7
Morningstar FundInvestor
February 2
014
Morningstar Analyst Rating
01-30-14
ˇ
Morningstar Pillars
Process
Performance
People
Parent
Price
¶
¶
Neutral
Neutral
Positive
Positive
Positive
Morningstar Analyst Rating
Morningstar evaluates mutual funds based on five key pillars, which
its analysts believe lead to funds that are more likely to outperform
over the long term on a risk-adjusted basis.
Analyst Rating Spectrum
Œ „ ´ˇ ¨
Pillar Spectrum
Positive
§
Negative
¶
Neutral
NAV
51.63
52.57
37.78
31.83
32.15
27.51
19.24
33.66
31.63
28.40
26.67
24.33
Total Return %
-1.79
39.20
18.92
-0.97
16.93
43.25
-42.26
10.37
14.05
6.56
10.24
31.23
+/-S&P 500
1.67
6.81
2.92
-3.08
1.87
16.79
-5.26
4.88
-1.74
1.65
-0.64
2.55
+/-Russ 1000Gr
1.06
5.72
3.66
-3.61
0.22
6.04
-3.82
-1.44
4.98
1.30
3.94
1.48
Income Return %
0.00
0.05
0.22
0.02
0.06
0.26
0.36
0.66
0.67
0.07
0.62
0.27
Capital Return %
-1.79
39.15
18.70
-0.99
16.87
42.99
-42.62
9.71
13.38
6.49
9.62
30.96
Total Rtn % Rank Cat
22
12
14
39
35
17
65
67
7
48
27
26
Income $
0.00
0.02
0.07
0.01
0.02
0.05
0.12
0.21
0.19
0.02
0.15
0.05
Capital Gains $
0.00
0.00
0.00
0.00
0.00
0.00
0.07
1.01
0.57
0.00
0.00
0.00
Expense Ratio %
. .
0.70
0.70
0.70
0.73
0.71
0.67
0.70
0.72
0.74
0.76
Income Ratio %
. .
0.25
0.04
0.06
0.25
0.49
0.64
0.53
0.42
0.72
0.29
Turnover Rate %
. .
31
30
42
59
56
51
38
36
. .
Net Assets $mil
37,244
37,244
27,354
22,840
22,080
18,348
12,613
21,493
16,078
11,149
8,238
5,645
Performance
01-31-14
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
Total
2009
2010
2011
2012
2013
0.21 14.89 14.00 9.15 43.25
4.29 -11.78 14.14 11.34 16.93
5.19 0.06 -14.48 10.01 -0.97
19.13 -4.91
6.07 -1.04 18.92
7.73 3.17 11.86 11.97 39.20
Trailing
Total
+/-
+/- Russ %Rank Growth of
Return% S&P 500 1000Gr
Cat
$10,000
3 Mo
6 Mo
1 Yr
3 Yr Avg
5 Yr Avg
10 Yr Avg
15 Yr Avg
4.70 2.70
1.96
21 10,470
16.25 9.40
6.10
7 11,625
31.73 10.21
7.38
10 13,173
16.61 2.68
2.24
8 15,857
22.47 3.28
1.59
15 27,552
8.50 1.67
1.20
18 22,610
6.39 2.24
3.65
15 25,323
Tax Analysis
Tax-Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat
3 Yr (estimated)
5 Yr (estimated)
10 Yr (estimated)
16.58
5
0.03
10
22.43
13
0.03
10
8.29
14
0.19
28
Potential Capital Gain Exposure: 46% of assets
Rating and Risk
Time Load-Adj
Morningstar
Morningstar
Morningstar
Period Return % Rtn vs Cat
Risk vs Cat
Risk-Adj Rating
1 Yr
31.73
3 Yr
16.61
High
Avg
5 Yr
22.47
+Avg
Avg
10 Yr
8.50
+Avg
Avg
Incept
10.82
Other Measures
Standard Index
Best Fit Index
S&P 500 M* U.S. Grwth TR
Alpha
1.4
1.3
Beta
1.09
1.04
R-Squared
89
98
Standard Deviation
14.27
Mean
16.61
Sharpe Ratio
1.15
Morningstar’s Take
by Katie Rushkewicz Reichart, CFA 01-30-14
T. Rowe Price Growth Stock’s new manager has a
strong pedigree but is untested on his own.
Manager Rob Bartolo unexpectedly resigned from
the firm in mid-January. He left behind a record that
had slightly edged the Russell 1000 Growth Index and
surpassed 80% of its large-growth peers since his late
2007 start.
While his successor Joe Fath won’t benefit from the
transition period that’s common when T. Rowe funds
change managers, he does come to the post prepared.
After joining the firm as an analyst in 2002, he became
associate portfolio manager at Silver-rated T. Rowe
Price Institutional Large Cap Growth TRLGX in April
2008, helping manager Rob Sharps source ideas and
keep tabs on the fund. In that role, he worked with the
firm’s growth managers, including Bartolo, as well as
T. Rowe’s analysts across sectors.
That experience gives Fath a running start. He’s
familiar with many of this fund’s top holdings, which
are also held in Institutional Large Cap Growth (there
was 65% overlap in assets as of December 2013).
Where he’ll need to do more work is at the tail end of
the portfolio: Growth Stock’s 118-name portfolio is
broader than the 74-stock institutional fund. This fund
won’t likely become much more concentrated under
Fath, though he may be willing to make more bets on
cyclical stocks and turnarounds than his predecessor.
