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 811-1352
Fidelity Devonshire Trust
(Exact name of registrant as specified in charter)
245 Summer St., Boston, MA 02210
(Address of principal executive offices) (Zip code)
Marc Bryant, Secretary
245 Summer St.
Boston, Massachusetts 02210
(Name and address of agent for service)
Registrant's telephone number, including area code:
617-563-7000
Date of fiscal year end: | January 31 |
Date of reporting period: | July 31, 2018 |
Item 1.
Reports to Stockholders
Fidelity® Equity-Income Fund Semi-Annual Report July 31, 2018 |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
JPMorgan Chase & Co. | 4.3 |
Verizon Communications, Inc. | 3.6 |
Wells Fargo & Co. | 3.3 |
Johnson & Johnson | 3.1 |
Bank of America Corp. | 3.1 |
Cisco Systems, Inc. | 2.9 |
United Technologies Corp. | 2.3 |
Chevron Corp. | 2.3 |
Citigroup, Inc. | 2.3 |
DowDuPont, Inc. | 2.2 |
29.4 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 23.3 |
Health Care | 12.2 |
Information Technology | 11.6 |
Energy | 9.9 |
Consumer Discretionary | 8.6 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018 * | ||
Stocks | 94.2% | |
Convertible Securities | 0.3% | |
Other Investments | 0.2% | |
Short-Term Investments and Net Other Assets (Liabilities) | 5.3% |
* Foreign investments – 12.9%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 94.2% | |||
Shares | Value (000s) | ||
CONSUMER DISCRETIONARY - 8.6% | |||
Automobiles - 0.8% | |||
General Motors Co. | 1,286,300 | $48,764 | |
Hotels, Restaurants & Leisure - 3.5% | |||
Bluegreen Vacations Corp. | 393,600 | 10,119 | |
Carnival Corp. | 279,800 | 16,575 | |
Cedar Fair LP (depositary unit) | 353,100 | 20,176 | |
Dunkin' Brands Group, Inc. | 318,100 | 22,149 | |
McDonald's Corp. | 699,100 | 110,136 | |
Royal Caribbean Cruises Ltd. | 157,600 | 17,771 | |
Wyndham Destinations, Inc. | 328,000 | 15,127 | |
Wyndham Hotels & Resorts, Inc. | 320,900 | 18,612 | |
230,665 | |||
Media - 2.5% | |||
Comcast Corp. Class A | 2,966,088 | 106,127 | |
Interpublic Group of Companies, Inc. | 832,900 | 18,782 | |
Omnicom Group, Inc. | 203,900 | 14,034 | |
Twenty-First Century Fox, Inc. Class A | 578,200 | 26,019 | |
164,962 | |||
Multiline Retail - 0.4% | |||
Macy's, Inc. | 710,000 | 28,208 | |
Specialty Retail - 1.4% | |||
Home Depot, Inc. | 160,800 | 31,761 | |
Lowe's Companies, Inc. | 253,400 | 25,173 | |
TJX Companies, Inc. | 334,400 | 32,524 | |
89,458 | |||
TOTAL CONSUMER DISCRETIONARY | 562,057 | ||
CONSUMER STAPLES - 8.3% | |||
Beverages - 0.1% | |||
Keurig Dr. Pepper, Inc. | 263,700 | 6,331 | |
Food & Staples Retailing - 1.3% | |||
Sysco Corp. | 236,700 | 15,909 | |
Walmart, Inc. | 797,491 | 71,160 | |
87,069 | |||
Food Products - 2.6% | |||
Bunge Ltd. | 196,800 | 13,605 | |
Hilton Food Group PLC | 1,594,605 | 20,009 | |
McCormick & Co., Inc. (non-vtg.) | 203,200 | 23,884 | |
Mondelez International, Inc. | 866,300 | 37,580 | |
Nestle SA (Reg. S) | 217,379 | 17,715 | |
The J.M. Smucker Co. | 261,800 | 29,091 | |
The Kraft Heinz Co. | 508,700 | 30,649 | |
172,533 | |||
Household Products - 0.7% | |||
Kimberly-Clark Corp. | 181,400 | 20,654 | |
Procter & Gamble Co. | 290,097 | 23,463 | |
44,117 | |||
Personal Products - 0.5% | |||
Unilever NV (Certificaten Van Aandelen) (Bearer) | 592,300 | 34,170 | |
Tobacco - 3.1% | |||
Altria Group, Inc. | 1,134,500 | 66,572 | |
British American Tobacco PLC (United Kingdom) | 1,589,200 | 87,362 | |
Imperial Tobacco Group PLC | 522,867 | 20,053 | |
Philip Morris International, Inc. | 286,200 | 24,699 | |
198,686 | |||
TOTAL CONSUMER STAPLES | 542,906 | ||
ENERGY - 9.6% | |||
Oil, Gas & Consumable Fuels - 9.6% | |||
BP PLC | 3,056,800 | 22,973 | |
Chevron Corp. | 1,197,472 | 151,205 | |
ConocoPhillips Co. | 1,449,000 | 104,574 | |
Enterprise Products Partners LP | 1,154,400 | 33,478 | |
Imperial Oil Ltd. | 995,600 | 34,096 | |
Phillips 66 Co. | 398,700 | 49,176 | |
Suncor Energy, Inc. | 1,641,900 | 69,142 | |
The Williams Companies, Inc. | 2,092,143 | 62,241 | |
Valero Energy Corp. | 409,000 | 48,405 | |
Williams Partners LP | 1,164,069 | 52,418 | |
627,708 | |||
FINANCIALS - 23.3% | |||
Banks - 14.5% | |||
Bank of America Corp. | 6,516,900 | 201,242 | |
Citigroup, Inc. | 2,103,000 | 151,185 | |
JPMorgan Chase & Co. | 2,458,682 | 282,626 | |
KeyCorp | 1,087,516 | 22,696 | |
Lakeland Financial Corp. | 32,536 | 1,578 | |
Regions Financial Corp. | 946,700 | 17,618 | |
SunTrust Banks, Inc. | 680,400 | 49,036 | |
Wells Fargo & Co. | 3,773,950 | 216,210 | |
942,191 | |||
Capital Markets - 4.9% | |||
KKR & Co. LP | 5,223,565 | 143,021 | |
State Street Corp. | 443,099 | 39,130 | |
The Blackstone Group LP | 3,992,532 | 139,419 | |
TPG Specialty Lending, Inc. | 1 | 0 | |
321,570 | |||
Consumer Finance - 1.0% | |||
Capital One Financial Corp. | 445,700 | 42,038 | |
Discover Financial Services | 306,800 | 21,909 | |
63,947 | |||
Insurance - 2.9% | |||
Aspen Insurance Holdings Ltd. | 104,200 | 4,215 | |
Axis Capital Holdings Ltd. | 92,000 | 5,204 | |
Chubb Ltd. | 606,500 | 84,740 | |
Marsh & McLennan Companies, Inc. | 203,200 | 16,939 | |
MetLife, Inc. | 1,103,638 | 50,480 | |
The Travelers Companies, Inc. | 223,800 | 29,125 | |
190,703 | |||
TOTAL FINANCIALS | 1,518,411 | ||
HEALTH CARE - 12.2% | |||
Biotechnology - 2.1% | |||
Amgen, Inc. | 710,000 | 139,551 | |
Health Care Equipment & Supplies - 2.3% | |||
Becton, Dickinson & Co. | 383,300 | 95,967 | |
Danaher Corp. | 519,700 | 53,311 | |
149,278 | |||
Health Care Providers & Services - 1.6% | |||
CVS Health Corp. | 647,600 | 42,003 | |
HealthSouth Corp. | 3 | 0 | |
UnitedHealth Group, Inc. | 256,000 | 64,824 | |
106,827 | |||
Pharmaceuticals - 6.2% | |||
AstraZeneca PLC (United Kingdom) | 594,255 | 45,744 | |
Bristol-Myers Squibb Co. | 455,300 | 26,749 | |
GlaxoSmithKline PLC | 2,070,900 | 43,013 | |
Johnson & Johnson | 1,533,248 | 203,186 | |
Roche Holding AG (participation certificate) | 192,940 | 47,395 | |
Sanofi SA | 410,319 | 35,696 | |
401,783 | |||
TOTAL HEALTH CARE | 797,439 | ||
INDUSTRIALS - 7.6% | |||
Aerospace & Defense - 3.8% | |||
General Dynamics Corp. | 245,700 | 49,081 | |
Raytheon Co. | 214,800 | 42,537 | |
United Technologies Corp. | 1,126,720 | 152,941 | |
244,559 | |||
Building Products - 0.0% | |||
Johnson Controls International PLC | 8,400 | 315 | |
Commercial Services & Supplies - 0.2% | |||
Waste Connection, Inc. (Canada) | 178,145 | 13,820 | |
Electrical Equipment - 1.7% | |||
AMETEK, Inc. | 531,200 | 41,327 | |
Eaton Corp. PLC | 415,500 | 34,557 | |
Fortive Corp. | 299,700 | 24,599 | |
Regal Beloit Corp. | 99,700 | 8,569 | |
109,052 | |||
Industrial Conglomerates - 1.3% | |||
General Electric Co. | 2,939,755 | 40,069 | |
Roper Technologies, Inc. | 154,400 | 46,613 | |
86,682 | |||
Machinery - 0.6% | |||
Allison Transmission Holdings, Inc. | 401,300 | 18,861 | |
Ingersoll-Rand PLC | 194,200 | 19,131 | |
37,992 | |||
TOTAL INDUSTRIALS | 492,420 | ||
INFORMATION TECHNOLOGY - 11.5% | |||
Communications Equipment - 2.9% | |||
Cisco Systems, Inc. | 4,399,686 | 186,063 | |
Electronic Equipment & Components - 1.0% | |||
Dell Technologies, Inc. (a) | 326,703 | 30,227 | |
TE Connectivity Ltd. | 343,432 | 32,135 | |
62,362 | |||
IT Services - 1.2% | |||
First Data Corp. Class A (a) | 1,476,636 | 34,347 | |
Paychex, Inc. | 610,357 | 42,127 | |
76,474 | |||
Semiconductors & Semiconductor Equipment - 3.1% | |||
Intel Corp. | 966,600 | 46,493 | |
NXP Semiconductors NV (a) | 30,400 | 2,898 | |
Qualcomm, Inc. | 2,047,116 | 131,200 | |
Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR | 597,500 | 24,623 | |
205,214 | |||
Software - 2.3% | |||
Micro Focus International PLC | 1,720,710 | 28,078 | |
Microsoft Corp. | 1,158,916 | 122,938 | |
151,016 | |||
Technology Hardware, Storage & Peripherals - 1.0% | |||
Apple, Inc. | 347,300 | 66,088 | |
TOTAL INFORMATION TECHNOLOGY | 747,217 | ||
MATERIALS - 4.2% | |||
Chemicals - 3.1% | |||
DowDuPont, Inc. | 2,088,900 | 143,654 | |
LyondellBasell Industries NV Class A | 535,700 | 59,350 | |
203,004 | |||
Containers & Packaging - 1.1% | |||
Packaging Corp. of America | 281,000 | 31,725 | |
WestRock Co. | 701,700 | 40,685 | |
72,410 | |||
TOTAL MATERIALS | 275,414 | ||
REAL ESTATE - 1.5% | |||
Equity Real Estate Investment Trusts (REITs) - 1.5% | |||
American Tower Corp. | 454,100 | 67,316 | |
Public Storage | 145,300 | 31,651 | |
Spirit MTA REIT (a) | 16,680 | 167 | |
Spirit Realty Capital, Inc. | 24,400 | 204 | |
99,338 | |||
TELECOMMUNICATION SERVICES - 4.0% | |||
Diversified Telecommunication Services - 4.0% | |||
AT&T, Inc. | 892,689 | 28,539 | |
Verizon Communications, Inc. | 4,512,860 | 233,044 | |
261,583 | |||
Wireless Telecommunication Services - 0.0% | |||
T-Mobile U.S., Inc. (a) | 10,043 | 603 | |
TOTAL TELECOMMUNICATION SERVICES | 262,186 | ||
UTILITIES - 3.4% | |||
Electric Utilities - 2.7% | |||
Exelon Corp. | 2,753,300 | 117,015 | |
PPL Corp. | 1,102,300 | 31,713 | |
Xcel Energy, Inc. | 573,000 | 26,851 | |
175,579 | |||
Multi-Utilities - 0.7% | |||
CenterPoint Energy, Inc. | 816,100 | 23,243 | |
Public Service Enterprise Group, Inc. | 384,600 | 19,830 | |
43,073 | |||
TOTAL UTILITIES | 218,652 | ||
TOTAL COMMON STOCKS | |||
(Cost $4,549,261) | 6,143,748 | ||
Convertible Preferred Stocks - 0.1% | |||
HEALTH CARE - 0.0% | |||
Health Care Equipment & Supplies - 0.0% | |||
Becton, Dickinson & Co. Series A, 6.125% | 17,100 | 1,079 | |
INDUSTRIALS - 0.0% | |||
Electrical Equipment - 0.0% | |||
Fortive Corp. Series A, 5.00% | 770 | 814 | |
UTILITIES - 0.1% | |||
Electric Utilities - 0.1% | |||
Vistra Energy Corp. 7.00% | 19,100 | 1,757 | |
Multi-Utilities - 0.0% | |||
CenterPoint Energy, Inc. 2.00% ZENS | 14,500 | 631 | |
TOTAL UTILITIES | 2,388 | ||
TOTAL CONVERTIBLE PREFERRED STOCKS | |||
(Cost $4,287) | 4,281 | ||
Principal Amount (000s) | Value (000s) | ||
Corporate Bonds - 0.2% | |||
Convertible Bonds - 0.2% | |||
CONSUMER DISCRETIONARY - 0.0% | |||
Media - 0.0% | |||
DISH Network Corp. 3.375% 8/15/26 | 601 | 546 | |
Liberty Media Corp. 1.375% 10/15/23 | 1,455 | 1,841 | |
2,387 | |||
ENERGY - 0.1% | |||
Oil, Gas & Consumable Fuels - 0.1% | |||
Chesapeake Energy Corp. 5.5% 9/15/26 | 860 | 855 | |
Scorpio Tankers, Inc. 3% 5/15/22 | 2,300 | 2,051 | |
2,906 | |||
INDUSTRIALS - 0.0% | |||
Electrical Equipment - 0.0% | |||
SolarCity Corp. 1.625% 11/1/19 | 658 | 590 | |
INFORMATION TECHNOLOGY - 0.1% | |||
Internet Software & Services - 0.0% | |||
Twitter, Inc. 0.25% 6/15/24 (b) | 1,266 | 1,152 | |
Yahoo!, Inc. 0% 12/1/18 | 510 | 695 | |
1,847 | |||
IT Services - 0.0% | |||
Square, Inc. 0.375% 3/1/22 | 220 | 620 | |
Semiconductors & Semiconductor Equipment - 0.1% | |||
Intel Corp. 3.25% 8/1/39 | 284 | 658 | |
Microchip Technology, Inc. 1.625% 2/15/25 | 400 | 720 | |
Micron Technology, Inc. 3% 11/15/43 | 330 | 596 | |
ON Semiconductor Corp. 1.625% 10/15/23 | 535 | 670 | |
2,644 | |||
TOTAL INFORMATION TECHNOLOGY | 5,111 | ||
TOTAL CONVERTIBLE BONDS | 10,994 | ||
Nonconvertible Bonds - 0.0% | |||
CONSUMER DISCRETIONARY - 0.0% | |||
Diversified Consumer Services - 0.0% | |||
Laureate Education, Inc. 8.25% 5/1/25 (b) | 535 | 575 | |
ENERGY - 0.0% | |||
Oil, Gas & Consumable Fuels - 0.0% | |||
California Resources Corp. 8% 12/15/22 (b) | 1,385 | 1,240 | |
Southwestern Energy Co. 4.1% 3/15/22 | 645 | 613 | |
1,853 | |||
HEALTH CARE - 0.0% | |||
Pharmaceuticals - 0.0% | |||
Valeant Pharmaceuticals International, Inc. 5.875% 5/15/23 (b) | 1,060 | 1,018 | |
TOTAL NONCONVERTIBLE BONDS | 3,446 | ||
TOTAL CORPORATE BONDS | |||
(Cost $14,317) | 14,440 | ||
Bank Loan Obligations - 0.0% | |||
INDUSTRIALS - 0.0% | |||
Commercial Services & Supplies - 0.0% | |||
Lineage Logistics Holdings, LLC. Tranche B, term loan 3 month U.S. LIBOR + 3.000% 5.0768% 2/27/25 (c)(d) (Cost $1,802) | 1,803 | 1,794 | |
Shares | Value (000s) | ||
Other - 0.2% | |||
ENERGY - 0.2% | |||
Oil, Gas & Consumable Fuels - 0.2% | |||
Utica Shale Drilling Program (non-operating revenue interest) (e)(f)(g) | |||
(Cost $22,679) | 22,678,929 | 11,947 | |
Money Market Funds - 5.2% | |||
Fidelity Cash Central Fund, 1.96% (h) | |||
(Cost $338,973) | 338,905,391 | 338,973 | |
TOTAL INVESTMENT IN SECURITIES - 99.9% | |||
(Cost $4,931,319) | 6,515,183 | ||
NET OTHER ASSETS (LIABILITIES) - 0.1% | 5,393 | ||
NET ASSETS - 100% | $6,520,576 |
Values shown as $0 in the Schedule of Investments may reflect amounts less than $500.
Legend
(a) Non-income producing
(b) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the end of the period, the value of these securities amounted to $3,985,000 or 0.1% of net assets.
(c) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end.
(d) Coupon is indexed to a floating interest rate which may be multiplied by a specified factor and/or subject to caps or floors.
(e) Investment is owned by a wholly-owned subsidiary (Subsidiary) that is treated as a corporation for U.S. tax purposes.
(f) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $11,947,000 or 0.2% of net assets.
(g) Level 3 security
(h) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
Additional information on each restricted holding is as follows:
Security | Acquisition Date | Acquisition Cost (000s) |
Utica Shale Drilling Program (non-operating revenue interest) | 10/5/16 - 9/1/17 | $22,679 |
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
(Amounts in thousands) | |
Fidelity Cash Central Fund | $2,329 |
Fidelity Securities Lending Cash Central Fund | 94 |
Total | $2,423 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
(Amounts in thousands) | ||||
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $562,057 | $562,057 | $-- | $-- |
Consumer Staples | 542,906 | 403,659 | 139,247 | -- |
Energy | 627,708 | 604,735 | 22,973 | -- |
Financials | 1,518,411 | 1,518,411 | -- | -- |
Health Care | 798,518 | 625,591 | 172,927 | -- |
Industrials | 493,234 | 492,420 | 814 | -- |
Information Technology | 747,217 | 719,139 | 28,078 | -- |
Materials | 275,414 | 275,414 | -- | -- |
Real Estate | 99,338 | 99,338 | -- | -- |
Telecommunication Services | 262,186 | 262,186 | -- | -- |
Utilities | 221,040 | 218,652 | 2,388 | -- |
Corporate Bonds | 14,440 | -- | 14,440 | -- |
Bank Loan Obligations | 1,794 | -- | 1,794 | -- |
Other | 11,947 | -- | -- | 11,947 |
Money Market Funds | 338,973 | 338,973 | -- | -- |
Total Investments in Securities: | $6,515,183 | $6,120,575 | $382,661 | $11,947 |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 87.1% |
United Kingdom | 4.1% |
Switzerland | 2.8% |
Canada | 1.8% |
Netherlands | 1.4% |
Others (Individually Less Than 1%) | 2.8% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amounts) | July 31, 2018 (Unaudited) | |
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $4,592,346) | $6,176,210 | |
Fidelity Central Funds (cost $338,973) | 338,973 | |
Total Investment in Securities (cost $4,931,319) | $6,515,183 | |
Cash | 13 | |
Restricted cash | 462 | |
Receivable for investments sold | 706 | |
Receivable for fund shares sold | 941 | |
Dividends receivable | 9,924 | |
Interest receivable | 119 | |
Distributions receivable from Fidelity Central Funds | 712 | |
Prepaid expenses | 16 | |
Other receivables | 1,363 | |
Total assets | 6,529,439 | |
Liabilities | ||
Payable for investments purchased | $918 | |
Payable for fund shares redeemed | 3,557 | |
Accrued management fee | 2,378 | |
Transfer agent fee payable | 682 | |
Other affiliated payables | 95 | |
Other payables and accrued expenses | 1,233 | |
Total liabilities | 8,863 | |
Net Assets | $6,520,576 | |
Net Assets consist of: | ||
Paid in capital | $4,755,895 | |
Distributions in excess of net investment income | (25,251) | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 206,111 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 1,583,821 | |
Net Assets | $6,520,576 | |
Equity-Income: | ||
Net Asset Value, offering price and redemption price per share ($5,493,459 ÷ 91,827.9 shares) | $59.82 | |
Class K: | ||
Net Asset Value, offering price and redemption price per share ($1,027,117 ÷ 17,180.3 shares) | $59.78 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Amounts in thousands | Six months ended July 31, 2018 (Unaudited) | |
Investment Income | ||
Dividends | $109,403 | |
Interest | 291 | |
Income from Fidelity Central Funds | 2,423 | |
Total income | 112,117 | |
Expenses | ||
Management fee | $14,800 | |
Transfer agent fees | 4,172 | |
Accounting and security lending fees | 579 | |
Custodian fees and expenses | 63 | |
Independent trustees' fees and expenses | (1) | |
Registration fees | 50 | |
Audit | 50 | |
Legal | 10 | |
Miscellaneous | 31 | |
Total expenses before reductions | 19,754 | |
Expense reductions | (306) | |
Total expenses after reductions | 19,448 | |
Net investment income (loss) | 92,669 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 206,539 | |
Fidelity Central Funds | (1) | |
Foreign currency transactions | (112) | |
Total net realized gain (loss) | 206,426 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (514,322) | |
Assets and liabilities in foreign currencies | (61) | |
Total change in net unrealized appreciation (depreciation) | (514,383) | |
Net gain (loss) | (307,957) | |
Net increase (decrease) in net assets resulting from operations | $(215,288) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Amounts in thousands | Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $92,669 | $173,761 |
Net realized gain (loss) | 206,426 | 460,187 |
Change in net unrealized appreciation (depreciation) | (514,383) | 609,856 |
Net increase (decrease) in net assets resulting from operations | (215,288) | 1,243,804 |
Distributions to shareholders from net investment income | (86,254) | (153,045) |
Distributions to shareholders from net realized gain | (151,569) | (355,004) |
Total distributions | (237,823) | (508,049) |
Share transactions - net increase (decrease) | (570,779) | (1,668,136) |
Total increase (decrease) in net assets | (1,023,890) | (932,381) |
Net Assets | ||
Beginning of period | 7,544,466 | 8,476,847 |
End of period | $6,520,576 | $7,544,466 |
Other Information | ||
Distributions in excess of net investment income end of period | $(25,251) | $(31,666) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Equity-Income Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $63.45 | $57.76 | $48.57 | $57.26 | $56.69 | $49.72 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .80 | 1.30 | 1.22 | 1.43 | 2.00B | 1.26 |
Net realized and unrealized gain (loss) | (2.39) | 8.52 | 10.43 | (3.91)C | 2.87 | 6.99 |
Total from investment operations | (1.59) | 9.82 | 11.65 | (2.48) | 4.87 | 8.25 |
Distributions from net investment income | (.75) | (1.20)D | (1.36) | (1.71)D | (1.60) | (1.28) |
Distributions from net realized gain | (1.29) | (2.93)D | (1.10) | (4.51)D | (2.70) | – |
Total distributions | (2.04) | (4.13) | (2.46) | (6.21)E | (4.30) | (1.28) |
Net asset value, end of period | $59.82 | $63.45 | $57.76 | $48.57 | $57.26 | $56.69 |
Total ReturnF,G | (2.41)% | 17.57% | 24.42% | (4.89)%C | 8.53% | 16.72% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | .61%J | .61% | .63% | .64% | .63% | .64% |
Expenses net of fee waivers, if any | .61%J | .61% | .63% | .64% | .63% | .64% |
Expenses net of all reductions | .60%J | .61% | .62% | .63% | .63% | .64% |
Net investment income (loss) | 2.74%J | 2.18% | 2.27% | 2.55% | 3.30%B | 2.30% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $5,493 | $5,921 | $6,686 | $5,752 | $6,686 | $6,842 |
Portfolio turnover rateK | 31%J,L | 33% | 36% | 46%L | 40% | 43% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.48 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 2.51%.
C Net realized and unrealized gain (loss) per share reflects proceeds received from litigation which amounted to $.13 per share. Excluding these litigation proceeds, the total return would have been (5.12)%.
D The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
E Total distributions of $6.21 per share is comprised of distributions from net investment income of $1.709 and distributions from net realized gain of $4.505 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
L Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Equity-Income Fund Class K
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $63.41 | $57.73 | $48.55 | $57.25 | $56.67 | $49.70 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .83 | 1.36 | 1.28 | 1.50 | 2.07B | 1.33 |
Net realized and unrealized gain (loss) | (2.39) | 8.51 | 10.42 | (3.92)C | 2.88 | 6.99 |
Total from investment operations | (1.56) | 9.87 | 11.70 | (2.42) | 4.95 | 8.32 |
Distributions from net investment income | (.78) | (1.26)D | (1.42) | (1.78)D | (1.67) | (1.35) |
Distributions from net realized gain | (1.29) | (2.93)D | (1.10) | (4.51)D | (2.70) | – |
Total distributions | (2.07) | (4.19) | (2.52) | (6.28)E | (4.37) | (1.35) |
Net asset value, end of period | $59.78 | $63.41 | $57.73 | $48.55 | $57.25 | $56.67 |
Total ReturnF,G | (2.37)% | 17.68% | 24.56% | (4.78)%C | 8.68% | 16.87% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | .51%J | .51% | .52% | .52% | .52% | .52% |
Expenses net of fee waivers, if any | .51%J | .51% | .52% | .52% | .52% | .52% |
Expenses net of all reductions | .50%J | .51% | .51% | .51% | .51% | .52% |
Net investment income (loss) | 2.84%J | 2.28% | 2.39% | 2.67% | 3.41%B | 2.42% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $1,027 | $1,623 | $1,791 | $1,646 | $2,272 | $2,480 |
Portfolio turnover rateK | 31%J,L | 33% | 36% | 46%L | 40% | 43% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.48 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 2.63%.
