T. ROWE PRICE CAPITAL APPRECIATION FUND
September 30, 2019 (Unaudited)
Portfolio of Investments‡ | Shares/Par | $ Value |
(Cost and value in $000s) | ||
COMMON STOCKS 59.5% | ||
COMMUNICATION SERVICES 3.5% | ||
Interactive Media & Services 3.5% | ||
Alphabet, Class A (1)(2) | 54,528 | 66,586 |
Alphabet, Class C (1)(2) | 656,195 | 799,902 |
Facebook, Class A (1)(2) | 2,231,700 | 397,421 |
Total Communication Services | 1,263,909 | |
CONSUMER DISCRETIONARY 3.9% | ||
Auto Components 1.0% | ||
Aptiv | 3,933,952 | 343,906 |
343,906 | ||
Hotels, Restaurants & Leisure 1.0% | ||
McDonald's (2) | 574,000 | 123,244 |
Yum! Brands (2) | 2,048,428 | 232,353 |
355,597 | ||
Internet & Direct Marketing Retail 1.9% | ||
Amazon.com (1)(2) | 395,514 | 686,577 |
686,577 | ||
Total Consumer Discretionary | 1,386,080 | |
CONSUMER STAPLES 0.8% | ||
Beverages 0.8% | ||
Keurig Dr Pepper | 9,855,788 | 269,260 |
Total Consumer Staples | 269,260 | |
ENERGY 0.2% | ||
Oil, Gas & Consumable Fuels 0.2% | ||
Concho Resources | 1,185,700 | 80,509 |
Total Energy | 80,509 | |
FINANCIALS 5.8% | ||
Banks 0.2% | ||
PNC Financial Services Group (2) | 635,100 | 89,016 |
89,016 | ||
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
Capital Markets 2.7% | ||
Intercontinental Exchange | 4,475,857 | 412,987 |
S&P Global (2) | 2,277,467 | 557,934 |
970,921 | ||
Insurance 2.9% | ||
Marsh & McLennan | 10,259,434 | 1,026,456 |
1,026,456 | ||
Total Financials | 2,086,393 | |
HEALTH CARE 11.2% | ||
Health Care Equipment & Supplies 5.4% | ||
Becton Dickinson & Company | 3,345,154 | 846,190 |
Danaher (2) | 7,431,818 | 1,073,378 |
1,919,568 | ||
Health Care Providers & Services 0.6% | ||
Anthem (2) | 197,300 | 47,372 |
UnitedHealth Group (2) | 708,000 | 153,862 |
201,234 | ||
Life Sciences Tools & Services 5.2% | ||
Avantor (1) | 6,212,743 | 91,327 |
PerkinElmer (3) | 11,822,960 | 1,006,962 |
Thermo Fisher Scientific | 2,679,988 | 780,600 |
1,878,889 | ||
Total Health Care | 3,999,691 | |
INDUSTRIALS & BUSINESS SERVICES 8.0% | ||
Commercial Services & Supplies 1.0% | ||
Waste Connections | 3,749,848 | 344,986 |
344,986 | ||
Industrial Conglomerates 5.1% | ||
General Electric | 116,715,071 | 1,043,433 |
Roper Technologies | 2,159,324 | 770,015 |
1,813,448 | ||
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
Machinery 1.9% | ||
Fortive | 10,101,016 | 692,525 |
692,525 | ||
Total Industrials & Business Services | 2,850,959 | |
INFORMATION TECHNOLOGY 14.0% | ||
Electronic Equipment, Instruments & Components 1.5% | ||
TE Connectivity | 5,985,229 | 557,704 |
557,704 | ||
IT Services 5.7% | ||
Fiserv (1)(2) | 10,334,625 | 1,070,564 |
Visa, Class A (2) | 5,568,217 | 957,789 |
2,028,353 | ||
Semiconductors & Semiconductor Equipment 3.0% | ||
Maxim Integrated Products | 7,997,257 | 463,121 |
Texas Instruments (2) | 4,692,247 | 606,426 |
1,069,547 | ||
Software 3.8% | ||
Microsoft (2) | 9,849,600 | 1,369,390 |
1,369,390 | ||
Total Information Technology | 5,024,994 | |
REAL ESTATE 0.5% | ||
Equity Real Estate Investment Trusts 0.5% | ||
American Tower, REIT (2) | 853,100 | 188,646 |
Total Real Estate | 188,646 | |
UTILITIES 7.1% | ||
Electric Utilities 5.5% | ||
American Electric Power (2) | 5,444,545 | 510,099 |
Eversource Energy | 5,639,963 | 482,048 |
NextEra Energy (2) | 2,077,256 | 483,980 |
Xcel Energy | 7,921,874 | 514,050 |
1,990,177 | ||
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
Multi-Utilities 0.9% | ||
NiSource (3) | 10,323,080 | 308,866 |
308,866 | ||
Water Utilities 0.7% | ||
American Water Works | 2,060,135 | 255,931 |
255,931 | ||
Total Utilities | 2,554,974 | |
Total Miscellaneous Common Stocks 4.5% (4) | 1,594,118 | |
Total Common Stocks (Cost $14,577,740) | 21,299,533 | |
PREFERRED STOCKS 2.1% | ||
FINANCIALS 0.4% | ||
Banking 0.3% | ||
JP Morgan Chase, Series DD, 5.75% (5) | 2,550,000 | 69,997 |
State Street, Series E, 6.00% (5) | 148,987 | 3,768 |
U.S. Bancorp, Series F, VR, 6.50% (3)(5)(6) | 465,800 | 12,740 |
U.S. Bancorp, Series K, 5.50% (3)(5) | 1,200,000 | 32,316 |
118,821 | ||
Financial Services 0.1% | ||
Charles Schwab, Series C, 6.00% (5) | 1,050,000 | 27,699 |
Charles Schwab, Series D, 5.95% (5) | 95,800 | 2,579 |
30,278 | ||
Total Financials | 149,099 | |
UTILITIES 1.7% | ||
ELECTRIC UTILITIES 1.5% | ||
Alabama Power, Series A, 5.00% (3)(5) | 780,000 | 20,678 |
CMS Energy, 5.875%, 10/15/78 (3) | 3,800,000 | 107,426 |
CMS Energy, 5.875%, 3/1/79 (3) | 5,050,000 | 142,662 |
DTE Energy, Series E, 5.25%, 12/1/77 (3) | 2,560,000 | 71,245 |
Duke Energy, 5.625%, 9/15/78 (3) | 2,520,000 | 69,199 |
SCE Trust III, Series H, VR, 5.75% (3)(5)(6) | 1,089,852 | 26,887 |
