T. Rowe Price All-Cap Opportunities Earns an Upgrade to Gold

Increased conviction in T. Rowe Price All-Cap Opportunities’ PRWAX manager Justin White lifted its People Pillar to High from Above Average and the strategy’s Morningstar Medalist Rating for all share classes to Gold from Silver in July.

This standout large-growth offering features an intelligent portfolio manager who makes the most of a flexible investment mandate. Though this was White’s first foray as a manager when he took over in April 2016, he was ready for the challenge. Through July 2023, the strategy beat one of the most difficult benchmarks, the Russell 1000 Growth Index, with lower volatility. While White leans on the firm’s large analyst team and an array of other experienced investors, his own insights, trading, and stock selection have set him apart from the pack.

White has shown a knack for knowing when to take gains from soaring winners and when to buy out-of-favor stocks. For example, in 2020′s coronavirus-roiled market, his growth-oriented picks performed well as markets favored technology and e-commerce stocks in the first half of the year. He then trimmed winners and picked up beaten-up stocks in industries like entertainment and machinery later in the year as the prospects of the economy reopening brightened. He continued pruning other highfliers in 2021 and avoided some of the ensuing carnage in 2022 when fears of slowing growth and soaring interest rates sent growth stocks tumbling. White, however, didn’t rest on those laurels; when he thought the valuations of some of the fast growers he had once sold got too low, he began buying them back, setting the fund up for the 2023 rally, at least through July.

White’s swift rearrangements won’t get every cycle right, but the fund has what it takes to compete in a tough peer group over the long term.

New to Coverage

WCM Small Cap Growth’s WCMNX impressive managers and their research-heavy approach earned Above Average People and Process Pillar ratings and Morningstar Medalist Ratings of Silver for its separately managed account and open-end fund share classes as the strategy came under full analyst coverage in July.

A compact but impressive team manages this strategy. John Rackers and Chad Hoffman have been at the helm since the SMA’s late-2007 inception and have more than 30 and 25 years of respective industry experience. Healthcare-focused analyst Sameer Sabharwal joined in 2019 to form a formidable stock-picking team.

The team winnows the Russell 2000 Index to about 250 companies by screening for stocks with market caps between $300 million and the benchmark’s largest stock for those with good returns on cash flow and on invested capital. The managers then use fundamental research to find businesses with durable competitive advantages, or moats. They buy 55-75 stocks for the portfolio and limit position sizes to 5% of assets to control single-stock risks.

So far, that tack has proven successful. From the strategy’s inception through June 2023, tech, health, and consumer cyclical picks have helped it outperform.