UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF

REGISTERED MANAGEMENT INVESTMENT COMPANY

 

Investment Company Act file Number 811-02265

 

Value Line Mid Cap Focused Fund, Inc.

(Exact name of registrant as specified in charter)

 

7 Times Square, New York, NY 10036

 

Mitchell E. Appel

(Name and address of agent for service)

 

Registrant’s telephone number, including area code: 212-907-1900

 

Date of fiscal year end: December 31

 

Date of reporting period: September 30, 2016

 

   

 

 

Item 1: Schedule of Investments.

A copy of the Schedule of Investments for the period ended 9/30/16 is included with this Form.

  

Value Line Mid Cap Focused Fund, Inc.

 

Schedule of Investments (unaudited)

 

Shares      Value 
COMMON STOCKS (99.8%) 
  
    CONSUMER DISCRETIONARY (4.6%)
     
     DISTRIBUTION & WHOLESALE (2.1%)     
 78,800   LKQ Corp. *  $2,794,248 
           
     RETAIL (2.5%)     
 44,000   TJX Companies, Inc. (The)   3,290,320 
         6,084,568 
     CONSUMER STAPLES (14.0%)     
     FOOD (8.1%)     
 102,000   Hormel Foods Corp.   3,868,860 
 31,000   J&J Snack Foods Corp.   3,692,720 
 33,100   McCormick & Co., Inc.   3,307,352 
         10,868,932 
     HOUSEHOLD PRODUCTS (2.9%)     
 80,000   Church & Dwight Co., Inc.   3,833,600 
           
     RETAIL (3.0%)     
 33,600   Casey's General Stores, Inc.   4,037,040 
         18,739,572 
     FINANCIALS (3.3%)     
     INSURANCE (3.3%)     
 55,900   Arch Capital Group Ltd. *   4,430,634 
           
     HEALTH CARE (15.2%)     
     ELECTRONICS (3.1%)     
 9,900   Mettler-Toledo International, Inc. *   4,156,317 
           
     HEALTHCARE PRODUCTS (10.6%)     
 16,200   C.R. Bard, Inc.   3,633,336 
 26,700   Danaher Corp.   2,093,013 
 22,700   Henry Schein, Inc. *   3,699,646 
 42,400   IDEXX Laboratories, Inc. *   4,779,752 
         14,205,747 
     HEALTHCARE SERVICES (1.5%)     
 30,700   Mednax, Inc. *   2,033,875 
         20,395,939 
     INDUSTRIALS (32.7%)     
     AEROSPACE & DEFENSE (7.9%)     
 37,983   HEICO Corp.   2,628,424 
 35,900   Teledyne Technologies, Inc. *   3,874,687 
 14,100   TransDigm Group, Inc. *   4,076,592 
         10,579,703 
     COMMERCIAL SERVICES (3.0%)     
 137,400   Rollins, Inc.   4,023,072 
           
     ELECTRICAL EQUIPMENTS (2.0%)     
 56,750   AMETEK, Inc.   2,711,515 

 

Shares      Value 
  
     ENVIRONMENTAL CONTROL (5.0%)     
 26,800   Stericycle, Inc. *  $2,147,752 
 61,100   Waste Connections, Inc.   4,564,170 
         6,711,922 
     TOOLS (2.4%)     
 21,400   Snap-on, Inc.   3,251,944 
           
     HOUSEWARES (3.0%)     
 85,600   Toro Co. (The)   4,009,504 
           
     MACHINERY DIVERSIFIED (5.3%)     
 26,800   Middleby Corp. (The) *   3,313,016 
 21,000   Roper Technologies, Inc.   3,831,870 
         7,144,886 
     MISCELLANEOUS MANUFACTURERS (2.5%)     
 31,900   Carlisle Companies, Inc.   3,271,983 
           
     TRANSPORTATION (1.6%)     
 22,200   Kansas City Southern   2,071,704 
         43,776,233 
           
     INFORMATION TECHNOLOGY (24.6%)     
     COMMERCIAL SERVICES (3.9%)     
 28,500   Gartner, Inc. *   2,520,825 
 24,600   WEX, Inc. *   2,659,014 
         5,179,839 
     COMPUTERS (0.7%)     
 19,600   CGI Group, Inc. Class A *   933,548 
           
     DIVERSIFIED FINANCIALS (1.5%)     
 9,300   Alliance Data Systems Corp. *   1,995,129 
           
     ELECTRONICS (3.0%)     
 62,100   Amphenol Corp. Class A   4,031,532 
           
     SOFTWARE (15.5%)     
 36,200   ANSYS, Inc. *   3,352,482 
 43,400   Fiserv, Inc. *   4,316,998 
 30,900   Jack Henry & Associates, Inc.   2,643,495 
 48,900   Open Text Corp.   3,171,654 
 18,900   Tyler Technologies, Inc. *   3,236,247 
 20,100   Ultimate Software Group, Inc. (The) *   4,108,239 
         20,829,115 
         32,969,163 
     MATERIALS (5.4%)     
     COMMERCIAL SERVICES (2.3%)     
 26,000   Ecolab, Inc.   3,164,720 
           
