Managing Smaller Cap Value Portfolios: Glenn Sussman And Steve Wilson Of Lapides Asset Management

• On 12:51 pm EST, Thursday November 5, 2009

67 WALL STREET, New York - November 5, 2009 - The Wall Street Transcript has just published its TWST Small Cap Value Report offering a timely review of the sector to serious investors and industry executives. This 47 page feature contains expert industry commentary through in-depth interviews with award winning Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Small-Cap Value - Capital Preservation - Sovereign Bonds - Precious Metals - Value-Investing - Companies with International Exposure - US-listed Chinese Companies - Risk Limitation - Industry-Diversified Portfolios - Long-Term Value - Micro-Cap Companies - Turnaround Situations - Strategic Buying - Fundamental Analysis

Companies include: Bridgepoint Education (BPI); Compass Minerals (CMP); Flexsteel (FLXS); Hardinge Corp (HDNG); Phillips-Van Heusen (PVH); Adobe (ADB); Affiliated Computer Services (ACS); Alliance Data Systems (ADS); American Water Works (AWK); Atlantic Tele-Network (ATNI); Celanese Chemical (CE); CenturyTel (CTL); Clean Energy Fuels (CLNE); Consolidated Graphics (CGX); Dell (DELL); Dillard's Department Stores (DDS); Drew Industries (DW); Educational Development Corporation (EDUC); First Acceptance Corp (FAC); Forestar Group (FOR); Fresh Del Monte (FDP); Hain Celestial (HAIN); Harbin Electric (HRBN); Huron Consulting (HURN); IMAX (IMAX); IMS Health (RX); Kennametal (KMT); Lamar Advertising (LAMR); NBTY (NTY); Nature's Sunshine Products (NATR); Nobility Homes (NOBH); Omniture, Inc. (OMTR); Perot Systems (PER); Pfizer (PFE); SPDR Barclays Capital International Treasury Bond Fund (BWX); SPDR Gold Trust (GLD); Silver Wheaton (SLW); Tellabs (TLAB); Temple-Inland (TIN); Tempur-Pedic (TPX); Tesoro (TSO); Valero (VLO); Verizon Wireless (VZ); Whole Foods (WFMI); Xerox (XRX).

In the following brief excerpt from just one of the in depth interviews in the 47 page report, top tier money managers discuss their stock picks.

GLENN SUSSMAN joined Lapides Asset Management LLC in July 2006 and serves as Analyst/Manager. He has over 25 years' experience conducting hands-on, proprietary research and managing smaller cap portfolios. Prior to joining Lapides, he was a Senior Vice President and an Analyst/Manager at Reich & Tang, where he spent eight years. Prior to Reich & Tang, he was Vice President and Principal at Richter Asset Management. Prior to that, he held the position of Vice President and Principal of Kurtz Capital Management. He holds a BBA from The George Washington University and an MBA from New York University.

STEVE WILSON founded Lapides Asset Management LLC and serves as the firm's Chief Investment Officer and as an Analyst/Manager. He has more than 25 years' experience conducting hands-on, proprietary research and managing portfolios of smaller cap securities. Prior to forming Lapides in mid-2005, he was an Analyst/Manager at Reich & Tang from 1986. Additionally, he served for eight years as Chief Investment Officer of the Capital Management Group at Reich & Tang. Before joining Reich & Tang, he was President of Home Capital Services, the investment management subsidiary of the Home Insurance Company. He has a BS from the Wharton School of the University of Pennsylvania and an MBA from New York University. He became a Chartered Financial Analyst in 1984 and is a member of the New York Society of Security Analysts. He was voted the top individual analyst by managements surveyed for the 2000 Reuters Investment Research Survey of Small to Mid Companies.

TWST: Those are some great new names but are you also adding to you existing holdings?

Mr. Wilson: We have seen a lot of appreciation in our holdings since March and we have mainly been scaling back some of the biggest movers but, yes, we have also been adding to some of our positions. In a handful of cases their share prices have lagged and they make attractive purchases. One example is Hain Celestial (HAIN). This is the natural and organic food company, probably best known for some of their key products, Celestial Seasonings Teas, Terra Blue Chips and Earth's Best baby food. Their stock price is down over 50% from prior highs, even though their earnings are off only a little bit. They've had a couple of new ventures that have been slow to come around and have been a drag on the company. They've had to take some restructuring actions but the core grocery, tea and snacks business has done quite well. There is a concern that the consumer will trade down or trade away from natural and organic and gourmet products, but we don't think that's a long-term issue. We view this as an opportunity to add to an existing holding at a very low valuation. The shares trade at a significant premium and we think that was an attractive redeployment of capital from some of our better performing names where the valuations have begun to stretch a bit.

Mr. Wilson: Another company that we've added to is called IMS Health (RX). They are a leading provider of market research and information analytics for health care, especially the drug industry. The share price has been impacted two ways, one from a perception standpoint, a concern that as the U.S. government gets more involved in healthcare, profits will be crimped across the board and will impact some of their core customers including the drug companies. The other issue impacting the shares is the high profile drug company mergers underway and what further consolidation of RX's customer base would mean. We choose to look past the near term uncertainty and we see several positive things that are happening. Globally, the universal need to manage healthcare costs only increases. Better utilization of health care spending is needed to insure cost effective positive outcomes. Pharmaceuticals are a key part of that strategy and properly managing the expenditures on pharmaceuticals is critical. IMS is a key piece to this puzzle, both in the US and around the world. If healthcare coverage is extended to more people then there is a lot more analysis and a lot more evaluation that needs to be done and that plays to IMS' strength. They generate significant free cash, have high margins, and there are high barriers to entry. It has the attributes we want and trades at a depressed valuation due to the dark cloud over its near term future. We think that cloud will dissipate over the next couple of years which is why we expanded the position.

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 47 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online .

The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations.

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