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Fees Go Down, Rating Goes Up for This Large-Value Medalist

A long-tenured management team, consistent strategy, strong performance, and, now, more competitive fees bolster the case for JHancock Disciplined Value.


Leo Acheson: JHancock Disciplined Value's (JVLAX) price tag was previously the only thing that was holding this fund back. But recently, assets have ballooned and its expenses have fallen each of the past two calendar years. Now, its expenses look competitive. As a result, we have increased the fund's Analyst Rating to Silver from Bronze.

There are a lot of things that we like about this strategy. First of all, it boasts strong investment heritage and has a tenured management team. Lead manager Mark Donovan has led the strategy since its 1997 inception, and he was also a founding partner of subadvisor Robeco Boston Partners in 1995.

Comanager David Pyle has been a named comanager since 2005, but he has been with the subadvisor since 2000. And the firm's 25-person analyst staff has, on average, over 10 years of experience with the firm. So, overall, it's a really stable group.

The team has also executed its strategy with a lot of success and discipline. They look for three things, including low valuations, strong or improving fundamentals, and attractive business momentum. When it comes to business momentum, they are looking at things such as earnings surprises or earnings revisions. Overall, the team has really executed the strategy with a lot of success, and results have been remarkably consistent.

Over the last 10 calendar years, the team has outperformed in nine of those years. The only year in which it underperformed was 2010, when it still ranked in its category's 59 percentile.

The fund's size bears watching. The mutual fund holds about $13 billion in assets. And across all of the strategy's vehicles, assets stand at about $32 billion. The managers think that they can manage about $35 billion total in the strategy, so they still have a little bit more room. Its size does bear watching, but for now this remains one of the large-value category's finer offerings.

Leo Acheson does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.