Small-Caps and Dividends: Jay Kaplan in Kiplinger
article 03-21-2016

Small-Caps and Dividends: Jay Kaplan in Kiplinger

Portfolio Manager Jay Kaplan shares why he likes investing in dividend-paying small-cap stocks and offers a few of his favorite names.


Royce's small-cap expertise and commentary from Portfolio Manager Jay Kaplan are featured in the March 15, 2016 Kiplinger article, 5 Small-Cap Stocks Paying Handsome Dividends by Anne Kates Smith. The article highlights small-company stocks that pay dividends.

Smith references original research on the topic from Royce, "As of the end of 2015, roughly one-third of nearly 4,200 small-capitalization stocks—defined as those with market values of $5 million to $3 billion—paid dividends, and nearly 900 delivered a yield of at least 2%."

In addition, Portfolio Manager Jay Kaplan speaks on the subject of small-cap dividend-payers saying, "Over the long run, small-caps have outperformed large-cap stocks … But there’s no free lunch. Part of why that happens is that there’s more risk and volatility in small caps."

Jay discusses DSW describing the footwear retailer as a "High-quality company that's out of favor." Jay also discusses Moelis & Company. (Royce Pennsylvania Mutual Fund, on which Jay serves as assistant portfolio manager, also holds Badger Meter.)

Jay Kaplan has 27 years of investment industry experience, 14 of which at Royce. He is co-portfolio manager of Royce Total Return Fund and Royce Dividend Value Fund—with Chuck Royce—and the portfolio manager of Royce Small-Cap Value Fund and Royce Capital Fund—Small-Cap Portfolio. In addition, he is an assistant manager of Royce Pennsylvania Mutual Fund.

Read the article here.

Important Disclosure Information

Jay Kaplan is a Portfolio Manager of Royce & Associates, LP, investment advisor to The Royce Funds. He serves as portfolio manager for Royce Total Return Fund, Royce Dividend Value Fund, Royce Small-Cap Value Fund, and Royce Capital Fund—Micro-Cap Portfolio. He also serves as assistant portfolio manager for Royce Pennsylvania Mutual Fund. The thoughts and opinions expressed in this piece are solely those of the person speaking and may differ from those of other Royce investment professionals, or the firm as a whole. There can be no assurance with regard to future market movements. There can be no assurance that companies that currently pays a dividend will continue to do so in the future.

This material is not authorized for distribution unless preceded or accompanied by a current prospectus. Please read the prospectus carefully before investing or sending money. Smaller-cap stocks may involve considerably more risk than larger-cap stocks. (Please see "Primary Risks for Fund Investors" in the prospectus.)

Percentage of Fund Holdings as of 12/31/15 (%)

  Badger Meter DSW Cl. A Moelis & Company Cl. A
Total Return 0.00 0.63 0.00
Dividend Value 0.00 0.65 0.00
Small-Cap Value 0.00 2.99 1.72
Capital Small-Cap 0.00 2.95 1.18
Pennsylvania Mutual 0.47 0.44 0.00

There can be no assurance that any of the securities mentioned in the interview will be included in these portfolios in the future. References to specific securities in this interview are not intended as recommendations and should not be relied upon as the basis for anyone to buy, sell, or hold any security.

There can be no assurance that companies that currently pay a dividend will continue to do so in the future.



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