Docoh
Loading...

Capital Group U.S. Equity Fund

Filed: 30 Jun 21, 12:40pm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM N-CSR

Certified Shareholder Report of

Registered Management Investment Companies

 

Investment Company Act File Number: 811-23469

 

Capital Group U.S. Equity Fund

(Exact Name of Registrant as Specified in Charter)

 

6455 Irvine Center Drive

Irvine, California 92618

(Address of Principal Executive Offices)

 

Registrant's telephone number, including area code: (949) 975-5000

 

Date of fiscal year end: October 31

 

Date of reporting period: April 30, 2021

 

Gregory F. Niland

Capital Group U.S. Equity Fund

5300 Robin Hood Road

Norfolk, Virginia 23513

(Name and Address of Agent for Service)

 
 

 

ITEM 1 – Reports to Stockholders

 

Capital Group U.S. Equity FundSM

 

Semi-annual report
for the six months ended
April 30, 2021

 

 

A U.S.-focused approach
to seeking prudent growth
and preserving wealth

 

 

Capital Group U.S. Equity Fund seeks to provide prudent growth of capital and conservation of principal.

 

This fund is one of more than 40 offered by Capital Group, home of American Funds, one of the nation’s largest mutual fund families. For nearly 90 years, Capital Group has invested with a long-term focus based on thorough research and attention to risk.

 

Fund results shown in this report are at net asset value. Results are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Prices and returns will vary, so investors may lose money. Investing for short periods makes losses more likely. For current and month-end results, visit capitalgroup.com/pcs.

 

Here are the total returns on a $1,000 investment with all distributions reinvested for periods ended March 31, 2021 (the most recent calendar quarter-end), and the total annual fund operating expense ratios as of the prospectus dated January 1, 2021:

 

  Cumulative
total returns
 Average annual
total returns
 Gross Net
  1 year 5 years Lifetime* expense ratio expense ratio
           
Capital Group U.S. Equity Fund  39.30%  14.85%  11.89%  0.45%  0.42%

 

*Since April 1, 2011 (fund inception). The fund is newly organized for the purpose of effecting the reorganization of Capital Group U.S. Equity Fund (the “predecessor fund”) into a new Delaware statutory trust. The fund acquired the assets and assumed the liabilities of the predecessor fund on November 8, 2019, and the predecessor fund is the accounting and performance survivor of the reorganization. This means that the predecessor fund’s performance and financial history have been adopted by the fund and will be used going forward from the date of reorganization. Except where the context indicates otherwise, all references herein to the “fund” include the predecessor fund prior to November 8, 2019. In connection with the reorganization, former shareholders of the predecessor fund received shares of the fund. The performance of the fund includes the performance of the predecessor fund prior to the reorganization.

 

The investment adviser is currently reimbursing a portion of other expenses so that total expenses do not exceed the fund’s unified fee. This reimbursement will be in effect through at least January 1, 2022. The adviser may elect at its discretion to extend, modify or terminate the reimbursement at that time. Visit capitalgroup.com/pcs for more information.

 

Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.

 

Fellow investors:

 

Shown in the table below are Capital Group U.S. Equity Fund’s semi-annual results for the six months ended April 30, 2021. Also shown are the results of its primary benchmark and peer group.

 

For additional information about the fund, its investment results, holdings and portfolio managers, visit capitalgrouppcsfunds.com. You can also read our insights about the markets, industries and more at capitalgroup.com/pcs.

 

Contents
  
1Results at a glance
  
2Investment portfolio
  
6Financial statements
  
9Notes to financial statements
  
15Financial highlights

 

Results at a glance

 

For periods ended April 30, 2021, with all distributions reinvested

 

  Cumulative
total returns
 Average annual
total returns
  6 months 1 year 5 years 10 years Lifetime1
                
Capital Group U.S. Equity Fund2  22.90%  32.31%  15.84%  12.27%  12.38%
Standard & Poor’s 500 Composite Index3  28.85   45.98   17.42   14.17   14.33 
Lipper Growth & Income Funds Average4  24.67   38.41   12.23   10.05   10.21 

 

1Since April 1, 2011 (fund inception).
2The fund is newly organized for the purpose of effecting the reorganization of Capital Group U.S. Equity Fund (the “predecessor fund”) into a new Delaware statutory trust. The fund acquired the assets and assumed the liabilities of the predecessor fund on November 8, 2019, and the predecessor fund is the accounting and performance survivor of the reorganization. This means that the predecessor fund’s performance and financial history have been adopted by the fund and will be used going forward from the date of reorganization. Except where the context indicates otherwise, all references herein to the “fund” include the predecessor fund prior to November 8, 2019. In connection with the reorganization, former shareholders of the predecessor fund received shares of the fund. The performance of the fund includes the performance of the predecessor fund prior to the reorganization.
3S&P source: S&P Dow Jones Indices LLC. The market index is unmanaged and, therefore, has no expenses. Investors cannot invest directly in an index.
4Lipper source: Refinitiv Lipper. Lipper averages reflect the current composition of all eligible mutual funds (all share classes) within a given category. Lipper categories are dynamic and averages may have few funds, especially over longer periods. To see the number of funds included in the Lipper category for each fund’s lifetime, please see the Quarterly Statistical Update, available on our website.

 

Capital Group U.S. Equity Fund1
 
Investment portfolio April 30, 2021unaudited
  
Industry sector diversificationPercent of net assets
  
  
Country diversification by domicilePercent of
net assets
United States  89.41%
Eurozone*  3.69 
Denmark  1.54 
United Kingdom  1.50 
Switzerland  .81 
Canada  .48 
Taiwan  .28 
Short-term securities & other assets less liabilities  2.29 
     
*Countries using the euro as a common currency; those represented in the fund’s portfolio are Belgium, France, Germany and the Netherlands.
       
