corporate management. The portfolio continues to hold the shares.
Shares of Crayon (information technology)—a Norway-listed value-added software reseller—gave back strong gains from July following the release of a mixed set of quarterly results that included weaker-than-expected profitability. As of month end, the portfolio continued to hold the shares.
Shares of CAE (industrials) – a Canada-listed aerospace and defense company – fell in the month alongside the release of weaker-thanexpected quarterly results, deteriorating operations in the company’s defense business, and a pessimistic near-term outlook from corporate management. The portfolio no longer holds the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-08.pdfJuly, 2022
Although the Lazard Global Small Cap Equity Fund rose more than 6% in absolute terms, performance trailed the MSCI World Small Cap Index (the “Index”) for the period. Given the sharp rise in equity markets, the portfolio’s cash holding was the largest allocation detractor from relative performance in the period. Stock selection impact also detracted.
Shares of PGT (industrials) – a US-listed manufacturer of impact resistant doors and windows – performed well in the period following the release of better-than-expected quarterly results that demonstrated the company’s strong pricing power and solid operational execution. Shares of Crayon (information technology) – a UK-listed software re-seller and consultant – rose in the period alongside strong results announcements from peers and suppliers.
After performing well year-to-date, shares of Bankinter (financials) – a Spain-listed bank – gave back some gains this month following the Spanish government’s announcement of a temporary special banking tax. Shares of Línea Directa Aseguradora (financials) – a Spain-listed insurer and reinsurer – fell in the month alongside a mixed set of quarterly results and rising claims costs
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-07.pdfJune, 2022
The Lazard Global Small Cap Equity Fund modestly underperformed the MSCI World Small Cap Index (the “Index”) in the quarter. The modest underperformance was not surprising, given our focus on stocks of high-quality companies. On a sector basis, positive allocation impact, due to mainly to the Fund’s cash holding and underweight in materials, was offset by negative stock selection impact. On a more granular basis (i.e., based on MSCI GICS level 3 industries), almost all the negative attribution in the period was due to the portfolio’s overweight in real estate management & development and underweight in oil, gas & consumable fuels. Although real estate stocks did not perform particularly well during the period, they often benefit as a hedge against higher inflation, and we believe this dynamic may take hold as the cycle matures. As it relates to fossil fuels, the portfolio is typically underweight due both to sustainability risks as well as to frequently low financial productivity (i.e., ROE, ROIC, etc.) among small cap companies in the industry.
United Therapeutics (health care) – a US-listed biotechnology company – contributed positively to relative performance in the period. The shares rose following FDA approval for its key pulmonary hypertension therapy.
Bankinter (financials) – a Spain-listed bank – contributed positively to relative performance in the period. The shares rose alongside the release of strong quarterly results and a more favorable rate environment for banks. Stelco (materials) – a Canada-listed steel producer – detracted from relative performance in the month. Despite the release of in-line quarterly results, continued share buybacks, and a significant land sale-leaseback (which we believe will lead to additional special capital returns), the share price fell alongside increased investor concerns regarding higher input costs and a slowdown in demand.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-06.pdfMay, 2022
The Lazard Global Small Cap Equity Fund trailed the MSCI World Small Cap Index (the “Index”) in the period, due mainly to negative stock selection impact. Allocation impact was marginally negative on a sector basis and modestly positive on a regional basis. On a more granular industry basis, the portfolio’s underweight in fossil fuels (i.e., MSCI GICS level 3 industry, “oil, gas, and consumable fuels”) continued to serve as a headwind to relative performance, accounting for approximately half of the negative attribution in the period.
Shares of United Therapeutics (health care) – a U.S.-listed biotechnology company – rose sharply in the month following FDA approval for its key pulmonary hypertension therapy. The portfolio continues to hold the shares.
Shares of Malibu Boats (consumer discretionary) – a U.S.-listed recreational powerboat manufacturer – performed well in the period alongside the release of better-than-expected quarterly results that demonstrated strong pricing power, robust demand, and solid operational execution. The portfolio continues to hold the shares.
