Though Flat, T. Rowe Price Value Is Fine
Manager of T. Rowe Price Value hunts for bargains in tech and media.
Its return so far in 2001 isn't dazzling in absolute terms, but T. Rowe Price Value Fund (TRVLX) is doing just fine. Its 0.78% loss for the year to date through March 26, 2001, is good enough to land it in the mid-value category's top quartile. The fund was just about average for the year 2000, but it notched a nice fourth-quarter rally, posting a 10.27% return that was more than four percentage points higher than the group norm.
Not too surprisingly, the fund's low-tech posture has helped in recent months. The fund's tech weighting, at 7% of assets as of December 31, 2000, is substantially smaller than most mid-value funds' allocations to that sector. Simply put, manager Brian Rogers thought most tech companies were grossly overvalued during 1999 and much of 2000. However, as many of those shares have come crashing to earth in 2000 and 2001, Rogers has taken the opportunity to snap up stocks that he thought had taken too much of a beating. For example, he added more to a position in Microsoft (MSFT) that he started in the second half of last year. He also started positions in Hewlett-Packard (HWP) and Time Warner (AOL) last year, as a cheap way to buy into AOL. Rogers thinks all of these are strong companies with great long-term growth potential, so when he could get them at a discount, he jumped at the chance.
Catherine Hickey does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.