Common stocks 97.71% Shares  Value
(000)
 
Information technology 21.59%        
Microsoft Corp.  60,031  $15,139 
Visa Inc., Class A  54,968   12,838 
Apple Inc.  45,798   6,021 
ASML Holding NV (New York registered) (ADR)  8,440   5,470 
Broadcom Inc.  9,881   4,508 
Fidelity National Information Services, Inc.  23,660   3,618 
Adobe Inc.1  6,918   3,517 
KLA Corp.  8,920   2,813 
Intel Corp.  42,400   2,439 
GoDaddy Inc., Class A1  25,000   2,170 
Lam Research Corp.  3,170   1,967 
Jack Henry & Associates, Inc.  10,922   1,778 
Texas Instruments Inc.  8,562   1,545 
FleetCor Technologies, Inc.1  4,740   1,364 
SAP SE (ADR)  8,100   1,133 
Accenture PLC, Class A  3,330   966 
Taiwan Semiconductor Manufacturing Company, Ltd. (ADR)  7,500   876 
Elastic NV, non-registered shares1  5,200   627 
       68,789 
         
Financials 15.11%        
Marsh & McLennan Companies, Inc.  59,290   8,046 
JPMorgan Chase & Co.  39,430   6,065 
Chubb Ltd.  31,780   5,453 
Aon PLC, Class A  20,800   5,230 
Intercontinental Exchange, Inc.  29,350   3,455 
Moody’s Corp.  9,375   3,063 
Truist Financial Corp.  47,423   2,813 
CME Group Inc., Class A  13,875   2,802 
State Street Corp.  31,687   2,660 
MSCI Inc.  4,200   2,040 
Discover Financial Services  15,200   1,733 
Arthur J. Gallagher & Co.  10,300   1,493 
First Republic Bank  7,000   1,283 
Travelers Companies, Inc.  7,100   1,098 
Nasdaq, Inc.  5,550   896 
       48,130 
         
Health care 13.08%        
UnitedHealth Group Inc.  19,052   7,598 
Seagen Inc.1  27,605   3,968 
Danaher Corp.  15,573   3,955 
Eli Lilly and Company  20,800   3,802 
         
2Capital Group U.S. Equity Fund
 
Common stocks (continued) Shares  Value
(000)
 
Health care (continued)        
Abbott Laboratories  27,515  $3,304 
Anthem, Inc.  7,375   2,798 
Edwards Lifesciences Corp.1  25,350   2,421 
AstraZeneca PLC (ADR)2  43,650   2,316 
Humana Inc.  4,785   2,130 
Gilead Sciences, Inc.  26,924   1,709 
Novo Nordisk A/S, Class B (ADR)  17,100   1,265 
Merck & Co., Inc.  16,000   1,192 
Cigna Corp.  4,565   1,137 
Neurocrine Biosciences, Inc.1  10,200   964 
Centene Corp.1  11,600   716 
Roche Holding AG (ADR)  16,600   676 
Ultragenyx Pharmaceutical Inc.1  5,100   569 
Vertex Pharmaceuticals Inc.1  2,300   502 
Biohaven Pharmaceutical Holding Co. Ltd.1  6,200   466 
Allogene Therapeutics, Inc.1  6,400   198 
       41,686 
         
Industrials 10.86%        
Waste Connections, Inc.  45,710   5,445 
Northrop Grumman Corp.  12,170   4,314 
CSX Corp.  40,950   4,126 
Norfolk Southern Corp.  8,296   2,317 
TransDigm Group Inc.1  3,385   2,077 
AMETEK, Inc.  14,500   1,956 
Carrier Global Corp.  42,831   1,867 
HEICO Corp.  8,600   1,211 
HEICO Corp., Class A  3,000   379 
Airbus Group SE (ADR)1  50,200   1,506 
Waste Management, Inc.  10,620   1,465 
Deere & Company  3,200   1,187 
ITT Inc.  12,400   1,169 
Honeywell International Inc.  5,100   1,137 
RELX PLC (ADR)  42,140   1,099 
Raytheon Technologies Corp.  10,900   907 
Equifax Inc.  3,750   860 
Trinity Industries, Inc.  28,566   790 
BWX Technologies, Inc.  11,555   773 
       34,585 
         
Communication services 9.88%        
Alphabet Inc., Class C1  2,377   5,729 
Charter Communications, Inc., Class A1  7,976   5,371 
Comcast Corp., Class A  92,140   5,173 
Facebook, Inc., Class A1  13,200   4,291 
Activision Blizzard, Inc.  38,840   3,542 
Cable One, Inc.  1,948   3,487 
Netflix, Inc.1  5,827   2,992 
Electronic Arts Inc.  6,200   881 
       31,466 
         
Consumer discretionary 7.96%        
Amazon.com, Inc.1  2,313   8,020 
Chipotle Mexican Grill, Inc.1  3,400   5,073 
NIKE, Inc., Class B  27,605   3,661 
Dollar General Corp.  13,444   2,887 
Hilton Worldwide Holdings Inc.1  17,448   2,246 
YUM! Brands, Inc.  13,277   1,587 
EssilorLuxottica (ADR)  14,080   1,167 
Darden Restaurants, Inc.  4,900   719 
       25,360 
         
Capital Group U.S. Equity Fund3
 
Common stocks (continued) Shares  Value
(000)
 
Consumer staples 7.46%        
Philip Morris International Inc.  42,282  $4,017 
Carlsberg A/S, Class B (ADR)  86,325   3,029 
Anheuser-Busch InBev SA/NV (ADR)  35,100   2,491 
Estée Lauder Companies Inc., Class A  6,687   2,098 
Nestlé SA (ADR)  15,955   1,907 
Procter & Gamble Company  13,036   1,739 
Mondelez International, Inc.  28,300   1,721 
Costco Wholesale Corp.  3,850   1,433 
PepsiCo, Inc.  9,583   1,381 
British American Tobacco PLC (ADR)  36,219   1,359 
General Mills, Inc.  18,816   1,145 
Hormel Foods Corp.  17,200   795 
Church & Dwight Co., Inc.  7,500   643 
       23,758 
         
Real estate 3.78%        
Equinix, Inc. REIT  7,350   5,298 
Crown Castle International Corp. REIT  24,550   4,641 
American Tower Corp. REIT  8,225   2,095 
       12,034 
         
Energy 2.79%        
Chevron Corp.  34,940   3,601 
ConocoPhillips  45,709   2,337 
EOG Resources, Inc.  31,098   2,290 
TC Energy Corp.  13,700   678 
       8,906 
         
Materials 2.75%        
Linde PLC  12,980   3,710 
Air Products and Chemicals, Inc.  7,908   2,282 
Sherwin-Williams Company  6,960   1,906 
Barrick Gold Corp.  40,000   850 
       8,748 
         
Utilities 2.45%        
Sempra Energy  13,320   1,833 
Exelon Corp.  39,883   1,792 
NextEra Energy, Inc.  18,000   1,395 
AES Corp.  44,000   1,224 
CenterPoint Energy, Inc.  39,707   972 
Ørsted AS (ADR)  12,200   594 
       7,810 
         
Total common stocks (cost: $158,266,000)      311,272 
         
Short-term securities 2.89%        
Money market investments 2.24%        
Capital Group Central Cash Fund 0.06%3,4  71,493   7,150 
         
4Capital Group U.S. Equity Fund
 
Short-term securities (continued) Shares  Value
(000)
 
Money market investments purchased with cash collateral from securities on loan 0.65%     
Goldman Sachs Financial Square Government Fund, Institutional Shares 0.03%3,5  1,690,872  $1,691 
Capital Group Central Cash Fund 0.06%3,4,5  3,684   369 
       2,060 
         