C Net realized and unrealized gain (loss) per share reflects proceeds received from litigation which amounted to $.13 per share. Excluding these litigation proceeds, the total return would have been (5.01)%
D The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
E Total distributions of $6.28 per share is comprised of distributions from net investment income of $1.777 and distributions from net realized gain of $4.505 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
L Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
(Amounts in thousands except percentages)
1. Organization.
Fidelity Equity-Income Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund offers Equity-Income and Class K shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. Corporate bonds and bank loan obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of July 31, 2018 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost and include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivables when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), certain independent Trustees have elected to defer receipt of a portion of their annual compensation. Deferred amounts are invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees of $1,132 are included in the accompanying Statement of Assets and Liabilities in other receivables and other payables and accrued expenses, respectively.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP. These differences resulted in distribution reclassifications.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, market discount, contingent interest, partnerships, deferred trustees compensation, equity-debt classifications, certain conversion ratio adjustments and losses deferred due to wash sales.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $1,710,748 |
Gross unrealized depreciation | (130,258) |
Net unrealized appreciation (depreciation) | $1,580,490 |
Tax cost | $4,934,693 |
Restricted Securities. The Fund may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of the Fund's Schedule of Investments.
Loans and Other Direct Debt Instruments. The Fund invests in direct debt instruments which are interests in amounts owed to lenders by corporate or other borrowers. These instruments may be in the form of loans, trade claims or other receivables and may include standby financing commitments such as revolving credit facilities that obligate the Fund to supply additional cash to the borrower on demand. Loans may be acquired through assignment or participation. The Fund did not have any unfunded loan commitments, which are contractual obligations for future funding, at period end.
Consolidated Subsidiary. The Fund invests in certain investments through a wholly-owned subsidiary ("Subsidiary"), which may be subject to federal and state taxes upon disposition.
As of period end, the Fund held an investment of $12,409 in this Subsidiary, representing .19% of the Fund's net assets. The financial statements have been consolidated and include accounts of the Fund and the Subsidiary. Accordingly, all inter-company transactions and balances have been eliminated.
Any cash held by the Subsidiary is restricted as to its use and is presented as Restricted cash in the Statement of Assets and Liabilities.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and in-kind transactions, aggregated $1,014,562 and $1,781,120, respectively.
Redemptions In-Kind. During the period, 1,109 shares of the Fund held by unaffiliated entities were redeemed in-kind for investments and cash, with a value of $63,055. The net realized gain of $22,455 on investments delivered through the in-kind redemptions is included in the accompanying Statement of Operations. The amount of the redemptions is included in share transactions activity shown in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .20% of the Fund's average net assets and an annualized group fee rate that averaged .24% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the reporting period, the total annualized management fee rate was .44% of the Fund's average net assets.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, is the transfer, dividend disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of Equity-Income, except for Class K. FIIOC receives an asset-based fee of Class K's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Equity-Income | $3,875 | .14 |
Class K | 297 | .05 |
$4,172 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions. For the period, the fees were equivalent to an annualized rate of .02%.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $54 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $10 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. At period end, there were no security loans outstanding. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $94, including $3 from securities loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $267 for the period. In addition, through arrangements with the Fund's custodian and each class' transfer agent, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses in the amount of less than five hundred dollars. During the period, credits reduced each class' transfer agent expense as noted in the table below.
Transfer Agent expense reduction | |
Equity-Income | $3 |
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $36.
9. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended July 31, 2018 | Year ended January 31, 2018 | |
From net investment income | ||
Equity-Income | $69,487 | $116,026 |
Class K | 16,767 | 37,019 |
Total | $86,254 | $153,045 |
From net realized gain | ||
Equity-Income | $119,107 | $278,349 |
Class K | 32,462 | 76,655 |
Total | $151,569 | $355,004 |
10. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended July 31, 2018 | Year ended January 31, 2018 | Six months ended July 31, 2018 | Year ended January 31, 2018 | |
Equity-Income | ||||
Shares sold | 1,610 | 9,765 | $93,968 | $585,205 |
Reinvestment of distributions | 3,016 | 6,203 | 176,970 | 370,841 |
Shares redeemed | (6,122) | (38,402) | (356,440) | (2,288,604) |
Net increase (decrease) | (1,496) | (22,434) | $(85,502) | $(1,332,558) |
Class K | ||||
Shares sold | 1,192 | 7,660 | $69,683 | $451,462 |
Reinvestment of distributions | 839 | 1,902 | 49,229 | 113,674 |
Shares redeemed | (10,445)(a) | (14,995) | (604,189)(a) | (900,714) |
Net increase (decrease) | (8,414) | (5,433) | $(485,277) | $(335,578) |
(a) Amount includes in-kind redemptions (see the Redemptions In-Kind note for additional details)
11. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying table for each class of the Fund 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the Fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of the Fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Equity-Income | .61% | |||
Actual | $1,000.00 | $975.90 | $2.99 | |
Hypothetical-C | $1,000.00 | $1,021.77 | $3.06 | |
Class K | .51% | |||
Actual | $1,000.00 | $976.30 | $2.50 | |
Hypothetical-C | $1,000.00 | $1,022.27 | $2.56 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Equity-Income Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
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EQU-SANN-0918
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Fidelity® Equity-Income Fund Semi-Annual Report July 31, 2018 |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-835-5092 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
JPMorgan Chase & Co. | 4.3 |
Verizon Communications, Inc. | 3.6 |
Wells Fargo & Co. | 3.3 |
Johnson & Johnson | 3.1 |
Bank of America Corp. | 3.1 |
Cisco Systems, Inc. | 2.9 |
United Technologies Corp. | 2.3 |
Chevron Corp. | 2.3 |
Citigroup, Inc. | 2.3 |
DowDuPont, Inc. | 2.2 |
29.4 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 23.3 |
Health Care | 12.2 |
Information Technology | 11.6 |
Energy | 9.9 |
Consumer Discretionary | 8.6 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018 * | ||
Stocks | 94.2% | |
Convertible Securities | 0.3% | |
Other Investments | 0.2% | |
Short-Term Investments and Net Other Assets (Liabilities) | 5.3% |
* Foreign investments – 12.9%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 94.2% | |||
Shares | Value (000s) | ||
CONSUMER DISCRETIONARY - 8.6% | |||
Automobiles - 0.8% | |||
General Motors Co. | 1,286,300 | $48,764 | |
Hotels, Restaurants & Leisure - 3.5% | |||
Bluegreen Vacations Corp. | 393,600 | 10,119 | |
Carnival Corp. | 279,800 | 16,575 | |
Cedar Fair LP (depositary unit) | 353,100 | 20,176 | |
Dunkin' Brands Group, Inc. | 318,100 | 22,149 | |
McDonald's Corp. | 699,100 | 110,136 | |
Royal Caribbean Cruises Ltd. | 157,600 | 17,771 | |
Wyndham Destinations, Inc. | 328,000 | 15,127 | |
Wyndham Hotels & Resorts, Inc. | 320,900 | 18,612 | |
230,665 | |||
Media - 2.5% | |||
Comcast Corp. Class A | 2,966,088 | 106,127 | |
Interpublic Group of Companies, Inc. | 832,900 | 18,782 | |
Omnicom Group, Inc. | 203,900 | 14,034 | |
Twenty-First Century Fox, Inc. Class A | 578,200 | 26,019 | |
164,962 | |||
Multiline Retail - 0.4% | |||
Macy's, Inc. | 710,000 | 28,208 | |
Specialty Retail - 1.4% | |||
Home Depot, Inc. | 160,800 | 31,761 | |
Lowe's Companies, Inc. | 253,400 | 25,173 | |
TJX Companies, Inc. | 334,400 | 32,524 | |
89,458 | |||
TOTAL CONSUMER DISCRETIONARY | 562,057 | ||
CONSUMER STAPLES - 8.3% | |||
Beverages - 0.1% | |||
Keurig Dr. Pepper, Inc. | 263,700 | 6,331 | |
Food & Staples Retailing - 1.3% | |||
Sysco Corp. | 236,700 | 15,909 | |
Walmart, Inc. | 797,491 | 71,160 | |
87,069 | |||
Food Products - 2.6% | |||
Bunge Ltd. | 196,800 | 13,605 | |
Hilton Food Group PLC | 1,594,605 | 20,009 | |
McCormick & Co., Inc. (non-vtg.) | 203,200 | 23,884 | |
Mondelez International, Inc. | 866,300 | 37,580 | |
Nestle SA (Reg. S) | 217,379 | 17,715 | |
The J.M. Smucker Co. | 261,800 | 29,091 | |
The Kraft Heinz Co. | 508,700 | 30,649 | |
172,533 | |||
Household Products - 0.7% | |||
Kimberly-Clark Corp. | 181,400 | 20,654 | |
Procter & Gamble Co. | 290,097 | 23,463 | |
44,117 | |||
Personal Products - 0.5% | |||
Unilever NV (Certificaten Van Aandelen) (Bearer) | 592,300 | 34,170 | |
Tobacco - 3.1% | |||
Altria Group, Inc. | 1,134,500 | 66,572 | |
British American Tobacco PLC (United Kingdom) | 1,589,200 | 87,362 | |
Imperial Tobacco Group PLC | 522,867 | 20,053 | |
Philip Morris International, Inc. | 286,200 | 24,699 | |
198,686 | |||
TOTAL CONSUMER STAPLES | 542,906 | ||
ENERGY - 9.6% | |||
Oil, Gas & Consumable Fuels - 9.6% | |||
BP PLC | 3,056,800 | 22,973 | |
Chevron Corp. | 1,197,472 | 151,205 | |
ConocoPhillips Co. | 1,449,000 | 104,574 | |
Enterprise Products Partners LP | 1,154,400 | 33,478 | |
Imperial Oil Ltd. | 995,600 | 34,096 | |
Phillips 66 Co. | 398,700 | 49,176 | |
Suncor Energy, Inc. | 1,641,900 | 69,142 | |
The Williams Companies, Inc. | 2,092,143 | 62,241 | |
Valero Energy Corp. | 409,000 | 48,405 | |
Williams Partners LP | 1,164,069 | 52,418 | |
627,708 | |||
FINANCIALS - 23.3% | |||
Banks - 14.5% | |||
Bank of America Corp. | 6,516,900 | 201,242 | |
Citigroup, Inc. | 2,103,000 | 151,185 | |
JPMorgan Chase & Co. | 2,458,682 | 282,626 | |
KeyCorp | 1,087,516 | 22,696 | |
Lakeland Financial Corp. | 32,536 | 1,578 | |
Regions Financial Corp. | 946,700 | 17,618 | |
SunTrust Banks, Inc. | 680,400 | 49,036 | |
Wells Fargo & Co. | 3,773,950 | 216,210 | |
942,191 | |||
Capital Markets - 4.9% | |||
KKR & Co. LP | 5,223,565 | 143,021 | |
State Street Corp. | 443,099 | 39,130 | |
The Blackstone Group LP | 3,992,532 | 139,419 | |
TPG Specialty Lending, Inc. | 1 | 0 | |
321,570 | |||
Consumer Finance - 1.0% | |||
Capital One Financial Corp. | 445,700 | 42,038 | |
Discover Financial Services | 306,800 | 21,909 | |
63,947 | |||
Insurance - 2.9% | |||
Aspen Insurance Holdings Ltd. | 104,200 | 4,215 | |
Axis Capital Holdings Ltd. | 92,000 | 5,204 | |
Chubb Ltd. | 606,500 | 84,740 | |
Marsh & McLennan Companies, Inc. | 203,200 | 16,939 | |
MetLife, Inc. | 1,103,638 | 50,480 | |
The Travelers Companies, Inc. | 223,800 | 29,125 | |
190,703 | |||
TOTAL FINANCIALS | 1,518,411 | ||
HEALTH CARE - 12.2% | |||
Biotechnology - 2.1% | |||
Amgen, Inc. | 710,000 | 139,551 | |
Health Care Equipment & Supplies - 2.3% | |||
Becton, Dickinson & Co. | 383,300 | 95,967 | |
Danaher Corp. | 519,700 | 53,311 | |
149,278 | |||
Health Care Providers & Services - 1.6% | |||
CVS Health Corp. | 647,600 | 42,003 | |
HealthSouth Corp. | 3 | 0 | |
UnitedHealth Group, Inc. | 256,000 | 64,824 | |
106,827 | |||
Pharmaceuticals - 6.2% | |||
AstraZeneca PLC (United Kingdom) | 594,255 | 45,744 | |
Bristol-Myers Squibb Co. | 455,300 | 26,749 | |
GlaxoSmithKline PLC | 2,070,900 | 43,013 | |
Johnson & Johnson | 1,533,248 | 203,186 | |
Roche Holding AG (participation certificate) | 192,940 | 47,395 | |
Sanofi SA | 410,319 | 35,696 | |
401,783 | |||
TOTAL HEALTH CARE | 797,439 | ||
INDUSTRIALS - 7.6% | |||
Aerospace & Defense - 3.8% | |||
General Dynamics Corp. | 245,700 | 49,081 | |
Raytheon Co. | 214,800 | 42,537 | |
United Technologies Corp. | 1,126,720 | 152,941 | |
244,559 | |||
Building Products - 0.0% | |||
Johnson Controls International PLC | 8,400 | 315 | |
Commercial Services & Supplies - 0.2% | |||
Waste Connection, Inc. (Canada) | 178,145 | 13,820 | |
Electrical Equipment - 1.7% | |||
AMETEK, Inc. | 531,200 | 41,327 | |
Eaton Corp. PLC | 415,500 | 34,557 | |
Fortive Corp. | 299,700 | 24,599 | |
Regal Beloit Corp. | 99,700 | 8,569 | |
109,052 | |||
Industrial Conglomerates - 1.3% | |||
General Electric Co. | 2,939,755 | 40,069 | |
Roper Technologies, Inc. | 154,400 | 46,613 | |
86,682 | |||
Machinery - 0.6% | |||
Allison Transmission Holdings, Inc. | 401,300 | 18,861 | |
Ingersoll-Rand PLC | 194,200 | 19,131 | |
37,992 | |||
TOTAL INDUSTRIALS | 492,420 | ||
INFORMATION TECHNOLOGY - 11.5% | |||
Communications Equipment - 2.9% | |||
Cisco Systems, Inc. | 4,399,686 | 186,063 | |
Electronic Equipment & Components - 1.0% | |||
Dell Technologies, Inc. (a) | 326,703 | 30,227 | |
TE Connectivity Ltd. | 343,432 | 32,135 | |
62,362 | |||
IT Services - 1.2% | |||
First Data Corp. Class A (a) | 1,476,636 | 34,347 | |
Paychex, Inc. | 610,357 | 42,127 | |
76,474 | |||
Semiconductors & Semiconductor Equipment - 3.1% | |||
Intel Corp. | 966,600 | 46,493 | |
NXP Semiconductors NV (a) | 30,400 | 2,898 | |
Qualcomm, Inc. | 2,047,116 | 131,200 | |
Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR | 597,500 | 24,623 | |
205,214 | |||
Software - 2.3% | |||
Micro Focus International PLC | 1,720,710 | 28,078 | |
Microsoft Corp. | 1,158,916 | 122,938 | |
151,016 | |||
Technology Hardware, Storage & Peripherals - 1.0% | |||
Apple, Inc. | 347,300 | 66,088 | |
TOTAL INFORMATION TECHNOLOGY | 747,217 | ||
MATERIALS - 4.2% | |||
Chemicals - 3.1% | |||
DowDuPont, Inc. | 2,088,900 | 143,654 | |
LyondellBasell Industries NV Class A | 535,700 | 59,350 | |
203,004 | |||
Containers & Packaging - 1.1% | |||
Packaging Corp. of America | 281,000 | 31,725 | |
WestRock Co. | 701,700 | 40,685 | |
72,410 | |||
TOTAL MATERIALS | 275,414 | ||
REAL ESTATE - 1.5% | |||
Equity Real Estate Investment Trusts (REITs) - 1.5% | |||
American Tower Corp. | 454,100 | 67,316 | |
Public Storage | 145,300 | 31,651 | |
Spirit MTA REIT (a) | 16,680 | 167 | |
Spirit Realty Capital, Inc. | 24,400 | 204 | |
99,338 | |||
TELECOMMUNICATION SERVICES - 4.0% | |||
Diversified Telecommunication Services - 4.0% | |||
AT&T, Inc. | 892,689 | 28,539 | |
Verizon Communications, Inc. | 4,512,860 | 233,044 | |
261,583 | |||
Wireless Telecommunication Services - 0.0% | |||
T-Mobile U.S., Inc. (a) | 10,043 | 603 | |
TOTAL TELECOMMUNICATION SERVICES | 262,186 | ||
UTILITIES - 3.4% | |||
Electric Utilities - 2.7% | |||
Exelon Corp. | 2,753,300 | 117,015 | |
PPL Corp. | 1,102,300 | 31,713 | |
Xcel Energy, Inc. | 573,000 | 26,851 | |
175,579 | |||
Multi-Utilities - 0.7% | |||
CenterPoint Energy, Inc. | 816,100 | 23,243 | |
Public Service Enterprise Group, Inc. | 384,600 | 19,830 | |
43,073 | |||
TOTAL UTILITIES | 218,652 | ||
TOTAL COMMON STOCKS | |||
(Cost $4,549,261) | 6,143,748 | ||
Convertible Preferred Stocks - 0.1% | |||
HEALTH CARE - 0.0% | |||
Health Care Equipment & Supplies - 0.0% | |||
Becton, Dickinson & Co. Series A, 6.125% | 17,100 | 1,079 | |
INDUSTRIALS - 0.0% | |||
Electrical Equipment - 0.0% | |||
Fortive Corp. Series A, 5.00% | 770 | 814 | |
UTILITIES - 0.1% | |||
Electric Utilities - 0.1% | |||
Vistra Energy Corp. 7.00% | 19,100 | 1,757 | |
Multi-Utilities - 0.0% | |||
CenterPoint Energy, Inc. 2.00% ZENS | 14,500 | 631 | |
TOTAL UTILITIES | 2,388 | ||
TOTAL CONVERTIBLE PREFERRED STOCKS | |||
(Cost $4,287) | 4,281 | ||
Principal Amount (000s) | Value (000s) | ||
Corporate Bonds - 0.2% | |||
Convertible Bonds - 0.2% | |||
CONSUMER DISCRETIONARY - 0.0% | |||
Media - 0.0% | |||
DISH Network Corp. 3.375% 8/15/26 | 601 | 546 | |
Liberty Media Corp. 1.375% 10/15/23 | 1,455 | 1,841 | |
2,387 | |||
ENERGY - 0.1% | |||
Oil, Gas & Consumable Fuels - 0.1% | |||
Chesapeake Energy Corp. 5.5% 9/15/26 | 860 | 855 | |
Scorpio Tankers, Inc. 3% 5/15/22 | 2,300 | 2,051 | |
2,906 | |||
INDUSTRIALS - 0.0% | |||
Electrical Equipment - 0.0% | |||
SolarCity Corp. 1.625% 11/1/19 | 658 | 590 | |
INFORMATION TECHNOLOGY - 0.1% | |||
Internet Software & Services - 0.0% | |||
Twitter, Inc. 0.25% 6/15/24 (b) | 1,266 | 1,152 | |
Yahoo!, Inc. 0% 12/1/18 | 510 | 695 | |
1,847 | |||
IT Services - 0.0% | |||
Square, Inc. 0.375% 3/1/22 | 220 | 620 | |
Semiconductors & Semiconductor Equipment - 0.1% | |||
Intel Corp. 3.25% 8/1/39 | 284 | 658 | |
Microchip Technology, Inc. 1.625% 2/15/25 | 400 | 720 | |
Micron Technology, Inc. 3% 11/15/43 | 330 | 596 | |
ON Semiconductor Corp. 1.625% 10/15/23 | 535 | 670 | |
2,644 | |||
TOTAL INFORMATION TECHNOLOGY | 5,111 | ||
TOTAL CONVERTIBLE BONDS | 10,994 | ||
Nonconvertible Bonds - 0.0% | |||
CONSUMER DISCRETIONARY - 0.0% | |||
Diversified Consumer Services - 0.0% | |||
Laureate Education, Inc. 8.25% 5/1/25 (b) | 535 | 575 | |
ENERGY - 0.0% | |||
Oil, Gas & Consumable Fuels - 0.0% | |||
California Resources Corp. 8% 12/15/22 (b) | 1,385 | 1,240 | |
Southwestern Energy Co. 4.1% 3/15/22 | 645 | 613 | |
1,853 | |||
HEALTH CARE - 0.0% | |||
Pharmaceuticals - 0.0% | |||
Valeant Pharmaceuticals International, Inc. 5.875% 5/15/23 (b) | 1,060 | 1,018 | |
TOTAL NONCONVERTIBLE BONDS | 3,446 | ||
TOTAL CORPORATE BONDS | |||
(Cost $14,317) | 14,440 | ||
Bank Loan Obligations - 0.0% | |||
INDUSTRIALS - 0.0% | |||
Commercial Services & Supplies - 0.0% | |||
Lineage Logistics Holdings, LLC. Tranche B, term loan 3 month U.S. LIBOR + 3.000% 5.0768% 2/27/25 (c)(d) (Cost $1,802) | 1,803 | 1,794 | |
Shares | Value (000s) | ||
Other - 0.2% | |||
ENERGY - 0.2% | |||
Oil, Gas & Consumable Fuels - 0.2% | |||
Utica Shale Drilling Program (non-operating revenue interest) (e)(f)(g) | |||
(Cost $22,679) | 22,678,929 | 11,947 | |
Money Market Funds - 5.2% | |||
Fidelity Cash Central Fund, 1.96% (h) | |||
(Cost $338,973) | 338,905,391 | 338,973 | |
TOTAL INVESTMENT IN SECURITIES - 99.9% | |||
(Cost $4,931,319) | 6,515,183 | ||
NET OTHER ASSETS (LIABILITIES) - 0.1% | 5,393 | ||
NET ASSETS - 100% | $6,520,576 |
Values shown as $0 in the Schedule of Investments may reflect amounts less than $500.
Legend
(a) Non-income producing
(b) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the end of the period, the value of these securities amounted to $3,985,000 or 0.1% of net assets.
(c) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end.
(d) Coupon is indexed to a floating interest rate which may be multiplied by a specified factor and/or subject to caps or floors.
(e) Investment is owned by a wholly-owned subsidiary (Subsidiary) that is treated as a corporation for U.S. tax purposes.
(f) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $11,947,000 or 0.2% of net assets.
(g) Level 3 security
(h) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
Additional information on each restricted holding is as follows:
Security | Acquisition Date | Acquisition Cost (000s) |
Utica Shale Drilling Program (non-operating revenue interest) | 10/5/16 - 9/1/17 | $22,679 |
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
(Amounts in thousands) | |
Fidelity Cash Central Fund | $2,329 |
Fidelity Securities Lending Cash Central Fund | 94 |
Total | $2,423 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
(Amounts in thousands) | ||||
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $562,057 | $562,057 | $-- | $-- |
Consumer Staples | 542,906 | 403,659 | 139,247 | -- |
Energy | 627,708 | 604,735 | 22,973 | -- |
Financials | 1,518,411 | 1,518,411 | -- | -- |
Health Care | 798,518 | 625,591 | 172,927 | -- |
Industrials | 493,234 | 492,420 | 814 | -- |
Information Technology | 747,217 | 719,139 | 28,078 | -- |
Materials | 275,414 | 275,414 | -- | -- |
Real Estate | 99,338 | 99,338 | -- | -- |
Telecommunication Services | 262,186 | 262,186 | -- | -- |
Utilities | 221,040 | 218,652 | 2,388 | -- |
Corporate Bonds | 14,440 | -- | 14,440 | -- |
Bank Loan Obligations | 1,794 | -- | 1,794 | -- |
Other | 11,947 | -- | -- | 11,947 |
Money Market Funds | 338,973 | 338,973 | -- | -- |
Total Investments in Securities: | $6,515,183 | $6,120,575 | $382,661 | $11,947 |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 87.1% |
United Kingdom | 4.1% |
Switzerland | 2.8% |
Canada | 1.8% |
Netherlands | 1.4% |
Others (Individually Less Than 1%) | 2.8% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amounts) | July 31, 2018 (Unaudited) | |
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $4,592,346) | $6,176,210 | |
Fidelity Central Funds (cost $338,973) | 338,973 | |
Total Investment in Securities (cost $4,931,319) | $6,515,183 | |
Cash | 13 | |
Restricted cash | 462 | |
Receivable for investments sold | 706 | |
Receivable for fund shares sold | 941 | |
Dividends receivable | 9,924 | |
Interest receivable | 119 | |
Distributions receivable from Fidelity Central Funds | 712 | |
Prepaid expenses | 16 | |
Other receivables | 1,363 | |
Total assets | 6,529,439 | |
Liabilities | ||
Payable for investments purchased | $918 | |
Payable for fund shares redeemed | 3,557 | |
Accrued management fee | 2,378 | |
Transfer agent fee payable | 682 | |
Other affiliated payables | 95 | |
Other payables and accrued expenses | 1,233 | |
Total liabilities | 8,863 | |
Net Assets | $6,520,576 | |
Net Assets consist of: | ||
Paid in capital | $4,755,895 | |
Distributions in excess of net investment income | (25,251) | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 206,111 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 1,583,821 | |
Net Assets | $6,520,576 | |
Equity-Income: | ||
Net Asset Value, offering price and redemption price per share ($5,493,459 ÷ 91,827.9 shares) | $59.82 | |
Class K: | ||
Net Asset Value, offering price and redemption price per share ($1,027,117 ÷ 17,180.3 shares) | $59.78 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Amounts in thousands | Six months ended July 31, 2018 (Unaudited) | |
Investment Income | ||
Dividends | $109,403 | |
Interest | 291 | |
Income from Fidelity Central Funds | 2,423 | |
Total income | 112,117 | |
Expenses | ||
Management fee | $14,800 | |
Transfer agent fees | 4,172 | |
Accounting and security lending fees | 579 | |
Custodian fees and expenses | 63 | |
Independent trustees' fees and expenses | (1) | |
Registration fees | 50 | |
Audit | 50 | |
Legal | 10 | |
Miscellaneous | 31 | |
Total expenses before reductions | 19,754 | |
Expense reductions | (306) | |
Total expenses after reductions | 19,448 | |
Net investment income (loss) | 92,669 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 206,539 | |
Fidelity Central Funds | (1) | |
Foreign currency transactions | (112) | |
Total net realized gain (loss) | 206,426 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (514,322) | |
Assets and liabilities in foreign currencies | (61) | |
Total change in net unrealized appreciation (depreciation) | (514,383) | |
Net gain (loss) | (307,957) | |
Net increase (decrease) in net assets resulting from operations | $(215,288) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Amounts in thousands | Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $92,669 | $173,761 |
Net realized gain (loss) | 206,426 | 460,187 |
Change in net unrealized appreciation (depreciation) | (514,383) | 609,856 |
Net increase (decrease) in net assets resulting from operations | (215,288) | 1,243,804 |
Distributions to shareholders from net investment income | (86,254) | (153,045) |
Distributions to shareholders from net realized gain | (151,569) | (355,004) |
Total distributions | (237,823) | (508,049) |
Share transactions - net increase (decrease) | (570,779) | (1,668,136) |
Total increase (decrease) in net assets | (1,023,890) | (932,381) |
Net Assets | ||
Beginning of period | 7,544,466 | 8,476,847 |
End of period | $6,520,576 | $7,544,466 |
Other Information | ||
Distributions in excess of net investment income end of period | $(25,251) | $(31,666) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Equity-Income Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $63.45 | $57.76 | $48.57 | $57.26 | $56.69 | $49.72 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .80 | 1.30 | 1.22 | 1.43 | 2.00B | 1.26 |
Net realized and unrealized gain (loss) | (2.39) | 8.52 | 10.43 | (3.91)C | 2.87 | 6.99 |
Total from investment operations | (1.59) | 9.82 | 11.65 | (2.48) | 4.87 | 8.25 |
Distributions from net investment income | (.75) | (1.20)D | (1.36) | (1.71)D | (1.60) | (1.28) |
Distributions from net realized gain | (1.29) | (2.93)D | (1.10) | (4.51)D | (2.70) | – |
Total distributions | (2.04) | (4.13) | (2.46) | (6.21)E | (4.30) | (1.28) |
Net asset value, end of period | $59.82 | $63.45 | $57.76 | $48.57 | $57.26 | $56.69 |
Total ReturnF,G | (2.41)% | 17.57% | 24.42% | (4.89)%C | 8.53% | 16.72% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | .61%J | .61% | .63% | .64% | .63% | .64% |
Expenses net of fee waivers, if any | .61%J | .61% | .63% | .64% | .63% | .64% |
Expenses net of all reductions | .60%J | .61% | .62% | .63% | .63% | .64% |
Net investment income (loss) | 2.74%J | 2.18% | 2.27% | 2.55% | 3.30%B | 2.30% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $5,493 | $5,921 | $6,686 | $5,752 | $6,686 | $6,842 |
Portfolio turnover rateK | 31%J,L | 33% | 36% | 46%L | 40% | 43% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.48 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 2.51%.