Shares of Pegasystems (information technology) – a U.S.-listed Business Process Management software solutions provider – fell in the period following an adverse litigation verdict involving alleged misuse of a competitor’s technology. The portfolio no longer holds the shares
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-05.pdfMarch, 2022
The Lazard Global Small Cap Equity Fund underperformed the MSCI World Small Cap Index (the “Index”) in the quarter due to negative impact from both allocation and stock selection. Negative allocation impact was caused mainly by the Fund’s underweights in the energy and materials sectors as well its overweight in Continental Europe. On a more granular basis (i.e., based on the sixty-nine MSCI GICS industries rather than twelve sectors), most of the negative attribution in the period was due to the portfolio’s limited exposure to both fossil fuel (i.e., MSCI GICS industry “Oil, Gas, and Consumable Fuels”) and metals & mining companies.
Cactus (energy) – a US-listed manufacturer of wellhead and pressure control equipment – contributed positively to relative performance in the period. The shares benefited from better-than-expected quarterly results, increased capital returns to shareholders, and industry tailwinds from higher energy prices. Bankinter (financials) – a Spain-listed bank – contributed positively to relative performance in the period. The shares rose alongside the release of strong quarterly results and a more favorable rate environment for banks.
Lazard Asset Management is deeply disturbed by the humanitarian tragedy unfolding in Ukraine. The Ukrainian people are suffering through an unspeakable crisis following Russia’s invasion. The conflict has likely killed thousands of civilians, injured many more, and displaced millions. Our thoughts are with the people of Ukraine.
Although Russia’s invasion of Ukraine continues to draw condemnation and reprisals from around the world, an already deeply troubling situation appears to be getting uglier. Alongside the growing humanitarian crisis, the war’s myriad effects continue to increase market volatility. Higher inflation, increased commodity and energy prices, supply chain disruptions, a stronger U.S. dollar, rising rates, weaker global demand, and central bank reactions are all factors that investors must consider in the months and quarters ahead. Thus far, we have not made material changes to the portfolio in response these risks. We are opportunistically adding to holdings of companies that we believe have been disproportionately impacted by recent market volatility, but whose fundamentals remain strong in our view. At the portfolio construction level, we continue to take a balanced approach to mitigate top-down risks while emphasizing idiosyncratic, or stock specific, risks. We continue to work closely with the firm’s Risk Management and Legal and Compliance Teams to assess, and when necessary, react, to the evolving situation. The portfolio has no holdings in Russian securities, and we estimate the underlying revenue exposure of portfolio companies is less than 1% overall. Relative the MSCI World Small Cap index, the portfolio currently trades at a moderate valuation discount (forward P/E) and a significant return premium (forward ROE) with lower debt ratios. As such, we believe it remains well positioned to capitalize on recent market volatility.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-03.pdfFebruary, 2022
The Lazard Global Small Cap Fund underperformed the MSCI World Small Cap Index (the “Index”) during the period due to negative impact from both allocation and stock selection. Shares of Crayon Group (information technology) – a Norway-listed software reseller and services provider – performed well alongside the release of strong quarterly results, recent acquisitions, and an optimistic growth outlook from corporate management. As of month-end, the Fund continued to hold the shares.
Shares of PGT Innovations (industrials) – a US-listed residential windows and doors manufacturer – performed well with the release of solid quarterly results, strong pricing power, and a better-than-expected profitability outlook from corporate management. As of month-end, the Fund continued to hold the shares. Shares of JD Sports Fashion (consumer discretionary) – a U.K.- listed branded footwear and apparel retailer – continued to be weak following a share sale by the Executive Chairman last month and news the company would delay releasing its full year results to facilitate reporting on a divestment and review the ongoing process of splitting the roles of Chairman and CEO. As of month-end, the Fund continued to hold the shares.
Shares of United Therapeutics (health care) – a U.S.-listed biotechnology company – fell following the release of weaker-than-expected quarterly results and delayed FDA approval for a new therapy. As of month-end, the Fund continued to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-02_en.pdfJanuary, 2022
The Lazard Global Small Cap Equity Fund moderately outperformed the MSCI World Small Cap Index (the “Index”) during the month due to positive stock selection impact. Allocation impact was modestly negative on both a sector and regional basis.