SCE Trust IV, Series J, VR, 5.375% (3)(5)(6) | 2,611,171 | 62,276 |
SCE Trust V, Series K, VR, 5.45% (5)(6) | 520,747 | 12,743 |
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
SCE Trust VI, 5.00% (5) | 582,844 | 13,796 |
Total Electric Utilities | 526,912 | |
GAS & GAS TRANSMISSION 0.2% | ||
NiSource, VR, 6.50% (3)(5)(6) | 2,550,000 | 70,788 |
Total Gas & Gas Transmission | 70,788 | |
Total Utilities | 597,700 | |
Total Preferred Stocks (Cost $689,522) | 746,799 | |
CONVERTIBLE PREFERRED STOCKS 3.2% | ||
FINANCIALS 1.3% | ||
Banks 1.3% | ||
Wells Fargo, Series L, 7.50% (5) | 306,209 | 464,978 |
Total Financials | 464,978 | |
HEALTH CARE 1.5% | ||
Health Care Equipment & Supplies 0.8% | ||
Becton Dickinson & Company, Series A, 6.125%, 5/1/20 | 4,512,218 | 279,600 |
279,600 | ||
Life Sciences Tools & Services 0.7% | ||
Avantor, Series A, 6.25%, 5/15/22 | 4,777,486 | 253,646 |
253,646 | ||
Total Health Care | 533,246 | |
INDUSTRIALS & BUSINESS SERVICES 0.2% | ||
Machinery 0.2% | ||
Fortive, Series A, 5.00%, 7/1/21 | 83,691 | 75,428 |
Total Industrials & Business Services | 75,428 | |
INFORMATION TECHNOLOGY 0.1% | ||
Software 0.1% | ||
Aurora Innovation, Series B, Acquisition Date: 3/1/19, Cost | ||
$25,766 (1)(7)(8) | 2,788,430 | 25,766 |
Total Information Technology | 25,766 | |
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
UTILITIES 0.1% | ||
Electric Utilities 0.1% | ||
American Electric Power, 6.125%, 3/15/22 | 865,845 | 47,714 |
Total Utilities | 47,714 | |
Total Convertible Preferred Stocks (Cost $1,006,751) | 1,147,132 | |
CORPORATE BONDS 17.3% | ||
Corporate Bonds 17.3% | ||
1011778 BC, 4.625%, 1/15/22 (9) | 26,110,000 | 26,110 |
Amazon.com, 2.60%, 12/5/19 | 30,730,000 | 30,761 |
American Electric Power, 3.65%, 12/1/21 | 6,150,000 | 6,342 |
American Tower, 3.30%, 2/15/21 | 25,595,000 | 25,963 |
Amphenol, 2.20%, 4/1/20 | 19,330,000 | 19,325 |
Aptiv, 4.35%, 3/15/29 | 3,180,000 | 3,438 |
AutoZone, 2.50%, 4/15/21 | 13,695,000 | 13,746 |
Avantor, 6.00%, 10/1/24 (9) | 77,440,000 | 82,764 |
Avantor, 9.00%, 10/1/25 (9) | 307,266,000 | 344,906 |
B&G Foods, 4.625%, 6/1/21 | 20,665,000 | 20,665 |
Bank of New York Mellon, VR, 4.625% (5)(6) | 26,250,000 | 26,775 |
Bank of New York Mellon, VR, 4.95% (5)(6) | 43,465,000 | 43,791 |
Becton Dickinson & Company, 2.675%, 12/15/19 | 7,098,000 | 7,102 |
Becton Dickinson & Company, 2.894%, 6/6/22 | 67,385,000 | 68,424 |
Becton Dickinson & Company, 3.363%, 6/6/24 | 43,305,000 | 45,067 |
Becton Dickinson & Company, FRN, 3M USD LIBOR + 1.03%, | ||
3.142%, 6/6/22 | 27,790,000 | 27,979 |
Berkshire Hathaway Energy, 2.40%, 2/1/20 | 19,570,000 | 19,570 |
Bristol-Myers Squibb, 2.55%, 5/14/21 (9) | 82,385,000 | 83,219 |
Bristol-Myers Squibb, FRN, 3M USD LIBOR + 0.20%, 2.368%, | ||
11/16/20 (9) | 53,870,000 | 53,912 |
Caterpillar Financial Services, 2.25%, 12/1/19 | 9,845,000 | 9,846 |
CCO Holdings, 4.00%, 3/1/23 (9) | 30,780,000 | 31,165 |
CCO Holdings, 5.00%, 2/1/28 (9) | 197,338,000 | 203,998 |
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
CCO Holdings, 5.125%, 2/15/23 | 20,665,000 | 20,975 |
CCO Holdings, 5.125%, 5/1/23 (9) | 59,985,000 | 61,410 |
CCO Holdings, 5.125%, 5/1/27 (9) | 133,065,000 | 138,720 |
CCO Holdings, 5.25%, 3/15/21 | 16,819,000 | 16,834 |
CCO Holdings, 5.25%, 9/30/22 | 54,948,000 | 55,497 |
CCO Holdings, 5.75%, 9/1/23 | 27,375,000 | 27,922 |
CCO Holdings, 5.75%, 1/15/24 | 32,375,000 | 33,063 |
CCO Holdings, 5.875%, 4/1/24 (9) | 48,215,000 | 50,144 |
Cedar Fair, 5.375%, 6/1/24 | 39,060,000 | 40,185 |
Cedar Fair, 5.375%, 4/15/27 | 44,339,000 | 47,332 |
Centene, 5.625%, 2/15/21 | 10,070,000 | 10,208 |
Charter Communications Operating, 3.579%, 7/23/20 | 17,785,000 | 17,944 |
Comcast, 3.30%, 10/1/20 | 54,035,000 | 54,772 |
Comcast, 3.45%, 10/1/21 | 24,505,000 | 25,208 |
Comcast, FRN, 3M USD LIBOR + 0.33%, 2.649%, 10/1/20 | 26,550,000 | 26,618 |
Comcast, FRN, 3M USD LIBOR + 0.44%, 2.759%, 10/1/21 | 20,950,000 | 21,003 |
Conagra Brands, 3.80%, 10/22/21 | 79,200,000 | 81,720 |
Conagra Brands, FRN, 3M USD LIBOR + 0.75%, 3.028%, | ||
10/22/20 | 13,375,000 | 13,381 |
Continental Airlines PTT, Series 2009-2, Class A, 7.25%, | ||
11/10/19 | 3,025,054 | 3,038 |
Continental Airlines PTT, Series 2012-1, Class A, 4.15%, | ||
4/11/24 | 10,341,292 | 10,863 |
Continental Airlines PTT, Series 2012-1, Class B, 6.25%, | ||
4/11/20 | 1,140,381 | 1,155 |
Crown Castle International, 4.875%, 4/15/22 | 57,537,000 | 61,064 |
Crown Castle International, 5.25%, 1/15/23 | 105,887,000 | 115,423 |
Delta Air Lines PTT, Series 2009-1, Class A, 7.75%, 12/17/19 | 1,214,931 | 1,228 |
Dollar Tree, FRN, 3M USD LIBOR + 0.70%, 3.003%, 4/17/20 | 9,695,000 | 9,697 |
