JPMorgan U.S. Value’s talented leader and well-executed approach earn its two cheapest share classes a Morningstar Analyst Rating of Gold, while the rest earn Silver.
Lead manager Clare Hart has masterfully steered this strategy since March 2004. That she skillfully did so alone on a day-to-day basis for the better part of 15 years didn’t stop her from reinforcing her investment team along the way. In 2019, Hart added then-analyst Andrew Brandon and JPMorgan’s corporate governance expert David Silberman as comanagers here—and on Gold-rated sibling strategy JPMorgan Equity Income HLIEX—to help shepherd the sizable asset bases her success had garnered ($10 billion here and $83 billion on that strategy as of March 2022). In both cases, the three managers work closely with two dedicated analysts trained in Hart’s well-rounded investment process and draw upon broader firmwide analytical support.
Hart’s sound approach has proven its worth here. Similar to the equity-income fund, she and the team focus here on competitively advantaged firms with good balance sheets, steady cash flows, and capable managements trading at attractive prices. Unlike its sibling, however, stocks need not pay a dividend, and the managers have more leeway to invest in underappreciated or cyclical firms whose somewhat less-pristine fundamentals offer appealing risk/reward prospects.
That means the 85- to 110-stock portfolio tends to have modestly lower quality characteristics than JPMorgan Equity Income but still much higher than most large-value Morningstar Category rivals. As of March 2022, the portfolio kept more of its assets in companies with a wide Morningstar Economic Moat Rating than nearly four fifths of its peers. Meanwhile, it included wide-moat stocks such as Berkshire Hathaway BRK.B and Alphabet GOOG, whose lack of a dividend disqualifies them from its sibling’s portfolio.
Hart’s deft execution has achieved sparkling long-term returns that have consistently beaten the Russell 1000 Value Index during her tenure: On her watch, the strategy’s monthly rolling three-year returns through April 2022 beat the benchmark 83% of the time.