Cactus (energy), a US-listed manufacturer of wellhead pressure control equipment, contributed to relative returns in the period. The shares performed well alongside those of other companies in the energy complex. The portfolio continues to hold the shares.
Kohl’s (consumer discretionary), a US-listed apparel retailer, contributed to relative returns in the period. The shares performed well following a takeover offer from an active investor backed private equity company. The portfolio continues to hold the shares.
Adaptive Biotechnologies (health care), a US-listed immune-driven diagnostics and therapeutics company, detracted from relative returns in the period. The shares fell alongside those of other med- and biotech companies as well as unexpected news that the company’s CFO was resigning. In addition, investor concerns increased somewhat with regard to a much-anticipated cell-therapy partnership with Genentech. The portfolio continues to hold the shares.
Ortho Clinical Diagnostics (health care), a US-listed in-vitro diagnostics company, detracted from relative returns in the period. The shares fell alongside those of other med- and biotech companies despite the release of strong quarterly sales figures. The portfolio continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2022-01_en.pdfDecember, 2021
The Lazard Global Small Cap Equity Fund (the “Fund”) modestly underperformed the MSCI World Small Cap Index (the “Index”) in the quarter. Ciena, a US-listed network and communication services infrastructure provider, contributed positively to relative performance in the period. The shares rose following quarterly results that included better-than-expected order growth and an optimistic revenue outlook from corporate management. The Fund continues to hold the shares.
National Storage Affiliates, a US-listed self-storage REIT, contributed positively to relative performance in the period. The shares rose alongside the release of strong quarterly results, higher-than-expected new property acquisitions, and a more optimistic outlook from corporate management. The Fund continues to hold the shares.
Ryohin Keikaku, a Japan-listed multiline “no-brand” retailer, detracted from relative performance in the period. The shares fell alongside increased investor concerns regarding higher input prices as well as negative demand impacts from mobility restrictions in China (China accounts for approximately 45% of group operating profit). The Fund continues to hold the shares. Teamviewer, a German-listed software solutions provider that enables full remote access and control functionality for connected devices, detracted from relative performance in the period. The shares fell as quarterly results and management’s outlook failed to meet lofty expectations for the second time this year. With investors now questioning the company’s growth trajectory against a backdrop of increased competition and lingering capital discipline concerns, the Fund exited the position.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2021-12_en.pdfOctober, 2021
Lazard Global Small Cap Equity Fund underperformed the MSCI World Small Cap Index (the “Index”) during the period due primarily to modestly negative stock selection impact.
Cactus (Energy), a US-listed manufacturer of wellhead and pressure control equipment, contributed to relative returns in the period. The shares performed well alongside strong industry fundamentals amid higher energy demand and constrained supply. The Fund continues to hold the shares.
National Storage Affiliates (real estate), a US-listed self-storage REIT, contributed to relative returns in the period. The shares performed well alongside strong quarterly results from industry peers and supportive industry data. The Fund continues to hold the shares. Stillfront (communication services), a Sweden-listed digital games publisher, detracted from relative performance in the period. Recent changes to Apple’s app tracking policy for advertisers continued to weigh on new user acquisitions within the industry. While we believe Stillfront is well positioned to adapt to the evolving landscape, timing has become increasingly uncertain, and the Fund exited the shares. Teamviewer (information technology), a German-listed software solutions provider that enables full remote access and control functionality for connected devices fell, as quarterly results and management’s outlook failed to meet lofty expectations for the second time this year. With investors now questioning the company’s growth trajectory against a backdrop of increased competition and lingering capital discipline concerns, we are re-evaluating the Fund’s position.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2021-10_en.pdfSeptember, 2021
The Lazard Global Small Cap Equity Fund marginally underperformed the MSCI World Small Cap Index (the “Index”) in the quarter, as positive stock selection impact was offset by negative allocation impact.
