Nicholas Limited Edition, Inc.

NCLEX - (Class I)

NNLEX - (Class N)

Small-cap Growth

Nicholas Limited Edition Inc., is a fund specifically designed to invest in small-cap growth stocks, was launched in 1987. The focus is on small-cap growth companies with market capitalizations generally between $500 million and $2 billion with sound business models, strong prospects for future earnings growth and trading at discounted valuations to their long-term potential. David O. Nicholas, CFA is the lead portfolio manager of the Fund and has been at the helm since 1993. He also serves as the Chief Investment Officer for Nicholas Company. Neal Dihora, CFA was named co-portfolio manager of Nicholas Limited Edition, Inc. in November 2016. 

The focus on small capitalization stocks targets a universe of stocks long recognized by Nicholas for their unique characteristics and long-term growth potential. Recognizing the value of primary research and potential investment opportunity in small- and mid-cap stocks, Nicholas incorporated these stocks as a central component of this Fund's investment process. Nicholas Limited Edition has a history of seeking to own smaller companies that have successfully grown into the mid-sized companies generating attractive returns. The small nature of these companies offers significant growth potential, but may also exhibit greater volatility. This Fund tends to have more holdings to diversify the portfolio in an attempt to modify the volatility.

As is true with the other Nicholas Funds, a critical component to the Fund’s style is buying stocks at valuations that offer the best opportunity for capital appreciation over the long-run, but also provide a margin of safety against declining stock prices. The Nicholas philosophy has strongly maintained the benefits of buying stocks at valuations that are afforadable relative to their long-term potential. We believe the Fund’s history suggests this approach can produce more consistent, risk-adjusted returns over time.

  • Snapshot
  • Objective
  • Performance
  • Portfolio Manager
  • Distribution History
  • Documents &
    Forms

Investment Approach

Nicholas Limited Edition pursues long-term capital growth through a diversified stock portfolio of primarily small-sized companies with capitalizations generally less than $2 billion. The Fund is typically benchmarked against the Russell 2000 Growth Index. 


 

Fund Facts

Co-Portfolio Manager: David O. Nicholas
Co-Portfolio Manager: Neal Dihora
Style: Small-Cap Growth
Fund Inception: 05/18/1987
Fund Assets (millions):  
    Class I $298.0*
    Class N $33.3*
Number of Holdings: 73*
   
* as of 12/31/2016  
Min. Initial Investment Class I: $100,000
Min. Initial Investment Class N: $500
Fiscal Year-End: December 31
Prospectus Date Class I: April
Prospectus Date Class N: January & April
Cusip Class I: 653738104
Cusip Class N: 653738203
Ticker Class I: NCLEX
Ticker Class N: NNLEX

 

Characteristics*

Weighted Avg Forward P/E Capped: 22.92x
Weighted  Avg Trailing P/E Capped: 25.29x
Weighted Median Mkt Cap (million): $2,757.9
Weighted Avg Mkt Cap (million): $3,229.9
Weighted  Harmonic Avg. Price/Book: 3.33x
Turn Over Rate:  (06/30/16)(1) 49.61%
Standard Deviation Class I: 10-Yr(2) 16.78%
Sharpe Ratio Class I: 10-Yr(2) 0.54  
Standard Deviation Class N: 10-Yr(2) 16.77%
Sharpe Ratio Class N: 10-Yr(2) 0.52   

 

Sector Diversification*

Sector Diversification

Top Ten Holdings*

Holdings % Net Assets
RPM International, Inc. 1.79%
Middleby Corporation (The) 1.77%
NuVasive, Inc. 1.76%
Zebra Technologies Corporation - Class A 1.75%
VCA Inc.   1.66%
Community Bank System, Inc. 1.64%
A.O. Smith Corporation 1.64%
INC Research Holdings, Inc. 1.59%
Knight Transportation, Inc. 1.59%
Brown & Brown, Inc. 1.46%
Total 16.75%

(1) Annualized
(2) Average Annual

* Data as of 12/31/16 unless stated otherwise.


