NEW YORK (TheStreet) -- Benchmark Electronics (BHE - Get Report) has seen its shares drop more than 16% this year, but investors should not give up on the Angleton, Texas-based manufacturer, said Jay Kaplan, portfolio manager for the Royce Small-Cap Value Fund (RCPFX - Get Report) .
"They are starting to change the business," said Kaplan. "They are moving away from computing and telecom, which are commodities and short-cycle, and moving toward industrial and medical, which are longer cycles and where they get paid for it."
The contrarian Royce Small-Cap Value Fund is down 7.4% this year, according to fund-tracker Morningstar. Kaplan is also bullish on SAIA (SAIA - Get Report) , which is down 35% year-to-date, saying the less-than-truckload transportation company will benefit from an improving economy and improving margins.
"They are actually firing customers who don't pay them enough and raising prices," said Kaplan, adding that the company trades at a cheap forward multiple of 14 times trailing twelve month earnings.
Kaplan is also bullish on Trustco Bank (TRST - Get Report) , which is down 21% thus far in 2015, despite a recent ruling by a regulator that it needs to clean up its audit system. "It will cost them around $5 million, or a year's worth of earnings or so, to get the back office in shape, but they are a traditional mortgage lender with a 4.5% dividend yield," said Kaplan. "Someday when the yield curve steepens as rates go up, it's going to be really good for their business."
Finally, Kaplan is positive on mortgage insurer Genworth Canada (GMICF) , which trades on the Toronto Exchange, despite worries that the Canadian economy has fallen into recession.
"People are worried that because of low oil prices there will be a lot of mortgage defaults in Canada," said Kaplan. "They have had low oil prices before. They will work through that. They should work through that again."