     PACKAGING & CONTAINERS (3.1%)     
 17,000   Ball Corp.   1,393,150 
 13,000   Crown Holdings, Inc. *   742,170 

 

 

 

1

 

 

September 30, 2016

 

Shares      Value 
 39,100   Silgan Holdings, Inc.  $1,978,069 
         4,113,389 
         7,278,109 
           
     TOTAL COMMON STOCKS
(Cost $94,796,554) (99.8%)		   133,674,218 
           
SHORT-TERM INVESTMENT (0.3%)     
     MONEY MARKET FUND (0.3%)     
 424,647   State Street Institutional Liquid Reserves Fund   424,647 
           
     TOTAL SHORT-TERM INVESTMENT
(Cost $424,647) (0.3%)		   424,647 
           
     TOTAL INVESTMENT SECURITIES (100.1%)
(Cost $95,221,201)		  $134,098,865 
           
EXCESS OF LIABILITIES OVER CASH AND
OTHER ASSETS (-0.1%)		   (183,462)
NET ASSETS (1) (100%)  $133,915,403 
NET ASSET VALUE OFFERING AND
REDEMPTION PRICE, PER OUTSTANDING SHARE
($133,915,403 ÷ 8,159,926 shares outstanding)		  $16.41 

 

* Non-income producing.
(1) For federal income tax purposes, the aggregate cost was $95,221,201, aggregate gross unrealized appreciation was $39,412,03, aggregate gross unrealized depreciation was $534,373 and the net unrealized appreciation was $38,877,664.

 

2 

 

 

 

 

The Fund follows fair valuation accounting standards (FASB ASC 820-10) which establishes a definition of fair value and set out a hierarchy for measuring fair value. These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value and a discussion of changes in valuation techniques and related inputs during the period. These inputs are summarized in the three broad levels listed below:

 

· Level 1 – Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access at the measurement date;
   
· Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active;
   
· Level 3 – Inputs that are unobservable.

 

Transfers between investment levels may occur as the markets fluctuate and/or the availability of data used in an investment’s valuation changes. The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

 

The following table summarizes the inputs used to value the Fund's investments in securities as of September 30, 2016:

 

Investments in Securities:  Level 1   Level 2   Level 3   Total 
Assets                    
Common Stocks*  $133,674,218   $—   $—   $133,674,218 
Short-Term Investment   424,647    —    —    424,647 
Total Investments in Securities  $134,098,865   $—   $—   $134,098,865 

 

* See Schedule of Investments for further classification.

 

See Notes to Financial Statements.

 

The Fund follows the updated provisions surrounding fair value measurements and disclosures on transfers in and out of all levels of the fair value hierarchy on a gross basis and the reasons for the transfers as well as disclosures about the valuation techniques and inputs used to measure fair value for investments that fall in either Level 2 or Level 3 of the fair value hierarchy.

 

For the period ended September 30, 2016, there were no transfers between Level 1, Level 2, and Level 3 assets.

 

The Fund's policy is to recognize transfers between levels at the beginning of the reporting period.

 

An investment asset’s or liability’s level within the fair value hierarchy is based on the lowest level input, individually or in aggregate, that is significant to fair value measurement. The objective of fair value measurement remains the same even when there is a significant decrease in the volume and level of activity for an asset or liability and regardless of the valuation techniques used.

 

For the period ended September 30, 2016, there were no Level 3 investments. The Schedule of Investments includes a breakdown of the Funds' investments by category.

 

 

 

  

Item 2. Controls and Procedures.

(a)The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in rule 30a-2(c) under the Act (17 CFR 270.30a-2(c) ) based on their evaluation of these controls and procedures as of the date within 90 days of filing date of this report, are approximately designed to ensure that material information relating to the registrant is made known to such officers and are operating effectively.

 

(b)The registrant’s principal executive officer and principal financial officer have determined that there have been no significant changes in the registrant’s internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including corrective actions with regard to significant deficiencies and material weaknesses.

 

Item 3. Exhibits:

(a)Certifications of principal executive officer and principal financial officer of the registrant.

 

   

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

By /s/ Mitchell E. Appel
Mitchell E. Appel, President
 
Date: November 29, 2016

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By: /s/ Mitchell E. Appel
Mitchell E. Appel, President, Principal Executive Officer
 
By: /s/ Emily D. Washington
Emily D. Washington, Treasurer, Principal Financial Officer
 
Date: November 29, 2016