 

Morningstar Ratings

Class I    
  Rating # of Funds
Overall 599
3 Year 599
5 Year 5 stars 531
10 Year 5 star 389

Morningstar Category: Small Growth
Source: Morningstar, as of December 31, 2016.
The Overall Morningstar Rating™ for a fund is derived from a weighted average
of the risk-adjusted performance figures associated with its three-,five- and ten year (if applicable) Morningstar Rating™ metrics. (3)

 

Class N    
  Rating # of Funds
Overall 599
3 Year 599
5 Year 5 stars 531
10 Year 5 star 389

 

(3) © [2016] Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or loses arising from any use of this information. For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating ™ (based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund’s monthly performance, including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each 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. (Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages.) One cannot invest directly in an index. Fund holdings and/or sector weightings are subject to change at any time and are not recommendations to buy or sell any security. 

Past performance does not guarantee future results.

 

Investment Objective

Nicholas Limited Edition, Inc. strives to increase the value of your investment over the long-term (“long-term growth”) by purchasing primarily small companies with capitalizations of less than $2 billion. The Fund’s manager looks for companies with ample financial resources that are positioned to take advantage of long-term trends in the United States. The goal is to find great companies early and hold them for the long-term.

Investment Policies & Considerations

The performance of smaller company stock funds is often influenced by their size. If the assets invested in a small-company fund grow too large the fund’s manager may be forced to invest in companies he or she would otherwise pass over, or take bigger positions in companies he or she favors.

Nicholas Limited Edition's management team believes that company selection is a key to providing superior returns over time. Our goal is to find companies that have the potential for outstanding earnings and sales growth over time, and are positioned to benefit from long-term economic and social trends. We search today’s small companies to find those that will become tomorrow’s big companies. Some of the factors we consider in assessing a company include:

  • Strategic position within its industry
  • Product development
  • Quality of management
  • Future potential
  • Price-to-earnings ratios relative to growth rate and industry trends

It is our strong conviction that superior long-term results are achieved by minimizing capital losses in adverse markets. We do not attempt to forecast short-term market swings, but work to preserve gains and minimize losses using long-term, fundamental valuation techniques. Our portfolio turnover is moderate as our goal is to find, and hold, stock in great companies. However, if a stock is not meeting our expectations, or has become over-valued, we will sell it.

At Nicholas, our watchword is patience. We believe it is a key to superior long-term results.

 

  •  Quarter-End Performance
  • Month-End Performance
  • Quarterly Performance Presentation

As of March 31, 2017

Average Annual Returns

Fund 3 Month YTD  1 Year  3 Year 5 Year 10 Year
Nicholas Fund (NICSX) 7.25% 7.25% 9.87% 6.24% 12.70% 9.04%
Nicholas II - Class I (NCTWX) 8.14% 8.14% 12.99% 7.90% 11.19% 8.20%
Nicholas II - Class N (NNTWX) 8.01% 8.01% 12.60% 7.52% 10.79% 7.84%
Nicholas Limited Edition - Class I (NCLEX) 6.16% 6.16% 19.50% 7.04% 10.42% 9.08%
Nicholas Limited Edition - Class N (NNLEX) 6.06% 6.06% 19.05% 6.67% 10.03% 8.74%
Nicholas Equity Income Fund (NSEIX) 5.29% 5.29% 15.57% 7.52% 11.94% 8.91%
Nicholas High Income Fund - Class I (NCINX) 1.43% 1.43% 8.99% 1.87% 4.40% 4.86%
Nicholas High Income Fund - Class N (NNHIX) 1.41% 1.41% 8.65% 1.54% 4.03% 4.54%

Performance data quoted represents past performance and does not guarantee future results.  The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.  Performance current to the most recent month end may be lower or higher than the performance quoted.