C Net realized and unrealized gain (loss) per share reflects proceeds received from litigation which amounted to $.13 per share. Excluding these litigation proceeds, the total return would have been (5.12)%.
D The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
E Total distributions of $6.21 per share is comprised of distributions from net investment income of $1.709 and distributions from net realized gain of $4.505 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
L Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Equity-Income Fund Class K
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $63.41 | $57.73 | $48.55 | $57.25 | $56.67 | $49.70 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .83 | 1.36 | 1.28 | 1.50 | 2.07B | 1.33 |
Net realized and unrealized gain (loss) | (2.39) | 8.51 | 10.42 | (3.92)C | 2.88 | 6.99 |
Total from investment operations | (1.56) | 9.87 | 11.70 | (2.42) | 4.95 | 8.32 |
Distributions from net investment income | (.78) | (1.26)D | (1.42) | (1.78)D | (1.67) | (1.35) |
Distributions from net realized gain | (1.29) | (2.93)D | (1.10) | (4.51)D | (2.70) | – |
Total distributions | (2.07) | (4.19) | (2.52) | (6.28)E | (4.37) | (1.35) |
Net asset value, end of period | $59.78 | $63.41 | $57.73 | $48.55 | $57.25 | $56.67 |
Total ReturnF,G | (2.37)% | 17.68% | 24.56% | (4.78)%C | 8.68% | 16.87% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | .51%J | .51% | .52% | .52% | .52% | .52% |
Expenses net of fee waivers, if any | .51%J | .51% | .52% | .52% | .52% | .52% |
Expenses net of all reductions | .50%J | .51% | .51% | .51% | .51% | .52% |
Net investment income (loss) | 2.84%J | 2.28% | 2.39% | 2.67% | 3.41%B | 2.42% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $1,027 | $1,623 | $1,791 | $1,646 | $2,272 | $2,480 |
Portfolio turnover rateK | 31%J,L | 33% | 36% | 46%L | 40% | 43% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.48 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 2.63%.
C Net realized and unrealized gain (loss) per share reflects proceeds received from litigation which amounted to $.13 per share. Excluding these litigation proceeds, the total return would have been (5.01)%
D The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
E Total distributions of $6.28 per share is comprised of distributions from net investment income of $1.777 and distributions from net realized gain of $4.505 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
L Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
(Amounts in thousands except percentages)
1. Organization.
Fidelity Equity-Income Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund offers Equity-Income and Class K shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. Corporate bonds and bank loan obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of July 31, 2018 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost and include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivables when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), certain independent Trustees have elected to defer receipt of a portion of their annual compensation. Deferred amounts are invested in a cross-section of Fidelity funds, are marked-to-market and remain in the Fund until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting payable to the Trustees of $1,132 are included in the accompanying Statement of Assets and Liabilities in other receivables and other payables and accrued expenses, respectively.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP. These differences resulted in distribution reclassifications.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, market discount, contingent interest, partnerships, deferred trustees compensation, equity-debt classifications, certain conversion ratio adjustments and losses deferred due to wash sales.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $1,710,748 |
Gross unrealized depreciation | (130,258) |
Net unrealized appreciation (depreciation) | $1,580,490 |
Tax cost | $4,934,693 |
Restricted Securities. The Fund may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of the Fund's Schedule of Investments.
Loans and Other Direct Debt Instruments. The Fund invests in direct debt instruments which are interests in amounts owed to lenders by corporate or other borrowers. These instruments may be in the form of loans, trade claims or other receivables and may include standby financing commitments such as revolving credit facilities that obligate the Fund to supply additional cash to the borrower on demand. Loans may be acquired through assignment or participation. The Fund did not have any unfunded loan commitments, which are contractual obligations for future funding, at period end.
Consolidated Subsidiary. The Fund invests in certain investments through a wholly-owned subsidiary ("Subsidiary"), which may be subject to federal and state taxes upon disposition.
As of period end, the Fund held an investment of $12,409 in this Subsidiary, representing .19% of the Fund's net assets. The financial statements have been consolidated and include accounts of the Fund and the Subsidiary. Accordingly, all inter-company transactions and balances have been eliminated.
Any cash held by the Subsidiary is restricted as to its use and is presented as Restricted cash in the Statement of Assets and Liabilities.
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and in-kind transactions, aggregated $1,014,562 and $1,781,120, respectively.
Redemptions In-Kind. During the period, 1,109 shares of the Fund held by unaffiliated entities were redeemed in-kind for investments and cash, with a value of $63,055. The net realized gain of $22,455 on investments delivered through the in-kind redemptions is included in the accompanying Statement of Operations. The amount of the redemptions is included in share transactions activity shown in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .20% of the Fund's average net assets and an annualized group fee rate that averaged .24% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the reporting period, the total annualized management fee rate was .44% of the Fund's average net assets.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, is the transfer, dividend disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of Equity-Income, except for Class K. FIIOC receives an asset-based fee of Class K's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Equity-Income | $3,875 | .14 |
Class K | 297 | .05 |
$4,172 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions. For the period, the fees were equivalent to an annualized rate of .02%.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $54 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $10 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. At period end, there were no security loans outstanding. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $94, including $3 from securities loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $267 for the period. In addition, through arrangements with the Fund's custodian and each class' transfer agent, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses in the amount of less than five hundred dollars. During the period, credits reduced each class' transfer agent expense as noted in the table below.
Transfer Agent expense reduction | |
Equity-Income | $3 |
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $36.
9. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended July 31, 2018 | Year ended January 31, 2018 | |
From net investment income | ||
Equity-Income | $69,487 | $116,026 |
Class K | 16,767 | 37,019 |
Total | $86,254 | $153,045 |
From net realized gain | ||
Equity-Income | $119,107 | $278,349 |
Class K | 32,462 | 76,655 |
Total | $151,569 | $355,004 |
10. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended July 31, 2018 | Year ended January 31, 2018 | Six months ended July 31, 2018 | Year ended January 31, 2018 | |
Equity-Income | ||||
Shares sold | 1,610 | 9,765 | $93,968 | $585,205 |
Reinvestment of distributions | 3,016 | 6,203 | 176,970 | 370,841 |
Shares redeemed | (6,122) | (38,402) | (356,440) | (2,288,604) |
Net increase (decrease) | (1,496) | (22,434) | $(85,502) | $(1,332,558) |
Class K | ||||
Shares sold | 1,192 | 7,660 | $69,683 | $451,462 |
Reinvestment of distributions | 839 | 1,902 | 49,229 | 113,674 |
Shares redeemed | (10,445)(a) | (14,995) | (604,189)(a) | (900,714) |
Net increase (decrease) | (8,414) | (5,433) | $(485,277) | $(335,578) |
(a) Amount includes in-kind redemptions (see the Redemptions In-Kind note for additional details)
11. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying table for each class of the Fund 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the Fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of the Fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Equity-Income | .61% | |||
Actual | $1,000.00 | $975.90 | $2.99 | |
Hypothetical-C | $1,000.00 | $1,021.77 | $3.06 | |
Class K | .51% | |||
Actual | $1,000.00 | $976.30 | $2.50 | |
Hypothetical-C | $1,000.00 | $1,022.27 | $2.56 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Equity-Income Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
EQU-K-SANN-0918
1.863288.109
Fidelity® Series All-Sector Equity Fund Fidelity® Series Stock Selector Large Cap Value Fund Fidelity® Series Value Discovery Fund Semi-Annual Report July 31, 2018 |
Contents
Fidelity® Series All-Sector Equity Fund | |
Fidelity® Series Stock Selector Large Cap Value Fund | |
Fidelity® Series Value Discovery Fund | |
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Funds. This report is not authorized for distribution to prospective investors in the Funds unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Funds nor Fidelity Distributors Corporation is a bank.
Fidelity® Series All-Sector Equity Fund
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
Microsoft Corp. | 3.3 |
Amazon.com, Inc. | 3.2 |
Alphabet, Inc. Class C | 3.1 |
Apple, Inc. | 2.9 |
Facebook, Inc. Class A | 2.4 |
Bank of America Corp. | 2.0 |
UnitedHealth Group, Inc. | 1.9 |
Philip Morris International, Inc. | 1.5 |
Citrix Systems, Inc. | 1.4 |
Citigroup, Inc. | 1.4 |
23.1 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Information Technology | 25.1 |
Financials | 13.8 |
Health Care | 13.8 |
Consumer Discretionary | 12.8 |
Industrials | 10.3 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks and Equity Futures | 99.4% | |
Short-Term Investments and Net Other Assets (Liabilities) | 0.6% |
* Foreign investments - 3.8%
Fidelity® Series All-Sector Equity Fund
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 98.9% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 12.8% | |||
Auto Components - 0.5% | |||
Aptiv PLC | 249,500 | $24,468,465 | |
Delphi Technologies PLC | 195,800 | 8,844,286 | |
33,312,751 | |||
Diversified Consumer Services - 0.5% | |||
Service Corp. International | 786,200 | 30,936,970 | |
Hotels, Restaurants & Leisure - 2.2% | |||
Hilton Grand Vacations, Inc. (a) | 413,800 | 14,313,342 | |
Marriott International, Inc. Class A | 208,841 | 26,698,233 | |
McDonald's Corp. | 345,500 | 54,430,070 | |
Starbucks Corp. | 894,038 | 46,838,651 | |
U.S. Foods Holding Corp. (a) | 55,000 | 1,859,550 | |
144,139,846 | |||
Household Durables - 0.8% | |||
Lennar Corp. Class A | 384,200 | 20,082,134 | |
Mohawk Industries, Inc. (a) | 174,200 | 32,812,312 | |
52,894,446 | |||
Internet & Direct Marketing Retail - 3.6% | |||
Amazon.com, Inc. (a) | 115,260 | 204,867,734 | |
Netflix, Inc. (a) | 77,000 | 25,983,650 | |
230,851,384 | |||
Media - 2.2% | |||
Comcast Corp. Class A | 1,484,248 | 53,106,393 | |
The Walt Disney Co. | 770,617 | 87,511,267 | |
140,617,660 | |||
Multiline Retail - 0.4% | |||
Dollar Tree, Inc. (a) | 304,600 | 27,803,888 | |
Specialty Retail - 2.0% | |||
Home Depot, Inc. | 357,879 | 70,688,260 | |
TJX Companies, Inc. | 625,698 | 60,855,387 | |
131,543,647 | |||
Textiles, Apparel & Luxury Goods - 0.6% | |||
Carter's, Inc. | 150,800 | 15,808,364 | |
Tapestry, Inc. | 433,900 | 20,445,368 | |
36,253,732 | |||
TOTAL CONSUMER DISCRETIONARY | 828,354,324 | ||
CONSUMER STAPLES - 6.4% | |||
Beverages - 1.6% | |||
Constellation Brands, Inc. Class A (sub. vtg.) | 96,704 | 20,330,082 | |
Keurig Dr. Pepper, Inc. | 70,943 | 1,703,341 | |
Monster Beverage Corp. (a) | 254,598 | 15,280,972 | |
The Coca-Cola Co. | 1,387,754 | 64,710,969 | |
102,025,364 | |||
Food & Staples Retailing - 0.5% | |||
Kroger Co. | 551,600 | 15,996,400 | |
Walgreens Boots Alliance, Inc. | 191,529 | 12,951,191 | |
28,947,591 | |||
Food Products - 1.2% | |||
Bunge Ltd. | 239,300 | 16,542,809 | |
Mondelez International, Inc. | 831,200 | 36,057,456 | |
The Hain Celestial Group, Inc. (a) | 135,152 | 3,843,723 | |
The J.M. Smucker Co. | 15,000 | 1,666,800 | |
The Kraft Heinz Co. | 174,300 | 10,501,575 | |
TreeHouse Foods, Inc. (a) | 198,800 | 9,441,012 | |
78,053,375 | |||
Household Products - 1.0% | |||
Colgate-Palmolive Co. | 518,184 | 34,723,510 | |
Kimberly-Clark Corp. | 53,200 | 6,057,352 | |
Procter & Gamble Co. | 156,366 | 12,646,882 | |
Spectrum Brands Holdings, Inc. (b) | 119,032 | 10,399,826 | |
63,827,570 | |||
Personal Products - 0.3% | |||
Coty, Inc. Class A | 351,371 | 4,711,885 | |
Edgewell Personal Care Co. (a) | 125,000 | 6,732,500 | |
Estee Lauder Companies, Inc. Class A | 76,042 | 10,261,107 | |
21,705,492 | |||
Tobacco - 1.8% | |||
Altria Group, Inc. | 366,930 | 21,531,452 | |
Philip Morris International, Inc. | 1,085,628 | 93,689,696 | |
115,221,148 | |||
TOTAL CONSUMER STAPLES | 409,780,540 | ||
ENERGY - 5.8% | |||
Energy Equipment & Services - 0.4% | |||
Baker Hughes, a GE Co. Class A | 387,100 | 13,385,918 | |
Halliburton Co. | 70,240 | 2,979,581 | |
Schlumberger Ltd. | 122,000 | 8,237,440 | |
24,602,939 | |||
Oil, Gas & Consumable Fuels - 5.4% | |||
Anadarko Petroleum Corp. | 373,981 | 27,356,710 | |
Cabot Oil & Gas Corp. | 285,600 | 6,711,600 | |
Chevron Corp. | 324,729 | 41,003,531 | |
ConocoPhillips Co. | 410,300 | 29,611,351 | |
Devon Energy Corp. | 537,700 | 24,201,877 | |
Diamondback Energy, Inc. | 39,300 | 5,185,635 | |
EOG Resources, Inc. | 312,600 | 40,306,644 | |
Extraction Oil & Gas, Inc. (a) | 209,923 | 3,174,036 | |
Exxon Mobil Corp. | 505,724 | 41,221,563 | |
Marathon Petroleum Corp. | 162,200 | 13,110,626 | |
Noble Energy, Inc. | 365,600 | 13,194,504 | |
Parsley Energy, Inc. Class A (a) | 513,500 | 16,139,305 | |
Phillips 66 Co. | 259,000 | 31,945,060 | |
Pioneer Natural Resources Co. | 110,400 | 20,895,408 | |
The Williams Companies, Inc. | 303,300 | 9,023,175 | |
Valero Energy Corp. | 247,900 | 29,338,965 | |
352,419,990 | |||
TOTAL ENERGY | 377,022,929 | ||
FINANCIALS - 13.8% | |||
Banks - 6.2% | |||
Bank of America Corp. | 4,137,687 | 127,771,775 | |
Citigroup, Inc. | 1,263,884 | 90,860,621 | |
First Horizon National Corp. | 1,114,600 | 19,940,194 | |
Huntington Bancshares, Inc. | 3,904,257 | 60,281,728 | |
KeyCorp | 720,000 | 15,026,400 | |
PNC Financial Services Group, Inc. | 247,300 | 35,816,459 | |
Synovus Financial Corp. | 118,051 | 5,834,080 | |
Wells Fargo & Co. | 767,200 | 43,952,888 | |
399,484,145 | |||
Capital Markets - 2.4% | |||
BlackRock, Inc. Class A | 42,218 | 21,225,522 | |
Cboe Global Markets, Inc. | 82,200 | 7,984,086 | |
E*TRADE Financial Corp. (a) | 529,152 | 31,648,581 | |
Goldman Sachs Group, Inc. | 188,300 | 44,708,069 | |
IntercontinentalExchange, Inc. | 98,500 | 7,280,135 | |
MSCI, Inc. | 35,000 | 5,816,650 | |
Northern Trust Corp. | 118,700 | 12,964,414 | |
State Street Corp. | 59,300 | 5,236,783 | |
TD Ameritrade Holding Corp. | 284,800 | 16,276,320 | |
153,140,560 | |||
Consumer Finance - 1.9% | |||
Capital One Financial Corp. | 952,405 | 89,830,840 | |
SLM Corp. (a) | 1,536,946 | 17,352,120 | |
Synchrony Financial | 593,400 | 17,172,996 | |
124,355,956 | |||
Diversified Financial Services - 0.4% | |||
Berkshire Hathaway, Inc. Class A (a) | 84 | 25,330,200 | |
Insurance - 2.9% | |||
American International Group, Inc. | 1,414,500 | 78,094,545 | |
Hartford Financial Services Group, Inc. | 362,100 | 19,082,670 | |
Marsh & McLennan Companies, Inc. | 91,100 | 7,594,096 | |
MetLife, Inc. | 900,200 | 41,175,148 | |
The Travelers Companies, Inc. | 349,300 | 45,457,902 | |
191,404,361 | |||
TOTAL FINANCIALS | 893,715,222 | ||
HEALTH CARE - 13.8% | |||
Biotechnology - 2.8% | |||
Alexion Pharmaceuticals, Inc. (a) | 224,900 | 29,902,704 | |
Amgen, Inc. | 407,003 | 79,996,440 | |
Biogen, Inc. (a) | 115,624 | 38,661,197 | |
Vertex Pharmaceuticals, Inc. (a) | 194,100 | 33,977,205 | |
182,537,546 | |||
Health Care Equipment & Supplies - 4.6% | |||
Abbott Laboratories | 949,800 | 62,249,892 | |
Align Technology, Inc. (a) | 40,000 | 14,266,000 | |
Baxter International, Inc. | 544,700 | 39,463,515 | |
Becton, Dickinson & Co. | 269,300 | 67,424,641 | |
Boston Scientific Corp. (a) | 1,942,110 | 65,274,317 | |
Intuitive Surgical, Inc. (a) | 66,300 | 33,692,997 | |
ResMed, Inc. | 151,200 | 15,993,936 | |
298,365,298 | |||
Health Care Providers & Services - 3.8% | |||
DaVita HealthCare Partners, Inc. (a) | 245,000 | 17,218,600 | |
HCA Holdings, Inc. | 147,000 | 18,261,810 | |
Henry Schein, Inc. (a) | 289,474 | 22,987,130 | |
Humana, Inc. | 138,400 | 43,482,512 | |
Molina Healthcare, Inc. (a) | 170,000 | 17,695,300 | |
UnitedHealth Group, Inc. | 480,200 | 121,596,244 | |
241,241,596 | |||
Life Sciences Tools & Services - 1.0% | |||
Agilent Technologies, Inc. | 310,300 | 20,492,212 | |
Thermo Fisher Scientific, Inc. | 193,500 | 45,381,555 | |
65,873,767 | |||
Pharmaceuticals - 1.6% | |||
Allergan PLC | 136,704 | 25,165,839 | |
Bristol-Myers Squibb Co. | 698,500 | 41,036,875 | |
Eli Lilly & Co. | 150,000 | 14,821,500 | |
Merck & Co., Inc. | 44,200 | 2,911,454 | |
Perrigo Co. PLC | 257,000 | 20,693,640 | |
104,629,308 | |||
TOTAL HEALTH CARE | 892,647,515 | ||
INDUSTRIALS - 10.3% | |||
Aerospace & Defense - 2.7% | |||
General Dynamics Corp. | 215,800 | 43,108,208 | |
Northrop Grumman Corp. | 147,400 | 44,292,226 | |
The Boeing Co. | 80,900 | 28,824,670 | |
United Technologies Corp. | 440,248 | 59,759,264 | |
175,984,368 | |||
Air Freight & Logistics - 0.4% | |||
FedEx Corp. | 101,300 | 24,906,631 | |
Airlines - 0.5% | |||
Southwest Airlines Co. | 524,800 | 30,522,368 | |
Construction & Engineering - 0.4% | |||
Jacobs Engineering Group, Inc. | 413,900 | 27,992,057 | |
Electrical Equipment - 1.1% | |||
AMETEK, Inc. | 438,649 | 34,126,892 | |
Fortive Corp. | 479,598 | 39,365,404 | |
73,492,296 | |||
Industrial Conglomerates - 1.8% | |||
3M Co. | 64,500 | 13,694,640 | |
General Electric Co. | 2,914,600 | 39,725,998 | |
Honeywell International, Inc. | 369,705 | 59,023,403 | |
112,444,041 | |||
Machinery - 2.4% | |||
Allison Transmission Holdings, Inc. | 963,200 | 45,270,400 | |
Apergy Corp. (a) | 132,400 | 5,428,400 | |
Caterpillar, Inc. | 64,600 | 9,289,480 | |
Gardner Denver Holdings, Inc. (a) | 888,300 | 25,414,263 | |
Ingersoll-Rand PLC | 396,200 | 39,029,662 | |
Snap-On, Inc. | 174,200 | 29,542,578 | |
153,974,783 | |||
Professional Services - 0.6% | |||
IHS Markit Ltd. (a) | 701,093 | 37,178,962 | |
Road & Rail - 0.4% | |||
Norfolk Southern Corp. | 146,600 | 24,775,400 | |
TOTAL INDUSTRIALS | 661,270,906 | ||
INFORMATION TECHNOLOGY - 25.1% | |||
Communications Equipment - 0.2% | |||
CommScope Holding Co., Inc. (a) | 171,600 | 5,510,076 | |
Palo Alto Networks, Inc. (a) | 20,700 | 4,103,982 | |
9,614,058 | |||
Electronic Equipment & Components - 0.4% | |||
CDW Corp. | 61,400 | 5,163,126 | |
Dell Technologies, Inc. (a) | 88,300 | 8,169,516 | |
IPG Photonics Corp. (a) | 30,300 | 4,970,412 | |
Jabil, Inc. | 365,136 | 10,285,881 | |
28,588,935 | |||
Internet Software & Services - 5.9% | |||
Alphabet, Inc. Class C (a) | 163,866 | 199,467,527 | |
Facebook, Inc. Class A (a) | 894,200 | 154,321,036 | |
GoDaddy, Inc. (a) | 78,300 | 5,764,446 | |
IAC/InterActiveCorp (a) | 128,100 | 18,862,725 | |
378,415,734 | |||
IT Services - 2.2% | |||
Alliance Data Systems Corp. | 170,600 | 38,364,528 | |
Cognizant Technology Solutions Corp. Class A | 29,400 | 2,396,100 | |
DXC Technology Co. | 174,600 | 14,795,604 | |
Fidelity National Information Services, Inc. | 72,200 | 7,445,986 | |
FleetCor Technologies, Inc. (a) | 14,049 | 3,048,633 | |
Global Payments, Inc. | 189,500 | 21,332,015 | |
Leidos Holdings, Inc. | 308,800 | 21,128,096 | |
PayPal Holdings, Inc. (a) | 278,400 | 22,867,776 | |
Worldpay, Inc. (a) | 130,900 | 10,758,671 | |
142,137,409 | |||
Semiconductors & Semiconductor Equipment - 4.4% | |||
Advanced Micro Devices, Inc. (a) | 1,387,500 | 25,432,875 | |
Analog Devices, Inc. | 146,800 | 14,113,352 | |
Applied Materials, Inc. | 212,900 | 10,353,327 | |
Broadcom, Inc. | 101,800 | 22,576,186 | |
Lam Research Corp. | 56,400 | 10,752,096 | |
Marvell Technology Group Ltd. | 1,253,100 | 26,703,561 | |
Micron Technology, Inc. (a) | 340,300 | 17,964,437 | |
NVIDIA Corp. | 206,880 | 50,656,637 | |
NXP Semiconductors NV (a) | 122,600 | 11,688,684 | |
ON Semiconductor Corp. (a) | 996,700 | 21,977,235 | |
Qorvo, Inc. (a) | 28,092 | 2,296,802 | |
Qualcomm, Inc. | 1,123,704 | 72,018,189 | |
286,533,381 | |||
Software - 9.1% | |||
Activision Blizzard, Inc. | 594,721 | 43,664,416 | |
Adobe Systems, Inc. (a) | 55,500 | 13,579,740 | |
Autodesk, Inc. (a) | 414,635 | 53,255,719 | |
Citrix Systems, Inc. (a) | 843,454 | 92,754,636 | |
Guidewire Software, Inc. (a) | 24,100 | 2,077,420 | |
Intuit, Inc. | 13,500 | 2,757,240 | |
Microsoft Corp. | 1,998,000 | 211,947,843 | |
Nuance Communications, Inc. (a) | 3,013,300 | 44,506,441 | |
Oracle Corp. | 719,000 | 34,281,920 | |
Parametric Technology Corp. (a) | 208,300 | 19,144,853 | |
Red Hat, Inc. (a) | 167,800 | 23,698,394 | |
Salesforce.com, Inc. (a) | 217,163 | 29,783,905 | |
Splunk, Inc. (a) | 29,100 | 2,796,510 | |
Symantec Corp. | 161,700 | 3,269,574 | |
Tableau Software, Inc. (a) | 12,500 | 1,288,375 | |
Workday, Inc. Class A (a) | 70,300 | 8,718,606 | |
587,525,592 | |||
Technology Hardware, Storage & Peripherals - 2.9% | |||
Apple, Inc. | 973,759 | 185,296,600 | |
HP, Inc. | 124,100 | 2,864,228 | |
188,160,828 | |||
TOTAL INFORMATION TECHNOLOGY | 1,620,975,937 | ||
MATERIALS - 2.9% | |||
Chemicals - 2.4% | |||
Air Products & Chemicals, Inc. | 63,500 | 10,424,795 | |
Axalta Coating Systems Ltd. (a) | 120,400 | 3,642,100 | |
Cabot Corp. | 15,000 | 991,500 | |
DowDuPont, Inc. | 795,822 | 54,728,679 | |
FMC Corp. | 32,500 | 2,921,100 | |
LyondellBasell Industries NV Class A | 210,247 | 23,293,265 | |
Olin Corp. | 427,600 | 12,618,476 | |
Platform Specialty Products Corp. (a) | 802,100 | 9,913,956 | |
Sherwin-Williams Co. | 9,900 | 4,363,227 | |
The Chemours Co. LLC | 500,200 | 22,914,162 | |
Westlake Chemical Corp. | 76,021 | 8,150,972 | |
153,962,232 | |||
Construction Materials - 0.1% | |||
Eagle Materials, Inc. | 77 | 7,650 | |
Martin Marietta Materials, Inc. | 33,400 | 6,660,628 | |
6,668,278 | |||