DTE Energy, 3.70%, 8/1/23 (3) | 15,895,000 | 16,669 |
Edison International, 2.125%, 4/15/20 | 12,010,000 | 11,965 |
Elanco Animal Health, 3.912%, 8/27/21 | 32,929,000 | 33,722 |
Elanco Animal Health, 4.272%, 8/28/23 | 4,310,000 | 4,524 |
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
Elanco Animal Health, 4.90%, 8/28/28 | 16,533,000 | 17,997 |
Enterprise Products Operating, 3.50%, 2/1/22 | 26,505,000 | 27,328 |
Equinix, 5.375%, 1/1/22 | 10,205,000 | 10,422 |
Equinix, 5.375%, 4/1/23 | 7,240,000 | 7,403 |
Eversource Energy, 2.75%, 3/15/22 | 19,200,000 | 19,419 |
Eversource Energy, 3.80%, 12/1/23 | 9,835,000 | 10,367 |
Fiserv, 2.70%, 6/1/20 | 38,295,000 | 38,435 |
Fiserv, 3.80%, 10/1/23 | 19,120,000 | 20,225 |
Fresenius Medical Care U.S. Finance, 5.75%, 2/15/21 (9) | 8,475,000 | 8,825 |
General Electric, Series D, VR, 5.00% (5)(6) | 118,859,000 | 112,767 |
HCA Healthcare, 6.25%, 2/15/21 | 14,005,000 | 14,670 |
Hilton Domestic Operating, 4.25%, 9/1/24 | 18,765,000 | 19,117 |
Hologic, 4.375%, 10/15/25 (9) | 34,325,000 | 35,183 |
Home Depot, 3.25%, 3/1/22 | 15,915,000 | 16,462 |
Home Depot, FRN, 3M USD LIBOR + 0.31%, 2.448%, 3/1/22 | 19,335,000 | 19,429 |
KFC Holding, 4.75%, 6/1/27 (9) | 135,145,000 | 140,720 |
KFC Holding, 5.00%, 6/1/24 (9) | 43,325,000 | 44,896 |
KFC Holding, 5.25%, 6/1/26 (9) | 89,453,000 | 94,485 |
Lennox International, 3.00%, 11/15/23 | 6,420,000 | 6,470 |
Level 3 Financing, 5.375%, 8/15/22 | 26,200,000 | 26,298 |
Marriott International, FRN, 3M USD LIBOR + 0.65%, 2.752%, | ||
3/8/21 | 11,415,000 | 11,466 |
Marsh & McLennan, 2.35%, 3/6/20 | 8,660,000 | 8,666 |
Marsh & McLennan, 2.75%, 1/30/22 | 13,100,000 | 13,257 |
Marsh & McLennan, 3.30%, 3/14/23 | 4,820,000 | 4,990 |
Mirant, EC, 0.00%, 7/15/49 (1)(7)(9) | 16,000,000 | — |
Moog, 5.25%, 12/1/22 (9) | 1,305,000 | 1,320 |
Nestle Holdings, 3.10%, 9/24/21 (9) | 111,585,000 | 113,924 |
Netflix, 4.375%, 11/15/26 | 134,150,000 | 135,491 |
Netflix, 4.875%, 4/15/28 | 253,705,000 | 256,559 |
Netflix, 5.375%, 2/1/21 | 20,705,000 | 21,326 |
Netflix, 5.50%, 2/15/22 | 15,620,000 | 16,518 |
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
Netflix, 5.875%, 2/15/25 | 56,540,000 | 62,053 |
Netflix, 5.875%, 11/15/28 | 245,295,000 | 266,145 |
Netflix, 6.375%, 5/15/29 (9) | 146,335,000 | 161,700 |
NextEra Energy Capital Holdings, 2.90%, 4/1/22 | 19,035,000 | 19,380 |
NiSource, 3.49%, 5/15/27 (3) | 71,255,000 | 74,626 |
NiSource, 4.375%, 5/15/47 (3) | 38,845,000 | 43,384 |
NiSource, VR, 5.65% (3)(5)(6) | 44,495,000 | 44,884 |
Northrop Grumman, 2.55%, 10/15/22 | 44,875,000 | 45,480 |
NuStar Logistics, 4.80%, 9/1/20 | 18,400,000 | 18,699 |
Philip Morris International, 2.00%, 2/21/20 | 25,740,000 | 25,728 |
Philip Morris International, 2.625%, 2/18/22 | 32,240,000 | 32,603 |
Philip Morris International, FRN, 3M USD LIBOR + 0.42%, | ||
2.572%, 2/21/20 | 17,230,000 | 17,252 |
PNC Financial Services Group, Series S, VR, 5.00% (5)(6) | 55,065,000 | 57,130 |
Reckitt Benckiser Treasury Services, 2.375%, 6/24/22 (9) | 58,025,000 | 58,285 |
Reckitt Benckiser Treasury Services, FRN, 3M USD LIBOR + | ||
0.56%, 2.695%, 6/24/22 (9) | 35,825,000 | 35,686 |
Refinitiv U.S. Holdings, 6.25%, 5/15/26 (9) | 43,645,000 | 46,864 |
Refinitiv U.S. Holdings, 8.25%, 11/15/26 (9) | 57,030,000 | 62,876 |
Reynolds Group Issuer, 5.125%, 7/15/23 (9) | 31,300,000 | 32,122 |
Reynolds Group Issuer, 5.75%, 10/15/20 | 123,241,428 | 123,395 |
Reynolds Group Issuer, 6.875%, 2/15/21 | 21,161,300 | 21,214 |
Reynolds Group Issuer, FRN, 3M USD LIBOR + 3.50%, 5.803%, | ||
7/15/21 (9) | 38,325,000 | 38,373 |
Roper Technologies, 3.65%, 9/15/23 | 31,830,000 | 33,423 |
Roper Technologies, 4.20%, 9/15/28 | 8,115,000 | 8,905 |
SBA Communications, 4.00%, 10/1/22 | 54,215,000 | 55,232 |
SBA Communications, 4.875%, 7/15/22 | 83,038,000 | 83,972 |
SBA Communications, 4.875%, 9/1/24 | 24,740,000 | 25,668 |
Sealed Air, 6.50%, 12/1/20 (9) | 30,565,000 | 31,482 |
Sensata Technologies, 4.875%, 10/15/23 (9) | 20,175,000 | 21,259 |
Sensata Technologies, 5.00%, 10/1/25 (9) | 23,800,000 | 25,436 |
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
Sensata Technologies, 5.625%, 11/1/24 (9) | 6,670,000 | 7,245 |
Sensata Technologies UK Financing, 6.25%, 2/15/26 (9) | 9,113,000 | 9,717 |
Service, 5.375%, 5/15/24 | 28,425,000 | 29,242 |
Shell International Finance, FRN, 3M USD LIBOR + 0.45%, | ||
2.631%, 5/11/20 | 49,720,000 | 49,844 |
Sirius XM Radio, 3.875%, 8/1/22 (9) | 37,800,000 | 38,367 |
Sirius XM Radio, 4.625%, 5/15/23 (9) | 31,620,000 | 32,213 |
Six Flags Entertainment, 4.875%, 7/31/24 (9) | 13,840,000 | 14,290 |
Six Flags Entertainment, 5.50%, 4/15/27 (9) | 5,025,000 | 5,352 |
