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T Rowe Price Equity Income Fund's Top 5 Holdings as of June

Baltimore-based fund's top holdings include Wells Fargo and GE.

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James Li
Aug 06, 2021

Summary

  • Fund seeks long-term capital appreciation through dividend income.
  • Top holdings include Wells Fargo and major industrial giant GE.
  • Other major holdings include UPS, Qualcomm and Southern.
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According to top-10 holdings statistics, a Premium feature of GuruFocus,

T Rowe Price Equity Income Fund (Trades, Portfolio)’s top-five holdings as of the June quarter are Wells Fargo & Co. (WFC, Financial), General Electric Co. (GE, Financial), United Parcel Service Inc. (UPS, Financial), Qualcomm Inc. (QCOM, Financial) and Southern Co. (SO, Financial).

Fund background

The fund, part of Baltimore-based asset management firm T. Rowe Price Group Inc. (

TROW, Financial), seeks long-term capital appreciation by investing in the stocks of well-established companies that are expected to pay above-average dividends and appear to be out of favor or undervalued. John Linehan started managing the fund in November 2015 following Brian Rogers’ departure.

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As of June 30, the fund’s $18.47-billion equity portfolio contains 117 stocks with a quarterly turnover of 6%. The top-four sectors in terms of weight are financial services, health care, industrials and technology, with weights of 23.32%, 14.82%, 12.16% and 9.11%, respectively.

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Wells Fargo

The fund owns 15.87 million shares of Wells Fargo (

WFC, Financial), giving the position a 3.89% weight in the equity portfolio.

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GuruFocus ranks the San Francisco-based bank’s financial strength 3 out of 10 on several warning signs, which include cash-to-debt and debt-to-equity ratios underperforming more than 60% of global competitors.

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Gurus with large holdings in Wells Fargo include Dodge & Cox,

PRIMECAP Management (Trades, Portfolio), and Chris Davis (Trades, Portfolio)’ Davis Select Advisors.

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Shares of Wells Fargo traded around $48.78, showing that the stock is fairly valued based on Friday’s price-to-GF-Value ratio of 1.07.

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General Electric

The fund owns 5,129,375 shares of General Electric (

GE, Financial), giving the position 2.99% of equity portfolio space.

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GuruFocus ranks the Boston-based conglomerate’s financial strength 3 out of 10 on several warning signs, which include a weak Altman Z-score of 1.39 and debt ratios that are underperforming more than 93% of global competitors.

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Shares of GE traded around $104.37, showing that the stock is significantly overvalued based on Friday’s price-to-GF-Value ratio of 1.73.

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United Parcel Service

The fund owns 2.345 million shares of United Parcel Service (

UPS, Financial), giving the position 2.64% equity portfolio weight.

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GuruFocus ranks the Atlanta-based logistics company’s profitability 8 out of 10 on several positive investing signs, which include a high Piotroski F-score of 7 and profit margins and returns outperforming more than 70% of global competitors.

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Other gurus with holdings in UPS include

PRIMECAP Management (Trades, Portfolio), Pioneer Investments (Trades, Portfolio) and Bill Gates (Trades, Portfolio)’ foundation trust.

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Shares of UPS traded around $192, showing that the stock is modestly overvalued based on Friday’s price-to-GF-Value ratio of 1.28.

Qualcomm

The fund owns 3.33 million shares of Qualcomm (

QCOM, Financial), giving the position a 2.58% weight in the equity portfolio.

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GuruFocus ranks the San Diego-based semiconductor company’s profitability 8 out of 10 on several positive investing signs, which include a high Piotroski F-score of 7 and profit margins and returns outperforming more than 90% of global competitors.

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Shares of Qualcomm traded around $146.16, showing that the stock is modestly overvalued based on Friday’s price-to-GF-Value ratio of 1.15.

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Southern

The fund owns 7.2 million shares of Southern (

SO, Financial), giving the position a 2.36% weight in the equity portfolio.

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GuruFocus ranks the Atlanta-based utility company’s profitability 6 out of 10 on the back of profit margins outperforming more than 70% of global competitors despite returns on assets underperforming more than 56% of global regulated utility companies.

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Disclosures

I am/we are Long UPS
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