Containers & Packaging - 0.1% | |||
Aptargroup, Inc. | 15,200 | 1,556,936 | |
Berry Global Group, Inc. (a) | 19,600 | 957,460 | |
Packaging Corp. of America | 22,600 | 2,551,540 | |
WestRock Co. | 45,900 | 2,661,282 | |
7,727,218 | |||
Metals & Mining - 0.3% | |||
Alcoa Corp. (a) | 45,100 | 1,951,477 | |
Freeport-McMoRan, Inc. | 330,000 | 5,445,000 | |
Newmont Mining Corp. | 130,100 | 4,772,068 | |
Royal Gold, Inc. | 16,100 | 1,362,221 | |
Steel Dynamics, Inc. | 158,000 | 7,440,220 | |
20,970,986 | |||
TOTAL MATERIALS | 189,328,714 | ||
REAL ESTATE - 3.5% | |||
Equity Real Estate Investment Trusts (REITs) - 3.4% | |||
American Homes 4 Rent Class A | 219,300 | 4,855,302 | |
American Tower Corp. | 212,700 | 31,530,648 | |
Boston Properties, Inc. | 151,500 | 19,017,795 | |
Colony NorthStar, Inc. | 324,219 | 1,997,189 | |
Corporate Office Properties Trust (SBI) | 339,600 | 10,099,704 | |
Equinix, Inc. | 54,100 | 23,765,048 | |
Equity Lifestyle Properties, Inc. | 216,900 | 19,735,731 | |
Gaming & Leisure Properties | 237,300 | 8,618,736 | |
General Growth Properties, Inc. | 77,400 | 1,650,168 | |
Healthcare Trust of America, Inc. | 298,800 | 8,163,216 | |
Outfront Media, Inc. | 168,500 | 3,580,625 | |
Prologis, Inc. | 392,800 | 25,775,536 | |
Public Storage | 123,900 | 26,989,137 | |
Spirit MTA REIT (a) | 87,780 | 876,922 | |
Spirit Realty Capital, Inc. | 1,013,000 | 8,478,810 | |
Store Capital Corp. | 459,400 | 12,610,530 | |
The Macerich Co. | 119,500 | 7,057,670 | |
VEREIT, Inc. | 775,300 | 5,915,539 | |
220,718,306 | |||
Real Estate Management & Development - 0.1% | |||
CBRE Group, Inc. (a) | 99,700 | 4,965,060 | |
TOTAL REAL ESTATE | 225,683,366 | ||
TELECOMMUNICATION SERVICES - 1.7% | |||
Diversified Telecommunication Services - 1.5% | |||
AT&T, Inc. | 1,201,000 | 38,395,970 | |
Verizon Communications, Inc. | 963,893 | 49,775,435 | |
Zayo Group Holdings, Inc. (a) | 238,600 | 8,849,674 | |
97,021,079 | |||
Wireless Telecommunication Services - 0.2% | |||
T-Mobile U.S., Inc. (a) | 186,063 | 11,163,780 | |
TOTAL TELECOMMUNICATION SERVICES | 108,184,859 | ||
UTILITIES - 2.8% | |||
Electric Utilities - 2.1% | |||
American Electric Power Co., Inc. | 181,700 | 12,926,138 | |
Evergy, Inc. | 202,576 | 11,362,488 | |
Eversource Energy | 110,400 | 6,703,488 | |
Exelon Corp. | 618,200 | 26,273,500 | |
FirstEnergy Corp. | 220,800 | 7,822,944 | |
NextEra Energy, Inc. | 300,000 | 50,262,000 | |
PG&E Corp. | 111,267 | 4,793,382 | |
PPL Corp. | 456,200 | 13,124,874 | |
Vistra Energy Corp. (a) | 173,500 | 3,921,100 | |
137,189,914 | |||
Independent Power and Renewable Electricity Producers - 0.2% | |||
NRG Energy, Inc. | 190,900 | 6,045,803 | |
The AES Corp. | 328,300 | 4,386,088 | |
10,431,891 | |||
Multi-Utilities - 0.5% | |||
Dominion Resources, Inc. | 244,500 | 17,533,095 | |
SCANA Corp. | 86,000 | 3,439,140 | |
Sempra Energy | 101,844 | 11,772,148 | |
32,744,383 | |||
TOTAL UTILITIES | 180,366,188 | ||
TOTAL COMMON STOCKS | |||
(Cost $4,555,442,252) | 6,387,330,500 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.1% | |||
U.S. Treasury Bills, yield at date of purchase 1.8% to 1.9% 8/2/18 to 9/27/18 (c) | |||
(Cost $4,894,169) | 4,900,000 | 4,894,178 | |
Shares | Value | ||
Money Market Funds - 1.6% | |||
Fidelity Cash Central Fund, 1.96% (d) | 105,345,189 | $105,366,258 | |
Fidelity Securities Lending Cash Central Fund 1.97% (d)(e) | 1,854,715 | 1,854,900 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $107,215,639) | 107,221,158 | ||
TOTAL INVESTMENT IN SECURITIES - 100.6% | |||
(Cost $4,667,552,060) | 6,499,445,836 | ||
NET OTHER ASSETS (LIABILITIES) - (0.6)% | (39,729,806) | ||
NET ASSETS - 100% | $6,459,716,030 |
Futures Contracts | |||||
Number of contracts | Expiration Date | Notional Amount | Value | Unrealized Appreciation/(Depreciation) | |
Purchased | |||||
Equity Index Contracts | |||||
CME E-mini S&P 500 Index Contracts (United States) | 221 | Sept. 2018 | $31,128,955 | $917,849 | $917,849 |
The notional amount of futures purchased as a percentage of Net Assets is 0.5%
Legend
(a) Non-income producing
(b) Security or a portion of the security is on loan at period end.
(c) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $1,312,911.
(d) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(e) Investment made with cash collateral received from securities on loan.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $1,016,829 |
Fidelity Securities Lending Cash Central Fund | 24,263 |
Total | $1,041,092 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $828,354,324 | $828,354,324 | $-- | $-- |
Consumer Staples | 409,780,540 | 409,780,540 | -- | -- |
Energy | 377,022,929 | 377,022,929 | -- | -- |
Financials | 893,715,222 | 893,715,222 | -- | -- |
Health Care | 892,647,515 | 892,647,515 | -- | -- |
Industrials | 661,270,906 | 661,270,906 | -- | -- |
Information Technology | 1,620,975,937 | 1,620,975,937 | -- | -- |
Materials | 189,328,714 | 189,328,714 | -- | -- |
Real Estate | 225,683,366 | 225,683,366 | -- | -- |
Telecommunication Services | 108,184,859 | 108,184,859 | -- | -- |
Utilities | 180,366,188 | 180,366,188 | -- | -- |
U.S. Government and Government Agency Obligations | 4,894,178 | -- | 4,894,178 | -- |
Money Market Funds | 107,221,158 | 107,221,158 | -- | -- |
Total Investments in Securities: | $6,499,445,836 | $6,494,551,658 | $4,894,178 | $-- |
Derivative Instruments: | ||||
Assets | ||||
Futures Contracts | $917,849 | $917,849 | $-- | $-- |
Total Assets | $917,849 | $917,849 | $-- | $-- |
Total Derivative Instruments: | $917,849 | $917,849 | $-- | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of July 31, 2018. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
Primary Risk Exposure / Derivative Type | Value | |
Asset | Liability | |
Equity Risk | ||
Futures Contracts(a) | $917,849 | $0 |
Total Equity Risk | 917,849 | 0 |
Total Value of Derivatives | $917,849 | $0 |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin on futures contracts, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
See accompanying notes which are an integral part of the financial statements.
Fidelity® Series All-Sector Equity Fund
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $1,805,414) — See accompanying schedule: Unaffiliated issuers (cost $4,560,336,421) | $6,392,224,678 | |
Fidelity Central Funds (cost $107,215,639) | 107,221,158 | |
Total Investment in Securities (cost $4,667,552,060) | $6,499,445,836 | |
Receivable for investments sold | 141,609,505 | |
Receivable for fund shares sold | 64,391 | |
Dividends receivable | 3,210,979 | |
Distributions receivable from Fidelity Central Funds | 200,090 | |
Receivable for daily variation margin on futures contracts | 153,595 | |
Other receivables | 193,917 | |
Total assets | 6,644,878,313 | |
Liabilities | ||
Payable to custodian bank | $748,519 | |
Payable for investments purchased | 17,088,241 | |
Payable for fund shares redeemed | 165,423,403 | |
Other payables and accrued expenses | 47,526 | |
Collateral on securities loaned | 1,854,594 | |
Total liabilities | 185,162,283 | |
Net Assets | $6,459,716,030 | |
Net Assets consist of: | ||
Paid in capital | $4,240,486,538 | |
Undistributed net investment income | 52,102,550 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 334,373,263 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 1,832,753,679 | |
Net Assets | $6,459,716,030 | |
Net Asset Value, offering price and redemption price per share ($6,459,716,030 ÷ 491,110,390 shares) | $13.15 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $51,018,709 | |
Interest | 209,698 | |
Income from Fidelity Central Funds | 1,041,092 | |
Total income | 52,269,499 | |
Expenses | ||
Custodian fees and expenses | $59,371 | |
Independent trustees' fees and expenses | 14,890 | |
Commitment fees | 8,825 | |
Miscellaneous | 1,276 | |
Total expenses | 84,362 | |
Net investment income (loss) | 52,185,137 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 337,261,988 | |
Fidelity Central Funds | (370) | |
Foreign currency transactions | (627) | |
Futures contracts | 2,355,907 | |
Total net realized gain (loss) | 339,616,898 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (278,456,429) | |
Assets and liabilities in foreign currencies | (8,521) | |
Futures contracts | 593,976 | |
Total change in net unrealized appreciation (depreciation) | (277,870,974) | |
Net gain (loss) | 61,745,924 | |
Net increase (decrease) in net assets resulting from operations | $113,931,061 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $52,185,137 | $85,725,708 |
Net realized gain (loss) | 339,616,898 | 811,779,870 |
Change in net unrealized appreciation (depreciation) | (277,870,974) | 531,184,034 |
Net increase (decrease) in net assets resulting from operations | 113,931,061 | 1,428,689,612 |
Distributions to shareholders from net investment income | (485,971) | (85,264,515) |
Distributions to shareholders from net realized gain | (255,620,590) | (756,569,233) |
Total distributions | (256,106,561) | (841,833,748) |
Share transactions - net increase (decrease) | 51,748,471 | 6,682,768 |
Total increase (decrease) in net assets | (90,427,029) | 593,538,632 |
Net Assets | ||
Beginning of period | 6,550,143,059 | 5,956,604,427 |
End of period | $6,459,716,030 | $6,550,143,059 |
Other Information | ||
Undistributed net investment income end of period | $52,102,550 | $403,384 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Series All-Sector Equity Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $13.46 | $12.33 | $12.02 | $13.80 | $13.89 | $12.57 |
Income from Investment Operations | �� | |||||
Net investment income (loss)A | .10 | .18 | .12 | .12 | .13 | .12 |
Net realized and unrealized gain (loss) | .12 | 2.80 | 2.33 | (.54) | 1.63 | 2.86 |
Total from investment operations | .22 | 2.98 | 2.45 | (.42) | 1.76 | 2.98 |
Distributions from net investment income | –B | (.19) | (.18) | (.14)C | (.12) | (.14) |
Distributions from net realized gain | (.53) | (1.66) | (1.96) | (1.22)C | (1.73) | (1.52) |
Total distributions | (.53) | (1.85) | (2.14) | (1.36) | (1.85) | (1.66) |
Net asset value, end of period | $13.15 | $13.46 | $12.33 | $12.02 | $13.80 | $13.89 |
Total ReturnD,E | 1.70% | 25.62% | 21.03% | (3.55)% | 12.68% | 24.13% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | - %H,I | .20% | .68% | .73% | .67% | .65% |
Expenses net of fee waivers, if any | - %H,I | .20% | .68% | .73% | .67% | .65% |
Expenses net of all reductions | - %H,I | .20% | .67% | .73% | .67% | .65% |
Net investment income (loss) | 1.63%H | 1.37% | .95% | .85% | .92% | .89% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $6,459,716 | $6,550,143 | $2,736,748 | $4,418,280 | $4,969,503 | $5,164,386 |
Portfolio turnover rateJ | 60%H | 61% | 43% | 66% | 65% | 72% |
A Calculated based on average shares outstanding during the period.
B Amount represents less than $.005 per share.
C The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount represents less than .005%.
J Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity® Series Stock Selector Large Cap Value Fund
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
Bank of America Corp. | 3.6 |
Citigroup, Inc. | 2.7 |
Chevron Corp. | 2.6 |
Berkshire Hathaway, Inc. Class B | 2.3 |
Johnson & Johnson | 2.2 |
Pfizer, Inc. | 2.0 |
Cisco Systems, Inc. | 2.0 |
Verizon Communications, Inc. | 1.9 |
DowDuPont, Inc. | 1.8 |
American International Group, Inc. | 1.8 |
22.9 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 22.7 |
Health Care | 13.9 |
Energy | 10.6 |
Information Technology | 9.7 |
Consumer Discretionary | 8.6 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks and Equity Futures | 96.7% | |
Short-Term Investments and Net Other Assets (Liabilities) | 3.3% |
* Foreign investments - 9.0%
Fidelity® Series Stock Selector Large Cap Value Fund
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 95.6% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 8.6% | |||
Auto Components - 0.5% | |||
Delphi Technologies PLC | 976,816 | $44,122,779 | |
Diversified Consumer Services - 0.3% | |||
ServiceMaster Global Holdings, Inc. (a) | 583,495 | 33,253,380 | |
Hotels, Restaurants & Leisure - 1.7% | |||
McDonald's Corp. | 757,300 | 119,305,042 | |
Royal Caribbean Cruises Ltd. | 385,200 | 43,435,152 | |
U.S. Foods Holding Corp. (a) | 158,500 | 5,358,885 | |
168,099,079 | |||
Household Durables - 0.9% | |||
Lennar Corp. Class A | 334,700 | 17,494,769 | |
Mohawk Industries, Inc. (a) | 397,000 | 74,778,920 | |
92,273,689 | |||
Internet & Direct Marketing Retail - 0.5% | |||
Liberty Interactive Corp. QVC Group Series A (a) | 2,122,644 | 45,191,091 | |
Media - 3.0% | |||
Comcast Corp. Class A | 2,799,700 | 100,173,266 | |
Liberty Broadband Corp. Class C (a) | 770,811 | 61,256,350 | |
The Walt Disney Co. | 1,237,200 | 140,496,432 | |
301,926,048 | |||
Multiline Retail - 0.6% | |||
Dollar Tree, Inc. (a) | 683,400 | 62,380,752 | |
Specialty Retail - 0.5% | |||
Burlington Stores, Inc. (a) | 333,600 | 50,977,416 | |
Textiles, Apparel & Luxury Goods - 0.6% | |||
PVH Corp. | 383,425 | 58,863,406 | |
TOTAL CONSUMER DISCRETIONARY | 857,087,640 | ||
CONSUMER STAPLES - 6.5% | |||
Beverages - 0.6% | |||
Molson Coors Brewing Co. Class B | 122,000 | 8,174,000 | |
PepsiCo, Inc. | 239,300 | 27,519,500 | |
The Coca-Cola Co. | 395,500 | 18,442,165 | |
54,135,665 | |||
Food & Staples Retailing - 0.9% | |||
Walmart, Inc. | 1,030,473 | 91,949,106 | |
Food Products - 1.7% | |||
ConAgra Foods, Inc. | 613,600 | 22,525,256 | |
General Mills, Inc. | 269,000 | 12,390,140 | |
Mondelez International, Inc. | 1,742,333 | 75,582,406 | |
The J.M. Smucker Co. | 86,800 | 9,645,216 | |
The Kraft Heinz Co. | 575,900 | 34,697,975 | |
Tyson Foods, Inc. Class A | 273,300 | 15,755,745 | |
170,596,738 | |||
Household Products - 2.0% | |||
Church & Dwight Co., Inc. | 405,700 | 22,678,630 | |
Colgate-Palmolive Co. | 387,400 | 25,959,674 | |
Procter & Gamble Co. | 1,734,115 | 140,255,221 | |
Spectrum Brands Holdings, Inc. | 88,600 | 7,740,982 | |
196,634,507 | |||
Personal Products - 0.1% | |||
Coty, Inc. Class A | 753,800 | 10,108,458 | |
Tobacco - 1.2% | |||
Altria Group, Inc. | 192,600 | 11,301,768 | |
Philip Morris International, Inc. | 1,272,500 | 109,816,750 | |
121,118,518 | |||
TOTAL CONSUMER STAPLES | 644,542,992 | ||
ENERGY - 10.6% | |||
Energy Equipment & Services - 1.0% | |||
Baker Hughes, a GE Co. Class A | 2,924,400 | 101,125,752 | |
Oil, Gas & Consumable Fuels - 9.6% | |||
Anadarko Petroleum Corp. | 1,026,300 | 75,073,845 | |
BP PLC sponsored ADR | 2,072,300 | 93,440,007 | |
Cenovus Energy, Inc. | 8,706,800 | 87,345,766 | |
Cheniere Energy, Inc. (a) | 1,221,800 | 77,584,300 | |
Chevron Corp. | 2,083,614 | 263,097,940 | |
ConocoPhillips Co. | 2,125,000 | 153,361,250 | |
EQT Corp. | 987,500 | 49,059,000 | |
Valero Energy Corp. | 1,345,400 | 159,228,090 | |
958,190,198 | |||
TOTAL ENERGY | 1,059,315,950 | ||
FINANCIALS - 22.7% | |||
Banks - 10.5% | |||
Bank of America Corp. | 11,484,200 | 354,632,095 | |
Citigroup, Inc. | 3,718,800 | 267,344,532 | |
First Horizon National Corp. | 3,549,100 | 63,493,399 | |
Huntington Bancshares, Inc. | 8,547,500 | 131,973,400 | |
KeyCorp | 2,418,300 | 50,469,921 | |
U.S. Bancorp | 827,492 | 43,865,351 | |
Wells Fargo & Co. | 2,342,225 | 134,186,070 | |
1,045,964,768 | |||
Capital Markets - 3.1% | |||
BlackRock, Inc. Class A | 126,400 | 63,548,864 | |
E*TRADE Financial Corp. (a) | 811,500 | 48,535,815 | |
Goldman Sachs Group, Inc. | 517,878 | 122,959,774 | |
Northern Trust Corp. | 406,900 | 44,441,618 | |
TD Ameritrade Holding Corp. | 430,700 | 24,614,505 | |
304,100,576 | |||
Consumer Finance - 2.8% | |||
Capital One Financial Corp. | 1,795,714 | 169,371,744 | |
Discover Financial Services | 555,500 | 39,668,255 | |
SLM Corp. (a) | 2,543,500 | 28,716,115 | |
Synchrony Financial | 1,239,500 | 35,871,130 | |
273,627,244 | |||
Diversified Financial Services - 2.3% | |||
Berkshire Hathaway, Inc. Class B (a) | 1,169,461 | 231,401,248 | |
Insurance - 4.0% | |||
American International Group, Inc. | 3,228,400 | 178,239,964 | |
Aspen Insurance Holdings Ltd. | 289,200 | 11,698,140 | |
Hartford Financial Services Group, Inc. | 589,600 | 31,071,920 | |
MetLife, Inc. | 1,816,100 | 83,068,414 | |
The Travelers Companies, Inc. | 719,600 | 93,648,744 | |
397,727,182 | |||
TOTAL FINANCIALS | 2,252,821,018 | ||
HEALTH CARE - 13.9% | |||
Biotechnology - 0.1% | |||
Alexion Pharmaceuticals, Inc. (a) | 104,800 | 13,934,208 | |
Health Care Equipment & Supplies - 3.3% | |||
Abbott Laboratories | 1,404,900 | 92,077,146 | |
Baxter International, Inc. | 700,100 | 50,722,245 | |
Becton, Dickinson & Co. | 232,500 | 58,211,025 | |
Boston Scientific Corp. (a) | 531,700 | 17,870,437 | |
Medtronic PLC | 1,178,336 | 106,321,257 | |
325,202,110 | |||
Health Care Providers & Services - 2.2% | |||
Aetna, Inc. | 221,900 | 41,803,741 | |
Anthem, Inc. | 157,100 | 39,746,300 | |
Cigna Corp. | 255,500 | 45,841,810 | |
CVS Health Corp. | 762,800 | 49,475,208 | |
Express Scripts Holding Co. (a) | 339,300 | 26,960,778 | |
HCA Holdings, Inc. | 128,800 | 16,000,824 | |
219,828,661 | |||
Life Sciences Tools & Services - 0.9% | |||
Thermo Fisher Scientific, Inc. | 361,000 | 84,665,330 | |
Pharmaceuticals - 7.4% | |||
Allergan PLC | 322,200 | 59,313,798 | |
Bristol-Myers Squibb Co. | 427,300 | 25,103,875 | |
Jazz Pharmaceuticals PLC (a) | 556,595 | 96,335,463 | |
Johnson & Johnson | 1,674,259 | 221,872,803 | |
Merck & Co., Inc. | 2,104,900 | 138,649,763 | |
Pfizer, Inc. | 4,891,998 | 195,337,480 | |
736,613,182 | |||
TOTAL HEALTH CARE | 1,380,243,491 | ||
INDUSTRIALS - 6.5% | |||
Aerospace & Defense - 1.3% | |||
United Technologies Corp. | 924,157 | 125,445,071 | |
Airlines - 0.6% | |||
American Airlines Group, Inc. | 1,556,924 | 61,560,775 | |
Construction & Engineering - 0.8% | |||
AECOM (a) | 2,458,447 | 82,505,481 | |
Electrical Equipment - 0.5% | |||
Sensata Technologies, Inc. PLC (a) | 937,548 | 50,974,485 | |
Industrial Conglomerates - 1.1% | |||
General Electric Co. | 7,667,980 | 104,514,567 | |
Honeywell International, Inc. | 52,818 | 8,432,394 | |
112,946,961 | |||
Machinery - 0.1% | |||
Caterpillar, Inc. | 34,500 | 4,961,100 | |
Marine - 0.4% | |||
A.P. Moller - Maersk A/S Series B | 25,359 | 36,411,386 | |
Professional Services - 0.4% | |||
Nielsen Holdings PLC | 1,734,800 | 40,871,888 | |
Road & Rail - 0.7% | |||
Norfolk Southern Corp. | 412,064 | 69,638,816 | |
Trading Companies & Distributors - 0.6% | |||
HD Supply Holdings, Inc. (a) | 1,376,483 | 60,537,722 | |
TOTAL INDUSTRIALS | 645,853,685 | ||
INFORMATION TECHNOLOGY - 9.7% | |||
Communications Equipment - 2.0% | |||
Cisco Systems, Inc. | 4,589,235 | 194,078,748 | |
Electronic Equipment & Components - 0.2% | |||
Dell Technologies, Inc. (a) | 255,800 | 23,666,616 | |
Internet Software & Services - 0.6% | |||
Alphabet, Inc. Class A (a) | 51,100 | 62,710,942 | |
IT Services - 2.5% | |||
Amdocs Ltd. | 1,775,369 | 119,979,437 | |
IBM Corp. | 345,500 | 50,073,315 | |
Leidos Holdings, Inc. | 1,159,900 | 79,360,358 | |
249,413,110 | |||
Semiconductors & Semiconductor Equipment - 2.5% | |||
Broadcom, Inc. | 193,100 | 42,823,787 | |
Intel Corp. | 1,022,000 | 49,158,200 | |
NXP Semiconductors NV (a) | 410,200 | 39,108,468 | |
Qualcomm, Inc. | 1,844,600 | 118,220,414 | |
249,310,869 | |||
Software - 1.6% | |||
Microsoft Corp. | 323,000 | 34,263,840 | |
Oracle Corp. | 2,576,300 | 122,837,984 | |
157,101,824 | |||
Technology Hardware, Storage & Peripherals - 0.3% | |||
Apple, Inc. | 143,000 | 27,211,470 | |
TOTAL INFORMATION TECHNOLOGY | 963,493,579 | ||
MATERIALS - 4.0% | |||
Chemicals - 3.3% | |||
DowDuPont, Inc. | 2,601,114 | 178,878,610 | |
LyondellBasell Industries NV Class A | 473,300 | 52,436,907 | |
Nutrien Ltd. | 976,700 | 53,045,205 | |
Westlake Chemical Corp. | 388,700 | 41,676,414 | |
326,037,136 | |||
Construction Materials - 0.3% | |||
Eagle Materials, Inc. | 358,300 | 35,597,105 | |
Containers & Packaging - 0.4% | |||
Crown Holdings, Inc. (a) | 876,700 | 39,688,209 | |
TOTAL MATERIALS | 401,322,450 | ||
REAL ESTATE - 4.4% | |||
Equity Real Estate Investment Trusts (REITs) - 4.3% | |||
American Tower Corp. | 140,600 | 20,842,544 | |
Boston Properties, Inc. | 486,514 | 61,072,102 | |
Colony NorthStar, Inc. | 3,085,606 | 19,007,333 | |
Corporate Office Properties Trust (SBI) | 906,938 | 26,972,336 | |
Equity Residential (SBI) | 734,040 | 48,028,237 | |
Gaming & Leisure Properties | 500,834 | 18,190,291 | |
Prologis, Inc. | 813,200 | 53,362,184 | |
Public Storage | 258,026 | 56,205,804 | |
Spirit Realty Capital, Inc. | 3,491,964 | 29,227,739 | |
Store Capital Corp. | 914,366 | 25,099,347 | |
The Macerich Co. | 633,100 | 37,390,886 | |
Welltower, Inc. | 450,400 | 28,195,040 | |
423,593,843 | |||
Real Estate Management & Development - 0.1% | |||
CBRE Group, Inc. (a) | 274,929 | 13,691,464 | |
TOTAL REAL ESTATE | 437,285,307 | ||
TELECOMMUNICATION SERVICES - 3.4% | |||
Diversified Telecommunication Services - 3.0% | |||
AT&T, Inc. | 3,287,265 | 105,093,862 | |
Verizon Communications, Inc. | 3,678,000 | 189,931,920 | |
295,025,782 | |||
Wireless Telecommunication Services - 0.4% | |||
T-Mobile U.S., Inc. (a) | 655,700 | 39,342,000 | |
TOTAL TELECOMMUNICATION SERVICES | 334,367,782 | ||
UTILITIES - 5.3% | |||
Electric Utilities - 3.7% | |||
Evergy, Inc. | 1,334,400 | 74,846,496 | |
Exelon Corp. | 1,693,600 | 71,978,000 | |
NextEra Energy, Inc. | 631,000 | 105,717,740 | |
PG&E Corp. | 358,200 | 15,431,256 | |
PPL Corp. | 2,433,300 | 70,006,041 | |
Vistra Energy Corp. (a) | 1,511,800 | 34,166,680 | |
372,146,213 | |||
Independent Power and Renewable Electricity Producers - 0.9% | |||
NRG Energy, Inc. | 1,588,600 | 50,310,962 | |
The AES Corp. | 2,793,500 | 37,321,160 | |
87,632,122 | |||
Multi-Utilities - 0.7% | |||
Sempra Energy | 557,368 | 64,426,167 | |
TOTAL UTILITIES | 524,204,502 | ||
TOTAL COMMON STOCKS | |||
(Cost $8,338,299,201) | 9,500,538,396 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.0% | |||
U.S. Treasury Bills, yield at date of purchase 1.8% to 1.96% 8/2/18 to 10/25/18 (b) | |||
(Cost $4,482,117) | 4,490,000 | 4,482,094 | |
Shares | Value | ||
Money Market Funds - 4.2% | |||
Fidelity Cash Central Fund, 1.96% (c) | |||
(Cost $412,913,562) | 412,872,592 | 412,955,167 | |
TOTAL INVESTMENT IN SECURITIES - 99.8% | |||
(Cost $8,755,694,880) | 9,917,975,657 | ||
NET OTHER ASSETS (LIABILITIES) - 0.2% | 19,393,184 | ||
NET ASSETS - 100% | $9,937,368,841 |
Futures Contracts | |||||
Number of contracts | Expiration Date | Notional Amount | Value | Unrealized Appreciation/(Depreciation) | |
Purchased | |||||
Equity Index Contracts | |||||
CME E-mini Russell 1000 Value Index Contracts (United States) | 1,743 | Sept. 2018 | $107,351,370 | $2,567,500 | $2,567,500 |
The notional amount of futures purchased as a percentage of Net Assets is 1.1%
Legend
(a) Non-income producing
(b) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $4,482,094.