Solera, 10.50%, 3/1/24 (9) | 224,212,000 | 236,544 |
State Street, VR, 5.25% (5)(6) | 33,460,000 | 34,046 |
T-Mobile USA, 6.00%, 3/1/23 | 13,950,000 | 14,177 |
T-Mobile USA, 6.50%, 1/15/26 | 6,975,000 | 7,489 |
Teleflex, 4.625%, 11/15/27 | 27,690,000 | 28,867 |
Teleflex, 4.875%, 6/1/26 | 33,225,000 | 34,720 |
Trinity Acquisition, 4.40%, 3/15/26 | 13,300,000 | 14,390 |
U.S. Airways PTT, Series 2010-1, Class A, 6.25%, 4/22/23 | 7,829,268 | 8,527 |
U.S. Airways PTT, Series 2012-2, Class A, 4.625%, 6/3/25 | 1,191,184 | 1,286 |
U.S. Airways PTT, Series 2012-2, Class B, 6.75%, 6/3/21 | 2,049,648 | 2,155 |
U.S. Airways PTT, Series 2013-1, Class A, 3.95%, 11/15/25 | 7,536,196 | 7,929 |
U.S. Airways PTT, Series 2013-1, Class B, 5.375%, 11/15/21 | 2,452,633 | 2,555 |
U.S. Bancorp, VR, 5.30% (3)(5)(6) | 22,505,000 | 23,883 |
Unilever Capital, 3.00%, 3/7/22 | 17,770,000 | 18,183 |
Verizon Communications, 3.125%, 3/16/22 | 32,200,000 | 33,067 |
Verizon Communications, FRN, 3M USD LIBOR + 1.00%, | ||
3.119%, 3/16/22 | 32,200,000 | 32,628 |
Welbilt, 9.50%, 2/15/24 | 23,776,000 | 25,529 |
Wisconsin Public Service, 3.35%, 11/21/21 | 15,900,000 | 16,344 |
Xylem, 3.25%, 11/1/26 | 5,110,000 | 5,262 |
Xylem, 4.875%, 10/1/21 | 3,095,000 | 3,238 |
Yum! Brands, 3.75%, 11/1/21 | 98,140,000 | 100,348 |
Yum! Brands, 3.875%, 11/1/20 | 60,185,000 | 60,636 |
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |
(Cost and value in $000s) | ||
Yum! Brands, 3.875%, 11/1/23 | 42,025,000 | 43,496 |
Yum! Brands, 5.35%, 11/1/43 | 47,261,000 | 44,839 |
Yum! Brands, 6.875%, 11/15/37 | 27,015,000 | 30,088 |
Zayo Group, 5.75%, 1/15/27 (9) | 109,199,000 | 111,519 |
Total Corporate Bonds (Cost $6,002,876) | 6,182,858 | |
BANK LOANS 4.4%(10) | ||
CCC Information Services, FRN | ||
3M USD LIBOR + 2.75%, 4.80%, 4/29/24 | 120,816,904 | 120,191 |
Emerald TopCo, FRN | ||
3M USD LIBOR + 3.50%, 5.544%, 7/24/26 | 35,500,000 | 35,382 |
Formula One Management, FRN | ||
3M USD LIBOR + 2.50%, 4.544%, 2/1/24 | 31,722,167 | 31,270 |
Gartner, FRN | ||
3M USD LIBOR + 1.50%, 3.544%, 3/21/22 (7) | 6,781,849 | 6,807 |
HB Fuller, FRN | ||
3M USD LIBOR + 2.00%, 4.044%, 10/20/24 | 15,282,990 | 15,210 |
HUB International, FRN | ||
3M USD LIBOR + 3.00%, 5.267%, 4/25/25 | 258,296,131 | 255,104 |
Kronos, FRN | ||
3M USD LIBOR + 3.00%, 5.253%, 11/1/23 | 390,554,815 | 391,176 |
NVA Holdings, FRN | ||
3M USD LIBOR + 4.41%, 4.41%, 9/19/22 (7) | 76,125,000 | 75,744 |
NVA Holdings, FRN | ||
3M USD LIBOR + 2.75%, 4.794%, 2/2/25 | 36,856,692 | 36,811 |
Prestige Brands, FRN | ||
3M USD LIBOR + 2.00%, 4.044%, 1/26/24 | 1,807,789 | 1,810 |
Refinitiv U.S. Holdings, FRN | ||
3M USD LIBOR + 3.75%, 5.794%, 10/1/25 | 316,462,976 | 318,045 |
Sunshine Luxembourg VII, FRN | ||
3M USD LIBOR + 4.25%, 5.25%, 7/17/26 | 117,595,000 | 118,085 |
Trans Union, FRN | ||
3M USD LIBOR + 1.50%, 3.544%, 8/9/22 | 61,229,363 | 60,847 |
Trans Union, FRN | ||
3M USD LIBOR + 2.00%, 4.112%, 6/19/25 | 43,951,050 | 44,061 |
Ultimate Software Group, FRN | ||
3M USD LIBOR + 3.75%, 5.794%, 5/4/26 | 14,065,000 | 14,135 |
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Shares/Par | $ Value | |||
(Cost and value in $000s) | ||||
Zayo Group, FRN | ||||
3M USD LIBOR + 2.00%, 4.044%, 1/19/21 | 19,005,076 | 19,033 | ||
Zayo Group, FRN | ||||
3M USD LIBOR + 2.25%, 4.294%, 1/19/24 | 31,725,000 | 31,777 | ||
Total Bank Loans (Cost $1,573,931) | 1,575,488 | |||
ASSET-BACKED SECURITIES 0.3% | ||||
Domino's Pizza Master Issuer | ||||
Series 2017-1A, Class A23 | ||||
4.118%, 7/25/47 (9) | 39,861,500 | 41,703 | ||
Domino's Pizza Master Issuer | ||||
Series 2018-1A, Class A2I | ||||
4.116%, 7/25/48 (9) | 34,913,063 | 36,244 | ||
Wendy's Funding | ||||
Series 2018-1A, Class A2I | ||||
3.573%, 3/15/48 (9) | 24,532,043 | 24,921 | ||
Total Asset-Backed Securities (Cost $98,360) | 102,868 | |||
BOND MUTUAL FUNDS 0.2% | ||||
T. Rowe Price Institutional Floating Rate Fund, 4.92% (3)(11) | 8,533,243 | 83,967 | ||
Total Bond Mutual Funds (Cost $82,483) | 83,967 | |||
SHORT-TERM INVESTMENTS 14.1% | ||||
Money Market Funds 14.1% | ||||
T. Rowe Price Government Reserve Fund, 2.00% (3)(12) | 5,048,305,484 | 5,048,306 | ||
Total Short-Term Investments (Cost $5,048,306) | 5,048,306 | |||
Total Investments in Securities 101.1% | ||||
(Cost $29,079,969) | $ | 36,186,951 | ||
Other Assets Less Liabilities (1.1)% | (410,611) | |||
Net Assets 100.0% | $ | 35,776,340 |
‡ | Shares/Par and Notional Amount are denominated in U.S. dollars unless | |
otherwise noted. | ||
(1) | Non-income producing |
The accompanying notes are an integral part of this Portfolio of Investments.