The core of the fund still will focus on firms with
growing market opportunities, strong management
teams, and solid free cash flow, with a growth bent
that can invite price risk.
It will take time to assess Fath’s process and see
how he positions the fund, which at $58 billion
strategywide, is a lot to manage. He’s also taking over
after a huge market rally, which could prove
challenging. Despite the success of the institutional
fund, which surpassed 96% of its peers when he was
involved, the record is not his own, and he was not in
charge of portfolio construction. Whether that fund’s
heightened risk profile--highlighted by steeper losses
than peers in down markets--carries over to this fund
remains to be seen.
Address:
100 East Pratt Street
Baltimore, MD 21202
800-638-5660
Web Address:
Inception:
04-11-50
Advisor:
T. Rowe Price Associates, Inc.
Subadvisor:
None
NTF Plans:
N/A
Minimum Purchase:
$2500
Add: $100 IRA: $1000
Min Auto Inv Plan:
$2500
Add: $100
Sales Fees:
No-load
Management Fee:
0.25% mx./0.21% mn., 0.15%A
Actual Fees:
Mgt:0.53% Dist:
.
Expense Projections:
3Yr:$224
5Yr:$390 10Yr:$871
Income Distribution:
Annually
Data through January 31, 2014
T. Rowe Price Growth Stock
Ticker
Status Yield Total Assets
Mstar Category
PRGFX Open
0.0% $41,569 mil
Large Growth
97% 97% 94% 99% 99% 96% 98% 98%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 01-14
Historical Profile
Return
Risk
Rating
Above Avg
Average
Above Avg
Investment Style
Equity
Stock %
Manager Change
Partial Manager Change
Growth of $10,000
Investment Values of
Fund
Investment Values of
S&P 500
Performance Quartile
(within Category)
History
10.0
14.0
18.0
22.0
26.8
Portfolio Analysis
12-31-13
Share change since 09-13 Total Stocks:116 Sector
PE Tot Ret% % Assets
Google, Inc. Class A
Technology 33.0 5.38 6.14
Amazon.com Inc
Cnsmr Cyc
.
-10.06 5.28
MasterCard Incorporated
Finan Svs 30.0 -9.28 3.03
Priceline.com, Inc.
Cnsmr Cyc 33.0 -1.51 2.98
Apple Inc
Technology 12.4 -10.77 2.85
Visa, Inc. Class A
Finan Svs 27.4 -3.26 2.81
Gilead Sciences Inc
Hlth care 44.3 7.39 2.77
Crown Castle Internation
Comm Svs
.
-3.36 2.28
Danaher Corporation
Industrl
20.8 -3.64 2.22
Precision Castparts Corp
Industrl
23.3 -5.40 2.18
Home Depot, Inc.
Cnsmr Cyc 20.8 -6.67 1.87
American Tower Corp
Real Est
55.0 1.33 1.85
Biogen Idec Inc
Hlth care 43.9 11.83 1.78
Starbucks Corporation
Cnsmr Cyc
.
-9.27 1.73
McKesson Corp
Hlth care 32.7 8.06 1.69
Boeing Co
Industrl
22.2 -8.23 1.56
T. Rowe Price Reserve In
. . .
1.33
Qualcomm, Inc.
Technology 20.3 -0.04 1.26
Las Vegas Sands Corp
Cnsmr Cyc 29.2 -2.98 1.22
eBay Inc
Cnsmr Cyc 25.4 -3.03 1.22
Current Investment Style
Market Cap %
Giant
44.3
Large
36.8
Mid
18.9
Small
0.0
Micro
0.0
Avg $mil:
50,109
Value Blnd Growth
Large Mid Small
Value Measures
Rel Category
Price/Earnings
Price/Book
Price/Sales
Price/Cash Flow
Dividend Yield %
25.39
5.22
2.54
18.11
0.78
1.42
1.82
1.40
1.81
0.59
Growth Measures
% Rel Category
Long-Term Erngs
Book Value
Sales
Cash Flow
Historical Erngs
16.37
11.81
12.17
13.98
13.45
1.22
1.14
1.52
1.08
0.61
Profitability
% Rel Category
Return on Equity
Return on Assets
Net Margin
18.79
9.67
14.22
0.90
0.99
1.01
Sector
Weightings
% of
Stocks
Rel
S&P 500 High
3 Year
Low
Cyclical 43.08 1.50
BasicMat 3.47 1.13 4 1
CnsmrCyc28.04 3.27 29 19
FinanSvs 9.68 0.62 10 8
Real Est 1.89 1.29 2 0
Sensitive 40.61 0.93
CommSrvs 3.51 0.88 5 3
Energy 4.80 0.45 8 4
Industrl 13.33 1.17 21 13
Technlgy 18.97 1.08 33 18
Defensive16.31 0.59
CnsmrDef 4.48 0.37 8 2
Hlthcare 11.83 1.00 12 6
Utilities 0.00 0.00
. .
h
r
t
y
u
j
i
o
p
a
k
s
d
f
Composition - Net
(% of Stock)
Cash
1.3
Stocks 98.0
Bonds 0.0
Other
0.7
Foreign 5.8
©
2014Morningstar, Inc.All rights reserved.The informationherein is not represented orwarranted to be accurate, correct, complete or
timely. Pastperformance is no guarantee of future results.Accessupdated reportsat
To order reprints, call 312-696-6100.
mfb.morningstar.com.
Mutual Funds
ß
®
EQ
∞
∞
∞
∞