As of March 31, 2017

Average Annual Returns

Fund 3 Month YTD  1 Year  3 Year 5 Year 10 Year
Nicholas Fund (NICSX) 7.25% 7.25% 9.87% 6.24% 12.70% 9.04%
Nicholas II - Class I (NCTWX) 8.14% 8.14% 12.99% 7.90% 11.19% 8.20%
Nicholas II - Class N (NNTWX) 8.01% 8.01% 12.60% 7.52% 10.79% 7.84%
Nicholas Limited Edition - Class I (NCLEX) 6.16% 6.16% 19.50% 7.04% 10.42% 9.08%
Nicholas Limited Edition - Class N (NNLEX) 6.06% 6.06% 19.05% 6.67% 10.03% 8.74%
Nicholas Equity Income Fund (NSEIX) 5.29% 5.29% 15.57% 7.52% 11.94% 8.91%
Nicholas High Income Fund - Class I (NCINX) 1.43% 1.43% 8.99% 1.87% 4.40% 4.86%
Nicholas High Income Fund - Class N (NNHIX) 1.41% 1.41% 8.65% 1.54% 4.03% 4.54%

Performance data quoted represents past performance and does not guarantee future results.  The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.  Performance current to the most recent month end may be lower or higher than the performance quoted.

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Fund's Quarterly Performance Presentation

Quarterly Performance Presentation

 

Nicholas Fund's Expense Ratio: 0.72%
Nicholas II – Class I's Expense Ratio: 0.61%
Nicholas II – Class N's Expense Ratio: 0.96%
Nicholas Limited Edition – Class I's Expense Ratio: 0.86%
Nicholas Limited Edition – Class N's Expense Ratio: 1.23%
Nicholas Equity Income Fund's Expense Ratio: 0.72%
Nicholas High Income Fund – Class I's Expense Ratio: 0.71%(1)
Nicholas High Income Fund – Class N's Expense Ratio: 1.07%(1)

(1)The expense ratio may not correlate to the "Ratio of expenses to average net assets" provided in the Financial Highlights in the Fund's Annual or Semiannual Report. The information in the Financial Highlights reflects the operating expenses of the Fund and does not include Acquired Fund Fees and Expenses. "Acquired Fund Fees and Expenses" are those expenses incurred indirectly by the Fund as a result of acquiring investments in shares of one or more other investment companies.

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David O. Nicholas, CFA

Chief Executive Officer, President, Chief Investment Officer and Portfolio Manager
Industry experience: 34 years
Nicholas Company Tenure: 31 years
Lead Portfolio Manager - Nicholas Fund, Inc., Nicholas II, Inc. and Nicholas Limited Edition, Inc.
Co-Portfolio Manager - Nicholas Equity Income Fund, Inc.

 

Dave Nicholas joined Nicholas Company as an investment analyst in 1986.  He serves in a leadership position for the company as CEO and President, while primarily focusing his efforts day-to-day on investments as a Portfolio Manager and the Chief Investment Officer.   Dave has developed his philosophy and skills over the past thirty years under the guidance of the long-held investment philosophy and process developed by Albert O. Nicholas, the founder of Nicholas Company.  This opportunity has allowed Dave to gain a deep experience and knowledge analyzing companies and the equity markets.

Dave’s approach is aligned with the Nicholas core investment philosophy and process, while adjusting it to meet the characteristics of various capitalization growth companies.  Core elements to the philosophy include identifying companies with secular growth capabilities, consistent earnings growth, strong balance sheets and solid management teams.  Dave also shares a preference for non-consensus strategies when market opportunities arise.

Dave is the lead portfolio manager of Nicholas Fund, Nicholas II and Nicholas Limited Edition, while serving as co-manager for Nicholas Equity Income Fund.  As Chief Investment Officer he guides the firm’s investment process and the investment team on a day-to-day basis.

Dave earned a B.B.A. in Finance from the University of Wisconsin-Madison and completed his M.S. in Finance at the University of Wisconsin-Milwaukee, where he is a member of the University’s Business School Advisory Board. He has earned the right to use the CFA designation and is a member of the CFA Society Milwaukee.


