T. Rowe Price Blue Chip Growth Fund (TRBCX)
Ticker Symbol:
Fund Status:
Open to new Retail investors  /  Open to subsequent Retail investments
Fund Management
Fund Manager
  • Larry J. Puglia
  • Managed Fund Since: 06/30/1993
  • Joined Firm On 07/16/1990*
  • B.A., University of Notre Dame (Summa cum laude); M.B.A., Darden Graduate School of Business Administration at the University of Virginia (Shermet Scholar, highest honors)

*Firm refers to T. Rowe Price Associates and Affiliates
Quarterly Commentaries
as of 09/30/2015

Large-cap growth stocks declined in a challenging third quarter that started off strong but ended in a correction environment. During the period, the S&P 500 Index experienced its first 10% pullback since 2011, as China's economy (the second largest in the world) began to show signs of slower growth. The Federal Reserve's decision to delay a rate hike after its September meeting contributed to investor uncertainty and heightened volatility. Within the benchmark index, the utilities and consumer staples sectors held up the best, while the energy, materials, and health care sectors posted double-digit declines.

The Blue Chip Growth Fund returned −4.98% in the quarter compared with −6.44% for the S&P 500 Index and −6.55% for the Lipper Large-Cap Growth Funds Index. For the 12 months ended September 30, 2015, the fund returned 5.50% versus −0.61% for the S&P 500 Index and 2.02% for the Lipper Large-Cap Growth Funds Index. The fund's average annual total returns were 5.50%, 16.03%, and 8.76% for the 1-, 5-, and 10-year periods, respectively, as of September 30, 2015. The fund's expense ratio was 0.72% as of its fiscal year ended December 31, 2014.

For up-to-date standardized total returns, including the most recent month-end performance, please click on the Performance tab, above.
Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. Share price, principal value, and return will vary and you may have a gain or loss when you sell your shares.

Benchmark Definitions

We concentrate on investing in high-quality, stable-growth companies that can perform well even if the economy only experiences modest expansion. Our bottom-up stock selection process focuses on large- and mid-cap growth companies that deliver steady revenues, earnings, and cash flow growth. The portfolio's largest sector allocations were in consumer discretionary, information technology, and health care, which together accounted for about three-quarters of the portfolio at the end of the period. The consumer discretionary sector was the portfolio's best absolute and relative performance contributor for the past three months, largely thanks to good stock selection. However, stock selection and a significant overweight allocation to the health care sector hurt absolute and relative results.

We expect large-cap growth stocks to generate moderate fourth-quarter gains as we head into what is typically the seasonally strongest period of the year. Stocks currently appear to be fairly valued based on several fundamental measures, such as price/earnings and price/book value ratios. We believe that year-over-year U.S. corporate revenue and earnings growth will be relatively flat in 2015 compared with 2014, and stock selection will be the primary driver of longer-term outperformance. The recent weakness in China's economy, falling energy and commodity prices, and the potential of a Federal Reserve interest rate hike remain significant near-term uncertainties. In general, we like the prospects for growth stocks that have sound fundamentals and reasonable valuations. Our focus in this environment is on identifying "all seasons" growth companies, those with the ability to increase revenues and earnings, even if global economic growth remains tepid.

See Glossary for additional details on all data elements.