Trigran Investments is an Illionois-based hedge fund that was founded in 1992 by Douglas T. Granat. Granat currently serves as the fund’s Director/President alongside Larry Oberman, who joined the fund in 1993 and is currently its Director/Executive Vice President. The fund has regulatory assets under management of around $565.90 million. Trigran uses a fundamental approach in analyzing its potential investments and holds a relatively small number of holdings. The fund generally prefers to invest in companies that have a market capitalization of under $2 billion, and which it believes are trading at a discount to their intrinsic value. Trigran’s benchmark is the Russell 2000 Index, which it seeks to beat over the long run.
Trigran is one of over 650 funds that we track at Insider Monkey. We analyze these funds’ quarterly 13F filings in order to identify their collective sentiment towards thousands of publicly-traded companies. The data we compile is used to identify stocks that are best-suited to be included in our investment strategy. Our picks are shared with the premium subscribers of our quarterly and monthly newsletters (see more details here). Since February 2016, our strategy has generated returns of more than 45%.
Trigran has recently filed its 13F for the June 30 reporting period, in which it disclosed its equity positions as of the end of the second quarter. According to the filing, the fund has an equity portfolio worth $390 million as of the end of June, up from $364 million a quarter earlier. A closer look at the positions included in the portfolio reveals that Trigran is focused on technology stocks, which have consistently amassed the largest chunk of the fund’s portfolio for the last several years. At the end of June, more than 40% of the value of Trigran’s 13F portfolio was invested in the technology sector, followed by energy and healthcare stocks, which represented 16% and 9% respectively.
The increase in the value of Trigran’s equity portfolio can be attributed to the fact that the fund raised its exposure to most of its holdings between April and June. In fact, out of 18 positions, Douglas Granat’s fund increased its stakes in 15. At the same time it reduced its stakes in two companies, closed two positions and did not add any new investments to its portfolio.
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With this in mind, let’s take a closer look at seven companies in which Trigran made the largest moves during the second quarter. Six of the companies from the list saw Douglas Granat and Larry Oberman boost their fund’s holding by more than 25%, while in one company, Trigran substantially cut its stake. The holdings are sorted based on their size in the fund’s 13F portfolio and aside from Trigran, we will take a look at other investors’ sentiment towards the companies in question.