T. Rowe Price Small Cap Value Fund

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

#63 in Small Blend

U.S. News evaluated 227 Small Blend 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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Performance

The fund has returned 24.67 percent over the past year, 14.17 percent over the past three years, 25.70 percent over the past five years, and 10.34 percent over the past decade. 

Trailing Returns Updated 02.28.2014
Year to date 0.4%
1 Year 24.7%
3 Years (Annualized) 14.2%
5 Years (Annualized) 25.7%
10 Years (Annualized) 10.3%

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Summary

T. Rowe Price Small-Cap Value, despite some short-term setbacks, has produced long-term numbers that are hard to argue with.

As of March 05, 2014, the fund has assets totaling almost $9.77 billion invested in 321 different holdings. Its portfolio consists primarily of shares of large companies. 

Recently, this fund has produced some tepid returns. After playing solid defense in 2008, management largely missed out on 2009's heated rally during which smaller companies, many of which had been badly damaged during the downturn, came roaring back. Last year, despite good returns from companies like Raven Industries and Progress Software, the fund hovered near the middle of Morningstar's small-blend category. Nonetheless, its 25 percent return last year trounced that of the S&P 500, as smaller stocks outperformed their larger counterparts. Lately, management has been keeping a fair amount of cash on hand. As of the end of the first quarter, 6 percent of its assets were tucked away in cash. The fund has returned 24.67 percent over the past year and 14.17 percent over the past three years. 

With about 300 holdings, this fund is highly diversified. Overall, this diversification has led to a very smooth ride for investors. As of the end of the first quarter, the fund's trailing 10-year returns landed it in the top 6 percent of its Morningstar category. Over time, management has shown quite a bit of patience, as reflected in the fund's 12 percent turnover ratio. Meanwhile, management has shown a willingness to dip far down into the market cap spectrum, and the fund has hefty exposure to micro-cap names. The fund has returned 25.70 percent over the past five years and 10.34 percent over the past decade.  

Investment Strategy

According to the fund's prospectus: "Reflecting a value approach to investing, the fund will seek the stocks of companies whose current stock prices do not appear to adequately reflect their underlying value as measured by assets, earnings, cash flow, or business franchises."

Role in Portfolio

Role in portfolio: Morningstar calls this fund a "supporting player." 

Management

Preston Athey manages the fund.

Fees

T. Rowe Price Small Cap Value Fund has an expense ratio of 0.81 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 2 for one year, 1 for five years, and 1 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 3 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

Morningstar gives this fund a stewardship rating of A on a scale of A to F, saying: "On most fronts, this fund is strong, benefiting from a top-rate investment culture, low fees, a manager with skin in the game, and a spotless regulatory history. With a more-independent board of directors, it would score even more highly."

Morningstar 2011-06-02

In the annual Lipper/Barron's Fund Families Survey of 2010, T. Rowe Price ranks 12 out of 57 fund families surveyed.

2011-06-02

Morningstar gives this fund a stewardship rating of A on a scale of A to F, saying: "On most fronts, this fund is strong, benefiting from a top-rate investment culture, low fees, a manager with skin in the game, and a spotless regulatory history. With a more-independent board of directors, it would score even more highly."

Morningstar 2011-06-02

In the annual Lipper/Barron's Fund Families Survey of 2010, T. Rowe Price ranks 12 out of 57 fund families surveyed.

2011-06-02