(c) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $3,710,255 |
Fidelity Securities Lending Cash Central Fund | 277 |
Total | $3,710,532 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $857,087,640 | $857,087,640 | $-- | $-- |
Consumer Staples | 644,542,992 | 644,542,992 | -- | -- |
Energy | 1,059,315,950 | 1,059,315,950 | -- | -- |
Financials | 2,252,821,018 | 2,252,821,018 | -- | -- |
Health Care | 1,380,243,491 | 1,380,243,491 | -- | -- |
Industrials | 645,853,685 | 609,442,299 | 36,411,386 | -- |
Information Technology | 963,493,579 | 963,493,579 | -- | -- |
Materials | 401,322,450 | 401,322,450 | -- | -- |
Real Estate | 437,285,307 | 437,285,307 | -- | -- |
Telecommunication Services | 334,367,782 | 334,367,782 | -- | -- |
Utilities | 524,204,502 | 524,204,502 | -- | -- |
U.S. Government and Government Agency Obligations | 4,482,094 | -- | 4,482,094 | -- |
Money Market Funds | 412,955,167 | 412,955,167 | -- | -- |
Total Investments in Securities: | $9,917,975,657 | $9,877,082,177 | $40,893,480 | $-- |
Derivative Instruments: | ||||
Assets | ||||
Futures Contracts | $2,567,500 | $2,567,500 | $-- | $-- |
Total Assets | $2,567,500 | $2,567,500 | $-- | $-- |
Total Derivative Instruments: | $2,567,500 | $2,567,500 | $-- | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of July 31, 2018. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
Primary Risk Exposure / Derivative Type | Value | |
Asset | Liability | |
Equity Risk | ||
Futures Contracts(a) | $2,567,500 | $0 |
Total Equity Risk | 2,567,500 | 0 |
Total Value of Derivatives | $2,567,500 | $0 |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin on futures contracts, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
See accompanying notes which are an integral part of the financial statements.
Fidelity® Series Stock Selector Large Cap Value Fund
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $8,342,781,318) | $9,505,020,490 | |
Fidelity Central Funds (cost $412,913,562) | 412,955,167 | |
Total Investment in Securities (cost $8,755,694,880) | $9,917,975,657 | |
Cash | 37,719 | |
Receivable for investments sold | 282,630,999 | |
Receivable for fund shares sold | 5,020 | |
Dividends receivable | 7,434,873 | |
Distributions receivable from Fidelity Central Funds | 586,520 | |
Receivable for daily variation margin on futures contracts | 392,175 | |
Other receivables | 148,106 | |
Total assets | 10,209,211,069 | |
Liabilities | ||
Payable for investments purchased | $21,486,361 | |
Payable for fund shares redeemed | 250,310,510 | |
Other payables and accrued expenses | 45,357 | |
Total liabilities | 271,842,228 | |
Net Assets | $9,937,368,841 | |
Net Assets consist of: | ||
Paid in capital | $8,188,320,837 | |
Undistributed net investment income | 114,854,175 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 469,345,552 | |
Net unrealized appreciation (depreciation) on investments | 1,164,848,277 | |
Net Assets | $9,937,368,841 | |
Net Asset Value, offering price and redemption price per share ($9,937,368,841 ÷ 763,339,354 shares) | $13.02 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $111,337,856 | |
Interest | 369,195 | |
Income from Fidelity Central Funds | 3,710,532 | |
Total income | 115,417,583 | |
Expenses | ||
Custodian fees and expenses | $66,867 | |
Independent trustees' fees and expenses | 23,314 | |
Commitment fees | 13,884 | |
Total expenses | 104,065 | |
Net investment income (loss) | 115,313,518 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 509,458,011 | |
Fidelity Central Funds | 20,277 | |
Foreign currency transactions | (135,753) | |
Futures contracts | (4,875,874) | |
Total net realized gain (loss) | 504,466,661 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (830,107,173) | |
Fidelity Central Funds | (20,331) | |
Futures contracts | 1,553,407 | |
Total change in net unrealized appreciation (depreciation) | (828,574,097) | |
Net gain (loss) | (324,107,436) | |
Net increase (decrease) in net assets resulting from operations | $(208,793,918) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $115,313,518 | $205,567,543 |
Net realized gain (loss) | 504,466,661 | 563,412,263 |
Change in net unrealized appreciation (depreciation) | (828,574,097) | 648,134,758 |
Net increase (decrease) in net assets resulting from operations | (208,793,918) | 1,417,114,564 |
Distributions to shareholders from net investment income | (5,439,653) | (200,956,092) |
Distributions to shareholders from net realized gain | (137,545,501) | (475,842,770) |
Total distributions | (142,985,154) | (676,798,862) |
Share transactions - net increase (decrease) | (196,648,537) | 561,627,353 |
Total increase (decrease) in net assets | (548,427,609) | 1,301,943,055 |
Net Assets | ||
Beginning of period | 10,485,796,450 | 9,183,853,395 |
End of period | $9,937,368,841 | $10,485,796,450 |
Other Information | ||
Undistributed net investment income end of period | $114,854,175 | $4,980,310 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Series Stock Selector Large Cap Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $13.47 | $12.49 | $10.38 | $12.67 | $11.96 | $10.71 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .15 | .28B | .17 | .18 | .18 | .15 |
Net realized and unrealized gain (loss) | (.42) | 1.63 | 2.25 | (.96) | 1.48 | 1.87 |
Total from investment operations | (.27) | 1.91 | 2.42 | (.78) | 1.66 | 2.02 |
Distributions from net investment income | (.01) | (.28) | (.16) | (.20)C | (.16) | (.13) |
Distributions from net realized gain | (.18) | (.65) | (.14) | (1.31)C | (.79) | (.64) |
Total distributions | (.18)D | (.93) | (.31)E | (1.51) | (.95) | (.77) |
Net asset value, end of period | $13.02 | $13.47 | $12.49 | $10.38 | $12.67 | $11.96 |
Total ReturnF,G | (1.96)% | 15.62% | 23.49% | (6.69)% | 13.70% | 18.81% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | - %J,K | .20% | .67% | .73% | .72% | .75% |
Expenses net of fee waivers, if any | - %J,K | .20% | .67% | .73% | .72% | .75% |
Expenses net of all reductions | - %J,K | .20% | .66% | .72% | .72% | .75% |
Net investment income (loss) | 2.32%J | 2.13%B | 1.51% | 1.43% | 1.37% | 1.23% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $9,937,369 | $10,485,796 | $3,615,123 | $2,860,230 | $3,226,266 | $3,208,521 |
Portfolio turnover rateL | 96%J | 61% | 54% | 64% | 55% | 66% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.03 per share. This dividend is not annualized in the ratio of net investment income (loss) to average net assets. Excluding this dividend the ratio would have been 1.87%.
C The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
D Total distributions of $.18 per share is comprised of distributions from net investment income of $.007 and distributions from net realized gain of $.177 per share.
E Total distributions of $.31 per share is comprised of distributions from net investment income of $.162 and distributions from net realized gain of $.144 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
J Annualized
K Amount represents less than .005%.
L Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity® Series Value Discovery Fund
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
JPMorgan Chase & Co. | 3.7 |
Wells Fargo & Co. | 3.4 |
Chevron Corp. | 3.2 |
Exxon Mobil Corp. | 2.9 |
Berkshire Hathaway, Inc. Class B | 2.8 |
Comcast Corp. Class A | 2.5 |
Amgen, Inc. | 2.1 |
U.S. Bancorp | 2.1 |
Verizon Communications, Inc. | 1.9 |
CVS Health Corp. | 1.9 |
26.5 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 25.8 |
Health Care | 14.8 |
Energy | 13.1 |
Consumer Discretionary | 11.2 |
Information Technology | 7.9 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks | 97.0% | |
Other Investments | 0.3% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.7% |
* Foreign investments - 18.5%
Fidelity® Series Value Discovery Fund
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 97.0% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 11.2% | |||
Media - 9.6% | |||
Cinemark Holdings, Inc. | 1,231,800 | $44,246,256 | |
Comcast Corp. Class A | 4,858,500 | 173,837,130 | |
Entercom Communications Corp. Class A (a) | 3,898,600 | 29,434,430 | |
Interpublic Group of Companies, Inc. | 3,652,900 | 82,372,895 | |
Lions Gate Entertainment Corp. Class B | 2,762,800 | 63,185,236 | |
The Walt Disney Co. | 958,200 | 108,813,192 | |
Twenty-First Century Fox, Inc. Class A | 2,773,700 | 124,816,500 | |
WPP PLC | 3,408,200 | 53,311,029 | |
680,016,668 | |||
Multiline Retail - 0.6% | |||
Dollar General Corp. | 460,500 | 45,198,075 | |
Textiles, Apparel & Luxury Goods - 1.0% | |||
PVH Corp. | 436,700 | 67,042,184 | |
TOTAL CONSUMER DISCRETIONARY | 792,256,927 | ||
CONSUMER STAPLES - 7.5% | |||
Beverages - 1.3% | |||
Coca-Cola European Partners PLC | 807,700 | 33,309,548 | |
PepsiCo, Inc. | 498,300 | 57,304,500 | |
90,614,048 | |||
Food & Staples Retailing - 1.1% | |||
Sysco Corp. | 600,400 | 40,352,884 | |
Walmart, Inc. | 456,600 | 40,742,418 | |
81,095,302 | |||
Food Products - 3.5% | |||
Kellogg Co. | 931,200 | 66,143,136 | |
Mondelez International, Inc. | 783,800 | 34,001,244 | |
Seaboard Corp. | 908 | 3,303,304 | |
The Hershey Co. | 354,400 | 34,805,624 | |
The J.M. Smucker Co. | 963,800 | 107,097,456 | |
245,350,764 | |||
Personal Products - 0.3% | |||
Unilever NV (NY Reg.) | 369,600 | 21,237,216 | |
Tobacco - 1.3% | |||
British American Tobacco PLC: | |||
(United Kingdom) | 488,700 | 26,864,972 | |
sponsored ADR | 1,144,333 | 62,686,562 | |
89,551,534 | |||
TOTAL CONSUMER STAPLES | 527,848,864 | ||
ENERGY - 12.8% | |||
Energy Equipment & Services - 1.4% | |||
Baker Hughes, a GE Co. Class A | 2,328,600 | 80,522,988 | |
Dril-Quip, Inc. (b) | 335,000 | 17,269,250 | |
97,792,238 | |||
Oil, Gas & Consumable Fuels - 11.4% | |||
Chevron Corp. | 1,795,103 | 226,667,656 | |
Dynagas LNG Partners LP | 669,200 | 5,420,520 | |
Exxon Mobil Corp. | 2,520,300 | 205,429,653 | |
GasLog Ltd. | 1,370,286 | 23,089,319 | |
GasLog Partners LP | 1,763,398 | 44,349,460 | |
Golar LNG Ltd. | 534,051 | 13,890,667 | |
Golar LNG Partners LP (c) | 3,512,000 | 57,631,920 | |
Hoegh LNG Partners LP (c) | 1,073,900 | 19,759,760 | |
Phillips 66 Co. | 872,900 | 107,663,486 | |
Suncor Energy, Inc. | 1,413,800 | 59,536,429 | |
Teekay Corp. (a) | 1,520,200 | 10,595,794 | |
Teekay LNG Partners LP | 111,700 | 1,787,200 | |
Teekay Offshore Partners LP | 13,180,800 | 33,479,232 | |
809,301,096 | |||
TOTAL ENERGY | 907,093,334 | ||
FINANCIALS - 25.8% | |||
Banks - 12.0% | |||
JPMorgan Chase & Co. | 2,253,530 | 259,043,273 | |
PNC Financial Services Group, Inc. | 632,000 | 91,532,560 | |
SunTrust Banks, Inc. | 1,481,400 | 106,764,498 | |
U.S. Bancorp | 2,769,800 | 146,827,098 | |
Wells Fargo & Co. | 4,262,100 | 244,175,709 | |
848,343,138 | |||
Capital Markets - 2.2% | |||
Goldman Sachs Group, Inc. | 415,500 | 98,652,165 | |
State Street Corp. | 625,800 | 55,264,398 | |
153,916,563 | |||
Consumer Finance - 2.7% | |||
Capital One Financial Corp. | 622,700 | 58,733,064 | |
Discover Financial Services | 997,400 | 71,224,334 | |
Synchrony Financial | 2,231,600 | 64,582,504 | |
194,539,902 | |||
Diversified Financial Services - 3.2% | |||
Berkshire Hathaway, Inc. Class B (b) | 1,022,600 | 202,341,862 | |
Cannae Holdings, Inc. (b) | 104,300 | 1,903,475 | |
Standard Life PLC | 6,216,857 | 25,483,479 | |
229,728,816 | |||
Insurance - 4.2% | |||
Allstate Corp. | 424,900 | 40,416,488 | |
Chubb Ltd. | 539,284 | 75,348,760 | |
FNF Group | 984,200 | 39,860,100 | |
Prudential PLC | 2,307,654 | 54,445,725 | |
The Travelers Companies, Inc. | 643,000 | 83,680,020 | |
293,751,093 | |||
Mortgage Real Estate Investment Trusts - 1.5% | |||
AGNC Investment Corp. | 2,000,300 | 38,945,841 | |
Annaly Capital Management, Inc. | 3,721,200 | 39,891,264 | |
MFA Financial, Inc. | 3,476,900 | 27,989,045 | |
106,826,150 | |||
TOTAL FINANCIALS | 1,827,105,662 | ||
HEALTH CARE - 14.8% | |||
Biotechnology - 3.4% | |||
Amgen, Inc. | 762,777 | 149,923,819 | |
Shire PLC sponsored ADR | 546,000 | 93,153,060 | |
243,076,879 | |||
Health Care Providers & Services - 6.5% | |||
Aetna, Inc. | 334,900 | 63,091,811 | |
Anthem, Inc. | 299,600 | 75,798,800 | |
Cigna Corp. | 529,800 | 95,056,716 | |
CVS Health Corp. | 2,077,543 | 134,749,439 | |
McKesson Corp. | 202,200 | 25,396,320 | |
UnitedHealth Group, Inc. | 251,600 | 63,710,152 | |
457,803,238 | |||
Pharmaceuticals - 4.9% | |||
Allergan PLC | 483,300 | 88,970,697 | |
Bayer AG | 901,630 | 100,375,919 | |
Johnson & Johnson | 247,900 | 32,851,708 | |
Pfizer, Inc. | 686,277 | 27,403,041 | |
Roche Holding AG (participation certificate) | 159,506 | 39,182,092 | |
Sanofi SA sponsored ADR | 1,380,800 | 59,871,488 | |
348,654,945 | |||
TOTAL HEALTH CARE | 1,049,535,062 | ||
INDUSTRIALS - 5.8% | |||
Aerospace & Defense - 2.7% | |||
Harris Corp. | 311,900 | 51,447,905 | |
Huntington Ingalls Industries, Inc. | 46,676 | 10,877,842 | |
United Technologies Corp. | 956,900 | 129,889,606 | |
192,215,353 | |||
Machinery - 1.1% | |||
Allison Transmission Holdings, Inc. | 572,957 | 26,928,979 | |
Deere & Co. | 360,100 | 52,138,879 | |
79,067,858 | |||
Professional Services - 0.7% | |||
Dun & Bradstreet Corp. | 79,800 | 10,046,022 | |
Nielsen Holdings PLC | 1,697,500 | 39,993,100 | |
50,039,122 | |||
Road & Rail - 1.3% | |||
Union Pacific Corp. | 588,200 | 88,165,298 | |
TOTAL INDUSTRIALS | 409,487,631 | ||
INFORMATION TECHNOLOGY - 7.9% | |||
Communications Equipment - 1.8% | |||
Cisco Systems, Inc. | 1,663,449 | 70,347,258 | |
F5 Networks, Inc. (b) | 333,500 | 57,155,230 | |
127,502,488 | |||
Electronic Equipment & Components - 0.9% | |||
TE Connectivity Ltd. | 683,408 | 63,946,487 | |
Internet Software & Services - 2.4% | |||
Alphabet, Inc. Class A (b) | 77,700 | 95,354,994 | |
comScore, Inc. (b) | 1,833,960 | 36,679,200 | |
eBay, Inc. (b) | 1,093,800 | 36,587,610 | |
168,621,804 | |||
IT Services - 1.6% | |||
Amdocs Ltd. | 731,400 | 49,428,012 | |
Cognizant Technology Solutions Corp. Class A | 647,800 | 52,795,700 | |
The Western Union Co. | 642,500 | 12,952,800 | |
115,176,512 | |||
Technology Hardware, Storage & Peripherals - 1.2% | |||
Apple, Inc. | 430,900 | 81,995,961 | |
TOTAL INFORMATION TECHNOLOGY | 557,243,252 | ||
MATERIALS - 4.4% | |||
Chemicals - 3.0% | |||
DowDuPont, Inc. | 1,555,600 | 106,978,612 | |
LyondellBasell Industries NV Class A | 752,800 | 83,402,712 | |
The Scotts Miracle-Gro Co. Class A | 291,849 | 23,181,566 | |
213,562,890 | |||
Containers & Packaging - 1.4% | |||
Ball Corp. | 1,234,900 | 48,124,053 | |
Graphic Packaging Holding Co. | 3,598,300 | 52,283,299 | |
100,407,352 | |||
TOTAL MATERIALS | 313,970,242 | ||
REAL ESTATE - 1.2% | |||
Real Estate Management & Development - 1.2% | |||
CBRE Group, Inc. (b) | 1,708,300 | 85,073,340 | |
TELECOMMUNICATION SERVICES - 2.7% | |||
Diversified Telecommunication Services - 2.7% | |||
AT&T, Inc. | 1,771,363 | 56,630,475 | |
Verizon Communications, Inc. | 2,616,339 | 135,107,746 | |
191,738,221 | |||
UTILITIES - 2.9% | |||
Electric Utilities - 2.9% | |||
Exelon Corp. | 2,429,800 | 103,266,500 | |
PPL Corp. | 582,100 | 16,747,017 | |
Xcel Energy, Inc. | 1,813,700 | 84,989,982 | |
205,003,499 | |||
TOTAL COMMON STOCKS | |||
(Cost $6,200,622,136) | 6,866,356,034 | ||
Other - 0.3% | |||
ENERGY - 0.3% | |||
Oil, Gas & Consumable Fuels - 0.3% | |||
Utica Shale Drilling Program (non-operating revenue interest) (d)(e)(f) | |||
(Cost $34,736,679) | 34,736,679 | 18,299,283 | |
Money Market Funds - 3.1% | |||
Fidelity Cash Central Fund, 1.96% (g) | 203,801,377 | 203,842,137 | |
Fidelity Securities Lending Cash Central Fund 1.97% (g)(h) | 14,768,913 | 14,770,390 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $218,612,738) | 218,612,527 | ||
TOTAL INVESTMENT IN SECURITIES - 100.4% | |||
(Cost $6,453,971,553) | 7,103,267,844 | ||
NET OTHER ASSETS (LIABILITIES) - (0.4)% | (28,733,672) | ||
NET ASSETS - 100% | $7,074,534,172 |
Legend
(a) Security or a portion of the security is on loan at period end.
(b) Non-income producing
(c) Affiliated company
(d) Investment is owned by a wholly-owned subsidiary (Subsidiary) that is treated as a corporation for U.S. tax purposes.
(e) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $18,299,283 or 0.3% of net assets.
(f) Level 3 security
(g) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(h) Investment made with cash collateral received from securities on loan.