Total short-term securities (cost: $9,208,000)      9,210 
Total investment securities 100.60% (cost: $167,474,000)      320,482 
Other assets less liabilities (0.60)%      (1,898)
         
Net assets 100.00%     $318,584 

 

Investments in affiliates4

 

  Value of
affiliates at
11/1/2020
(000)
  Additions
(000)
  Reductions
(000)
  Net
realized
gain
(000)
  Net
unrealized
depreciation
(000)
  Value of
affiliates at
4/30/2021
(000)
  Dividend
income
(000)
 
Short-term securities 2.36%                            
Money market investments 2.24%                            
Capital Group Central Cash Fund 0.06%3 $10,533  $24,351  $27,734  $6  $6  $7,150  $5 
Money market investments purchased with cash collateral from securities on loan 0.12%                            
Capital Group Central Cash Fund 0.06%3,5     3697               369        —8 
Total short-term securities                      7,519     
Total 2.36%             $6  $6  $7,519  $5 
                             
1Security did not produce income during the last 12 months.
2All or a portion of this security was on loan. The total value of all such securities was $2,239,000, which represented .70% of the net assets of the fund. Refer to Note 5 for more information on securities lending.
3Rate represents the seven-day yield at 4/30/2021.
4Part of the same group of investment companies as the fund as defined under the Investment Company Act of 1940.
5Security purchased with cash collateral from securities on loan. Refer to Note 5 for more information on securities lending.
6Amount less than one thousand.
7Represents net activity. Refer to Note 5 for more information on securities lending.
8Information not shown. Dividend income is included with securities lending income in the fund’s statement of operations.

 

Key to abbreviation

ADR = American Depositary Receipts

 

See notes to financial statements.

 

Capital Group U.S. Equity Fund5
 

Financial statements

 

Statement of assets and liabilitiesunaudited
at April 30, 2021(dollars in thousands)

 

Assets:        
Investment securities, at value (includes $2,239 of investment securities on loan):        
Unaffiliated issuers (cost: $159,956) $312,963     
Affiliated issuers (cost: $7,518)  7,519  $320,482 
Cash      50 
Cash denominated in currencies other than U.S. dollars (cost: $8)      8 
Cash collateral received for securities on loan      228 
Receivables for:        
Sales of fund’s shares  25     
Dividends  268     
Securities lending income  *  293 
       321,061 
Liabilities:        
Collateral for securities on loan      2,288 
Payables for:        
Purchases of investments  77     
Investment advisory services  110     
Other  2   189 
Net assets at April 30, 2021     $318,584 
         
Net assets consist of:        
Capital paid in on shares of beneficial interest     $152,674 
Total distributable earnings      165,910 
Net assets at April 30, 2021     $318,584 

 

*Amount less than one thousand.

 

(dollars and shares in thousands, except per-share amounts)

 

Shares of beneficial interest issued and outstanding (no stated par value) —
unlimited shares authorized (10,403 total shares outstanding)

  Net assets  Shares
outstanding
  Net asset value
per share
 
Class M $318,584   10,403  $30.62 

 

See notes to financial statements.

 

6Capital Group U.S. Equity Fund
 

Financial statements (continued)

 

Statement of operationsunaudited
for the six months ended April 30, 2021(dollars in thousands)

 

Investment income:        
Income:        
Dividends (net of non-U.S. taxes of $37; also includes $5 from affiliates) $2,259     
Securities lending income (net of fees)  3     
Interest  * $2,262 
Fees and expenses:        
Investment advisory services  629     
Trustees’ compensation  13     
Legal  *    
Total fees and expenses before reimbursement  642     
Less reimbursement of fees and expenses:        
Miscellaneous fee reimbursement  13     
Total fees and expenses after reimbursement      629 
Net investment income      1,633 
         
Net realized gain and unrealized appreciation:        
Net realized gain on:        
Investments:        
Unaffiliated issuers  12,673     
Affiliated issuers  *    
Currency transactions  1   12,674 
Net unrealized appreciation on:        
Investments:        
Unaffiliated issuers  45,838     
Affiliated issuers  *  45,838 
Net realized gain and unrealized appreciation      58,512 
         
Net increase in net assets resulting from operations     $60,145 

 

*Amount less than one thousand.
Additional information related to class-specific fees and expenses is included in the notes to financial statements.

 

See notes to financial statements.

 

Capital Group U.S. Equity Fund7
 

Financial statements (continued)

 

Statements of changes in net assets 
 (dollars in thousands)

 

  Six months ended
April 30,
2021*
  Year ended
October 31,
2020
 
Operations:        
Net investment income $1,633  $2,903 
Net realized gain  12,674   5,844 
Net unrealized appreciation  45,838   12,306 
Net increase in net assets resulting from operations  60,145   21,053 
         
Distributions paid to shareholders  (7,066)  (10,739)
         
Net capital share transactions  2,110   8,756 
         
Total increase in net assets  55,189   19,070 
         
Net assets:        
Beginning of period  263,395   244,325 
End of period $318,584  $263,395 

 

*Unaudited.

 

See notes to financial statements.

 

8Capital Group U.S. Equity Fund
 
Notes to financial statementsunaudited

 

1. Organization

 

Capital Group U.S. Equity Fund (the “fund”) is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. On September 16, 2019, the fund’s board approved the reorganization of Capital Group U.S. Equity Fund (the “predecessor fund”) into a new Delaware statutory trust. On November 8, 2019, the fund acquired the assets and assumed the liabilities of the predecessor fund. The fund’s fiscal year ends on October 31. The fund seeks to provide prudent growth of capital and conservation of principal.

 

2. Significant accounting policies

 

The fund is an investment company that applies the accounting and reporting guidance issued in Topic 946 by the U.S. Financial Accounting Standards Board. The fund’s financial statements have been prepared to comply with U.S. generally accepted accounting principles (“U.S. GAAP”). These principles require the fund’s investment adviser to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. Subsequent events, if any, have been evaluated through the date of issuance in the preparation of the financial statements. The fund follows the significant accounting policies described in this section, as well as the valuation policies described in the next section on valuation.

 

Security transactions and related investment income — Security transactions are recorded by the fund as of the date the trades are executed with brokers. Realized gains and losses from security transactions are determined based on the specific identified cost of the securities. In the event a security is purchased with a delayed payment date, the fund will segregate liquid assets sufficient to meet its payment obligations. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security.

 

Distributions paid to shareholders — Income dividends and capital gain distributions are recorded on the ex-dividend date.