Arcadis, a Netherlands-listed consultancy and engineering firm serving the buildings, environment, infrastructure, and water markets, contributed positively to relative performance in the period. The shares rose on the back of better-than-expected quarterly results, cyclical tailwinds following the COVID-19 induced downturn, and rising demand from customers for environmentally sustainable engineering solutions. The Fund continues to hold the shares.
Technopro, a Japan-listed provider of engineering staffing services, contributed positively to relative performance in the period. After falling last quarter, the shares rose sharply as the company reported better-than-expected results and announced a medium-term plan that, if executed well, could result in higher profitability and returns. Shares of the company also benefited from strong ongoing demand for IT related engineering and some optimism that COVID-19 related headwinds are abating. The Fund continues to hold the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2021-09.pdfAugust, 2021
The Lazard Global Small Cap Equity Fund moderately underperformed the MSCI World Small Cap Index (the “Index”) during the period. Both stock selection impact and allocation impact detracted modestly from relative performance this month. Stevanato (healthcare), a US-listed Italy-based producer of drug delivery, containment, and diagnostic solutions for the pharmaceutical, biotechnology, and life sciences industries, contributed positively to relative performance in the period. Shares of the company continued to perform well following its July IPO and the release of strong quarterly results in August. Stelco (materials), a Canada-listed steel manufacturer, contributed positively to relative performance in the period. The share price continued to climb alongside the release of solid quarterly results, a dividend increase, a large share buyback announcement, and rising expectations for additional capital returns
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2021-08_en.pdfJuly, 2021
The Lazard Global Small Cap Equity Fund outperformed the MSCI World Small Cap Index (the “Index”) during the month due mainly to positive stock selection impact. Allocation impact was modestly positive on regional basis due to the Fund’s overweight in Continental Europe.
Stelco (materials), a Canada-listed steel manufacturer, contributed positively to relative performance in the period. The share price continued to rise alongside strong steel prices and positive results from peers. The fund continues to hold the shares. Malibu Boats (consumer discretionary), a U.S.-listed recreational power boat manufacturer, contributed positively to relative performance in the period. The share price performed well alongside solid earnings reports from peers and strong consumer demand for recreational products. The Fund continues to hold the shares.
ATI Physical Therapy (health care), a US-listed physical therapy provider, detracted from relative performance in the period. The shares fell following the company’s inaugural quarterly earnings report which included weaker-than-expected results and guidance as well as higherthan-expected leverage. With management credibility in question, a less certain outlook, and more debt than anticipated, we decided to exit the shares.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2021-07_en.pdfJune, 2021
The Lazard Global Small Cap Fund outperformed its MSCI World Small Cap Index benchmark in the quarter, primarily because of positive stock selection. On a sector basis, allocation impact was modestly negative due to the portfolio’s underweight to energy and cash holding in a market rally. On a regional basis, allocation impact was marginally positive due primarily to the portfolio’s overweight to Continental Europe.
flatexDEGIRO, a German-listed online brokerage, contributed to relative performance. The shares performed well, benefiting from strong trading volume, the integration of recent acquisitions, and optimism for future growth. Stelco, a Canada-listed steel manufacturer, also contributed. The share price rose on the release of quarterly results that reflected solid cost control and prospects for increased capital returns to shareholders. Stelco is well placed to take advantage of both higher steel prices and strong end demand.
Technopro, a Japan-listed provider of engineering staffing services, detracted. The shares fell following the announcement of quarterly results that included somewhat conservative guidance from management for the full year. Nevertheless, the company appears well-positioned to benefit from strong ongoing demand for IT related engineering. Exelixis, a US-listed biopharmaceutical company focused on cancer treatment, also detracted. The shares fell following disappointing data from studies on two high potential treatments. We believe, however, that the company’s pipeline remains undervalued despite this setback. The resumption of growth from core assets should also work to assuage investor concerns.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2021-06_en.pdfMay, 2021
Global equity markets rose modestly in May. Stocks in cyclical sectors such as energy, materials, and financials, outperformed on a relative basis while those in less cyclical sectors such as health care, information technology, and utilities trailed. Regionally, the United Kingdom and Continental Europe led, while Japan, North America, and Asia ex-Japan lagged. The portfolio performed in line with its benchmark, the MSCI World Small Cap Index during the period as marginally positive stock selection was offset by marginally negative sector allocation.
