Royce Investment Partners, the firm led by Chuck Royce (Trades, Portfolio), disclosed this week that it exited its position in The New Home Co. Inc. (NWHM, Financial), trimmed its stakes in GP Strategies Corp. (GPX, Financial) and Chicken Soup for the Soul Entertainment Inc. (CSSE, Financial) and boosted its holding in Computer Task Group Inc. (CTG, Financial) toward the end of July according to GuruFocus Real-Time Picks, a Premium feature.
The New York-based firm seeks long-term capital appreciation by investing in small-cap companies that have a solid business and are trading below estimates of enterprise value.
As of the March-quarter filing date, Royce’s $14.88 billion equity portfolio contains 1,012 stocks with a quarterly turnover ratio of 17%. The top four sectors in terms of weight are industrials, technology, financial services and consumer cyclical, representing 26.35%, 20.07%, 14.65% and 14.21% of the equity portfolio.
The New Home
The firm sold 1,015,270 shares of The New Home (NWHM, Financial), cleaning out the position and reducing the equity portfolio by 0.04%. Shares averaged $8.90 on July 31; the stock is significantly overvalued based on Tuesday’s price-to-GF Value ratio of 1.90.
GuruFocus ranks the Irvine, California-based homebuilder’s financial strength 3 out of 10 on several warning signs, which include a moderately-weak Altman Z-score of 2.41 and debt ratios that underperform more than 80% of global competitors despite a high Piotroski F-score of 7.
GP Strategies
The firm sold 1,400,425 shares of GP Strategies (GPX, Financial), slashing 96.53% of the position and 0.19% of the equity portfolio. Shares averaged $20.35 on July 31; the stock is significantly overvalued based on Tuesday’s price-to-GF Value ratio of 1.83.
GuruFocus ranks the Columbia, Maryland-based e-Learning company’s financial strength 7 out of 10 on several positive investing signs, which include a high Altman Z-score of 3.9 and debt ratios that outperform more than 75% of global competitors.
Chicken Soup for the Soul Entertainment
The firm sold 88,438 shares of Chicken Soup for the Soul Entertainment (CSSE, Financial), slimming the position 18.28%. Shares traded around $35.88 on July 31; the stock is modestly overvalued based on Tuesday’s price-to-GF Value ratio of 1.13.
GuruFocus ranks the Connecticut-based video-on-demand streaming company’s financial strength 4 out of 10 on several warning signs, which include a low Piotroski F-score of 3 and debt ratios that underperform more than 56% of global competitors.
Computer Task Group
The firm purchased 442,663 shares of Computer Task Group (CTG, Financial), boosting the position by 71.68%. Shares averaged $8.91 on July 31; the stock is significantly overvalued based on Tuesday’s price-to-GF Value ratio of 1.71.
GuruFocus ranks the Amherst, New York-based software company’s profitability 6 out of 10: Operating margins are underperforming more than half of global competitors despite returns and three-year revenue and earnings growth rates outperforming more than 60% of global software companies.