T. ROWE PRICE CAPITAL APPRECIATION FUND
(2) | All or a portion of this security is pledged to cover or as collateral for written | |
call options at September 30, 2019. | ||
(3) | Affiliated Companies | |
(4) | The identity of certain securities has been concealed to protect the fund while | |
it completes a purchase or selling program for the securities. | ||
(5) | Perpetual security with no stated maturity date. | |
(6) | Security is a fix-to-float security, which carries a fixed coupon until a certain | |
date, upon which it switches to a floating rate. Reference rate and spread is | ||
provided if the rate is currently floating. | ||
(7) | Level 3 in fair value hierarchy. | |
(8) | Security cannot be offered for public resale without first being registered | |
under the Securities Act of 1933 and related rules ("restricted security"). | ||
Acquisition date represents the day on which an enforceable right to acquire | ||
such security is obtained and is presented along with related cost in the | ||
security description. The fund has registration rights for certain restricted | ||
securities. Any costs related to such registration are borne by the issuer. The | ||
aggregate value of restricted securities (excluding 144A holdings) at period- | ||
end amounts to $25,766 and represents 0.1% of net assets. | ||
(9) | Security was purchased pursuant to Rule 144A under the Securities Act of | |
1933 and may be resold in transactions exempt from registration only to | ||
qualified institutional buyers. Total value of such securities at period-end | ||
amounts to $2,587,899 and represents 7.2% of net assets. | ||
(10) | Bank loan positions may involve multiple underlying tranches. In those | |
instances, the position presented reflects the aggregate of those respective | ||
underlying tranches and the rate presented reflects their weighted average | ||
rate. | ||
(11) | SEC 30-day yield | |
(12) | Seven-day yield | |
3M USD LIBOR | Three month USD LIBOR (London interbank offered rate) | |
EC | Escrow CUSIP; represents a beneficial interest in a residual pool of bankruptcy | |
assets; the amount and timing of future distributions, if any, is uncertain; when | ||
presented, interest rate and maturity date are those of the original security. | ||
FRN | Floating Rate Note | |
OTC | Over-the-counter | |
PTT | Pass-Through Trust | |
REIT | A domestic Real Estate Investment Trust whose distributions pass-through | |
with original tax character to the shareholder | ||
VR | Variable Rate; rate shown is effective rate at period-end. The rates for certain | |
variable rate securities are not based on a published reference rate and | ||
spread but are determined by the issuer or agent and based on current market | ||
conditions. |
The accompanying notes are an integral part of this Portfolio of Investments.
T. ROWE PRICE CAPITAL APPRECIATION FUND
(Amounts in 000s, except for contracts) | ||||||
OPTIONS WRITTEN (0.9)% | ||||||
OTC Options Written (0.9)% | ||||||
Counterparty | Description | Contracts | Notional Amount | $ Value | ||
Goldman | Alphabet, Class A, Call, 1/17/20 @ | |||||
Sachs | $1,270.00 | 182 | 22,225 | (802) | ||
Goldman | Alphabet, Class A, Call, 1/17/20 @ | |||||
Sachs | $1,300.00 | 181 | 22,103 | (586) | ||
Goldman | Alphabet, Class A, Call, 1/17/20 @ | |||||
Sachs | $1,350.00 | 182 | 22,225 | (328) | ||
Alphabet, Class C, Call, 1/17/20 @ | ||||||
Citigroup | $1,300.00 | 1,535 | 187,117 | (4,828) | ||
Alphabet, Class C, Call, 1/17/20 @ | ||||||
Citigroup | $1,340.00 | 369 | 44,981 | (727) | ||
Alphabet, Class C, Call, 1/17/20 @ | ||||||
Citigroup | $1,350.00 | 478 | 58,268 | (832) | ||
Alphabet, Class C, Call, 1/17/20 @ | ||||||
Citigroup | $1,365.00 | 1,395 | 170,051 | (1,988) | ||
Alphabet, Class C, Call, 1/17/20 @ | ||||||
Citigroup | $1,400.00 | 369 | 44,981 | (325) | ||
Alphabet, Class C, Call, 1/17/20 @ | ||||||
Citigroup | $1,500.00 | 368 | 44,859 | (77) | ||
Amazon.com, Call, 1/17/20 @ | ||||||
Citigroup | $1,800.00 | 286 | 49,647 | (2,193) | ||
Amazon.com, Call, 1/17/20 @ | ||||||
Citigroup | $2,000.00 | 95 | 16,491 | (190) | ||
Amazon.com, Call, 1/17/20 @ | ||||||
Citigroup | $2,025.00 | 95 | 16,491 | (157) | ||
Amazon.com, Call, 1/17/20 @ | ||||||
Citigroup | $2,100.00 | 95 | 16,491 | (88) | ||
Amazon.com, Call, 1/17/20 @ | ||||||
Citigroup | $2,300.00 | 432 | 74,991 | (90) | ||
Amazon.com, Call, 1/17/20 @ | ||||||
Credit Suisse | $2,500.00 | 188 | 32,635 | (11) | ||
Amazon.com, Call, 1/17/20 @ | ||||||
Credit Suisse | $2,600.00 | 188 | 32,635 | (7) | ||
Amazon.com, Call, 1/17/20 @ | ||||||
Credit Suisse | $2,700.00 | 188 | 32,635 | (5) | ||
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
(Amounts in 000s, except for contracts) | |||||||
Counterparty | Description | Contracts | Notional Amount | Value | |||
American Electric Power, Call, | |||||||
Citigroup | 1/17/20@ $82.50 | 2,812 | 26,346 | (3,318) | |||
American Electric Power, Call, | |||||||
Citigroup | 1/17/20@ $85.00 | 12,828 | 120,186 | (12,315) | |||
American Electric Power, Call, | |||||||
Citigroup | 1/17/20@ $95.00 | 9,570 | 89,661 | (2,560) | |||
American Tower, Call, 1/17/20 @ | |||||||
Credit Suisse | $170.00 | 2,223 | 49,157 | (11,771) | |||
American Tower, Call, 1/17/20 @ | |||||||
Citigroup | $175.00 | 1,541 | 34,076 | (7,428) | |||
American Tower, Call, 1/17/20 @ | |||||||
Credit Suisse | $175.00 | 4,767 | 105,413 | (22,977) | |||
Citigroup | Anthem, Call, 1/17/20 @ $300.00 | 547 | 13,133 | (59) | |||
