T. Rowe Price Equity Income Fund

Scorecard
3 / 5 Stars
Lipper
3 4 5 5 3
Zacks Investment Research
3 (Hold)
Standard & Poor's
3 / 5 Stars
TheStreet.com
C+ (Hold)

U.S. News evaluated 326 Large Value Funds. Our list highlights the top-rated funds for long-term investors based on the ratings of leading fund industry researchers.

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Note: Profile written for different share class.

Performance

The fund has returned 20.32 percent over the past year, 12.14 percent over the past three years, 22.66 percent over the past five years, and 6.88 percent over the past decade. 

Trailing Returns Updated 02.28.2014
Year to date -0.5%
1 Year 20.3%
3 Years (Annualized) 12.1%
5 Years (Annualized) 22.7%
10 Years (Annualized) 6.9%

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Summary

T. Rowe Price Equity Income's blend of diversification and sturdiness has served investors well.

As of March 05, 2014, the fund has assets totaling almost $28.49 billion invested in 117 different holdings. Its portfolio consists primarily of shares of large companies.

Since 2006, this fund has finished every year in the top half of Morningstar's large-value category. This is a tribute to management's ability to outperform in a host of climates, ranging from 2008's market nosedive to 2009's rapid recovery to last year's touch-and-go growth. Lately, management has shown a preference for some of the world's largest energy companies. Chevron, ExxonMobil, and Royal Dutch Shell are all among its top holdings. The fund has returned 20.32 percent over the past year and 12.14 percent over the past three years. 

Historically, this fund has pursued a cautious strategy. With more than 100 holdings, the fund is broadly diversified. While this can hold it back occasionally, it also makes investors less likely to feel the pain of the occasional bad selection. Meanwhile, management has shown a preference for a long-term, buy-and-hold strategy. The fund's turnover ratio, for instance, currently sits at just 12 percent. By comparison, a fund that replenished its entire portfolio once a year would have a ratio of 100 percent. The fund has returned 22.66 percent over the past five years and 6.88 percent over the past decade. 

Investment Strategy

Management looks for companies that are trading at a discount to what they are worth. With more than 100 stocks in its portfolio, the fund is broadly diversified. Management takes a long-term approach to investing and keeps a lid on trading. Compared with its peers, the fund is overweight to mid-cap companies. 

Role in Portfolio

Morningstar calls the fund a "core" holding.

Management

Brian Rogers manages the fund.

Fees

T. Rowe Price Equity Income Fund has an expense ratio of 0.94 percent. 

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Risk

Like all stock funds, this one comes with some risks.

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Fund Opinions

The fund's Value Line Overall Rank, a measure of risk-adjusted performance and relative growth in fund returns, is 2 on a scale of 1 to 5, with 1 being the best and 5 the worst.

Value Line 2014-03-12

The fund's Value Line Growth Persistence rank, which awards funds that consistently outperform their broad universes, is 3 for one year, 2 for five years, and 3 for 10 years. Scores are on a 1 to 5 scale, with 1 being the best and 5 the worst.

Value Line 2014-03-12

The fund's Value Line Risk Rank, a measure of volatility, is 2 on a scale of 1 to 5, with 1 being the least volatile and 5 the most.

Value Line 2014-03-12

The fund appears on the 2011 "Kiplinger 25" list of the best no-load mutual funds.

Kiplinger 25 2011-04-13

The fund appears on the 2011 Money 70 list of recommended mutual and exchange-traded funds.

Money 70 2011-01-21

In the annual Lipper/Barron's Fund Families Survey of 2009, T. Rowe Price ranks 12 out of 61 fund families surveyed.

2011-06-02

Morningstar gives this fund a stewardship rating of A on a scale of A to F, saying: "This offering looks good on the stewardship front, benefiting from a top-rate investment culture, low fees, strong manager ownership, and a spotless regulatory history." 

Morningstar 2011-06-02

In the annual Lipper/Barron's Fund Families Survey of 2009, T. Rowe Price ranks 12 out of 61 fund families surveyed.

2011-06-02

Morningstar gives this fund a stewardship rating of A on a scale of A to F, saying: "This offering looks good on the stewardship front, benefiting from a top-rate investment culture, low fees, strong manager ownership, and a spotless regulatory history." 

Morningstar 2011-06-02