 

Currency translation — Assets and liabilities, including investment securities, denominated in currencies other than U.S. dollars are translated into U.S. dollars at the exchange rates supplied by one or more pricing vendors on the valuation date. Purchases and sales of investment securities and income and expenses are translated into U.S. dollars at the exchange rates on the dates of such transactions. The effects of changes in exchange rates on investment securities are included with the net realized gain or loss and net unrealized appreciation or depreciation on investments in the fund’s statement of operations. The realized gain or loss and unrealized appreciation or depreciation resulting from all other transactions denominated in currencies other than U.S. dollars are disclosed separately.

 

3. Valuation

 

Capital Research and Management Company (“CRMC”), the fund’s investment adviser, values the fund’s investments at fair value as defined by U.S. GAAP. The net asset value per share is calculated once daily as of the close of regular trading on the New York Stock Exchange, normally 4 p.m. New York time, each day the New York Stock Exchange is open.

 

Methods and inputs — The fund’s investment adviser uses the following methods and inputs to establish the fair value of the fund’s assets and liabilities. Use of particular methods and inputs may vary over time based on availability and relevance as market and economic conditions evolve.

 

Equity securities are generally valued at the official closing price of, or the last reported sale price on, the exchange or market on which such securities are traded, as of the close of business on the day the securities are being valued or, lacking any sales, at the last available bid price. Prices for each security are taken from the principal exchange or market on which the security trades.

 

Fixed-income securities, including short-term securities, are generally valued at prices obtained from one or more pricing vendors. Vendors value such securities based on one or more of the inputs described in the following table. The table provides examples of inputs that are commonly relevant for valuing particular classes of fixed-income securities in which the fund is authorized to invest. However, these classifications are not exclusive, and any of the inputs may be used to value any other class of fixed-income security.

 

Capital Group U.S. Equity Fund9

 

Fixed-income class Examples of standard inputs
All Benchmark yields, transactions, bids, offers, quotations from dealers and trading systems, new issues, spreads and other relationships observed in the markets among comparable securities; and proprietary pricing models such as yield measures calculated using factors such as cash flows, financial or collateral performance and other reference data (collectively referred to as “standard inputs”)
Corporate bonds, notes & loans; convertible securities Standard inputs and underlying equity of the issuer
Bonds & notes of governments & government agencies Standard inputs and interest rate volatilities

 

When the fund’s investment adviser deems it appropriate to do so (such as when vendor prices are unavailable or deemed to be not representative), fixed-income securities will be valued in good faith at the mean quoted bid and ask prices that are reasonably and timely available (or bid prices, if ask prices are not available) or at prices for securities of comparable maturity, quality and type.

 

Securities with both fixed-income and equity characteristics, or equity securities traded principally among fixed-income dealers, are generally valued in the manner described for either equity or fixed-income securities, depending on which method is deemed most appropriate by the fund’s investment adviser. The Capital Group Central Cash Fund (“CCF”), a fund within the Capital Group Central Fund Series (“Central Funds”), is valued based upon a floating net asset value, which fluctuates with changes in the value of CCF’s portfolio securities. The underlying securities are valued based on the policies and procedures in CCF’s statement of additional information.

 

Securities and other assets for which representative market quotations are not readily available or are considered unreliable by the fund’s investment adviser are fair valued as determined in good faith under fair valuation guidelines adopted by authority of the fund’s board of trustees as further described. The investment adviser follows fair valuation guidelines, consistent with U.S. Securities and Exchange Commission rules and guidance, to consider relevant principles and factors when making fair value determinations. The investment adviser considers relevant indications of value that are reasonably and timely available to it in determining the fair value to be assigned to a particular security, such as the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; significant events occurring after the close of trading in the security; and changes in overall market conditions. In addition, the closing prices of equity securities that trade in markets outside U.S. time zones may be adjusted to reflect significant events that occur after the close of local trading but before the net asset value of each share class of the fund is determined. Fair valuations and valuations of investments that are not actively trading involve judgment and may differ materially from valuations that would have been used had greater market activity occurred.

 

Processes and structure — The fund’s board of trustees has delegated authority to the fund’s investment adviser to make fair value determinations, subject to board oversight. The investment adviser has established a Joint Fair Valuation Committee (the “Fair Valuation Committee”) to administer, implement and oversee the fair valuation process, and to make fair value decisions. The Fair Valuation Committee regularly reviews its own fair value decisions, as well as decisions made under its standing instructions to the investment adviser’s valuation teams. The Fair Valuation Committee reviews changes in fair value measurements from period to period and may, as deemed appropriate, update the fair valuation guidelines to better reflect the results of back testing and address new or evolving issues. The Fair Valuation Committee reports any changes to the fair valuation guidelines to the board of trustees. The fund’s board and audit committee also regularly review reports that describe fair value determinations and methods.

 

The fund’s investment adviser has also established a Fixed-Income Pricing Review Group to administer and oversee the fixed-income valuation process, including the use of fixed-income pricing vendors. This group regularly reviews pricing vendor information and market data. Pricing decisions, processes and controls over security valuation are also subject to additional internal reviews, including an annual control self-evaluation program facilitated by the investment adviser’s compliance group.

 

Classifications — The fund’s investment adviser classifies the fund’s assets and liabilities into three levels based on the inputs used to value the assets or liabilities. Level 1 values are based on quoted prices in active markets for identical securities. Level 2 values are based on significant observable market inputs, such as quoted prices for similar securities and quoted prices in inactive markets. Certain securities trading outside the U.S. may transfer between Level 1 and Level 2 due to valuation adjustments resulting from significant market movements following the close of local trading. Level 3 values are based on significant unobservable inputs that reflect the investment adviser’s determination of assumptions that market participants might reasonably use in valuing the securities. The valuation levels are not necessarily an indication of the risk or liquidity associated with the underlying investment. For example, U.S. government securities are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market. At April 30, 2021, all of the fund’s investments were classified as Level 1.

 

10Capital Group U.S. Equity Fund

 

4. Risk factors

 

Market conditions — The prices of, and the income generated by, the securities held by the fund may decline — sometimes rapidly or unpredictably — due to various factors, including events or conditions affecting the general economy or particular industries; overall market changes; local, regional or global political, social or economic instability; governmental, governmental agency or central bank responses to economic conditions; and currency exchange rate, interest rate and commodity price fluctuations.

 

Economies and financial markets throughout the world are highly interconnected. Economic, financial or political events, trading and tariff arrangements, wars, terrorism, cybersecurity events, natural disasters, public health emergencies (such as the spread of infectious disease) and other circumstances in one country or region, including actions taken by governmental or quasi-governmental authorities in response to any of the foregoing, could have impacts on global economies or markets. As a result, whether or not the fund invests in securities of issuers located in or with significant exposure to the countries affected, the value and liquidity of the fund’s investments may be negatively affected by developments in other countries and regions.

