Mutual-fund manager likes KVH
Hidden tech gems to invest in now, picked by a mutual-fund manager with a great track record
8:30 am ET September 17, 2019 (MarketWatch)
**(Included here is background on the mutual-fund manager and the portion that deals with KVH):
The trick to picking winners that are off the radar for most people is to find the right companies with exposure to the right trends. This is no small task. So for guidance, I recently talked with Chris Retzler, who has managed the Needham Small Cap Growth Fund since the financial crisis.
Retzler, a former Fulbright scholar who went to Columbia Business School a few years after I was there, is the kind of money manager I'm happy to learn from because he posts great returns. So far this year his fund is up 36.5%, compared to 20% for the S&P 500 , 23% for and 17% for the Russell 2000 .
Outperformance over eight months can be a fluke, so it's better to look at longer time frames when weighing the expertise of a fund manager. Retzler's fund beats its Morningstar small-cap growth category by 4.6 percentage points annualized over the past three years, and 2.8 percentage points over the last five years.
Trend No. 2: Modernization of the military
The military has always driven tech development -- and it's no different now. This makes military spending on tech a key trend for Retzler. "New technologies are being deployed for greater precision and effectiveness to minimize casualties for our troops and civilians," he says.
A good example is tech offered by KVH Industries (KVHI). The company's inertial navigation division offers products that assure uninterrupted access to navigation systems like GPS for military vehicles.
Second-quarter sales were weak following eight quarters of double-digit growth. But the slowdown won't last forever.
"We have a strong pipeline of opportunities and continue to get designed into new platforms," cofounder and CEO Martin Kits Van Heyningen said in the second-quarter conference call. |
