But in 2022 that aggression came back to haunt them.
T. Rowe’s Brutal 2022
These funds earn Morningstar Analyst Ratings of Silver.
- T. Rowe Price Growth Stock PRGFX
- T. Rowe Price Blue Chip Growth TRBCX
- T. Rowe Price New Horizons PRNHX
T. Rowe Price Growth Stock lost 40%, T. Rowe Price Blue Chip Growth lost 39%, and T. Rowe Price New Horizons lost 37%. One common thread throughout the funds was Rivian RIVN, an electric vehicle maker that T. Rowe invested in aggressively only to see its shares fall 82% in 2022. [Correction: While many T. Rowe Price funds held Rivian in 2022, that company was not in T. Rowe Price New Horizons’ portfolio last year.] Other holdings that were hard-hit included Tesla, Amazon AMZN, Meta META, and Spotify SPOT.
T. Rowe generally does strong research to avoid blowups, but last year was a year that punished nearly all high-valuation stocks. And Rivian certainly looks like a mistake at the moment, but all managers make mistakes. Still, the losses were a little surprising at T. Rowe. Both Blue Chip Growth and Growth Stock’s five-year returns are now bottom-decile, though on the plus side, New Horizons is still top-quartile.
Historically, T. Rowe has lost less than most peers in most downturns, but some of their funds are more cautious than others. So, it really is a sobering year for T. Rowe Price, but we’re maintaining our Silver rating on all three of these funds as we see good fundamentals despite a tough year.
The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.