 

Issuer risks — The prices of, and the income generated by, securities held by the fund may decline in response to various factors directly related to the issuers of such securities, including reduced demand for an issuer’s goods or services, poor management performance, major litigation, investigations or other controversies related to the issuer, changes in government regulations affecting the issuer or its competitive environment and strategic initiatives such as mergers, acquisitions or dispositions and the market response to any such initiatives.

 

Investing in growth-oriented stocks — Growth-oriented common stocks and other equity-type securities (such as preferred stocks, convertible preferred stocks and convertible bonds) may involve larger price swings and greater potential for loss than other types of investments.

 

Investing in income-oriented stocks — The value of the fund’s securities and income provided by the fund may be reduced by changes in the dividend policies of, and the capital resources available for dividend payments at, the companies in which the fund invests.

 

Investing outside the U.S. — Securities of issuers domiciled outside the U.S., or with significant operations or revenues outside the U.S., may lose value because of adverse political, social, economic or market developments (including social instability, regional conflicts, terrorism and war) in the countries or regions in which the issuers operate or generate revenue. These securities may also lose value due to changes in foreign currency exchange rates against the U.S. dollar and/or currencies of other countries. Issuers of these securities may be more susceptible to actions of foreign governments, such as nationalization, currency blockage or the imposition of price controls or punitive taxes, each of which could adversely impact the value of these securities. Securities markets in certain countries may be more volatile and/or less liquid than those in the U.S. Investments outside the U.S. may also be subject to different accounting practices and different regulatory, legal and reporting standards and practices, and may be more difficult to value, than those in the U.S. In addition, the value of investments outside the U.S. may be reduced by foreign taxes, including foreign withholding taxes on interest and dividends. Further, there may be increased risks of delayed settlement of securities purchased or sold by the fund. The risks of investing outside the U.S may be heightened in connection with investments in emerging markets.

 

Management — The investment adviser to the fund actively manages the fund’s investments. Consequently, the fund is subject to the risk that the methods and analyses, including models, tools and data, employed by the investment adviser in this process may be flawed or incorrect and may not produce the desired results. This could cause the fund to lose value or its investment results to lag relevant benchmarks or other funds with similar objectives.

 

5. Certain investment techniques

 

Securities lending — The fund has entered into securities lending transactions in which the fund earns income by lending investment securities to brokers, dealers or other institutions. Each transaction involves three parties: the fund, acting as the lender of the securities, a borrower, and a lending agent that acts as an intermediary.

 

Securities lending transactions are entered into by the fund under a securities lending agent agreement with the lending agent. The lending agent facilitates the exchange of securities between the fund and approved borrowers, ensures that securities loans are properly coordinated and documented, marks-to-market the value of collateral daily, secures additional collateral from a borrower if it falls below preset terms, and may reinvest cash collateral on behalf of the fund according to agreed parameters. The lending agent provides indemnification to the fund against losses resulting from a borrower default. Although risk is mitigated by the collateral and indemnification, the fund could experience a delay in recovering its securities and a potential loss of income or value if a borrower fails to return securities, collateral investments decline in value or the lending agent fails to perform.

 

Capital Group U.S. Equity Fund11

 

The borrower is required to post highly liquid assets, such as cash or U.S. government securities, as collateral for the loan in an amount at least equal to the value of the securities loaned. Investments made with cash collateral are recognized as assets in the fund’s investment portfolio. The same amount is recorded as a liability in the fund’s statement of assets and liabilities. While securities are on loan, the fund will continue to receive the equivalent of the interest, dividends or other distributions paid by the issuer, as well as a portion of the interest on the investment of the collateral. Additionally, although the fund does not have the right to vote on securities while they are on loan, the fund has a right to consent on corporate actions and a right to recall loaned securities to vote. A borrower is obligated to return loaned securities at the conclusion of a loan or, during the pendency of a loan, on demand from the fund.

 

As of April 30, 2021, the total value of securities on loan was $2,239,000, and the total value of collateral received was $2,288,000, which consisted entirely of cash. Investment securities purchased with cash collateral are disclosed in the investment portfolio as short-term securities. Securities received as collateral, if any, are not recognized as fund assets. The contractual maturity of cash collateral received under the securities lending agreement is classified as overnight and continuous.

 

Collateral — The fund receives highly liquid assets, such as cash or U.S. government securities, as collateral in exchange for lending investment securities. The purpose of the collateral is to cover potential losses that could occur in the event the borrower cannot meet its contractual obligation. The lending agent may reinvest cash collateral from securities lending transactions according to agreed parameters. Cash collateral reinvested by the lending agent, if any, is disclosed in the fund’s investment portfolio.

 

6. Taxation and distributions

 

Federal income taxation — The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income and net capital gains each year. The fund is not subject to income taxes to the extent such distributions are made. Therefore, no federal income tax provision is required.

 

As of and during the period ended April 30, 2021, the fund did not have a liability for any unrecognized tax benefits. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the statement of operations. During the period, the fund did not incur any significant interest or penalties.

 

The fund’s tax returns are generally not subject to examination by federal, state and, if applicable, non-U.S. tax authorities after the expiration of each jurisdiction’s statute of limitations, which is typically three years after the date of filing but can be extended in certain jurisdictions.

 

Non-U.S. taxation — Dividend income is recorded net of non-U.S. taxes paid. The fund may file withholding tax reclaims in certain jurisdictions to recover a portion of amounts previously withheld. These reclaims are recorded when the amount is known and there are no significant uncertainties on collectability. Gains realized by the fund on the sale of securities in certain countries, if any, may be subject to non-U.S. taxes. If applicable, the fund records an estimated deferred tax liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities.

 

Distributions — Distributions determined on a tax basis may differ from net investment income and net realized gains for financial reporting purposes. These differences are due primarily to different treatment for items such as currency gains and losses and short-term capital gains and losses. The fiscal year in which amounts are distributed may differ from the year in which the net investment income and net realized gains are recorded by the fund for financial reporting purposes.

 

The components of distributable earnings on a tax basis are reported as of the fund’s most recent year-end. As of October 31, 2020, the components of distributable earnings on a tax basis were as follows (dollars in thousands):

 

Undistributed ordinary income $213 
Undistributed long-term capital gains  5,499 

 

As of April 30, 2021, the tax basis unrealized appreciation (depreciation) and cost of investments were as follows (dollars in thousands):

 

Gross unrealized appreciation on investments $153,416 
Gross unrealized depreciation on investments  (459)
Net unrealized appreciation on investments  152,957 
Cost of investments  167,525 

 

12Capital Group U.S. Equity Fund

 

Distributions paid were characterized for tax purposes as follows (dollars in thousands):

 

  Six months ended April 30, 2021 Year ended October 31, 2020
Share class Ordinary
income
  Long-term
capital gains
  Total
distributions
paid
  Ordinary
income
  Long-term
capital gains
  Total
distributions
paid
 
Class M $1,567  $5,499  $7,066  $2,946  $7,793  $10,739 

 

7. Fees and transactions with related parties

 

CRMC, the fund’s investment adviser, is the parent company of American Funds Distributors®, Inc. (“AFD”), the principal underwriter of the fund’s share, and American Funds Service Company® (“AFS”), the fund’s transfer agent. CRMC, AFD and AFS are considered related parties to the fund.