Citigroup | Anthem, Call, 1/17/20 @ $310.00 | 547 | 13,133 | (32) | |||
Citigroup | Anthem, Call, 1/17/20 @ $330.00 | 879 | 21,105 | (16) | |||
Citigroup | Danaher, Call, 1/17/20 @ $150.00 | 1,588 | 22,935 | (762) | |||
JPMorgan | Facebook, Class A, Call, 1/17/20 @ | ||||||
Chase | $200.00 | 4,666 | 83,092 | (1,785) | |||
JPMorgan | Facebook, Class A, Call, 1/17/20 @ | ||||||
Chase | $220.00 | 8,045 | 143,265 | (849) | |||
Credit Suisse | Fiserv, Call, 12/20/19 @ $95.00 | 3,872 | 40,110 | (4,317) | |||
Citigroup | Mcdonald's, Call, 1/17/20 @ $195.00 | 2,019 | 43,350 | (4,452) | |||
Credit Suisse | Mcdonald's, Call, 1/17/20 @ $195.00 | 851 | 18,272 | (1,876) | |||
Citigroup | Mcdonald's, Call, 1/17/20 @ $200.00 | 2,019 | 43,350 | (3,649) | |||
Credit Suisse | Mcdonald's, Call, 1/17/20 @ $200.00 | 851 | 18,272 | (1,538) | |||
Citigroup | Microsoft, Call, 1/17/20 @ $120.00 | 4,323 | 60,103 | (8,711) | |||
Citigroup | Microsoft, Call, 1/17/20 @ $125.00 | 7,545 | 104,898 | (12,638) | |||
Credit Suisse | Microsoft, Call, 1/17/20 @ $125.00 | 9,328 | 129,687 | (15,624) | |||
Citigroup | Microsoft, Call, 1/17/20 @ $130.00 | 7,545 | 104,898 | (9,790) | |||
Credit Suisse | Microsoft, Call, 1/17/20 @ $130.00 | 2,153 | 29,933 | (2,793) | |||
Royal Bank of | |||||||
Canada | Microsoft, Call, 1/17/20 @ $130.00 | 7,110 | 98,850 | (9,225) | |||
Citigroup | Microsoft, Call, 1/17/20 @ $135.00 | 7,760 | 107,887 | (7,411) | |||
NextEra Energy, Call, 1/17/20 @ | |||||||
Credit Suisse | $195.00 | 1,509 | 35,158 | (5,953) | |||
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
(Amounts in 000s, except for contracts) | |||||||
Counterparty | Description | Contracts | Notional Amount | Value | |||
NextEra Energy, Call, 1/17/20 @ | |||||||
Credit Suisse | $200.00 | 9,675 | 225,418 | (33,524) | |||
PNC Financial Services Group, Call, | |||||||
Credit Suisse | 1/17/20@ $140.00 | 6,351 | 89,016 | (4,287) | |||
Citigroup | S&P Global, Call, 1/17/20 @ $220.00 | 3,197 | 78,320 | (9,767) | |||
Citigroup | S&P Global, Call, 1/17/20 @ $230.00 | 3,197 | 78,320 | (7,465) | |||
JPMorgan | Texas Instruments, Call, 1/17/20 @ | ||||||
Chase | $120.00 | 3,180 | 41,098 | (4,142) | |||
Royal Bank of | Texas Instruments, Call, 1/17/20 @ | ||||||
Canada | $125.00 | 14,788 | 191,120 | (14,196) | |||
Goldman | Texas Instruments, Call, 1/17/20 @ | ||||||
Sachs | $130.00 | 637 | 8,233 | (432) | |||
JPMorgan | Texas Instruments, Call, 1/17/20 @ | ||||||
Chase | $130.00 | 7,185 | 92,859 | (4,868) | |||
Goldman | Texas Instruments, Call, 1/17/20 @ | ||||||
Sachs | $135.00 | 838 | 10,830 | (381) | |||
Goldman | Texas Instruments, Call, 1/17/20 @ | ||||||
Sachs | $140.00 | 838 | 10,830 | (236) | |||
Unitedhealth Group, Call, 1/17/20 @ | |||||||
Citigroup | $270.00 | 1,301 | 28,273 | (98) | |||
Unitedhealth Group, Call, 1/17/20 @ | |||||||
Citigroup | $280.00 | 1,302 | 28,295 | (53) | |||
Unitedhealth Group, Call, 1/17/20 @ | |||||||
Citigroup | $290.00 | 1,426 | 30,990 | (32) | |||
Goldman | Unitedhealth Group, Call, 1/17/20 @ | ||||||
Sachs | $290.00 | 732 | 15,908 | (16) | |||
Unitedhealth Group, Call, 1/17/20 @ | |||||||
Citigroup | $300.00 | 2,160 | 46,941 | (31) | |||
Goldman | Unitedhealth Group, Call, 1/17/20 @ | ||||||
Sachs | $310.00 | 159 | 3,455 | (2) | |||
Credit Suisse | Visa, Call, 1/17/20 @ $150.00 | 2,573 | 44,258 | (6,593) | |||
Credit Suisse | Visa, Call, 1/17/20 @ $155.00 | 2,573 | 44,258 | (5,429) | |||
Credit Suisse | Visa, Call, 1/17/20 @ $160.00 | 4,165 | 71,642 | (7,320) | |||
Credit Suisse | Visa, Call, 1/17/20 @ $165.00 | 3,628 | 62,405 | (5,007) | |||
Credit Suisse | Visa, Call, 1/17/20 @ $170.00 | 3,682 | 63,334 | (3,949) | |||
Goldman | |||||||
Sachs | Visa, Call, 1/17/20 @ $170.00 | 3,722 | 64,022 | (3,992) | |||
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
(Amounts in 000s, except for contracts) | |||||
Counterparty | Description | Contracts | Notional Amount | Value | |
Credit Suisse | Visa, Call, 1/17/20 @ $175.00 | 3,682 | 63,334 | (2,844) | |
Goldman | |||||
Sachs | Visa, Call, 1/17/20 @ $175.00 | 8,938 | 153,743 | (6,905) | |
Goldman | |||||
Sachs | Visa, Call, 1/17/20 @ $180.00 | 3,048 | 52,429 | (1,661) | |
Citigroup | Yum! Brands, Call, 1/17/20 @ $100.00 | 4,034 | 45,758 | (5,910) | |
Bank of | |||||
America | Yum! Brands, Call, 1/17/20 @ $105.00 | 3,648 | 41,379 | (3,821) | |
Citigroup | Yum! Brands, Call, 1/17/20 @ $105.00 | 6,556 | 74,365 | (6,867) | |
Citigroup | Yum! Brands, Call, 1/17/20 @ $115.00 | 3,124 | 35,436 | (1,242) | |
Citigroup | Yum! Brands, Call, 1/17/20 @ $120.00 | 3,122 | 35,413 | (626) | |
Total OTC Options Written (Premiums $(151,428)) | $ | (306,779) | |||
Total Options Written (Premiums $(151,428)) | $ | (306,779) |
The accompanying notes are an integral part of this Portfolio of Investments.
T. ROWE PRICE CAPITAL APPRECIATION FUND
Affiliated Companies
($000s)
The fund may invest in certain securities that are considered affiliated companies. As defined
by the 1940 Act, an affiliated company is one in which the fund owns 5% or more of the
outstanding voting securities, or a company that is under common ownership or control. The
following securities were considered affiliated companies for all or some portion of the nine
months ended September 30, 2019. Net realized gain (loss), investment income, change in net
unrealized gain/loss, and purchase and sales cost reflect all activity for the period then ended.
