Fund Profile

BlackRock Smaller Companies 12 June 2019

Disclaimer

Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by BlackRock Smaller Companies. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

Overview
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Overview

BlackRock Smaller Companies aims to achieve long-term capital growth through investment mainly in listed UK smaller companies. For the past 17 years the trust has been led by Mike Prentis, however it recently announced that he will be stepping down at the June AGM and co-manager Roland Arnold will be taking over the reins. With this said, very little will change about the manner in which the portfolio is run, and the focus will continue to be on finding growth companies with potential to become much larger through a combination of top-down and bottom-up analysis.

The portfolio has become increasingly concentrated over the past year, as the managers have been selling a number of holdings where their conviction has weakened. Currently the portfolio is made up of c.120 stocks, and it is well diversified by sector and underlying revenues. The team continue to have a solid exposure to companies with an international presence, with over half of the portfolio’s revenues coming from abroad. At a sectoral level, the largest active overweights come from media (+7.4%), financial services (+7.3%) and industrial engineering (+5.2%). The company offers little exposure to travel & leisure companies, food producers and general retailers, many of which are UK focused. The company is also underweight software and computer services businesses as the team believe that ongoing political uncertainty could continue to impact business investment decisions, such as IT spend.

The company has a strong long-term track record of outperformance of not only its benchmark - the Numis Smaller Companies Plus AIM excluding Investment Companies - but also of its open and closed ended peers in the UK Smaller Companies sectors. Over the past five years the company’s net asset value per share has delivered returns of close to 80%, 30% ahead of the IA sector peer group and 25% ahead of the AIC peer group (all calculations on a total return basis). Perhaps more impressively, the company’s NAV has outperformed the benchmark by 48% over the same period. More recently, performance has been affected by political uncertainty surrounding the UK, which has impacted smaller companies share prices.

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Fund History

12 May 2022 Going against the grain
Overzealous selling may provide opportunities for investors happy to take on the risk…
11 May 2022 Results analysis: BlackRock Smaller Companies
BRSC’s wide discount may provide an attractive entry point for investors…
05 Apr 2022 Fund Analysis
BRSC’s wide discount could prove a lucrative long-term entry point…
30 Dec 2021 Great expectations
As the last of the mince pies wilts in the fridge, topped with a generous helping of stilton, the Kepler Trust Intelligence team stick a finger in the air and point toward their top picks for the year ahead…
01 Dec 2021 Smaller companies: finding the best
Roland Arnold, Portfolio Manager of the BlackRock Smaller Companies Trust plc, explains how he uncovers companies that could grow their earnings for the long term.
29 Sep 2021 Fund Analysis
BRSC has a strong track record of consistent outperformance...
18 May 2021 Results analysis: BlackRock Smaller Companies
BRSC continues to forge a solid long-term track record despite a challenging year…
10 Feb 2021 Fund Analysis
BRSC has a strong track record of consistent outperformance...
10 Feb 2021 Eye of the Pfizer
Mining shares have rallied in recent months. With further potential, what impact could this have on the relative returns of active UK Small cap strategies...
17 Sep 2020 Five small cap trusts on very wide discounts
The UK Smaller Companies Sector is battered and bruised, but bombed out valuations among trusts in the sector look interesting...
05 Jun 2020 Deep impact
Audio and presentations from our conference this week, where fifteen of the world's best fund managers described a profoundly altered investment landscape...
22 May 2020 Fund Analysis
BRSC has one of the strongest track records in the UK Smaller Companies universe, consistently outperforming the benchmark in rising and falling markets…
13 May 2020 Braving the new world
Join 15 of the UK's best known fund managers at the Kepler Trust Intelligence Virtual Summit to find out how they see the world after the pandemic...
06 May 2020 The fight in the dog
We look at the characteristics which have separated the winners from the losers among small-cap trusts in the current crisis, with some surprising results...
27 Dec 2019 Fund Analysis
BRSC is well positioned for uncertain conditions with strong diversification across sectors and geographies…
04 Dec 2019 Small wonders: income from the UK's most exciting companies
Smaller companies have typically been employed to add a little spice to a portfolio, to generate some growth alongside their stodgier blue-chip cousins. But they can play plenty of other roles, including as a solution for income.
12 Jun 2019 Fund Analysis
BlackRock Smaller Companies is a well-run company, with a long-term track record of strong performance...
25 Oct 2017 Patience is a virtue…
We analyse the outperformance of UK small-caps and why it has been so important to take a long-term view...
05 Jul 2017 IPOs: Be selective
The small-cap team at BlackRock explains its strategy to investing in newly-listed companies and the risks surrounding them...
27 Jun 2017 What's driving frontier markets?
Can political and economic reforms make a difference when it comes to looking for growth?
15 Jun 2017 Signs of continental shift
BlackRock's Stefan Gries explains what's driving opportunities in Greater Europe...
12 Jun 2017 MAYDAY!
As the Conservative party founders, we examine the impact of last week’s disastrous election on trusts...
08 Jun 2017 The long game
Highlights from BlackRock Income & Growth's annual general meeting...
07 Jun 2017 Omnishambles...
Given the huge levels of political-induced uncertainty, we analyse recent drivers and themes within the UK equity market ahead of the upcoming election
05 Jun 2017 Emerging Opportunities
BlackRock's Chris Colunga discusses the advantages of emerging European countries...
25 May 2017 An opportunity in UK small-caps?
We round up recent recommendations, results and analysis of the latest developments in the UK small-cap sector...
04 May 2017 Size matters
We highlight the potential liquidity and capacity constraints that could hinder open-ended UK smaller companies funds...
29 Mar 2017 Good things come in small packages...
Mike Prentis, BlackRock’s portfolio manager for smaller companies, explains his rationale for picking companies...
15 Mar 2017 Never mind the ballots
Despite political uncertainty in Europe, the continent remains home to some of the world's strongest brands and companies...
10 Mar 2017 The long and short of it
BlackRock's Dan Whitestone explains how 'shorting' a company can make money for investors on a falling share price...
25 Jan 2017 Frontier markets can give you the edge…
Gordon Fraser, portfolio manager for frontier markets at BlackRock, highlights everything investors need to know about high growth frontier markets...
06 Jan 2017 Confidence returns to commodities
Tom Holl, co-manager of BlackRock’s Commodities Income Investment Trust, discusses the future for this diverse sector...
19 Dec 2016 Salvation for Latin America?
BlackRock’s portfolio manager for Latin America, Will Landers, assesses the region’s potential for growth....
26 Oct 2016 Fund Analysis
A UK focused trust which implements a bottom-up investment process targeting ‘high quality’ companies which offer strong growth potential.
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