 

Investment advisory services — The fund has an investment advisory and service agreement with CRMC that provides for monthly fees accrued daily. For the services it provides to the fund, CRMC receives a unified management fee of 0.425% of the daily net assets of the fund. Out of the fund’s unified management fee CRMC pays all expenses of managing and operating the fund except brokerage expenses, taxes, interest, fees and expenses of the independent trustees (including legal counsel fees) and extraordinary expenses, such as litigation expenses. These expenses, which are not paid by CRMC from the unified management fee, are paid by the fund, which are currently reimbursed by CRMC.

 

Miscellaneous fee reimbursement — Expense limitations have been imposed through at least January 1, 2021, to limit the share class’s total annual operating expense to 0.425% as a percentage of daily net assets. For the period ended April 30, 2021, CRMC reimbursed miscellaneous fees of $13,000 for the fund. CRMC may recoup all or a portion of this reimbursement by the end of the current fiscal year. Fees and expenses in the statement of operations are presented gross of any reimbursements from CRMC.

 

Affiliated officers and trustees — Officers and certain trustees of the fund are or may be considered to be affiliated with CRMC. No affiliated officers or trustees received any compensation directly from the fund.

 

Investment in CCF — The fund holds shares of CCF, an institutional prime money market fund managed by CRMC. CCF invests in high-quality, short-term money market instruments. CCF is used as the primary investment vehicle for the fund’s short-term investments. CCF shares are only available for purchase by CRMC, its affiliates, and other funds managed by CRMC or its affiliates, and are not available to the public. CRMC does not receive an investment advisory services fee from CCF.

 

Security transactions with related funds — The fund purchased securities from, and sold securities to, other funds managed by CRMC (or funds managed by certain affiliates of CRMC) under procedures adopted by the fund’s board of trustees. The funds involved in such transactions are considered related by virtue of having a common investment adviser (or affiliated investment advisers), common trustees and/or common officers. Each transaction was executed at the current market price of the security and no brokerage commissions or fees were paid in accordance with Rule 17a-7 of the 1940 Act. During the six months ended April 30, 2021, the fund engaged in such purchase and sale transactions with related funds in the amounts of $745,000 and $1,709,000, respectively, which generated $985,000 of net realized gains from such sales.

 

Interfund lending — Pursuant to an exemptive order issued by the SEC, the fund, along with other CRMC-managed funds (or funds managed by certain affiliates of CRMC), may participate in an interfund lending program. The program provides an alternate credit facility that permits the funds to lend or borrow cash for temporary purposes directly to or from one another, subject to the conditions of the exemptive order. The fund did not lend or borrow cash through the interfund lending program at any time during the six months ended April 30, 2021.

 

8. Indemnifications

 

The fund’s organizational documents provide board members and officers with indemnification against certain liabilities or expenses in connection with the performance of their duties to the fund. In the normal course of business, the fund may also enter into contracts that provide general indemnifications. The fund’s maximum exposure under these arrangements is unknown since it is dependent on future claims that may be made against the fund. The risk of material loss from such claims is considered remote. Insurance policies are also available to the fund’s board members and officers.

 

Capital Group U.S. Equity Fund13

 

9. Capital share transactions

 

Capital share transactions in the fund were as follows (dollars and shares in thousands):

 

  Sales  Reinvestments of
distributions
  Repurchases  Net increase 
Share class Amount  Shares  Amount  Shares  Amount  Shares  Amount  Shares 
                         
Six months ended April 30, 2021                        
Class M $14,319   506  $6,899   249  $(19,108)  (666) $2,110   89 
                                 
Year ended October 31, 2020                                
Class M $25,632   1,042  $10,453   423  $(27,329)  (1,094) $8,756   371 

 

10. Investment transactions

 

The fund made purchases and sales of investment securities, excluding short-term securities and U.S. government obligations, if any, of $37,134,000 and $36,267,000, respectively, during the six months ended April 30, 2021.

 

14Capital Group U.S. Equity Fund

 

Financial highlights

 

     Income from investment operations1  Dividends and distributions                   
Year ended Net asset
value,
beginning
of period
  Net
investment
income
  Net gains on
securities (both
realized and
unrealized)
  Total from
investment
operations
  Dividends
(from net
investment
income)
  Distributions
(from capital
gains)
  Total
dividends
and
distributions
  Net asset
value, end
of period
  Total
return2
  Net assets,
end of
period
(in millions)
  Ratio of
expenses to
average net
assets before
reimbursements3
  Ratio of
expenses to
average net
assets after
reimbursements2,3
  Ratio of
net income
to average
net assets2
 
4/30/20214,5 $25.54  $.16  $5.61  $5.77  $(.15) $(.54) $(.69) $30.62   22.90%6  $319   .43%7   .43%7   1.11%7 
10/31/2020  24.57   .28   1.77   2.05   (.29)  (.79)  (1.08)  25.54   8.51   263   .45   .42   1.12 
10/31/2019  22.78   .34   3.27   3.61   (.35)  (1.47)  (1.82)  24.57   17.65   244   .45   .42   1.49 
10/31/2018  22.95   .34   .85   1.19   (.29)  (1.07)  (1.36)  22.78   5.30   223   .44   .43   1.45 
10/31/2017  19.78   .32   4.02   4.34   (.31)  (.86)  (1.17)  22.95   22.76   236   .53   .52   1.52 
10/31/2016  19.88   .33   .55   .88   (.30)  (.68)  (.98)  19.78   4.58   210   .66   .65   1.68 

 

  Six months ended Year ended October 31,
  April 30, 20214,5,6 2020 2019 2018 2017 2016
Portfolio turnover rate for all share classes8  13%  19%  16%  22%  19%  31%

 

1Based on average shares outstanding.
2This column reflects the impact, if any, of certain reimbursements from CRMC. During some of the periods shown, CRMC reimbursed a portion of miscellaneous fees and expenses.
3Ratios do not include expenses of any Central Funds. The fund indirectly bears its proportionate share of the expenses of any Central Funds.
4Based on operations for a period that is less than a full year.
5Unaudited.
6Not annualized.
7Annualized.
8Rates do not include the fund’s portfolio activity with respect to any Central Funds.

 

See notes to financial statements.

