Unveiling the Investment Strategy and Portfolio Changes of T Rowe Price Equity Income Fund (Trades, Portfolio)
Renowned for its conservative, value-oriented investment approach, T Rowe Price Equity Income Fund (Trades, Portfolio) recently disclosed its Q3 2023 13F filing. The fund, established in 1985 and managed by John Linehan since November 2015, is part of the Baltimore-based asset management firm, T. Rowe Price. The fund's primary objective is to achieve a high level of dividend income and long-term capital growth, typically investing at least 80% of its net assets in common stocks. It places a particular emphasis on large-capitalization stocks with a strong dividend-paying track record or those perceived to be undervalued.
New Additions to the Portfolio
In the third quarter of 2023, T Rowe Price Equity Income Fund (Trades, Portfolio) made two significant additions to its portfolio:
- The fund purchased 295,000 shares of Dollar General Corp (DG, Financial), accounting for 0.2% of the portfolio and a total value of $31.21 million.
- The second-largest addition was Bank of New York Mellon Corp (BK, Financial), with 695,000 shares, representing approximately 0.19% of the portfolio, and a total value of $29.64 million.
Key Position Increases
The fund also increased its stakes in 38 stocks, with the most notable increases being:
- Kenvue Inc (KVUE, Financial) saw an additional 6,110,000 shares, bringing the total to 7,410,000 shares. This represents a significant 470% increase in share count, a 0.78% impact on the current portfolio, and a total value of $148.79 million.
- The fund also increased its stake in Charles Schwab Corp (SCHW, Financial) by 2,070,000 shares, bringing the total to 3,500,000 shares. This represents a 144.76% increase in share count and a total value of $192.15 million.
Complete Exits
The fund completely exited five holdings in Q3 2023:
- All 490,000 shares of Raymond James Financial Inc (RJF, Financial) were sold, resulting in a -0.31% impact on the portfolio.
- The fund also liquidated all 170,000 shares of Target Corp (TGT, Financial), causing a -0.13% impact on the portfolio.
Key Position Reductions
The fund reduced its position in 67 stocks, with the most significant changes being:
- Johnson & Johnson (JNJ, Financial) was reduced by 770,000 shares, resulting in a -36.07% decrease in shares and a -0.76% impact on the portfolio. The stock traded at an average price of $165.01 during the quarter and has returned -10.21% over the past 3 months and -12.21% year-to-date.
- NiSource Inc (NIMC, Financial) was reduced by 422,200 shares, resulting in an -81.19% reduction in shares and a -0.26% impact on the portfolio. The stock traded at an average price of $100.63 during the quarter and has returned -4.02% over the past 3 months and -3.81% year-to-date.
Portfolio Overview
As of Q3 2023, T Rowe Price Equity Income Fund (Trades, Portfolio)'s portfolio included 120 stocks. The top holdings were Southern Co (SO, Financial) at 2.89%, Wells Fargo & Co (WFC, Financial) at 2.85%, TotalEnergies SE (XPAR:TTE, Financial) at 2.72%, American International Group Inc (AIG, Financial) at 2.53%, and Qualcomm Inc (QCOM, Financial) at 2.42%.
The holdings are primarily concentrated in 11 industries: Financial Services, Healthcare, Industrials, Energy, Technology, Consumer Defensive, Utilities, Consumer Cyclical, Communication Services, Real Estate, and Basic Materials.
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