Value Line Mid Cap Focused Fund
* The Adviser and EULAV Securities LLC, the Fund’s principal underwriter (the “Distributor”), have agreed to waive certain class-specific fees and/or pay certain class-specific expenses incurred by the Institutional Class so that the Institutional Class bears its class-specific fees and expenses at the same percentage of its average daily net assets as the Investor Class’s class-specific fees and expenses (excluding 12b-1 fees and any extraordinary expenses incurred in different amounts by the classes) (the “Expense Limitation”). The information regarding the Institutional Class in the table has been restated to reflect the Expense Limitation. The Adviser and the Distributor may subsequently recover from assets attributable to the Institutional Class the reimbursed expenses and/or waived fees (within 3 years after the fiscal year end in which the waiver/reimbursement occurred) to the extent that the Institutional Class’s expense ratio is less than the Expense Limitation or, if lower, the expense limitation in effect when the waiver/reimbursement occurred. The Expense Limitation can be terminated or modified before June 30, 2019 only with the agreement of the Fund’s board. The Fund's performance would be lower in the absence of such waivers.
As of 09/30/26, the Fund’s Top 10 Holdings were as follows:
CACI International Inc Class A (5.60%),
Teledyne Technologies Inc (5.30%),
Heico Corp (5.27%),
WR Berkley Corp (5.10%),
Waste Connections Inc (5.06%),
ITT Inc (4.93%),
Woodward Inc (4.57%),
Casey's General Stores Inc (4.35%),
AutoZone Inc (4.32%),
Cintas Corp (4.26%)
There are risks associated with investing in small and mid cap stocks, which tend to be more volatile and less liquid than stocks of large companies, including the risk of price fluctuations.
The performance data quoted herein represents past performance and does not guarantee future results. Market volatility can dramatically impact the fund's short term performance. Current performance may be lower or higher than figures shown. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than their original cost. Past performance data through the most recent month end is available at vlfunds.com or by calling 1-800-243-2729.
You should carefully consider investment objectives, risks, charges and expenses of Value Line Funds before investing. This and other information can be found in the fund's prospectus and summary prospectus, which can be obtained free of charge from your investment representative, by calling 800.243.2729, or by clicking on the applicable fund at www.vlfunds.com. Please read it carefully before you invest or send money. Value Line Funds are distributed by EULAV Securities LLC. Past performance is no guarantee of future results.
Portfolio holdings are subject to change and should not be considered a recommendation to buy or sell securities. Current and future portfolio holdings are subject to risk.
The average annual returns shown above are historical and reflect changes in share price, reinvested dividends and are net of expenses. Investment results and the principal value of an investment will vary.
The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three- year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
VLEOX (3 Year / 3 stars / 519 funds; 5 Year / 4 stars / 497 funds; 10 Year / 4 stars / 406 funds; )
VLIFX (3 Year / 2 stars / 442 funds; 5 Year / 4 stars / 425 funds; 10 Year / 4 stars / 363 funds; )
VALLX (3 Year / 4 stars / 965 funds; 5 Year / 2 stars / 914 funds; 10 Year / 2 stars / 744 funds; )
VALSX (3 Year / 1 stars / 366 funds; 5 Year / 1 stars / 349 funds; 10 Year / 4 stars / 277 funds; )
VLAAX (3 Year / 1 stars / 464 funds; 5 Year / 1 stars / 441 funds; 10 Year / 2 stars / 377 funds; )
VALIX (3 Year / 5 stars / 464 funds; 5 Year / 3 stars / 441 funds; 10 Year / 5 stars / 377 funds; )
Source: Morningstar Direct
How would you characterize the mid-cap growth market during the third quarter, and how did the Fund perform?
The third quarter remained challenging for the Fund’s investment style, particularly in September as rising interest rates pressured many of the more stable, higher-quality companies we favor. During the first two months of the quarter, these stocks generally kept pace with more aggressive growth companies, but market leadership shifted late in the period toward more volatile, higher-risk areas.
The Fund’s investment process emphasizes companies with consistent earnings histories, durable business models, and relatively stable operating performance. Those characteristics have historically supported the Fund’s lower-risk profile, but they were less favored as investor sentiment shifted toward more speculative opportunities late in the quarter.
Against this backdrop, the Fund returned -7.61%, compared with -5.97% for the Morningstar Mid-Cap Growth Category average with all of the relative shortfall occurring in September.
Please visit the Fund’s performance page for complete performance information.
What were the primary contributors and detractors during the quarter?
Sector positioning and stock selection both influenced relative results. Information Technology was a significant headwind, as the Fund’s holdings declined while the category as a whole generated a positive return. The Fund also had no exposure to the relatively strong Energy sector and was underweight Health Care, another area of strength.
Industrials were a relative bright spot, led by a 32% gain by the Fund’s largest holding CACI International Inc. (CACI), which makes high-technology defense systems.
Casey’s General Stores Inc. (CASY) was a notable detractor. After a long period of strong performance, the stock sold off following its quarterly report as investors became more cautious about the outlook.
How does risk management influence the Fund’s long-term risk profile?
Risk management remains central to the Fund’s investment process. We emphasize companies with consistent earnings growth, durable competitive positions, and relatively stable operating performance, with the goal of participating in long-term growth while limiting unnecessary volatility.
That discipline has contributed to the Fund’s historically low volatility relative to peers. As of September 30, 2026, the Fund ranked the lowest for standard deviation among its peers in the Morningstar Mid-Cap Growth Category for the 5- and 10-year periods.
Periods when investors favor more speculative or volatile stocks can create relative performance headwinds, as occurred late in the third quarter. Even so, we believe maintaining a consistent focus on quality companies and prudent risk control provides a disciplined framework for pursuing attractive long-term, risk-adjusted returns.
Source: Morningstar as of 9/30/26