Additional information on each restricted holding is as follows:
Security | Acquisition Date | Acquisition Cost |
Utica Shale Drilling Program (non-operating revenue interest) | 10/5/16 - 9/1/17 | $34,736,679 |
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $1,533,182 |
Fidelity Securities Lending Cash Central Fund | 41,668 |
Total | $1,574,850 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Other Affiliated Issuers
An affiliated company is a company in which the Fund has ownership of at least 5% of the voting securities. Fiscal year to date transactions with companies which are or were affiliates are as follows:
Affiliate | Value, beginning of period | Purchases | Sales Proceeds | Dividend Income | Realized Gain (loss) | Change in Unrealized appreciation (depreciation) | Value, end of period |
Golar LNG Partners LP | $56,073,470 | $16,660,887 | $419,258 | $3,106,218 | $(126,908) | $(14,556,271) | $57,631,920 |
Hoegh LNG Partners LP | 19,706,065 | -- | -- | 472,516 | -- | 53,695 | 19,759,760 |
Total | $75,779,535 | $16,660,887 | $419,258 | $3,578,734 | $(126,908) | $(14,502,576) | $77,391,680 |
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $792,256,927 | $738,945,898 | $53,311,029 | $-- |
Consumer Staples | 527,848,864 | 500,983,892 | 26,864,972 | -- |
Energy | 907,093,334 | 907,093,334 | -- | -- |
Financials | 1,827,105,662 | 1,772,659,937 | 54,445,725 | -- |
Health Care | 1,049,535,062 | 909,977,051 | 139,558,011 | -- |
Industrials | 409,487,631 | 409,487,631 | -- | -- |
Information Technology | 557,243,252 | 557,243,252 | -- | -- |
Materials | 313,970,242 | 313,970,242 | -- | -- |
Real Estate | 85,073,340 | 85,073,340 | -- | -- |
Telecommunication Services | 191,738,221 | 191,738,221 | -- | -- |
Utilities | 205,003,499 | 205,003,499 | -- | -- |
Other | 18,299,283 | -- | -- | 18,299,283 |
Money Market Funds | 218,612,527 | 218,612,527 | -- | -- |
Total Investments in Securities: | $7,103,267,844 | $6,810,788,824 | $274,179,737 | $18,299,283 |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 81.5% |
United Kingdom | 3.6% |
Switzerland | 2.5% |
Marshall Islands | 2.5% |
Bailiwick of Jersey | 2.0% |
Canada | 1.7% |
Netherlands | 1.5% |
Germany | 1.4% |
Ireland | 1.3% |
Others (Individually Less Than 1%) | 2.0% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Fidelity® Series Value Discovery Fund
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $14,292,892) — See accompanying schedule: Unaffiliated issuers (cost $6,142,403,530) | $6,807,263,637 | |
Fidelity Central Funds (cost $218,612,738) | 218,612,527 | |
Other affiliated issuers (cost $92,955,285) | 77,391,680 | |
Total Investment in Securities (cost $6,453,971,553) | $7,103,267,844 | |
Cash | 710,860 | |
Restricted cash | 706,535 | |
Receivable for investments sold | 156,024,610 | |
Receivable for fund shares sold | 3,892 | |
Dividends receivable | 6,640,576 | |
Distributions receivable from Fidelity Central Funds | 328,222 | |
Other receivables | 74,574 | |
Total assets | 7,267,757,113 | |
Liabilities | ||
Payable for fund shares redeemed | $178,411,549 | |
Other payables and accrued expenses | 45,578 | |
Collateral on securities loaned | 14,765,814 | |
Total liabilities | 193,222,941 | |
Net Assets | $7,074,534,172 | |
Net Assets consist of: | ||
Paid in capital | $6,274,306,844 | |
Undistributed net investment income | 85,806,185 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 65,122,805 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 649,298,338 | |
Net Assets | $7,074,534,172 | |
Net Asset Value, offering price and redemption price per share ($7,074,534,172 ÷ 522,590,949 shares) | $13.54 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends (including $3,578,734 earned from other affiliated issuers) | $85,596,235 | |
Income from Fidelity Central Funds | 1,574,850 | |
Total income | 87,171,085 | |
Expenses | ||
Custodian fees and expenses | $51,828 | |
Independent trustees' fees and expenses | 16,615 | |
Commitment fees | 9,893 | |
Total expenses before reductions | 78,336 | |
Expense reductions | (1,030) | |
Total expenses after reductions | 77,306 | |
Net investment income (loss) | 87,093,779 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 71,498,189 | |
Fidelity Central Funds | 3 | |
Other affiliated issuers | (126,908) | |
Foreign currency transactions | (147,881) | |
Total net realized gain (loss) | 71,223,403 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (319,988,788) | |
Fidelity Central Funds | (305) | |
Other affiliated issuers | (14,502,576) | |
Assets and liabilities in foreign currencies | (14,130) | |
Total change in net unrealized appreciation (depreciation) | (334,505,799) | |
Net gain (loss) | (263,282,396) | |
Net increase (decrease) in net assets resulting from operations | $(176,188,617) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $87,093,779 | $209,753,536 |
Net realized gain (loss) | 71,223,403 | 1,900,566,903 |
Change in net unrealized appreciation (depreciation) | (334,505,799) | (924,677,998) |
Net increase (decrease) in net assets resulting from operations | (176,188,617) | 1,185,642,441 |
Distributions to shareholders from net investment income | – | (149,871,066) |
Distributions to shareholders from net realized gain | (10,682,801) | (462,206,675) |
Total distributions | (10,682,801) | (612,077,741) |
Share transactions - net increase (decrease) | (169,312,364) | (6,007,771,301) |
Total increase (decrease) in net assets | (356,183,782) | (5,434,206,601) |
Net Assets | ||
Beginning of period | 7,430,717,954 | 12,864,924,555 |
End of period | $7,074,534,172 | $7,430,717,954 |
Other Information | ||
Undistributed net investment income end of period | $85,806,185 | $– |
Distributions in excess of net investment income end of period | $– | $(1,287,594) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Series Value Discovery Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $13.89 | $13.03 | $10.83 | $12.31 | $11.80 | $10.57 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .16 | .31 | .27 | .31 | .32 | .25 |
Net realized and unrealized gain (loss) | (.49) | 1.58 | 2.44 | (.80) | .87 | 1.50 |
Total from investment operations | (.33) | 1.89 | 2.71 | (.49) | 1.19 | 1.75 |
Distributions from net investment income | – | (.25)B | (.26) | (.32) | (.28) | (.24) |
Distributions from net realized gain | (.02) | (.78)B | (.25) | (.67) | (.40) | (.28) |
Total distributions | (.02) | (1.03) | (.51) | (.99) | (.68) | (.52) |
Net asset value, end of period | $13.54 | $13.89 | $13.03 | $10.83 | $12.31 | $11.80 |
Total ReturnC,D | (2.38)% | 15.05% | 25.40% | (4.32)% | 9.91% | 16.57% |
Ratios to Average Net AssetsE,F | ||||||
Expenses before reductions | –%G,H | .27% | .62% | .62% | .63% | .65% |
Expenses net of fee waivers, if any | –%G,H | .27% | .62% | .62% | .63% | .65% |
Expenses net of all reductions | –%G,H | .26% | .62% | .62% | .63% | .65% |
Net investment income (loss) | 2.45%G | 2.29% | 2.21% | 2.51% | 2.50% | 2.17% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $7,074,534 | $7,430,718 | $5,063,707 | $4,400,959 | $4,809,405 | $4,826,469 |
Portfolio turnover rateI | 33%G | 74%J | 42% | 41% | 38% | 42% |
A Calculated based on average shares outstanding during the period.
B The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
G Annualized
H Amount represents less than .005%.
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
J Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Series All-Sector Equity Fund, Fidelity Series Stock Selector Large Cap Value Fund and Fidelity Series Value Discovery Fund (the Funds) are funds of Fidelity Devonshire Trust (the Trust). The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Each Fund is authorized to issue an unlimited number of shares. Shares of the Funds are only available for purchase by mutual funds for which Fidelity Management & Research Company (FMR) or an affiliate serves as an investment manager.
Effective August 28, 2017, the Fund no longer offered Class F, and all outstanding shares of Class F were exchanged for shares of Series All-Sector Equity, Series Stock Selector Large Cap Value and Series Value Discovery, respectively.
2. Investments in Fidelity Central Funds.
The Funds invest in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Funds' Schedules of Investments list each of the Fidelity Central Funds held as of period end, if any, as an investment of each Fund, but do not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, each Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
Each Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Funds:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of each Fund's investments to the Fair Value Committee (the Committee) established by each Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, each Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees each Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing each Fund's investments and ratifies the fair value determinations of the Committee.
Each Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value each Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded and are categorized as Level 1 in the hierarchy. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of July 31, 2018 is included at the end of each Fund's Schedule of Investments.
Foreign Currency. The Funds may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Funds' investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost and for certain Funds include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Funds are informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Funds represent a return of capital or capital gain. The Funds determine the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, each Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. Each Fund files a U.S. federal tax return, in addition to state and local tax returns as required. Each Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on each Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP. These differences resulted in distribution reclassifications for the period ended January 31, 2018.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to the short-term gain distributions from the Underlying Funds, futures contracts, foreign currency transactions, passive foreign investment companies (PFIC), market discount, partnerships, redemptions in kind and losses deferred due to wash sales and excise tax regulations.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows for each Fund:
Tax cost | Gross unrealized appreciation | Gross unrealized depreciation | Net unrealized appreciation (depreciation) | |
Fidelity Series All-Sector Equity Fund | $4,676,563,143 | $1,930,584,404 | $(106,783,862) | $1,823,800,542 |
Fidelity Series Stock Selector Large Cap Value Fund | 8,776,745,362 | 1,425,528,652 | (281,730,857) | 1,143,797,795 |
Fidelity Series Value Discovery Fund | 6,457,572,741 | 936,337,597 | (290,642,494) | 645,695,103 |
At the prior fiscal period end, Fidelity Series Stock Selector Large Cap Value Fund was required to defer losses on futures contracts. In addition, Fidelity Series Stock Selector Large Cap Value Fund elected to defer to the next fiscal year $17,326,307 of capital losses recognized during the period November 1, 2017 to January 31, 2018.
Restricted Securities. The Funds may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of each applicable Fund's Schedule of Investments.
Consolidated Subsidiary. Fidelity Series Value Discovery Fund (the Fund) invests in certain investments through a wholly-owned subsidiary ("Subsidiary"), which may be subject to federal and state taxes upon disposition.
As of period end, the Fund held an investment of $19,005,818 in this Subsidiary, representing .27% of the Fund's net assets. The financial statements have been consolidated and include accounts of the Fund and the Subsidiary. Accordingly, all inter-company transactions and balances have been eliminated.
Any cash held by the Subsidiary is restricted as to its use and is presented as Restricted cash in the Statement of Assets and Liabilities.
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Funds' investment objective allows the Funds to enter into various types of derivative contracts, including futures contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Funds used derivatives to increase returns and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Funds may not achieve their objectives.
The Funds' use of derivatives increased or decreased their exposure to the following risk:
Equity Risk | Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment. |
The Funds are also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Funds will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Funds. Counterparty credit risk related to exchange-traded futures contracts may be mitigated by the protection provided by the exchange on which they trade.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. Fidelity Series All-Sector Equity Fund and Fidelity Series Stock Selector Large Cap Value Fund used futures contracts to manage their exposure to the stock market.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin on futures contracts in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract. The net realized gain (loss) and change in net unrealized appreciation (depreciation) on futures contracts during the period is presented in the Statement of Operations.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The notional amount at value reflects each contract's exposure to the underlying instrument or index at period end and is representative of volume of activity during the period. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, are noted in the table below.
Purchases ($) | Sales ($) | |
Fidelity Series All-Sector Equity Fund | 1,874,479,208 | 2,017,014,125 |
Fidelity Series Stock Selector Large Cap Value Fund | 4,545,811,170 | 4,746,993,718 |
Fidelity Series Value Discovery Fund | 1,145,004,077 | 1,216,717,701 |
6. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Funds with investment management related services for which the Funds do not pay a management fee. Under the management contract, the investment adviser or an affiliate pays all ordinary operating expenses of the Funds, except custody fees, fees and expenses of the independent Trustees, and certain miscellaneous expenses such as proxy and shareholder meeting expenses.
Brokerage Commissions. Certain Funds placed a portion of their portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were as follows:
Amount | |
Fidelity Series All-Sector Equity Fund | $44,263 |
Fidelity Series Stock Selector Large Cap Value Fund | 154,415 |
Fidelity Series Value Discovery Fund | 19,487 |
Interfund Trades. The Funds may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
Prior Fiscal Year Redemptions In-Kind. During the prior period, 454,588,598 shares of Fidelity Series Value Discovery Fund held by affiliated entities were redeemed in kind for investments and cash with a value of $6,049,509,537. The Fund had a net realized gain of $1,529,538,334 on investments delivered through in-kind redemptions. The amount of in-kind redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
Other. During the period, the investment adviser reimbursed Fidelity Series Value Discovery Fund for certain losses in the amount of $75,504.
7. Committed Line of Credit.
Certain Funds participate with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The participating funds have agreed to pay commitment fees on their pro-rata portion of the line of credit, which are reflected in Miscellaneous expenses on the Statement of Operations, and are as follows:
Fidelity Series All-Sector Equity Fund | $8,825 |
Fidelity Series Stock Selector Large Cap Value Fund | 13,884 |
Fidelity Series Value Discovery Fund | 9,893 |
During the period, the Funds did not borrow on this line of credit.
8. Security Lending.
Certain Funds lend portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Funds. On the settlement date of the loan, each applicable Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Funds and any additional required collateral is delivered to the Funds on the next business day. The Funds or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Funds may apply collateral received from the borrower against the obligation. The Funds may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on each applicable Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented on each applicable Fund's Statement of Operations as a component of income from Fidelity Central Funds. During the period, there were no securities loaned to FCM. Security lending activity was as follows:
Total Security Lending Income | |
Fidelity Series All-Sector Equity Fund | $24,263 |
Fidelity Series Stock Selector Large Cap Value Fund | 277 |
Fidelity Series Value Discovery Fund | 41,668 |
9. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of Certain Funds include an amount in addition to trade execution, which may be rebated back to the Funds to offset certain expenses. In addition, through arrangements with each applicable Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. All of the applicable expense reductions are noted in the table below.
Custody expense reduction | |
Fidelity Series Value Discovery Fund | $1,030 |
10. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended July 31, 2018 | Year ended January 31, 2018 | |
Fidelity Series All-Sector Equity Fund | ||
From net investment income | ||
Series All-Sector Equity | $485,971 | $84,485,761 |
Class F | – | 778,754 |
Total | $485,971 | $85,264,515 |
From net realized gain | ||
Series All-Sector Equity | $255,620,590 | $645,726,540 |
Class F | – | 110,842,693 |
Total | $255,620,590 | $756,569,233 |
Fidelity Series Stock Selector Large Cap Value Fund | ||
From net investment income | ||
Series Stock Selector Large Cap Value | $5,439,653 | $196,951,761 |
Class F | – | 4,004,331 |
Total | $5,439,653 | $200,956,092 |
From net realized gain | ||
Series Stock Selector Large Cap Value | $137,545,501 | $458,490,671 |
Class F | – | 17,352,099 |
Total | $137,545,501 | $475,842,770 |
Fidelity Series Value Discovery Fund | ||
From net investment income | ||
Series Value Discovery | $– | $81,449,326 |
Class F | – | 68,421,740 |
Total | $– | $149,871,066 |
From net realized gain | ||
Series Value Discovery | $10,682,801 | $383,419,382 |
Class F | – | 78,787,293 |
Total | $10,682,801 | $462,206,675 |
11. Share Transactions.
Transactions for each class of shares were as follows:
Shares | Shares | Dollars | Dollars | |
Six months ended July 31, 2018 | Year ended January 31, 2018 | Six months ended July 31, 2018 | Year ended January 31, 2018 | |
Fidelity Series All-Sector Equity Fund | ||||
Series All-Sector Equity | ||||
Shares sold | 17,902,904 | 284,598,389 | $226,487,291 | $3,701,113,864 |
Reinvestment of distributions | 19,914,974 | 57,825,664 | 256,106,561 | 730,212,301 |
Shares redeemed | (33,400,390) | (77,770,587) | (430,845,381) | (1,027,443,751) |
Net increase (decrease) | 4,417,488 | 264,653,466 | $51,748,471 | $3,403,882,414 |
Class F | ||||
Shares sold | – | 17,419,838 | $– | $220,628,351 |
Reinvestment of distributions | – | 9,008,995 | – | 111,621,447 |
Shares redeemed | – | (288,104,477) | – | (3,729,449,444) |
Net increase (decrease) | – | (261,675,644) | $– | $(3,397,199,646) |
Fidelity Series Stock Selector Large Cap Value Fund | ||||
Series Stock Selector Large Cap Value | ||||
Shares sold | 27,561,199 | 506,849,247 | $347,839,270 | $6,538,339,415 |
Reinvestment of distributions | 11,118,597 | 50,657,934 | 142,985,154 | 655,442,432 |
Shares redeemed | (53,783,161) | (68,423,833) | (687,472,961) | (894,534,018) |
Net increase (decrease) | (15,103,365) | 489,083,348 | $(196,648,537) | $6,299,247,829 |
Class F | ||||
Shares sold | – | 32,789,177 | $– | $420,765,409 |
Reinvestment of distributions | – | 1,658,108 | – | 21,356,430 |
Shares redeemed | – | (479,833,926) | – | (6,179,742,315) |
Net increase (decrease) | – | (445,386,641) | $– | $(5,737,620,476) |
Fidelity Series Value Discovery Fund | ||||
Series Value Discovery | ||||
Shares sold | 18,987,716 | 359,596,343 | $250,389,091 | $4,706,853,232 |
Reinvestment of distributions | 790,148 | 34,973,828 | 10,682,801 | 464,868,708 |
Shares redeemed | (32,248,116) | (248,104,733)(a) | (430,384,256) | (3,299,221,934)(a) |
Net increase (decrease) | (12,470,252) | 146,465,438 | $(169,312,364) | $1,872,500,006 |
Class F | ||||
Shares sold | – | 33,199,574 | $– | $439,081,260 |
Reinvestment of distributions | – | 11,137,913 | – | 147,209,033 |
Shares redeemed | – | (642,768,758)(a) | – | (8,466,561,600)(a) |
Net increase (decrease) | – | (598,431,271) | $– | $(7,880,271,307) |
(a) Amount includes in-kind redemptions (see the Prior Fiscal Year Redemptions In-Kind note for additional details).
12. Proposed Reorganization.
The Board of Trustees of Fidelity Series Value Discovery Fund approved an Agreement and Plan of Reorganization (the Agreement) between the Fidelity Series Value Discovery Fund and Fidelity Advisor Series Equity Value Fund. The Agreement provides for the transfer of all the assets and the assumption of all the liabilities of Fidelity Advisor Series Equity Value Fund in exchange for corresponding shares of the Fidelity Series Value Discovery Fund equal in value to the net assets of the Fidelity Advisor Series Equity Value Fund on the day the reorganization is effective.
The reorganization does not require Fidelity Advisor Series Equity Value Fund's shareholder approval and is expected to become effective in September 2018. The reorganization is expected to qualify as a tax-free transaction for federal income tax purposes with no gain or loss recognized by the funds or their shareholders.
13. Reorganization.
Subsequent to period end, on September 14, 2018, Fidelity Series Stock Selector Large Cap Value Fund acquired all of the assets and assumed all of the liabilities of Fidelity Advisor Series Stock Selector Large Cap Value Fund pursuant to an Agreement and Plan of Reorganization approved by the Board of Trustees ("the Board"). The reorganization was accomplished by an exchange of shares of Fidelity Series Stock Selector Large Cap Value Fund for shares then outstanding of Fidelity Advisor Series Stock Selector Large Cap Value Fund at their net asset value on the reorganization date. The reorganization provides shareholders of Fidelity Advisor Series Stock Selector Large Cap Value Fund access to a larger portfolio with a similar investment objective. The reorganization qualified as a tax-free reorganization for federal income tax purposes with no gain or loss recognized to the funds or their shareholders. The Fidelity Advisor Series Stock Selector Large Cap Value Fund net assets of $1,142,737,823, including securities of $1,141,814,114 and unrealized appreciation of $155,225,458, were combined with the Fidelity Series Stock Selector Large Cap Value Fund net assets of $10,008,538,109 for total net assets after the acquisition of $11,151,275,932.
14. Other.
The Funds' organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Funds. In the normal course of business, the Funds may also enter into contracts that provide general indemnifications. The Funds' maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Funds. The risk of material loss from such claims is considered remote.
At the end of the period, mutual funds managed by the investment adviser or its affiliates were the owners of record of all of the outstanding shares of the Funds.
Shareholder Expense Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying table for each fund 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, each Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each fund provides information about hypothetical account values and hypothetical expenses based on a fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, each Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Fidelity Series All-Sector Equity Fund | - %-C | |||
Actual | $1,000.00 | $1,017.00 | $--D | |
Hypothetical-E | $1,000.00 | $1,024.79 | $--D | |
Fidelity Series Stock Selector Large Cap Value Fund | - %-C | |||
Actual | $1,000.00 | $980.40 | $--D | |
Hypothetical-E | $1,000.00 | $1,024.79 | $--D | |
Fidelity Series Value Discovery Fund | - %-C | |||
Actual | $1,000.00 | $976.20 | $--D | |
Hypothetical-E | $1,000.00 | $1,024.74 | $--D |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/ 365 (to reflect the one-half year period).
C Amount represents less than .005%.
D Amount represents less than $.005.
E 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Series All-Sector Equity Fund
Fidelity Series Stock Selector Large Cap Value Fund
Fidelity Series Value Discovery Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contracts with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the funds for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the funds, and the Sector Portfolios Board.
The Board considered that the approval of the funds' Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the funds' assets; (ii) the fees and expenses paid by shareholders, including the expense cap arrangement currently in place for each fund; (iii) the nature, extent or quality of services provided under the funds' Advisory Contracts; or (iv) the day-to-day management of each fund or the persons primarily responsible for such management. The Board concluded that the funds' Advisory Contracts are fair and reasonable, and that the funds' Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the funds' Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the funds, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for each fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing each fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the funds) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the funds' management fee structures are fair and reasonable, and that the continuation of the funds' Advisory Contracts should be approved.
EDT-LDT-SANN-0918
1.956974.105
Fidelity Advisor® Series Equity Value Fund Fidelity Advisor® Series Stock Selector Large Cap Value Fund Semi-Annual Report July 31, 2018 |
Contents
Fidelity Advisor® Series Equity Value Fund | |
Fidelity Advisor® Series Stock Selector Large Cap Value Fund | |
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-877-208-0098 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Funds. This report is not authorized for distribution to prospective investors in the Funds unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Funds nor Fidelity Distributors Corporation is a bank.
