Small-Cap Equity Specialist Royce & Associates Reveals Top Stock Picks for Q2

#3. Ritchie Bros. Auctioneers (USA) (NYSE:RBA)

 – Number of shares owned by Royce & Associates (as of March 31): 5.52 Million

 – Value of Royce & Associates’ holding (as of March 31): $149.56 Million

The New York-based asset manager had 5.52 million shares of Ritchie Bros. Auctioneers (USA) (NYSE:RBA) in its equity portfolio at the end of March, 1.09 million shares less than it held at the end of December. The trimmed stake was worth $149.56 million on March 31, accounting for 0.94% of the fund’s $15.85 billion portfolio. Ritchie Bros. Auctioneers is the world’s largest auctioneer of heavy machinery, which is sold through the company’s unreserved auctions and online marketplaces. The company operates 44 permanent and regional auction sites around the world, but a big chunk of its revenue is derived from its online used equipment marketplace, called EquipmentOne. In February 2016, the company acquired Amsterdam-based Mascus International Holding BV, which operates a global online portal for the sale and purchase of heavy equipment and vehicles. The freshly-acquired company has the largest online market presence for heavy machinery and trucks on the European continent. Ritchie’s shares have gained an impressive 32% since the start of 2016. Tom Gayner’s Markel Gayner Asset Management owns 109,000 shares of Ritchie Bros. Auctioneers (USA) (NYSE:RBA) as of the end of the first quarter.

#2. MKS Instruments Inc. (NASDAQ:MKSI)

 – Number of shares owned by Royce & Associates (as of March 31): 4.12 Million

 – Value of Royce & Associates’ holding (as of March 31): $155.15 Million

Royce & Associates reduced its exposure to MKS Instruments Inc. (NASDAQ:MKSI) by 742,207 shares during the first three months of the year, ending the March quarter with 4.12 million shares worth $155.15 million. The provider of instruments, subsystems and process control solutions for manufacturing processes has seen its shares gain 3% since the beginning of the year. At the end of April, MKS Instruments completed the acquisition of Newport Corporation, a supplier of advanced-technology products and systems to various end-markets, for $23.00 per share and a repayment of $93 million of indebtedness. The company funded the acquisition with cash on hand and a seven-year, $780 million secured term loan. MKS Instruments currently pays out a quarterly dividend of $0.17 per share to shareholders, which equates to an annual dividend yield of 1.84%. Ken Fisher’s Fisher Asset Management is the owner of 662,634 shares of MKS Instruments Inc. (NASDAQ:MKSI) as of the end of March.

#1. UniFirst Corp (NYSE:UNF)

 – Number of shares owned by Royce & Associates (as of March 31): 1.69 Million

 – Value of Royce & Associates’ holding (as of March 31): $184.68 Million

The small-cap expert also cut its stake in UniFirst Corp (NYSE:UNF), the fund’s top stock pick at the end of the fourth quarter, selling 431,654 shares of the company during the first quarter, ending March with 1.69 million shares valued at $184.68 million. After reporting revenue of $363.1 million for the second quarter of fiscal year 2016 ended February 27, the U.S provider of workplace uniforms and protective wear clothing said that it anticipates full-year revenue in the range of $1.455 billion-to-$1.467 billion. The company has a debt-free balance sheet as of the end of February, with cash and cash equivalents amounting to $335 million. UniFirst’s organic growth has been somewhat hampered by weak energy market conditions, as its businesses that service the oil industry experienced weaker demand due to elevated headcount cuts. Nonetheless, UniFirst shares have advanced by 6% since the start of 2016. First Eagle Investment Management, overseen by Mehdi Mahmud, acquired a stake of 11,599 shares of UniFirst Corp (NYSE:UNF) during the first quarter.

Disclosure: None