 

Capital Group U.S. Equity Fund15
 
Expense exampleunaudited

 

As a shareholder of the fund, you incur ongoing costs, including management fees and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six-month period (November 1, 2020, through April 30, 2021).

 

Actual expenses:

The first line in the table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading titled “Expenses paid during period” to estimate the expenses you paid on your account during this period.

 

Hypothetical example for comparison purposes:

The second line in the table provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds.

 

Notes:

Shareholders of the fund may be subject to an additional fee charged by CRMC’s Capital Group Private Client Services division for the ongoing services provided to the shareholder. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would be lower by the amount of these fees. Note that the expenses shown in the table are meant to highlight your ongoing costs only. The second line in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds.

 

  Beginning
account value
11/1/2020
  Ending
account value
4/30/2021
  Expenses
paid during
period*
  Annualized
expense ratio
 
Capital Group U.S. Equity Fund                
Actual return $1,000.00  $1,228.96  $2.38   .43%
Assumed 5% return  1,000.00   1,022.66   2.16   .43 

 

*The “expenses paid during period” are equal to the “annualized expense ratio,” multiplied by the average account value over the period, multiplied by the number of days in the period, and divided by 365 (to reflect the one-half year period).

 

16Capital Group U.S. Equity Fund
 

Approval of Investment Advisory and Service Agreement

 

The fund’s board has approved the continuation of the fund’s Investment Advisory and Service Agreement (the “agreement”) with Capital Research and Management Company (“CRMC”) for an additional one-year term through July 31, 2022. The board approved the agreement following the recommendation of the fund’s Contracts Committee (the “committee”), which is composed of all the fund’s independent board members. The board and the committee determined in the exercise of their business judgment that the fund’s advisory fee structure was fair and reasonable in relation to the services provided, and that approving the agreement was in the best interests of the fund and its shareholders.

 

In reaching this decision, the board and the committee took into account their interaction with CRMC as well as information furnished to them throughout the year and otherwise provided to them, as well as information prepared specifically in connection with their review of the agreement, and were advised by their independent counsel with respect to the matters considered. They considered the following factors, among others, but did not identify any single issue or particular piece of information that, in isolation, was the controlling factor, and each board and committee member did not necessarily attribute the same weight to each factor.

 

1. Nature, extent and quality of services

 

The board and the committee considered the depth and quality of CRMC’s investment management process, including its global research capabilities; the experience, capability and integrity of its senior management and other personnel; the low turnover rates of its key personnel; the overall financial strength and stability of CRMC and the Capital Group organization; the resources and systems CRMC devotes to investment management (the manner in which the fund’s assets are managed, including liquidity management), financial, investment operations, compliance, trading, proxy voting, shareholder communications, and other services; and the ongoing evolution of CRMC’s organizational structure designed to maintain and strengthen these qualities. The board and the committee also considered the nature, extent and quality of administrative and shareholder services provided by CRMC to the fund under the agreement and other agreements, as well as the benefits to fund shareholders from investing in a fund that is part of a large family of funds. The board and the committee considered the risks assumed by CRMC in providing services to the fund, including operational, business, financial, reputational, regulatory and litigation risks. The board and the committee concluded that the nature, extent and quality of the services provided by CRMC have benefited and should continue to benefit the fund and its shareholders.

 

2. Investment results

 

The board and the committee considered the investment results of the fund in light of its objective. They compared the fund’s investment results with those of other funds (including funds that currently form the basis of the Lipper index for the category in which the fund is included), and data such as relevant market and fund indexes over various periods (including the fund’s lifetime) through December 31, 2020. They generally placed greater emphasis on investment results over longer term periods. On the basis of this evaluation and the board’s and the committee’s ongoing review of investment results, and considering the relative market conditions during certain reporting periods, the board and the committee concluded that the fund’s investment results have been satisfactory for renewal of the agreement, and that CRMC’s record in managing the fund indicated that its continued management should benefit the fund and its shareholders.

 

3. Advisory fees and total expenses

 

The board and the committee compared the advisory fees and total expense levels of the fund to those of other relevant funds. They observed that the fund’s advisory fees and expenses generally compared favorably to those of other similar funds included in the comparable Lipper category. The board and the committee noted that, although the fees paid by CRMC clients with separately managed accounts generally were lower than those paid by the fund, the differences appropriately reflected the investment, operational, regulatory and market differences between advising the fund and separately managed accounts. They also recognized that the fees for certain separately managed accounts could be lower than those of the fund due to the sizes of the accounts and the clients’ overall relationships with CRMC. The board and the committee concluded that the fund’s cost structure was fair and reasonable in relation to the services provided, as well as in relation to the risks assumed by the adviser in sponsoring and managing the fund, and that the fund’s shareholders receive reasonable value in return for the advisory fees and other amounts paid to CRMC by the fund.

 

4. Ancillary benefits

 

The board and the committee considered a variety of other benefits that CRMC and its affiliates receive as a result of CRMC’s relationship with the fund, including fees paid to CRMC’s affiliated transfer agent; sales charges and distribution fees received and retained by the fund’s principal underwriter, an affiliate of CRMC; and possible ancillary benefits to CRMC and its institutional management affiliates in managing other investment vehicles. The board and the committee reviewed CRMC’s portfolio trading practices, noting that, since 2019, CRMC has borne the cost of third-party research. The board and committee also noted that CRMC benefited from the use of commissions from portfolio transactions made on behalf of the fund to facilitate payment to certain broker-dealers for research to comply with regulatory requirements, with all such amounts reimbursed to the fund by CRMC. The board and the committee took these ancillary benefits into account in evaluating the reasonableness of the advisory fees and other amounts paid to CRMC by the fund.

 

Capital Group U.S. Equity Fund17
 

5. Adviser financial information

 

The board and the committee reviewed information regarding CRMC’s costs of providing services to the fund, including personnel, systems and resources of investment, compliance, trading, accounting and other administrative operations. They considered CRMC’s costs and related cost allocation methodology as well as its track record of investing in technology, infrastructure and staff to maintain and expand services and capabilities, respond to industry and regulatory developments, and attract and retain qualified personnel. They noted information regarding the compensation structure for CRMC’s investment professionals. They reviewed information on the profitability of the investment adviser and its affiliates. The board and the committee also compared CRMC’s profitability and compensation data to the reported results and data of several large, publicly held investment management companies. The board and the committee noted the competitiveness and cyclicality of both the mutual fund industry and the capital markets, and the importance in that environment of CRMC’s long-term profitability for maintaining its independence, company culture and management continuity. They further considered CRMC’s reimbursement of fund expenses through voluntary fee caps and, as applicable, the sharing of potential economies of scale, or efficiencies, through breakpoints and other fee reductions and costs voluntarily absorbed. The board and the committee concluded that the fund’s advisory fee structure reflected a reasonable sharing of benefits between CRMC and the fund’s shareholders.