Cactus (energy sector), a US-listed designer and manufacturer of wellhead and pressure control equipment, contributed performance in the period. The company delivered better-than-expected quarterly results that pointed towards continued market share gains. An improving economy is providing further cyclical tailwinds.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2021-05_en.pdfJanuary, 2021
Global equity markets rose in January. Stocks of companies in the energy, consumer discretionary and health care sectors outperformed on a relative basis, while those in materials, real estate, and utilities sectors underperformed. Regionally, North America outperformed strongly while all other major geographies lagged on a relative basis. The Lazard Global Small Cap Fund underperformed the MSCI World Small Cap Index during the month, mainly due to stock selection impact. Allocation impact (sector basis) detracted modestly from relative performance. FlatexDEGIRO, a German-listed online brokerage and financial services provider, contributed positively to relative performance in the period.
The shares performed well on the back of strong trading volume, the integration of recent acquisitions, and optimism regarding future growth. Columbus McKinnon, a US-listed manufacturer of material handling products and systems, contributed positively to relative performance. The company reported better-than-expected results in the period, and the new management team presented a credible plan to accelerate organic growth and expand profitability. Digital Garage, a Japan-listed information technology company with digital advertising, payments, and business incubation divisions, detracted from relative performance in the period. Demand for the company’s services was negatively impacted as a result of the resurgence COVID-19. Royal Unibrew, a Denmark-listed brewer, detracted from relative performance in the period. The shares were weak alongside lower demand, particularly on-trade (e.g. in bars and restaurants), as a result of the resurgence in COVID-19.
The Fund has maintained its holdings in all four names. COVID-19 vaccine progression is likely to continue to drive investor sentiment in the near to medium term. Recent optimism, however, must be weighed against the effects of widespread surges in infection rates and fatalities that, unfortunately, look set to continue. The outcome of the US elections buoyed investor sentiment as uncertainty decreased, and the path towards additional fiscal stimulus opened. As the US government transition process continues, investors may become increasingly focused on US-China trade tensions and the progressive policy changes US President Joseph Biden plans to pursue.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/LazardGlobalSmallCapFund_FactSheet_2021-01_en.pdfasset_class: Foreign Equity
asset_category: Equity World Mid/Small
peer_benchmark: Foreign Equity - World Mid/Small Index
broad_market_index: Developed -World Index
manager_contact_details: Array
ticker: LAZ0012AU
release_schedule: Monthly
commentary_block: Array
factsheet_url:
https://www.lazardassetmanagement.com/au/en_us/funds/funds/lazard-global-small-cap-fund/f181/s31/
Fact Sheet
fund_features:
The Lazard Global Small Cap Fund seeks to achieve total returns (including income and capital appreciation and before the deduction of fees and taxes) that exceed those of the MSCI World Small Cap Accumulation Index by 3% per annum over rolling three-year periods. The investment strategy of the Fund is to provide investors with access to investments in global small companies in any geographical location.
- The Fund invests in securities with market capitalisations, at the time of initial purchase, between US$300 million and US$5 billion or in the market capitalisation range of companies included in the MSCI World Small Cap Accumulation Index and to be domiciled in countries in the benchmark subject to the emerging markets exposure outlined below.
- The number of securities will generally range from 60 to 90 which means LAM makes active decisions as to which securities the Fund holds.
- The Fund cannot: more than 5% of its assets in the equity securities (including equity like and securities convertible into equity securities) of any one issuer at the time of purchase;more than 10% of the outstanding equity securities (including equity like and securities convertible into equity securities) of any one issuer; and more than 25% of its assets in the equity securities (including equity like and securities convertible into equity securities) of issuers located in emerging market countries.
structure: Managed Fund