Sawgrass Small Cap Quality Growth

Sawgrass Genesis Small Growth seeks to exploit investor behavior that we believe leads to persistent overvaluation of companies experiencing rapid rates of change at the expense of those with more consistent, less volatile growth. Using our internally developed quantitative models and our experience with risk management techniques, we select leaders from the small cap growth universe.

Investment Process

The Sawgrass Genesis Small Growth decision process begins with a universe of 1200 companies with market caps between $300M and $4.5B. Applying Sawgrass’ proprietary, sector-specific, quantitative model results in an investable universe of 200 stocks.

Using a bottom up approach we analyze a company’s profitability; business valuation; equity valuation; earnings quality; and sales, earnings and margin stability. We favor stocks that exhibit low price volatility and are consolidating or positively trending.

The stock(s) with the best mix of quantitative and qualitative data are selected for the best mix of quantitative and qualitative data are selected for purchase resulting in a diversified portfolio of 70-90 stocks. Positions are purchased and weighted with particular consideration given to each stock’s impact on risk factors as well as the overall risk profile of the portfolio.

Positions may be pyramided into or gradually sold out of but are typically purchased/sold in whole. Winners are trimmed to prevent excessive portfolio weighting/risk. Stocks are sold primarily when the underlying technical factors of a stock begin to deteriorate.