Change in Net | ||||||||
Net Realized Gain | Unrealized | Investment | ||||||
Affiliate | (Loss) | Gain/Loss | Income | |||||
Alabama Power, Series A | $ | — | $ | 2,161 | $ | 731 | ||
CMS Energy, 10/15/78, | ||||||||
Preferred Stock | — | 15,998 | 4,186 | |||||
CMS Energy, 3/1/79, Preferred | ||||||||
Stock | — | 16,412 | 3,935 | |||||
DTE Energy, 3.70%, Corporate | ||||||||
Bond | — | 898 | 443 | |||||
DTE Energy, Preferred Stock | — | 14,285 | 2,520 | |||||
Duke Energy, Preferred Stock | — | 9,223 | 2,658 | |||||
NiSource, Common Stock | 28,311 | 39,853 | 8,983 | |||||
NiSource, 3.49%, Corporate | ||||||||
Bond | — | 6,357 | 1,867 | |||||
NiSource, 4.375%, Corporate | ||||||||
Bond | — | 7,090 | 1,276 | |||||
NiSource, 5.65%, Corporate | ||||||||
Bond | — | 3,837 | 1,902 | |||||
NiSource, Preferred Stock | — | 6,936 | 3,234 | |||||
PerkinElmer | 20,446 | 74,315 | 2,399 | |||||
SCE Trust III, Series H | (107) | 1,882 | 1,250 | |||||
SCE Trust IV, Series J | (71) | 9,566 | 2,694 | |||||
SCE Trust V, Series K | (62) | 2,299 | 639 | |||||
U.S. Bancorp, 5.30%, Corporate | ||||||||
Bond | — | 2,728 | 895 | |||||
U.S. Bancorp, Series F, | ||||||||
Preferred Stock | — | 406 | 568 | |||||
U.S. Bancorp, Series K, | ||||||||
Preferred Stock | — | 2,688 | 1,238 | |||||
T. Rowe Price Institutional | ||||||||
Floating Rate Fund | — | 2,216 | 3,234 | |||||
T. Rowe Price Government | ||||||||
Reserve Fund | — | — | 45,570 | |||||
Affiliates not held at period end | 54,872 | (24,877) | 3,635 | |||||
Totals | $ | 103,389# | $ | 194,273 | $ | 93,857+ | ||
The accompanying notes are an integral part of this Portfolio of Investments. |
T. ROWE PRICE CAPITAL APPRECIATION FUND
Supplementary Investment Schedule | ||||||
Value | Purchase | Sales | Value | |||
Affiliate | 12/31/18 | Cost | Cost | 9/30/19 | ||
Alabama Power, Series A | $ 18,517 | $ — | $ — | $ �� 20,678 | ||
CMS Energy, 10/15/78, | ||||||
Preferred Stock | 91,428 | — | — | 107,426 | ||
CMS Energy, 3/1/79, | ||||||
Preferred Stock | — | 126,250 | — | 142,662 | ||
DTE Energy, Common | ||||||
Stock | 182,956 | — | 166,445 | — | ||
DTE Energy, Corporate | ||||||
Bond, 3.70% | 15,771 | — | — | 16,669 | ||
DTE Energy, Corporate | ||||||
Bond, 3.80% | 63,066 | — | 64,305 | — | ||
DTE Energy, Preferred | ||||||
Stock | 56,960 | — | — | 71,245 | ||
Duke Energy, Common | ||||||
Stock | 161,027 | — | 151,422 | — | ||
Duke Energy, Preferred | ||||||
Stock | 59,976 | — | — | 69,199 | ||
NiSource, Common Stock | 419,299 | — | 150,286 | 308,866 | ||
NiSource, 3.49%, Corporate | ||||||
Bond | 68,269 | — | — | 74,626 | ||
NiSource, 4.375%, | ||||||
Corporate Bond | 36,294 | — | — | 43,384 | ||
NiSource, 5.65%, Corporate | ||||||
Bond | 41,047 | — | — | 44,884 | ||
NiSource, Preferred Stock | 63,852 | — | — | 70,788 | ||
PerkinElmer | 930,423 | 82,228 | 80,004 | 1,006,962 | ||
SCE Trust III, Series H | 26,844 | — | 1,839 | 26,887 | ||
SCE Trust IV, Series J | 54,288 | — | 1,578 | 62,276 | ||
SCE Trust V, Series K | 13,050 | — | 2,606 | * | ||
U.S. Bancorp, 5.30%, | ||||||
Corporate Bond | 21,155 | — | — | 23,883 | ||
U.S. Bancorp, Series F, | ||||||
Preferred Stock | 12,334 | — | — | 12,740 | ||
U.S. Bancorp, Series K, | ||||||
Preferred Stock | 29,628 | — | — | 32,316 | ||
T. Rowe Price Institutional | ||||||
Floating Rate Fund | 78,517 | 3,234 | — | 83,967 | ||
T. Rowe Price Government | ||||||
Reserve Fund | 543,200 | ¤ | ¤ | 5,048,306 | ||
$ 7,267,764^ |
# | Capital gain distributions from mutual funds represented $0 of the net realized gain (loss). |
+ | Investment income comprised $86,297 of dividend income and $7,560 of interest income. |
¤ | Purchase and sale information not shown for cash management funds. |
The accompanying notes are an integral part of this Portfolio of Investments.
T. ROWE PRICE CAPITAL APPRECIATION FUND
^ | The cost basis of investments in affiliated companies was $6,834,469. |
* | On the date indicated, issuer was held but not considered an affiliated company. |
The accompanying notes are an integral part of this Portfolio of Investments.
T. ROWE PRICE CAPITAL APPRECIATION FUND
Unaudited
NOTES TO PORTFOLIO OF
INVESTMENTS
T. Rowe Price Capital Appreciation Fund, Inc. (the fund) is registered under the Investment Company Act of 1940 (the
1940 Act) as an open-end management investment company and follows accounting and reporting guidance of the
Financial Accounting Standards BoardAccounting Standards CodificationTopic 946. The accompanying Portfolio of
Investments was prepared in accordance with accounting principles generally accepted in the United States of America
(GAAP). For additional information on the fund’s significant accounting policies and investment related disclosures,
please refer to the fund’s most recent semiannual or annual shareholder report and its prospectus.
VALUATION
The fund’s financial instruments are valued at the close of the New York Stock Exchange (NYSE), normally 4 p.m. ET,
each day the NYSE is open for business.
Fair Value
The fund’s financial instruments are reported at fair value, which GAAP defines as the price that would be received to
sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement
date. The T. Rowe Price Valuation Committee (the Valuation Committee) is an internal committee that has been
delegated certain responsibilities by the fund’s Board of Directors (the Board) to ensure that financial instruments are
appropriately priced at fair value in accordance with GAAP and the 1940 Act. Subject to oversight by the Board, the
Valuation Committee develops and oversees pricing-related policies and procedures and approves all fair value
determinations. Specifically, the Valuation Committee establishes procedures to value securities; determines pricing
techniques, sources, and persons eligible to effect fair value pricing actions; oversees the selection, services, and
performance of pricing vendors; oversees valuation-related business continuity practices; and provides guidance on
internal controls and valuation-related matters. The Valuation Committee reports to the Board and has representation
from legal, portfolio management and trading, operations, risk management, and the fund’s treasurer.
Various valuation techniques and inputs are used to determine the fair value of financial instruments. GAAP
establishes the following fair value hierarchy that categorizes the inputs used to measure fair value:
Level 1 - quoted prices (unadjusted) in active markets for identical financial instruments that the fund can access at
the reporting date
Level 2 - inputs other than Level 1 quoted prices that are observable, either directly or indirectly (including, but not
limited to, quoted prices for similar financial instruments in active markets, quoted prices for identical or
similar financial instruments in inactive markets, interest rates and yield curves, implied volatilities, and
credit spreads)
Level 3 - unobservable inputs
Observable inputs are developed using market data, such as publicly available information about actual events or
transactions, and reflect the assumptions that market participants would use to price the financial instrument.
Unobservable inputs are those for which market data are not available and are developed using the best information
available about the assumptions that market participants would use to price the financial instrument. GAAP requires
valuation techniques to maximize the use of relevant observable inputs and minimize the use of unobservable inputs.
When multiple inputs are used to derive fair value, the financial instrument is assigned to the level within the fair value
hierarchy based on the lowest-level input that is significant to the fair value of the financial instrument. Input levels are
not necessarily an indication of the risk or liquidity associated with financial instruments at that level but rather the
degree of judgment used in determining those values.