Fidelity Advisor® Series Equity Value Fund
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
JPMorgan Chase & Co. | 3.6 |
Wells Fargo & Co. | 3.5 |
Chevron Corp. | 3.2 |
Exxon Mobil Corp. | 2.9 |
Berkshire Hathaway, Inc. Class B | 2.8 |
Comcast Corp. Class A | 2.4 |
Amgen, Inc. | 2.1 |
U.S. Bancorp | 2.1 |
CVS Health Corp. | 1.9 |
Verizon Communications, Inc. | 1.9 |
26.4 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 25.8 |
Health Care | 14.8 |
Energy | 13.0 |
Consumer Discretionary | 11.2 |
Information Technology | 7.9 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks | 97.1% | |
Other Investments | 0.2% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.7% |
* Foreign investments - 18.5%
Fidelity Advisor® Series Equity Value Fund
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 97.1% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 11.2% | |||
Media - 9.6% | |||
Cinemark Holdings, Inc. | 195,700 | $7,029,544 | |
Comcast Corp. Class A | 768,400 | 27,493,352 | |
Entercom Communications Corp. Class A (a) | 631,500 | 4,767,825 | |
Interpublic Group of Companies, Inc. | 583,500 | 13,157,925 | |
Lions Gate Entertainment Corp. Class B | 441,300 | 10,092,531 | |
The Walt Disney Co. | 151,600 | 17,215,696 | |
Twenty-First Century Fox, Inc. Class A | 438,600 | 19,737,000 | |
WPP PLC | 540,100 | 8,448,239 | |
107,942,112 | |||
Multiline Retail - 0.6% | |||
Dollar General Corp. | 73,100 | 7,174,765 | |
Textiles, Apparel & Luxury Goods - 1.0% | |||
PVH Corp. | 69,400 | 10,654,288 | |
TOTAL CONSUMER DISCRETIONARY | 125,771,165 | ||
CONSUMER STAPLES - 7.5% | |||
Beverages - 1.3% | |||
Coca-Cola European Partners PLC | 127,800 | 5,270,472 | |
PepsiCo, Inc. | 79,000 | 9,085,000 | |
14,355,472 | |||
Food & Staples Retailing - 1.1% | |||
Sysco Corp. | 95,400 | 6,411,834 | |
Walmart, Inc. | 72,500 | 6,469,175 | |
12,881,009 | |||
Food Products - 3.5% | |||
Kellogg Co. | 148,700 | 10,562,161 | |
Mondelez International, Inc. | 124,400 | 5,396,472 | |
Seaboard Corp. | 100 | 363,800 | |
The Hershey Co. | 56,500 | 5,548,865 | |
The J.M. Smucker Co. | 154,000 | 17,112,480 | |
38,983,778 | |||
Personal Products - 0.3% | |||
Unilever NV (NY Reg.) | 61,400 | 3,528,044 | |
Tobacco - 1.3% | |||
British American Tobacco PLC: | |||
(United Kingdom) | 79,000 | 4,342,813 | |
sponsored ADR | 179,910 | 9,855,470 | |
14,198,283 | |||
TOTAL CONSUMER STAPLES | 83,946,586 | ||
ENERGY - 12.8% | |||
Energy Equipment & Services - 1.4% | |||
Baker Hughes, a GE Co. Class A | 372,800 | 12,891,424 | |
Dril-Quip, Inc. (b) | 52,200 | 2,690,910 | |
15,582,334 | |||
Oil, Gas & Consumable Fuels - 11.4% | |||
Chevron Corp. | 286,769 | 36,210,322 | |
Dynagas LNG Partners LP | 114,500 | 927,450 | |
Exxon Mobil Corp. | 398,600 | 32,489,886 | |
GasLog Ltd. | 212,000 | 3,572,200 | |
GasLog Partners LP | 288,100 | 7,245,715 | |
Golar LNG Ltd. | 81,689 | 2,124,731 | |
Golar LNG Partners LP | 547,900 | 8,991,039 | |
Hoegh LNG Partners LP | 167,700 | 3,085,680 | |
Phillips 66 Co. | 138,600 | 17,094,924 | |
Suncor Energy, Inc. | 228,000 | 9,601,291 | |
Teekay Corp. (a) | 237,400 | 1,654,678 | |
Teekay LNG Partners LP | 17,400 | 278,400 | |
Teekay Offshore Partners LP | 2,101,600 | 5,338,064 | |
128,614,380 | |||
TOTAL ENERGY | 144,196,714 | ||
FINANCIALS - 25.8% | |||
Banks - 12.0% | |||
JPMorgan Chase & Co. | 356,430 | 40,971,628 | |
PNC Financial Services Group, Inc. | 100,400 | 14,540,932 | |
SunTrust Banks, Inc. | 235,300 | 16,958,071 | |
U.S. Bancorp | 439,921 | 23,320,212 | |
Wells Fargo & Co. | 676,949 | 38,782,408 | |
134,573,251 | |||
Capital Markets - 2.2% | |||
Goldman Sachs Group, Inc. | 66,000 | 15,670,380 | |
State Street Corp. | 100,700 | 8,892,817 | |
24,563,197 | |||
Consumer Finance - 2.7% | |||
Capital One Financial Corp. | 99,500 | 9,384,840 | |
Discover Financial Services | 159,300 | 11,375,613 | |
Synchrony Financial | 354,500 | 10,259,230 | |
31,019,683 | |||
Diversified Financial Services - 3.2% | |||
Berkshire Hathaway, Inc. Class B (b) | 161,700 | 31,995,579 | |
Cannae Holdings, Inc. (b) | 16,055 | 293,004 | |
Standard Life PLC | 993,452 | 4,072,253 | |
36,360,836 | |||
Insurance - 4.2% | |||
Allstate Corp. | 68,500 | 6,515,720 | |
Chubb Ltd. | 86,993 | 12,154,662 | |
FNF Group | 156,300 | 6,330,150 | |
Prudential PLC | 360,593 | 8,507,665 | |
The Travelers Companies, Inc. | 102,100 | 13,287,294 | |
46,795,491 | |||
Mortgage Real Estate Investment Trusts - 1.5% | |||
AGNC Investment Corp. | 319,300 | 6,216,771 | |
Annaly Capital Management, Inc. | 599,700 | 6,428,784 | |
MFA Financial, Inc. | 555,100 | 4,468,555 | |
17,114,110 | |||
TOTAL FINANCIALS | 290,426,568 | ||
HEALTH CARE - 14.8% | |||
Biotechnology - 3.4% | |||
Amgen, Inc. | 120,700 | 23,723,585 | |
Shire PLC sponsored ADR | 87,200 | 14,877,192 | |
38,600,777 | |||
Health Care Providers & Services - 6.5% | |||
Aetna, Inc. | 53,500 | 10,078,865 | |
Anthem, Inc. | 47,900 | 12,118,700 | |
Cigna Corp. | 84,400 | 15,143,048 | |
CVS Health Corp. | 329,687 | 21,383,499 | |
McKesson Corp. | 32,100 | 4,031,760 | |
UnitedHealth Group, Inc. | 39,900 | 10,103,478 | |
72,859,350 | |||
Pharmaceuticals - 4.9% | |||
Allergan PLC | 77,200 | 14,211,748 | |
Bayer AG | 140,108 | 15,597,827 | |
Johnson & Johnson | 39,293 | 5,207,108 | |
Pfizer, Inc. | 108,836 | 4,345,821 | |
Roche Holding AG (participation certificate) | 24,760 | 6,082,208 | |
Sanofi SA sponsored ADR | 220,600 | 9,565,216 | |
55,009,928 | |||
TOTAL HEALTH CARE | 166,470,055 | ||
INDUSTRIALS - 5.8% | |||
Aerospace & Defense - 2.7% | |||
Harris Corp. | 49,500 | 8,165,025 | |
Huntington Ingalls Industries, Inc. | 7,200 | 1,677,960 | |
United Technologies Corp. | 152,900 | 20,754,646 | |
30,597,631 | |||
Machinery - 1.1% | |||
Allison Transmission Holdings, Inc. | 91,400 | 4,295,800 | |
Deere & Co. | 57,500 | 8,325,425 | |
12,621,225 | |||
Professional Services - 0.7% | |||
Dun & Bradstreet Corp. | 12,300 | 1,548,447 | |
Nielsen Holdings PLC | 270,400 | 6,370,624 | |
7,919,071 | |||
Road & Rail - 1.3% | |||
Union Pacific Corp. | 94,700 | 14,194,583 | |
TOTAL INDUSTRIALS | 65,332,510 | ||
INFORMATION TECHNOLOGY - 7.9% | |||
Communications Equipment - 1.8% | |||
Cisco Systems, Inc. | 263,959 | 11,162,826 | |
F5 Networks, Inc. (b) | 53,700 | 9,203,106 | |
20,365,932 | |||
Electronic Equipment & Components - 0.9% | |||
TE Connectivity Ltd. | 109,124 | 10,210,733 | |
Internet Software & Services - 2.4% | |||
Alphabet, Inc. Class A (b) | 12,500 | 15,340,250 | |
comScore, Inc. (b) | 289,405 | 5,788,100 | |
eBay, Inc.(b) | 175,100 | 5,857,095 | |
26,985,445 | |||
IT Services - 1.6% | |||
Amdocs Ltd. | 116,200 | 7,852,796 | |
Cognizant Technology Solutions Corp. Class A | 102,900 | 8,386,350 | |
The Western Union Co. | 112,300 | 2,263,968 | |
18,503,114 | |||
Technology Hardware, Storage & Peripherals - 1.2% | |||
Apple, Inc. | 69,500 | 13,225,155 | |
TOTAL INFORMATION TECHNOLOGY | 89,290,379 | ||
MATERIALS - 4.5% | |||
Chemicals - 3.1% | |||
DowDuPont, Inc. | 246,000 | 16,917,420 | |
LyondellBasell Industries NV Class A | 121,300 | 13,438,827 | |
The Scotts Miracle-Gro Co. Class A | 46,374 | 3,683,487 | |
34,039,734 | |||
Containers & Packaging - 1.4% | |||
Ball Corp. | 196,200 | 7,645,914 | |
Graphic Packaging Holding Co. | 571,500 | 8,303,895 | |
15,949,809 | |||
TOTAL MATERIALS | 49,989,543 | ||
REAL ESTATE - 1.2% | |||
Real Estate Management & Development - 1.2% | |||
CBRE Group, Inc. (b) | 271,300 | 13,510,740 | |
TELECOMMUNICATION SERVICES - 2.7% | |||
Diversified Telecommunication Services - 2.7% | |||
AT&T, Inc. | 281,364 | 8,995,207 | |
Verizon Communications, Inc. | 413,890 | 21,373,280 | |
30,368,487 | |||
UTILITIES - 2.9% | |||
Electric Utilities - 2.9% | |||
Exelon Corp. | 385,600 | 16,388,000 | |
PPL Corp. | 92,700 | 2,666,979 | |
Xcel Energy, Inc. | 287,900 | 13,490,994 | |
32,545,973 | |||
TOTAL COMMON STOCKS | |||
(Cost $976,336,315) | 1,091,848,720 | ||
Other - 0.2% | |||
ENERGY - 0.2% | |||
Oil, Gas & Consumable Fuels - 0.2% | |||
Utica Shale Drilling Program (non-operating revenue interest) (c)(d)(e) | |||
(Cost $4,632,348) | 4,632,348 | 2,440,321 | |
Money Market Funds - 3.5% | |||
Fidelity Cash Central Fund, 1.96% (f) | 32,065,416 | 32,071,829 | |
Fidelity Securities Lending Cash Central Fund 1.97% (f)(g) | 6,614,613 | 6,615,274 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $38,687,103) | 38,687,103 | ||
TOTAL INVESTMENT IN SECURITIES - 100.8% | |||
(Cost $1,019,655,766) | 1,132,976,144 | ||
NET OTHER ASSETS (LIABILITIES) - (0.8)% | (8,619,610) | ||
NET ASSETS - 100% | $1,124,356,534 |
Legend
(a) Security or a portion of the security is on loan at period end.
(b) Non-income producing
(c) Investment is owned by a wholly-owned subsidiary (Subsidiary) that is treated as a corporation for U.S. tax purposes.
(d) Restricted securities - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $2,440,321 or 0.2% of net assets.
(e) Level 3 security
(f) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(g) Investment made with cash collateral received from securities on loan.
Additional information on each restricted holding is as follows:
Security | Acquisition Date | Acquisition Cost |
Utica Shale Drilling Program (non-operating revenue interest) | 10/5/16 - 9/1/17 | $4,632,348 |
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $215,790 |
Fidelity Securities Lending Cash Central Fund | 27,474 |
Total | $243,264 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $125,771,165 | $117,322,926 | $8,448,239 | $-- |
Consumer Staples | 83,946,586 | 79,603,773 | 4,342,813 | -- |
Energy | 144,196,714 | 144,196,714 | -- | -- |
Financials | 290,426,568 | 281,918,903 | 8,507,665 | -- |
Health Care | 166,470,055 | 144,790,020 | 21,680,035 | -- |
Industrials | 65,332,510 | 65,332,510 | -- | -- |
Information Technology | 89,290,379 | 89,290,379 | -- | -- |
Materials | 49,989,543 | 49,989,543 | -- | -- |
Real Estate | 13,510,740 | 13,510,740 | -- | -- |
Telecommunication Services | 30,368,487 | 30,368,487 | -- | -- |
Utilities | 32,545,973 | 32,545,973 | -- | -- |
Other | 2,440,321 | -- | -- | 2,440,321 |
Money Market Funds | 38,687,103 | 38,687,103 | -- | -- |
Total Investments in Securities: | $1,132,976,144 | $1,087,557,071 | $42,978,752 | $2,440,321 |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 81.5% |
United Kingdom | 3.5% |
Switzerland | 2.5% |
Marshall Islands | 2.4% |
Bailiwick of Jersey | 2.1% |
Canada | 1.8% |
Netherlands | 1.5% |
Germany | 1.4% |
Ireland | 1.3% |
Others (Individually Less Than 1%) | 2.0% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Fidelity Advisor® Series Equity Value Fund
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $6,421,748) — See accompanying schedule: Unaffiliated issuers (cost $980,968,663) | $1,094,289,041 | |
Fidelity Central Funds (cost $38,687,103) | 38,687,103 | |
Total Investment in Securities (cost $1,019,655,766) | $1,132,976,144 | |
Cash | 111,020 | |
Restricted cash | 94,998 | |
Receivable for investments sold | 2,484,371 | |
Receivable for fund shares sold | 102,208 | |
Dividends receivable | 1,032,313 | |
Distributions receivable from Fidelity Central Funds | 55,159 | |
Other receivables | 12,045 | |
Total assets | 1,136,868,258 | |
Liabilities | ||
Payable for fund shares redeemed | $5,882,924 | |
Other payables and accrued expenses | 14,300 | |
Collateral on securities loaned | 6,614,500 | |
Total liabilities | 12,511,724 | |
Net Assets | $1,124,356,534 | |
Net Assets consist of: | ||
Paid in capital | $983,882,693 | |
Undistributed net investment income | 13,363,340 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 13,789,797 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 113,320,704 | |
Net Assets, for 85,885,503 shares outstanding | $1,124,356,534 | |
Net Asset Value, offering price and redemption price per share ($1,124,356,534 ÷ 85,885,503 shares) | $13.09 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $13,359,675 | |
Income from Fidelity Central Funds | 243,264 | |
Total income | 13,602,939 | |
Expenses | ||
Custodian fees and expenses | $11,641 | |
Independent trustees' fees and expenses | 2,587 | |
Miscellaneous | 1,541 | |
Total expenses before reductions | 15,769 | |
Expense reductions | (137) | |
Total expenses after reductions | 15,632 | |
Net investment income (loss) | 13,587,307 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 15,039,634 | |
Fidelity Central Funds | (149) | |
Foreign currency transactions | (20,458) | |
Total net realized gain (loss) | 15,019,027 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (55,819,819) | |
Fidelity Central Funds | 73 | |
Assets and liabilities in foreign currencies | (2,286) | |
Total change in net unrealized appreciation (depreciation) | (55,822,032) | |
Net gain (loss) | (40,803,005) | |
Net increase (decrease) in net assets resulting from operations | $(27,215,698) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $13,587,307 | $29,112,239 |
Net realized gain (loss) | 15,019,027 | 226,692,845 |
Change in net unrealized appreciation (depreciation) | (55,822,032) | (82,296,499) |
Net increase (decrease) in net assets resulting from operations | (27,215,698) | 173,508,585 |
Distributions to shareholders from net investment income | (344,183) | (19,287,881) |
Distributions to shareholders from net realized gain | (3,183,691) | (104,511,364) |
Total distributions | (3,527,874) | (123,799,245) |
Share transactions | ||
Proceeds from sales of shares | 45,727,047 | 130,293,748 |
Reinvestment of distributions | 3,527,874 | 123,799,245 |
Cost of shares redeemed | (50,437,915) | (796,877,232) |
Net increase (decrease) in net assets resulting from share transactions | (1,182,994) | (542,784,239) |
Total increase (decrease) in net assets | (31,926,566) | (493,074,899) |
Net Assets | ||
Beginning of period | 1,156,283,100 | 1,649,357,999 |
End of period | $1,124,356,534 | $1,156,283,100 |
Other Information | ||
Undistributed net investment income end of period | $13,363,340 | $120,216 |
Shares | ||
Sold | 3,564,125 | 9,806,742 |
Issued in reinvestment of distributions | 269,921 | 9,545,702 |
Redeemed | (3,957,298) | (59,980,507) |
Net increase (decrease) | (123,252) | (40,628,063) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Advisor Series Equity Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $13.44 | $13.02 | $10.84 | $12.37 | $11.84 | $10.60 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .16 | .30 | .26 | .31 | .32 | .25 |
Net realized and unrealized gain (loss) | (.47) | 1.57 | 2.46 | (.80) | .88 | 1.49 |
Total from investment operations | (.31) | 1.87 | 2.72 | (.49) | 1.20 | 1.74 |
Distributions from net investment income | –B | (.22)C | (.28) | (.33) | (.28) | (.24) |
Distributions from net realized gain | (.04) | (1.23)C | (.26) | (.71) | (.39) | (.26) |
Total distributions | (.04) | (1.45) | (.54) | (1.04) | (.67) | (.50) |
Net asset value, end of period | $13.09 | $13.44 | $13.02 | $10.84 | $12.37 | $11.84 |
Total ReturnD,E | (2.30)% | 15.04% | 25.49% | (4.34)% | 9.99% | 16.44% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | –%H,I | .28% | .66% | .66% | .66% | .68% |
Expenses net of fee waivers, if any | –%H,I | .28% | .66% | .66% | .66% | .68% |
Expenses net of all reductions | –%H,I | .27% | .66% | .66% | .66% | .68% |
Net investment income (loss) | 2.46%H | 2.25% | 2.19% | 2.50% | 2.48% | 2.15% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $1,124,357 | $1,156,283 | $1,649,358 | $1,567,110 | $1,786,446 | $1,770,773 |
Portfolio turnover rateJ | 31%H | 82%K | 39% | 42% | 39% | 44% |
A Calculated based on average shares outstanding during the period.
B Amount represents less than $.005 per share.
C The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the Fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
H Annualized
I Amount represents less than .005%.
J Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
K Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Advisor® Series Stock Selector Large Cap Value Fund
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
Bank of America Corp. | 3.6 |
Citigroup, Inc. | 2.7 |
Chevron Corp. | 2.7 |
Berkshire Hathaway, Inc. Class B | 2.4 |
Johnson & Johnson | 2.2 |
Cisco Systems, Inc. | 2.0 |
Pfizer, Inc. | 1.9 |
Verizon Communications, Inc. | 1.9 |
DowDuPont, Inc. | 1.8 |
American International Group, Inc. | 1.8 |
23.0 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 22.9 |
Health Care | 13.5 |
Energy | 10.7 |
Information Technology | 10.1 |
Consumer Discretionary | 9.1 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks and Equity Futures | 96.2% | |
Short-Term Investments and Net Other Assets (Liabilities) | 3.8% |
* Foreign investments - 8.8%
Fidelity Advisor® Series Stock Selector Large Cap Value Fund
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 96.0% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 9.1% | |||
Auto Components - 0.5% | |||
Delphi Technologies PLC | 118,059 | $5,332,725 | |
Diversified Consumer Services - 0.3% | |||
ServiceMaster Global Holdings, Inc. (a) | 65,952 | 3,758,604 | |
Hotels, Restaurants & Leisure - 1.8% | |||
McDonald's Corp. | 91,500 | 14,414,910 | |
Royal Caribbean Cruises Ltd. | 46,600 | 5,254,616 | |
U.S. Foods Holding Corp. (a) | 17,700 | 598,437 | |
20,267,963 | |||
Household Durables - 1.0% | |||
Lennar Corp. Class A | 38,100 | 1,991,487 | |
Mohawk Industries, Inc. (a) | 48,000 | 9,041,280 | |
11,032,767 | |||
Internet & Direct Marketing Retail - 0.5% | |||
Liberty Interactive Corp. QVC Group Series A (a) | 256,481 | 5,460,480 | |
Media - 3.2% | |||
Comcast Corp. Class A | 338,300 | 12,104,374 | |
Liberty Broadband Corp. Class C (a) | 93,145 | 7,402,233 | |
The Walt Disney Co. | 149,524 | 16,979,945 | |
36,486,552 | |||
Multiline Retail - 0.7% | |||
Dollar Tree, Inc. (a) | 82,600 | 7,539,728 | |
Specialty Retail - 0.5% | |||
Burlington Stores, Inc. (a) | 40,300 | 6,158,243 | |
Textiles, Apparel & Luxury Goods - 0.6% | |||
PVH Corp. | 46,305 | 7,108,744 | |
TOTAL CONSUMER DISCRETIONARY | 103,145,806 | ||
CONSUMER STAPLES - 6.3% | |||
Beverages - 0.5% | |||
Molson Coors Brewing Co. Class B | 13,600 | 911,200 | |
PepsiCo, Inc. | 26,700 | 3,070,500 | |
The Coca-Cola Co. | 44,200 | 2,061,046 | |
6,042,746 | |||
Food & Staples Retailing - 0.9% | |||
Walmart, Inc. | 115,098 | 10,270,195 | |
Food Products - 1.7% | |||
ConAgra Foods, Inc. | 68,600 | 2,518,306 | |
General Mills, Inc. | 30,100 | 1,386,406 | |
Mondelez International, Inc. | 194,719 | 8,446,910 | |
The J.M. Smucker Co. | 9,700 | 1,077,864 | |
The Kraft Heinz Co. | 64,329 | 3,875,822 | |
Tyson Foods, Inc. Class A | 30,600 | 1,764,090 | |
19,069,398 | |||
Household Products - 1.9% | |||
Church & Dwight Co., Inc. | 45,300 | 2,532,270 | |
Colgate-Palmolive Co. | 43,300 | 2,901,533 | |
Procter & Gamble Co. | 193,757 | 15,671,066 | |
Spectrum Brands Holdings, Inc. | 9,900 | 864,963 | |
21,969,832 | |||
Personal Products - 0.1% | |||
Coty, Inc. Class A | 84,200 | 1,129,122 | |
Tobacco - 1.2% | |||
Altria Group, Inc. | 21,500 | 1,261,620 | |
Philip Morris International, Inc. | 142,146 | 12,267,200 | |
13,528,820 | |||
TOTAL CONSUMER STAPLES | 72,010,113 | ||
ENERGY - 10.7% | |||
Energy Equipment & Services - 1.0% | |||
Baker Hughes, a GE Co. Class A | 339,081 | 11,725,421 | |
Oil, Gas & Consumable Fuels - 9.7% | |||
Anadarko Petroleum Corp. | 119,000 | 8,704,850 | |
BP PLC sponsored ADR | 240,300 | 10,835,127 | |
Cenovus Energy, Inc. | 902,883 | 9,057,634 | |
Cheniere Energy, Inc. (a) | 141,700 | 8,997,950 | |
Chevron Corp. | 241,586 | 30,505,064 | |
ConocoPhillips Co. | 246,306 | 17,775,904 | |
EQT Corp. | 114,500 | 5,688,360 | |
Valero Energy Corp. | 156,000 | 18,462,600 | |
110,027,489 | |||
TOTAL ENERGY | 121,752,910 | ||
FINANCIALS - 22.9% | |||
Banks - 10.6% | |||
Bank of America Corp. | 1,324,300 | 40,894,387 | |
Citigroup, Inc. | 429,000 | 30,840,810 | |
First Horizon National Corp. | 412,700 | 7,383,203 | |
Huntington Bancshares, Inc. | 985,200 | 15,211,488 | |
KeyCorp | 278,400 | 5,810,208 | |
U.S. Bancorp | 96,308 | 5,105,287 | |
Wells Fargo & Co. | 272,675 | 15,621,551 | |
120,866,934 | |||
Capital Markets - 3.1% | |||
BlackRock, Inc. Class A | 14,100 | 7,088,916 | |
E*TRADE Financial Corp. (a) | 94,800 | 5,669,988 | |
Goldman Sachs Group, Inc. | 60,322 | 14,322,252 | |
Northern Trust Corp. | 46,000 | 5,024,120 | |
TD Ameritrade Holding Corp. | 49,700 | 2,840,355 | |
34,945,631 | |||
Consumer Finance - 2.8% | |||
Capital One Financial Corp. | 208,986 | 19,711,560 | |
Discover Financial Services | 64,600 | 4,613,086 | |
SLM Corp. (a) | 292,500 | 3,302,325 | |
Synchrony Financial | 140,100 | 4,054,494 | |
31,681,465 | |||
Diversified Financial Services - 2.4% | |||
Berkshire Hathaway, Inc. Class B (a) | 136,039 | 26,918,037 | |
Insurance - 4.0% | |||
American International Group, Inc. | 376,800 | 20,803,128 | |
Aspen Insurance Holdings Ltd. | 32,200 | 1,302,490 | |
Hartford Financial Services Group, Inc. | 68,000 | 3,583,600 | |
MetLife, Inc. | 211,051 | 9,653,473 | |
The Travelers Companies, Inc. | 83,700 | 10,892,718 | |
46,235,409 | |||
TOTAL FINANCIALS | 260,647,476 | ||
HEALTH CARE - 13.5% | |||
Biotechnology - 0.1% | |||
Alexion Pharmaceuticals, Inc. (a) | 11,700 | 1,555,632 | |
Prothena Corp. PLC (a) | 9 | 134 | |
1,555,766 | |||
Health Care Equipment & Supplies - 3.2% | |||
Abbott Laboratories | 157,000 | 10,289,780 | |
Baxter International, Inc. | 78,000 | 5,651,100 | |
Becton, Dickinson & Co. | 26,000 | 6,509,620 | |
Boston Scientific Corp. (a) | 59,400 | 1,996,434 | |
Medtronic PLC | 131,628 | 11,876,794 | |
36,323,728 | |||
Health Care Providers & Services - 2.2% | |||
Aetna, Inc. | 24,800 | 4,672,072 | |
Anthem, Inc. | 17,600 | 4,452,800 | |
Cigna Corp. | 28,576 | 5,127,106 | |
CVS Health Corp. | 85,200 | 5,526,072 | |
Express Scripts Holding Co. (a) | 37,900 | 3,011,534 | |
HCA Holdings, Inc. | 14,400 | 1,788,912 | |
24,578,496 | |||
Life Sciences Tools & Services - 0.8% | |||
Thermo Fisher Scientific, Inc. | 40,300 | 9,451,559 | |
Pharmaceuticals - 7.2% | |||
Allergan PLC | 36,000 | 6,627,240 | |
Bristol-Myers Squibb Co. | 47,700 | 2,802,375 | |
Jazz Pharmaceuticals PLC (a) | 62,176 | 10,761,422 | |
Johnson & Johnson | 187,047 | 24,787,468 | |
Merck & Co., Inc. | 235,199 | 15,492,558 | |
Pfizer, Inc. | 546,538 | 21,823,262 | |
82,294,325 | |||
TOTAL HEALTH CARE | 154,203,874 | ||
INDUSTRIALS - 6.4% | |||
Aerospace & Defense - 1.2% | |||
United Technologies Corp. | 104,496 | 14,184,287 | |
Airlines - 0.6% | |||
American Airlines Group, Inc. | 176,091 | 6,962,638 | |
Construction & Engineering - 0.8% | |||
AECOM (a) | 277,973 | 9,328,774 | |
Electrical Equipment - 0.5% | |||
Sensata Technologies, Inc. PLC (a) | 106,050 | 5,765,939 | |
Industrial Conglomerates - 1.1% | |||
General Electric Co. | 867,265 | 11,820,822 | |
Honeywell International, Inc. | 5,853 | 934,431 | |
12,755,253 | |||
Machinery - 0.1% | |||
Caterpillar, Inc. | 3,900 | 560,820 | |
Marine - 0.4% | |||
A.P. Moller - Maersk A/S Series B | 2,868 | 4,117,980 | |
Professional Services - 0.4% | |||
Nielsen Holdings PLC | 196,200 | 4,622,472 | |
Road & Rail - 0.7% | |||
Norfolk Southern Corp. | 46,572 | 7,870,668 | |
Trading Companies & Distributors - 0.6% | |||
HD Supply Holdings, Inc. (a) | 154,838 | 6,809,775 | |
TOTAL INDUSTRIALS | 72,978,606 | ||
INFORMATION TECHNOLOGY - 10.1% | |||
Communications Equipment - 2.0% | |||
Cisco Systems, Inc. | 552,614 | 23,370,046 | |
Electronic Equipment & Components - 0.2% | |||
Dell Technologies, Inc. (a) | 30,800 | 2,849,616 | |
Internet Software & Services - 0.7% | |||
Alphabet, Inc. Class A (a) | 6,200 | 7,608,764 | |
IT Services - 2.6% | |||
Amdocs Ltd. | 204,300 | 13,806,594 | |
IBM Corp. | 41,600 | 6,029,088 | |
Leidos Holdings, Inc. | 139,700 | 9,558,274 | |
29,393,956 | |||
Semiconductors & Semiconductor Equipment - 2.6% | |||
Broadcom, Inc. | 23,300 | 5,167,241 | |
Intel Corp. | 123,100 | 5,921,110 | |
NXP Semiconductors NV (a) | 49,400 | 4,709,796 | |
Qualcomm, Inc. | 222,193 | 14,240,349 | |
30,038,496 | |||
Software - 1.7% | |||
Microsoft Corp. | 38,900 | 4,126,512 | |
Oracle Corp. | 310,297 | 14,794,961 | |
18,921,473 | |||
Technology Hardware, Storage & Peripherals - 0.3% | |||
Apple, Inc. | 17,224 | 3,277,555 | |
TOTAL INFORMATION TECHNOLOGY | 115,459,906 | ||
MATERIALS - 4.1% | |||
Chemicals - 3.3% | |||
DowDuPont, Inc. | 304,657 | 20,951,262 | |
LyondellBasell Industries NV Class A | 55,400 | 6,137,766 | |
Nutrien Ltd. | 114,400 | 6,213,138 | |
Westlake Chemical Corp. | 45,474 | 4,875,722 | |
38,177,888 | |||
Construction Materials - 0.4% | |||
Eagle Materials, Inc. | 42,000 | 4,172,700 | |
Containers & Packaging - 0.4% | |||
Crown Holdings, Inc.(a) | 102,700 | 4,649,229 | |
TOTAL MATERIALS | 46,999,817 | ||
REAL ESTATE - 4.5% | |||
Equity Real Estate Investment Trusts (REITs) - 4.3% | |||
American Tower Corp. | 16,084 | 2,384,292 | |
Boston Properties, Inc. | 55,453 | 6,961,015 | |
Colony NorthStar, Inc. | 352,146 | 2,169,219 | |
Corporate Office Properties Trust (SBI) | 103,439 | 3,076,276 | |
Equity Residential (SBI) | 83,759 | 5,480,351 | |
Gaming & Leisure Properties | 57,128 | 2,074,889 | |
Prologis, Inc. | 92,763 | 6,087,108 | |
Public Storage | 29,431 | 6,410,955 | |
Safety Income and Growth, Inc. | 51,419 | 915,258 | |
Spirit Realty Capital, Inc. | 398,211 | 3,333,026 | |
Store Capital Corp. | 103,689 | 2,846,263 | |
The Macerich Co. | 72,251 | 4,267,144 | |
Welltower, Inc. | 51,372 | 3,215,887 | |
49,221,683 | |||
Real Estate Management & Development - 0.2% | |||
CBRE Group, Inc. (a) | 30,771 | 1,532,396 | |
TOTAL REAL ESTATE | 50,754,079 | ||
TELECOMMUNICATION SERVICES - 3.3% | |||
Diversified Telecommunication Services - 2.9% | |||
AT&T, Inc. | 366,906 | 11,729,985 | |
Verizon Communications, Inc. | 410,903 | 21,219,031 | |
32,949,016 | |||
Wireless Telecommunication Services - 0.4% | |||
T-Mobile U.S., Inc. (a) | 73,153 | 4,389,180 | |
TOTAL TELECOMMUNICATION SERVICES | 37,338,196 | ||
UTILITIES - 5.1% | |||
Electric Utilities - 3.6% | |||
Evergy, Inc. | 149,100 | 8,363,019 | |
Exelon Corp. | 189,200 | 8,041,000 | |
NextEra Energy, Inc. | 70,467 | 11,806,041 | |
PG&E Corp. | 40,000 | 1,723,200 | |
PPL Corp. | 271,900 | 7,822,563 | |
Vistra Energy Corp. (a) | 168,900 | 3,817,140 | |
41,572,963 | |||
Independent Power and Renewable Electricity Producers - 0.9% | |||
NRG Energy, Inc. | 177,500 | 5,621,425 | |
The AES Corp. | 312,000 | 4,168,320 | |
9,789,745 | |||
Multi-Utilities - 0.6% | |||
Sempra Energy | 62,231 | 7,193,281 | |
TOTAL UTILITIES | 58,555,989 | ||
TOTAL COMMON STOCKS | |||
(Cost $942,602,867) | 1,093,846,772 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.1% | |||
U.S. Treasury Bills, yield at date of purchase 1.81% to 1.89% 8/2/18 to 9/13/18 (b) | |||
(Cost $728,868) | 730,000 | 728,870 | |
Shares | Value | ||
Money Market Funds - 3.8% | |||
Fidelity Cash Central Fund, 1.96% (c) | |||
(Cost $43,068,023) | 43,059,412 | 43,068,023 | |
TOTAL INVESTMENT IN SECURITIES - 99.9% | |||
(Cost $986,399,758) | 1,137,643,665 | ||
NET OTHER ASSETS (LIABILITIES) - 0.1% | 1,350,221 | ||
NET ASSETS - 100% | $1,138,993,886 |
Futures Contracts | |||||
Number of contracts | Expiration Date | Notional Amount | Value | Unrealized Appreciation/(Depreciation) | |
Purchased | |||||
Equity Index Contracts | |||||
CME E-mini Russell 1000 Value Index Contracts (United States) | 44 | Sept. 2018 | $2,709,960 | $44,359 | $44,359 |
The notional amount of futures purchased as a percentage of Net Assets is 0.2%
Legend
(a) Non-income producing
(b) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $447,504.