 


 

Neal Dihora, CFA

Senior Research Analyst and Portfolio Manager
Industry experience: 15 years
Nicholas Company Tenure: 4 years
Co-Portfolio Manager - Nicholas Limited Edition, Inc. 

 

Neal joined Nicholas as a senior research analyst in 2015, in addition to an earlier period with the firm from 2003-05. Neal was named co-portfolio manager of Nicholas Limited Edition, Inc. in November 2016. Neal is focused on stocks with small-and mid–sized capitalizations with an emphasis on healthcare and industrials.

 

Before rejoining Nicholas Company in 2015, Neal was a senior equity analyst at Morningstar, covering the aerospace and defense sectors. Prior to Morningstar, Neal was a co-portfolio manager of the Wasatch Ultra Growth fund for three years starting in 2006, with a particular focus on the healthcare and retail areas.

 

Neal earned his B.B.A. and M.S. from the University of Wisconsin at Madison and is an alumnus of the school's Applied Security Analysis Program. He has earned the right to use the CFA designation and is a member of the CFA Society Milwaukee.

 


 

NOTE: None of the 2016 distributions included income from U.S. Treasuries, U.S. Agencies, state government or municipalities.
 

Distribution Year

Share Class

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Distribution History 2016 - Class I

Pay Date Net
Investment Income
Short Term
Capital Gains
Long Term
Capital Gains
Total
Distribution
12/27/2016 0.0012 0.0000 2.5295 2.5307
Distribution Year
  • 2016
Share Class
  • Class I

Distribution History 2016 - Class N

 

Pay Date Net
Investment Income
Short Term
Capital Gains
Long Term
Capital Gains
Total
Distribution
12/27/2016 0.0000 0.0000 2.5295 2.5295
Distribution Year
  • 2016
Share Class
  • Class N
  • Regular Account Forms
  • IRA Account Forms

These forms are in PDF format. You'll need Adobe Acrobat Reader to view them. Click here to download it.

Note:

The IRA maintenance fee will be automatically deducted from Individual Retirement Account(s) on November 3, 2017.  If you would like to prepay the fee, please make sure we receive your check payable to US Bank prior to that date.  The fee is $15.00 per account, per social security number, with a cap of $30.00.  Include your account number(s) on your check for proper credit.

Please print, complete and mail to the appropriate address:

Nicholas Family Of Funds
c/o U.S. Bancorp Fund Services, LLC
P.O. Box 701
Milwaukee, WI 53201-0701

Overnight Express:

Nicholas Family Of Funds
c/o U.S. Bancorp Fund Services, LLC
615 East Michigan Street
Milwaukee, WI 53202


Order By Telephone

1-800-544-6547

Automated transactions are available 24 hours a day, 7 days a week.

To speak to a representative, call Monday - Friday, from 8am - 7pm, Central Time.

Shareholders calling from outside the U.S. may call collect, 414-765-4124, Monday - Friday, from 8am -7pm, Central Time.



The Nicholas Funds are offered only to United States residents, and information on this site is intended only for such persons. Nothing on this web site should be considered a solicitation to buy or an offer to sell shares of any Nicholas Fund in any jurisdiction where the offer or solicitation would be unlawful under the securities laws of such jurisdiction. 

Please refer to each prospectus for important information about each investment company, including investment objectives, risks, charges and expenses. 

Mutual fund investing involves risk; principal loss is possible. Small- and medium-capitalization companies tend to have limited liquidity and greater price volatility than large-capitalization companies. Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities. Investment by the Funds in lower-rated and non-rated securities presents a greater risk of loss to principal and interest than higher-rated securities. 

Past performance does not guarantee future results.

Diversification does not assure a profit nor protect against loss in a declining market.

Glossary of terms   |   Privacy & Security

Nicholas Funds are distributed by Quasar Distributors, LLC

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