Value Line Mid Cap Focused Fund
| Value Line Mid Cap Focused Fund | |
|---|---|
| Investor Class | VLIFX |
| Institutional Class | VLMIX |
| AUM | $1565M |
Stephen E. Grant Senior Portfolio Manager
* 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 12/31/25, the Fund’s Top 10 Holdings were as follows:
Heico Corp (6.22%),
Casey's General Stores Inc (5.83%),
MSCI Inc (5.62%),
Waste Connections Inc (5.57%),
Tyler Technologies Inc (5.40%),
Steris PLC (4.77%),
WR Berkley Corp (4.53%),
Monolithic Power Systems Inc (4.26%),
IQVIA Holdings Inc (4.22%),
Lennox International Inc (4.21%)
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 / 4 stars / 518 funds; 5 Year / 5 stars / 496 funds; 10 Year / 4 stars / 391 funds; )
VLIFX (3 Year / 3 stars / 469 funds; 5 Year / 5 stars / 445 funds; 10 Year / 5 stars / 373 funds; )
VALLX (3 Year / 3 stars / 1002 funds; 5 Year / 2 stars / 935 funds; 10 Year / 2 stars / 757 funds; )
VALSX (3 Year / 1 stars / 1002 funds; 5 Year / 2 stars / 935 funds; 10 Year / 2 stars / 757 funds; )
VLAAX (3 Year / 1 stars / 464 funds; 5 Year / 1 stars / 444 funds; 10 Year / 2 stars / 371 funds; )
VALIX (3 Year / 5 stars / 464 funds; 5 Year / 2 stars / 444 funds; 10 Year / 5 stars / 371 funds; )
VAGIX ()
Source: Morningstar Direct
Would you please comment on the Fund’s performance relative to the Morningstar Mid-Cap Growth Category in the fourth quarter and longer-term periods?
During the fourth quarter of 2025, U.S. equity markets continued to be influenced by investor enthusiasm surrounding artificial intelligence and other technology-driven themes. While large-cap stocks captured much of the market’s attention, mid-cap companies experienced more uneven performance, particularly those outside of the most speculative areas of the market.
For the quarter ended December 31, 2025, the Fund generated a return of -2.61%, underperforming the Morningstar Mid-Cap Growth Category’s average -1.8% return. While short-term relative performance can be impacted by shifts in market leadership, the Fund’s investment approach remains focused on identifying high-quality companies with long histories of consistent growth in both earnings and stock price.
Over longer-term periods, we believe this disciplined approach continues to serve investors well. As of December 31, 2025, the Fund’s performance ranked in the top 20% of the Morningstar Mid-Cap Growth Category for the 5 and 10-year periods.
Please visit the Fund’s performance page for complete performance information.
Source: Morningstar as of 12/31/25
What were the primary performance contributors and detractors during the quarter?
Stock selection within the Information Technology and Industrials sectors was the primary driver of performance during the quarter. In Information Technology, holdings such as Fair Isaac Corp. (FICO), a leading credit analytics company, and chip-maker Monolithic Power Systems Inc. (MPWR) contributed positively, reflecting continued demand for their specialized products and services.
Industrials also contributed positively to results, led by holdings including Comfort Systems USA Inc. (FIX), which specializes in HVAC systems, and CACI International Inc. (CACI), an information solutions provider.
These gains were partially offset by weakness in the Consumer Discretionary and Financials sectors. Pool Corp. (POOL) detracted during the quarter and certain insurance holdings also negatively weighed on results.
How do you think about portfolio risk in the current market environment?
Risk management remains a central component of the Fund’s investment philosophy. The portfolio is constructed with the goal of participating in market advances while maintaining resilience during periods of volatility.
As a result, the Fund’s standard deviation, a measure of volatility, ranks the lowest among its peers in the Morningstar Mid-Cap Growth Category for the 5 and 10-year periods ended December 31, 2025. The Fund has also been awarded Morningstar’s “Low” Risk Rating for the same periods.
Source: Morningstar as of 12/31/25
Were there any notable portfolio changes during the quarter?
Portfolio activity during the quarter reflected both ongoing evaluation of existing holdings and the identification of selective new opportunities. The Fund added three new positions during the period: Woodward Inc. (WWD), which creates control solutions for the aerospace and industrial markets; RBC Bearings Inc. (RBC), a manufacturer for the industrial, defense, and aerospace industries; and AutoZone Inc. (AZO), a leading retailer of automotive parts.
During the quarter, the Fund exited four positions, including Watsco Inc. (WSO), CDW Corp. (CDW), AptarGroup (ATR), and Chemed Corp. (CHE). As of quarter-end, the Fund held 35 positions.