 

18Capital Group U.S. Equity Fund
 

Liquidity Risk Management Program

 

The fund has adopted a liquidity risk management program (the “program”). The fund’s board has designated Capital Research and Management Company (“CRMC”) as the administrator of the program. Personnel of CRMC or its affiliates conduct the day-to-day operation of the program pursuant to policies and procedures administered by the Capital Group Liquidity Risk Management Committee.

 

Under the program, CRMC manages the fund’s liquidity risk, which is the risk that the fund could not meet shareholder redemption requests without significant dilution of remaining shareholders’ interests in the fund. This risk is managed by monitoring the degree of liquidity of the fund’s investments, limiting the amount of the fund’s illiquid investments, and utilizing various risk management tools and facilities available to the fund for meeting shareholder redemptions, among other means. CRMC’s process of determining the degree of liquidity of the fund’s investments is supported by one or more third-party liquidity assessment vendors.

 

The fund’s board reviewed a report prepared by CRMC regarding the operation and effectiveness of the program for the period October 1, 2019, through September 30, 2020. No significant liquidity events impacting the fund were noted in the report. In addition, CRMC provided its assessment that the program had been effective in managing the fund’s liquidity risk.

 

Capital Group U.S. Equity Fund19
 

This page was intentionally left blank.

 

20Capital Group U.S. Equity Fund
 

Office of the fund

6455 Irvine Center Drive
Irvine, CA 92618-4518

 

Investment adviser

Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071-1406

 

Transfer agent for shareholder accounts

American Funds Service Company
(Write to the address near you.)

 

P.O. Box 6007
Indianapolis, IN 46206-6007

 

P.O. Box 2280
Norfolk, VA 23501-2280

 

Custodian of assets

State Street Bank and Trust Company
One Lincoln Street
Boston, MA 02111

 

Counsel

Morgan, Lewis & Bockius LLP
One Federal Street
Boston, MA 02110-1726

 

Independent registered public accounting firm

PricewaterhouseCoopers LLP
601 South Figueroa Street
Los Angeles, CA 90017-3874

 

Principal underwriter

American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, CA 90071-1406

 

Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectus, which can be obtained from Capital Research and Management Company by calling (800) 266-9532 and should be read carefully before investing.

 

Capital Group Private Client Services files a complete list of its portfolio holdings with the U.S. Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form NPORT-P. This filing is available free of charge on the SEC website (www.sec.gov). Additionally, the list of portfolio holdings is available by calling your relationship manager at (800) 266-9532.

 

The proxy voting procedures and policies of Capital Group U.S. Equity Fund — which describe how we vote proxies relating to portfolio securities — are available upon request by calling your relationship manager at (800) 266-9532. The fund files its proxy voting record with the SEC for the 12 months ended June 30 by August 31. The report also is available on the SEC website or by calling your relationship manager.

 

Standard & Poor’s 500 Composite Index (“Index”) is a product of S&P Dow Jones Indices LLC and/or its affiliates and has been licensed for use by Capital Group. Copyright © 2021 S&P Dow Jones Indices LLC, a division of S&P Global, and/or its affiliates. All rights reserved. Redistribution or reproduction in whole or in part is prohibited without written permission of S&P Dow Jones Indices LLC.

 

If used as sales material after June 30, 2021, this report must be accompanied by the Capital Group U.S. Equity Fund Quarterly Results document for the most recently completed calendar quarter.

 

American Funds Distributors, Inc., member FINRA.

 

All Capital Group trademarks mentioned are owned by The Capital Group Companies, Inc., an affiliated company or fund. All other company and product names mentioned are the property of their respective companies.

 

 

 

ITEM 2 – Code of Ethics

 

Not applicable for filing of semi-annual reports to shareholders.

 

ITEM 3 – Audit Committee Financial Expert

 

Not applicable for filing of semi-annual reports to shareholders.

 

ITEM 4 – Principal Accountant Fees and Services

 

Not applicable for filing of semi-annual reports to shareholders.

 

ITEM 5 – Audit Committee of Listed Registrants

 

Not applicable to this Registrant, insofar as the Registrant is not a listed issuer as defined in Rule 10A-3 under the Securities Exchange Act of 1934.

 

ITEM 6 – Schedule of Investments

 

Not applicable, insofar as the schedule is included as part of the report to shareholders filed under Item 1 of this Form.

 

ITEM 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

 

Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.

 

ITEM 8 – Portfolio Managers of Closed-End Management Investment Companies

 

Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.

 

ITEM 9 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers

 

Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.

 

ITEM 10 – Submission of Matters to a Vote of Security Holders

 

There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s board of trustees since the Registrant last submitted a proxy statement to its shareholders. The procedures are as follows. The Registrant has a nominating committee comprised solely of persons who are not considered ‘‘interested persons’’ of the Registrant within the meaning of the Investment Company Act of 1940, as amended. The committee periodically reviews such issues as the board’s composition, responsibilities, committees, compensation and other relevant issues, and recommends any appropriate changes to the full board of trustees. While the committee normally is able to identify from its own resources an ample number of qualified candidates, it will consider shareholder suggestions of persons to be considered as nominees to fill future vacancies on the board. Such suggestions must be sent in writing to the nominating committee of the Registrant, c/o the Registrant’s Secretary, and must be accompanied by complete biographical and occupational data on the prospective nominee, along with a written consent of the prospective nominee for consideration of his or her name by the nominating committee.

 

ITEM 11 – Controls and Procedures

 

(a)The Registrant’s Principal Executive Officer and Principal Financial Officer have concluded, based on their evaluation of the Registrant’s disclosure controls and procedures (as such term is defined in Rule 30a-3 under the Investment Company Act of 1940), that such controls and procedures are adequate and reasonably designed to achieve the purposes described in paragraph (c) of such rule.
  
(b)

There were no changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant’s semi-annual period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

 

 

ITEM 12 – Exhibits

 

(a)(1)Not applicable for filing of semi-annual reports to shareholders.
  
(a)(2)The certifications required by Rule 30a-2 of the Investment Company Act of 1940 and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are attached as exhibits hereto.

 

 
 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 CAPITAL GROUP U.S. EQUITY FUND
  
 By __/s/ John S. Armour____________________
 

John S. Armour, President and

Principal Executive Officer

  
 Date: June 30, 2021

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

 

 

By __/s/ John S. Armour_________________

John S. Armour, President and

Principal Executive Officer

 
Date: June 30, 2021

 

 

 

By ___/s/ Gregory F. Niland    __________

Gregory F. Niland, Treasurer and

Principal Financial Officer

 
Date: June 30, 2021