Valuation Techniques
Equity securities listed or regularly traded on a securities exchange or in the over-the-counter (OTC) market are valued
at the last quoted sale price or, for certain markets, the official closing price at the time the valuations are made. OTC
Bulletin Board securities are valued at the mean of the closing bid and asked prices. A security that is listed or traded on
T. ROWE PRICE CAPITAL APPRECIATION FUND
more than one exchange is valued at the quotation on the exchange determined to be the primary market for such
security. Listed securities not traded on a particular day are valued at the mean of the closing bid and asked prices for
domestic securities and the last quoted sale or closing price for international securities.
For valuation purposes, the last quoted prices of non-U.S. equity securities may be adjusted to reflect the fair value of
such securities at the close of the NYSE. If the fund determines that developments between the close of a foreign market
and the close of the NYSE will affect the value of some or all of its portfolio securities, the fund will adjust the previous
quoted prices to reflect what it believes to be the fair value of the securities as of the close of the NYSE. In deciding
whether it is necessary to adjust quoted prices to reflect fair value, the fund reviews a variety of factors, including
developments in foreign markets, the performance of U.S. securities markets, and the performance of instruments
trading in U.S. markets that represent foreign securities and baskets of foreign securities. The fund may also fair value
securities in other situations, such as when a particular foreign market is closed but the fund is open. The fund uses
outside pricing services to provide it with quoted prices and information to evaluate or adjust those prices. The fund
cannot predict how often it will use quoted prices and how often it will determine it necessary to adjust those prices to
reflect fair value. As a means of evaluating its security valuation process, the fund routinely compares quoted prices, the
next day’s opening prices in the same markets, and adjusted prices.
Actively traded equity securities listed on a domestic exchange generally are categorized in Level 1 of the fair value
hierarchy. Non-U.S. equity securities generally are categorized in Level 2 of the fair value hierarchy despite the
availability of quoted prices because, as described above, the fund evaluates and determines whether those quoted prices
reflect fair value at the close of the NYSE or require adjustment. OTC Bulletin Board securities, certain preferred
securities, and equity securities traded in inactive markets generally are categorized in Level 2 of the fair value
hierarchy.
Debt securities generally are traded in the OTC market and are valued at prices furnished by dealers who make markets
in such securities or by an independent pricing service, which considers the yield or price of bonds of comparable
quality, coupon, maturity, and type, as well as prices quoted by dealers who make markets in such securities. Generally,
debt securities are categorized in Level 2 of the fair value hierarchy; however, to the extent the valuations include
significant unobservable inputs, the securities would be categorized in Level 3.
Investments denominated in foreign currencies are translated into U.S. dollar values each day at the prevailing exchange
rate, using the mean of the bid and asked prices of such currencies against U.S. dollars as quoted by a major bank.
Investments in mutual funds are valued at the mutual fund’s closing NAV per share on the day of valuation and are
categorized in Level 1 of the fair value hierarchy. Listed options, and OTC options with a listed equivalent, are valued at
the mean of the closing bid and asked prices and generally are categorized in Level 2 of the fair value hierarchy.
Thinly traded financial instruments and those for which the above valuation procedures are inappropriate or are
deemed not to reflect fair value are stated at fair value as determined in good faith by the Valuation Committee. The
objective of any fair value pricing determination is to arrive at a price that could reasonably be expected from a current
sale. Financial instruments fair valued by the Valuation Committee are primarily private placements, restricted
securities, warrants, rights, and other securities that are not publicly traded.
Subject to oversight by the Board, the Valuation Committee regularly makes good faith judgments to establish and
adjust the fair valuations of certain securities as events occur and circumstances warrant. For instance, in determining
the fair value of an equity investment with limited market activity, such as a private placement or a thinly traded public
company stock, the Valuation Committee considers a variety of factors, which may include, but are not limited to, the
issuer’s business prospects, its financial standing and performance, recent investment transactions in the issuer, new
rounds of financing, negotiated transactions of significant size between other investors in the company, relevant market
valuations of peer companies, strategic events affecting the company, market liquidity for the issuer, and general
economic conditions and events. In consultation with the investment and pricing teams, the Valuation Committee will
determine an appropriate valuation technique based on available information, which may include both observable and
T. ROWE PRICE CAPITAL APPRECIATION FUND
unobservable inputs. The Valuation Committee typically will afford greatest weight to actual prices in arm’s length
transactions, to the extent they represent orderly transactions between market participants, transaction information can
be reliably obtained, and prices are deemed representative of fair value. However, the Valuation Committee may also
consider other valuation methods such as market-based valuation multiples; a discount or premium from market value
of a similar, freely traded security of the same issuer; or some combination. Fair value determinations are reviewed on a
regular basis and updated as information becomes available, including actual purchase and sale transactions of the
issue. Because any fair value determination involves a significant amount of judgment, there is a degree of subjectivity
inherent in such pricing decisions, and fair value prices determined by the Valuation Committee could differ from
those of other market participants. Depending on the relative significance of unobservable inputs, including the
valuation technique(s) used, fair valued securities may be categorized in Level 2 or 3 of the fair value hierarchy.
Valuation Inputs
The following table summarizes the fund’s financial instruments, based on the inputs used to determine their fair values
on September 30, 2019 (for further detail by category, please refer to the accompanying Portfolio of Investments):
($000s) | Level 1 | Level 2 | Level 3 | Total Value | ||||
Assets | ||||||||
Common Stocks | $ | 20,796,035 | $ 503,498 | $ — | $ 21,299,533 | |||
Preferred Stocks | 746,799 | — | — | 746,799 | ||||
Convertible Preferred Stocks | — | 1,121,366 | 25,766 | 1,147,132 | ||||
Corporate Bonds | — | 6,182,858 | — | 6,182,858 | ||||
Fixed Income Securities(1) | — | 102,868 | — | 102,868 | ||||
Bank Loans | — | 1,492,937 | 82,551 | 1,575,488 | ||||
Bond Mutual Funds | 83,967 | — | — | 83,967 | ||||
Short-Term Investments | 5,048,306 | — | — | 5,048,306 | ||||
Total | $ | 26,675,107 | $ 9,403,527 | $ 108,317 | $ 36,186,951 | |||
Liabilities | ||||||||
Options Written | $ | — | $ 306,779 | $ — | $ 306,779 | |||
1 Includes Asset-Backed Securities. |
Following is a reconciliation of the fund’s Level 3 holdings for the period ended September 30, 2019. Gain (loss) reflects
both realized and change in unrealized gain/loss on Level 3 holdings during the period, if any. The change in unrealized
gain/loss on Level 3 instruments held at September 30, 2019, totaled $53,000 for the period ended September 30, 2019.
($000s) | |||||||||||||
Beginning | Ending | ||||||||||||
Balance | Gain (Loss) | Total | Balance | ||||||||||
1/1/19 | During Period | Purchases | Total Sales | 9/30/19 | |||||||||
Investment in Securities | |||||||||||||
Convertible Preferred | |||||||||||||
Stocks | $ | – | $ | – | $ | 25,766 | $ | – | $ | 25,766 | |||
Corporate Bonds | – | – | – | – | – | ||||||||
Bank Loans | – | 61 | 82,883 | (393) | 82,551 | ||||||||
Total | $ | – | $ | 61 | $ | 108,649 | $ | (393) | $ | 108,317 |