Franklin MicroCap Value Fund

This fund or share class has been closed to new investors.

This fund or share class has been closed to new investors.

Fund Description

The fund seeks high total return by investing at least 80% of its net assets in companies with a total market capitalization of less than $500 million at the time of purchase.

Strategy Statement

"We look for financially sound, micro-cap companies where we can gain from market inefficiencies. We seek companies with low price-to-book value that we believe will increase over several years."

Bruce Baughman

Management

Bruce Baughman

Bruce Baughman

  • Joined Franklin Templeton in 1987
  • Managed Fund Since 1995

Rating

Overall Morningstar Rating As of 01/31/2019

Rating Category: Small Value

Morningstar
The fund's overall Morningstar Rating measures risk-adjusted returns and is derived from a weighted average of the performance figures associated with its 3-, 5- and 10-year (if applicable) rating metrics.

Historical Morningstar Rating As of 01/31/2019

Years Ratings Funds
in category
3
2 Stars
384
5
2 Stars
334
10
3 Stars
231

Morningstar Style Box As of12/31/2018

Strategy, Benefits, Results

Strategy

We are long-term, bottom-up investors looking for companies with solid operating results and trading at attractive valuations. We are bargain seekers looking for $1 worth of value for 80 cents.

We seek undervalued micro-capitalization companies with the following characteristics:

  • Well-managed companies with strong fundamentals and low price-to-book values.
  • Stock prices that are low based on earnings, cash flow or sales and relative to the market, a company's industry or a company's earnings record.
  • Recent sharp price declines but the potential for good long-term earning prospects.
  • Valuable intangibles not reflected in the stock price, such as franchises, underused or understated assets or cash, or patents and trademarks.

We are buy-and-hold investors who generally seek to hold an investment for five or more years.

Benefits

  • MicroCap Exposure. We like micro caps that exist below Wall Street's radar, where we can take advantage of the market's inefficiencies.
  • Broad Market Exposure. We invest in a broad variety of companies across multiple sectors and industries.
  • Value Expertise. Investors benefit from our veteran management team with extensive value-investing experience.

Investing In The Fund

What Are the Risks?
  • All investments involve risks, including possible loss of principal.
  • Value securities may not increase in price as anticipated, or may decline further in value.
  • Stocks historically have outperformed other asset classes over the long term, but tend to fluctuate more dramatically over the short term.
  • Smaller-company securities may have limited liquidity and involve risks such as relatively small revenues, limited product lines and small market share.
  • Historically, these stocks have exhibited greater price volatility than larger-company stocks, especially over the short term.
  • Investments in foreign securities involve special risks, including currency fluctuations and economic and political uncertainty.
  • These and other risks are described more fully in the fund’s prospectus.

Minimum Investment

See Prospectus

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