(c) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $504,504 |
Fidelity Securities Lending Cash Central Fund | 1,086 |
Total | $505,590 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $103,145,806 | $103,145,806 | $-- | $-- |
Consumer Staples | 72,010,113 | 72,010,113 | -- | -- |
Energy | 121,752,910 | 121,752,910 | -- | -- |
Financials | 260,647,476 | 260,647,476 | -- | -- |
Health Care | 154,203,874 | 154,203,874 | -- | -- |
Industrials | 72,978,606 | 68,860,626 | 4,117,980 | -- |
Information Technology | 115,459,906 | 115,459,906 | -- | -- |
Materials | 46,999,817 | 46,999,817 | -- | -- |
Real Estate | 50,754,079 | 50,754,079 | -- | -- |
Telecommunication Services | 37,338,196 | 37,338,196 | -- | -- |
Utilities | 58,555,989 | 58,555,989 | -- | -- |
U.S. Government and Government Agency Obligations | 728,870 | -- | 728,870 | -- |
Money Market Funds | 43,068,023 | 43,068,023 | -- | -- |
Total Investments in Securities: | $1,137,643,665 | $1,132,796,815 | $4,846,850 | $-- |
Derivative Instruments: | ||||
Assets | ||||
Futures Contracts | $44,359 | $44,359 | $-- | $-- |
Total Assets | $44,359 | $44,359 | $-- | $-- |
Total Derivative Instruments: | $44,359 | $44,359 | $-- | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of July 31, 2018. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
Primary Risk Exposure / Derivative Type | Value | |
Asset | Liability | |
Equity Risk | ||
Futures Contracts(a) | $44,359 | $0 |
Total Equity Risk | 44,359 | 0 |
Total Value of Derivatives | $44,359 | $0 |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin on futures contracts, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
See accompanying notes which are an integral part of the financial statements.
Fidelity Advisor® Series Stock Selector Large Cap Value Fund
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $943,331,735) | $1,094,575,642 | |
Fidelity Central Funds (cost $43,068,023) | 43,068,023 | |
Total Investment in Securities (cost $986,399,758) | $1,137,643,665 | |
Cash | 16,928 | |
Receivable for investments sold | 9,488,615 | |
Receivable for fund shares sold | 103,388 | |
Dividends receivable | 831,749 | |
Distributions receivable from Fidelity Central Funds | 65,727 | |
Receivable for daily variation margin on futures contracts | 27,957 | |
Other receivables | 14,205 | |
Total assets | 1,148,192,234 | |
Liabilities | ||
Payable for investments purchased | $3,172,254 | |
Payable for fund shares redeemed | 6,010,778 | |
Other payables and accrued expenses | 15,316 | |
Total liabilities | 9,198,348 | |
Net Assets | $1,138,993,886 | |
Net Assets consist of: | ||
Paid in capital | $909,136,509 | |
Undistributed net investment income | 12,308,215 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 66,260,896 | |
Net unrealized appreciation (depreciation) on investments | 151,288,266 | |
Net Assets, for 86,580,013 shares outstanding | $1,138,993,886 | |
Net Asset Value, offering price and redemption price per share ($1,138,993,886 ÷ 86,580,013 shares) | $13.16 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $11,824,546 | |
Interest | 6,690 | |
Income from Fidelity Central Funds | 505,590 | |
Total income | 12,336,826 | |
Expenses | ||
Custodian fees and expenses | $22,417 | |
Independent trustees' fees and expenses | 2,603 | |
Commitment fees | 1,549 | |
Total expenses | 26,569 | |
Net investment income (loss) | 12,310,257 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 71,555,998 | |
Fidelity Central Funds | (8) | |
Foreign currency transactions | (16,349) | |
Futures contracts | (625,073) | |
Total net realized gain (loss) | 70,914,568 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (100,357,719) | |
Fidelity Central Funds | (1) | |
Futures contracts | (338,455) | |
Total change in net unrealized appreciation (depreciation) | (100,696,175) | |
Net gain (loss) | (29,781,607) | |
Net increase (decrease) in net assets resulting from operations | $(17,471,350) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $12,310,257 | $23,090,754 |
Net realized gain (loss) | 70,914,568 | 65,341,700 |
Change in net unrealized appreciation (depreciation) | (100,696,175) | 68,282,154 |
Net increase (decrease) in net assets resulting from operations | (17,471,350) | 156,714,608 |
Distributions to shareholders from net investment income | (599,164) | (22,335,139) |
Distributions to shareholders from net realized gain | (17,803,742) | (55,478,121) |
Total distributions | (18,402,906) | (77,813,260) |
Share transactions | ||
Proceeds from sales of shares | 46,022,073 | 109,860,281 |
Reinvestment of distributions | 18,402,906 | 77,813,260 |
Cost of shares redeemed | (50,769,243) | (207,314,060) |
Net increase (decrease) in net assets resulting from share transactions | 13,655,736 | (19,640,519) |
Total increase (decrease) in net assets | (22,218,520) | 59,260,829 |
Net Assets | ||
Beginning of period | 1,161,212,406 | 1,101,951,577 |
End of period | $1,138,993,886 | $1,161,212,406 |
Other Information | ||
Undistributed net investment income end of period | $12,308,215 | $597,122 |
Shares | ||
Sold | 3,579,754 | 8,313,800 |
Issued in reinvestment of distributions | 1,413,434 | 5,958,136 |
Redeemed | (3,971,833) | (15,632,209) |
Net increase (decrease) | 1,021,355 | (1,360,273) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Advisor Series Stock Selector Large Cap Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $13.57 | $12.68 | $10.50 | $12.82 | $12.07 | $10.72 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .14 | .28B | .18 | .17 | .18 | .14 |
Net realized and unrealized gain (loss) | (.33) | 1.58 | 2.33 | (.97) | 1.50 | 1.88 |
Total from investment operations | (.19) | 1.86 | 2.51 | (.80) | 1.68 | 2.02 |
Distributions from net investment income | (.01) | (.28) | (.19) | (.20)C | (.16) | (.12) |
Distributions from net realized gain | (.21) | (.69) | (.15) | (1.32)C | (.76) | (.55) |
Total distributions | (.22) | (.97) | (.33)D | (1.52) | (.93)E | (.67) |
Net asset value, end of period | $13.16 | $13.57 | $12.68 | $10.50 | $12.82 | $12.07 |
Total ReturnF,G | (1.42)% | 15.03% | 24.12% | (6.72)% | 13.70% | 18.79% |
Ratios to Average Net AssetsH,I | ||||||
Expenses before reductions | - %J,K | .25% | .71% | .77% | .75% | .78% |
Expenses net of fee waivers, if any | - %J,K | .25% | .71% | .76% | .75% | .78% |
Expenses net of all reductions | - %J,K | .24% | .70% | .76% | .75% | .78% |
Net investment income (loss) | 2.21%J | 2.10%B | 1.53% | 1.38% | 1.35% | 1.19% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $1,138,994 | $1,161,212 | $1,101,952 | $1,044,631 | $1,201,298 | $1,139,423 |
Portfolio turnover rateL | 90%J | 55% | 48% | 64% | 55% | 61% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.04 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.83%.
C The amounts shown reflect certain reclassifications related to book to tax differences that were made in the year shown.
D Total distributions of $.33 per share is comprised of distributions from net investment income of $.185 and distributions from net realized gain of $.145 per share.
E Total distributions of $.93 per share is comprised of distributions from net investment income of $.163 and distributions from net realized gain of $.762 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
I Expense ratios reflect operating expenses of the Fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
J Annualized
K Amount represents less than .005%.
L Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Advisor Series Equity Value Fund and Fidelity Advisor Series Stock Selector Large Cap Value Fund (the Funds) are funds of Fidelity Devonshire Trust (the Trust). Each Fund is authorized to issue an unlimited number of shares. Shares of the Funds are only available for purchase by mutual funds for which Fidelity Management & Research Company (FMR) or an affiliate serves as an investment manager. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust.
2. Investments in Fidelity Central Funds.
The Funds invest in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Funds' Schedules of Investments list each of the Fidelity Central Funds held as of period end, if any, as an investment of each Fund, but do not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, each Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
Each Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Funds:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of each Fund's investments to the Fair Value Committee (the Committee) established by each Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, each Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees each Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing each Fund's investments and ratifies the fair value determinations of the Committee.
Each Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value each Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded and are categorized as Level 1 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of July 31, 2018 is included at the end of each Fund's Schedule of Investments.
Foreign Currency. The Funds may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Funds' investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost and for certain Funds include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Funds are informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Funds represent a return of capital or capital gain. The Funds determine the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, each Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. Each Fund files a U.S. federal tax return, in addition to state and local tax returns as required. Each Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on each Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to short-term capital gains, futures contracts, foreign currency transactions, passive foreign investment companies (PFIC), market discount, redemptions in kind, partnerships and losses deferred due to wash sales and excise tax regulations.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows for each Fund:
Tax cost | Gross unrealized appreciation | Gross unrealized depreciation | Net unrealized appreciation (depreciation) | |
Fidelity Advisor Series Equity Value Fund | $1,020,173,406 | $156,707,271 | $(43,904,533) | $112,802,738 |
Fidelity Advisor Series Stock Selector Large Cap Value Fund | 988,647,904 | 181,339,303 | (32,299,183) | 149,040,120 |
Fidelity Advisor Series Stock Selector Large Cap Value Fund elected to defer to its next fiscal year $3,267,459 of capital losses recognized during the period November 1, 2017 to January 31, 2018.
Restricted Securities. The Funds may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of each applicable Fund's Schedule of Investments.
Consolidated Subsidiary. Fidelity Advisor Series Equity Value Fund invests in certain investments through a wholly-owned subsidiary ("Subsidiary"), which may be subject to federal and state taxes upon disposition.
As of period end, the Fund held an investment of $2,535,319 in this Subsidiary, representing .23% of the Fund's net assets. The financial statements have been consolidated and include accounts of the Fund and the Subsidiary. Accordingly, all inter-company transactions and balances have been eliminated.
Any cash held by the Subsidiary is restricted as to its use and is presented as Restricted cash in the Statement of Assets and Liabilities.
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Funds' investment objective allows the Funds to enter into various types of derivative contracts, including futures contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Funds used derivatives to increase returns and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Funds may not achieve their objectives.
The Funds' use of derivatives increased or decreased their exposure to the following risk:
Equity Risk | Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment. |
The Funds are also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Funds will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Funds. Counterparty credit risk related to exchange-traded futures may be mitigated by the protection provided by the exchange on which they trade.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. Fidelity Advisor Series Stock Selector Large Cap Value Fund used futures contracts to manage its exposure to the stock market.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin on futures contracts in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract. The net realized gain (loss) and change in net unrealized appreciation (depreciation) on futures contracts during the period is presented in the Statement of Operations.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The notional amount at value reflects each contract's exposure to the underlying instrument or index at period end and is representative of volume of activity during the period. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, are noted in the table below.
Purchases ($) | Sales ($) | |
Fidelity Advisor Series Equity Value Fund | 177,874,703 | 167,756,102 |
Fidelity Advisor Series Stock Selector Large Cap Value Fund | 495,771,157 | 477,279,620 |
6. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Funds with investment management related services for which the Funds do not pay a management fee. Under the management contract, the investment adviser or an affiliate pays all ordinary operating expenses of the Funds, except custody fees, fees and expenses of the independent Trustees, and certain miscellaneous expenses such as proxy and shareholder meeting expenses.
Brokerage Commissions. Certain Funds placed a portion of their portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were as follows:
Amount | |
Fidelity Advisor Series Equity Value Fund | $3,047 |
Fidelity Advisor Series Stock Selector Large Cap Value Fund | 15,806 |
Interfund Trades. The Funds may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
Prior Fiscal Year Redemptions In-Kind. During the prior period, 37,998,289 shares of Fidelity Advisor Series Equity Value Fund held by affiliated entities were redeemed in-kind for investments and cash with a value of $504,085,301. The Fund had a net realized gain of $135,786,829 on investments delivered through in-kind redemptions. The amount of the in-kind redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
Other. During the period, the investment adviser reimbursed the Fidelity Advisor Series Equity Value Fund for certain losses in the amount of $11,859.
7. Committed Line of Credit.
Certain Funds participate with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The participating funds have agreed to pay commitment fees on their pro-rata portion of the line of credit, which are reflected in Miscellaneous expenses on the Statement of Operations, and are as follows:
Fidelity Advisor Series Equity Value Fund | $1,541 |
Fidelity Advisor Series Stock Selector Large Cap Value Fund | 1,549 |
During the period, the Funds did not borrow on this line of credit.
8. Security Lending.
Certain Funds lend portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Funds. On the settlement date of the loan, each applicable Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Funds and any additional required collateral is delivered to the Funds on the next business day. The Funds or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Funds may apply collateral received from the borrower against the obligation. The Funds may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on each applicable Fund's Statement of Assets and Liabilities. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented on each applicable Fund's Statement of Operations as a component of income from Fidelity Central Funds. During the period, there were no securities loaned to FCM. Security lending activity was as follows:
Total Security Lending Income | |
Fidelity Advisor Series Equity Value Fund | $27,474 |
Fidelity Advisor Series Stock Selector Large Cap Value Fund | 1,086 |
9. Expense Reductions.
Through arrangements with each applicable Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce each applicable Fund's expenses. All of the applicable expense reductions are noted in the table below.
Custody Expense reduction | |
Fidelity Advisor Series Equity Value Fund | $137 |
10. Proposed Reorganization.
The Board of Trustees of the Fidelity Advisor Series Equity Value Fund approved an Agreement and Plan of Reorganization (the Agreement) between the Fidelity Advisor Series Equity Value Fund and Fidelity Series Value Discovery Fund. The Agreement provides for the transfer of all the assets and the assumption of all the liabilities of the Fidelity Advisor Series Equity Value Fund in exchange for corresponding shares of Fidelity Series Value Discovery Fund equal in value to the net assets of the Fidelity Advisor Series Equity Value Fund on the day the reorganization is effective. The reorganization does not require shareholder approval and is expected to become effective in September 2018. The reorganization is expected to qualify as a tax-free transaction for federal income tax purposes with no gain or loss recognized by the funds or their shareholders.
The Board of Trustees of the Fidelity Advisor Series Stock Selector Large Cap Value Fund approved an Agreement and Plan of Reorganization (the Agreement) between the Fidelity Advisor Series Stock Selector Large Cap Value Fund and Fidelity Series Stock Selector Large Cap Value Fund. The Agreement provides for the transfer of all the assets and the assumption of all the liabilities of the Fidelity Advisor Series Stock Selector Large Cap Value Fund in exchange for corresponding shares of Fidelity Series Stock Selector Large Cap Value Fund equal in value to the net assets of the Fidelity Advisor Series Stock Selector Large Cap Value Fund on the day the reorganization is effective. The reorganization does not require shareholder approval and is expected to become effective in September 2018. The reorganization is expected to qualify as a tax-free transaction for federal income tax purposes with no gain or loss recognized by the funds or their shareholders.
11. Other.
The Funds' organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Funds. In the normal course of business, the Funds may also enter into contracts that provide general indemnifications. The Funds' maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Funds. The risk of material loss from such claims is considered remote.
At the end of the period, mutual funds managed by the investment adviser or its affiliates were the owners of record of all of the outstanding shares of the Funds.
Shareholder Expense Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying table for each fund 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, each Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each fund provides information about hypothetical account values and hypothetical expenses based on a fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, each Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Fidelity Advisor Series Equity Value Fund | - %-C | |||
Actual | $1,000.00 | $977.00 | $--D | |
Hypothetical-E | $1,000.00 | $1,024.79 | $--D | |
Fidelity Advisor Series Stock Selector Large Cap Value Fund | - %-C | |||
Actual | $1,000.00 | $985.80 | $--D | |
Hypothetical-E | $1,000.00 | $1,024.79 | $--D |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/ 365 (to reflect the one-half year period).
C Amount represents less than .005%.
D Amount represents less than $.005.
E 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Advisor Series Equity Value Fund
Fidelity Advisor Series Stock Selector Large Cap Value Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contracts with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the funds for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the funds, and the Sector Portfolios Board.
The Board considered that the approval of the funds' Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the funds' assets; (ii) the fees and expenses paid by shareholders, including the expense cap arrangement currently in place for each fund; (iii) the nature, extent or quality of services provided under the funds' Advisory Contracts; or (iv) the day-to-day management of each fund or the persons primarily responsible for such management. The Board concluded that the funds' Advisory Contracts are fair and reasonable, and that the funds' Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the funds' Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the funds, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for each fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing each fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the funds) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the funds' management fee structures are fair and reasonable, and that the continuation of the funds' Advisory Contracts should be approved.
AEDTI-ALDTI-SANN-0918
1.956893.105
Fidelity Advisor® Stock Selector Large Cap Value Fund - Semi-Annual Report July 31, 2018 Class A, Class M, Class C, Class I and Class Z are classes of Fidelity® Stock Selector Large Cap Value Fund |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-877-208-0098 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
Bank of America Corp. | 3.6 |
Citigroup, Inc. | 2.7 |
Berkshire Hathaway, Inc. Class B | 2.3 |
Johnson & Johnson | 2.2 |
Cisco Systems, Inc. | 2.0 |
Pfizer, Inc. | 2.0 |
Verizon Communications, Inc. | 1.9 |
American International Group, Inc. | 1.8 |
DowDuPont, Inc. | 1.8 |
Capital One Financial Corp. | 1.7 |
22.0 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 22.8 |
Health Care | 13.8 |
Energy | 10.7 |
Information Technology | 9.7 |
Consumer Discretionary | 8.7 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks and Equity Futures | 96.8% | |
Short-Term Investments and Net Other Assets (Liabilities) | 3.2% |
* Foreign investments - 11.1%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 96.0% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 8.7% | |||
Auto Components - 0.5% | |||
Delphi Technologies PLC | 104,930 | $4,739,688 | |
Diversified Consumer Services - 0.3% | |||
ServiceMaster Global Holdings, Inc. (a) | 62,429 | 3,557,829 | |
Hotels, Restaurants & Leisure - 1.7% | |||
McDonald's Corp. | 81,350 | 12,815,879 | |
Royal Caribbean Cruises Ltd. | 41,380 | 4,666,009 | |
U.S. Foods Holding Corp. (a) | 16,900 | 571,389 | |
18,053,277 | |||
Household Durables - 0.9% | |||
Lennar Corp. Class A | 36,000 | 1,881,720 | |
Mohawk Industries, Inc. (a) | 42,650 | 8,033,554 | |
9,915,274 | |||
Internet & Direct Marketing Retail - 0.5% | |||
Liberty Interactive Corp. QVC Group Series A (a) | 228,014 | 4,854,418 | |
Media - 3.1% | |||
Comcast Corp. Class A | 300,740 | 10,760,477 | |
Liberty Broadband Corp. Class C (a) | 82,797 | 6,579,878 | |
The Walt Disney Co. | 132,900 | 15,092,124 | |
32,432,479 | |||
Multiline Retail - 0.6% | |||
Dollar Tree, Inc. (a) | 73,410 | 6,700,865 | |
Specialty Retail - 0.5% | |||
Burlington Stores, Inc. (a) | 35,831 | 5,475,335 | |
Textiles, Apparel& Luxury Goods - 0.6% | |||
PVH Corp. | 41,183 | 6,322,414 | |
TOTAL CONSUMER DISCRETIONARY | 92,051,579 | ||
CONSUMER STAPLES - 6.5% | |||
Beverages - 0.5% | |||
Molson Coors Brewing Co. Class B | 13,100 | 877,700 | |
PepsiCo, Inc. | 25,500 | 2,932,500 | |
The Coca-Cola Co. | 42,100 | 1,963,123 | |
5,773,323 | |||
Food & Staples Retailing - 0.9% | |||
Walmart, Inc. | 109,745 | 9,792,546 | |
Food Products - 1.8% | |||
ConAgra Foods, Inc. | 65,300 | 2,397,163 | |
General Mills, Inc. | 28,600 | 1,317,316 | |
Mondelez International, Inc. | 194,300 | 8,428,734 | |
The J.M. Smucker Co. | 9,300 | 1,033,416 | |
The Kraft Heinz Co. | 61,400 | 3,699,350 | |
Tyson Foods, Inc. Class A | 29,100 | 1,677,615 | |
18,553,594 | |||
Household Products - 2.0% | |||
Church & Dwight Co., Inc. | 43,200 | 2,414,880 | |
Colgate-Palmolive Co. | 41,300 | 2,767,513 | |
Procter & Gamble Co. | 184,680 | 14,936,918 | |
Spectrum Brands Holdings, Inc. | 9,400 | 821,278 | |
20,940,589 | |||
Personal Products - 0.1% | |||
Coty, Inc. Class A | 80,300 | 1,076,823 | |
Tobacco - 1.2% | |||
Altria Group, Inc. | 20,500 | 1,202,940 | |
Philip Morris International, Inc. | 135,500 | 11,693,650 | |
12,896,590 | |||
TOTAL CONSUMER STAPLES | 69,033,465 | ||
ENERGY - 10.7% | |||
Energy Equipment & Services - 1.1% | |||
Baker Hughes, a GE Co. Class A | 341,700 | 11,815,986 | |
Oil, Gas & Consumable Fuels - 9.6% | |||
Anadarko Petroleum Corp. | 108,900 | 7,966,035 | |
BP PLC sponsored ADR | 194,900 | 8,788,041 | |
Cenovus Energy, Inc. | 918,600 | 9,215,305 | |
Cheniere Energy, Inc. (a) | 115,300 | 7,321,550 | |
Chevron Corp. | 115,900 | 14,634,693 | |
ConocoPhillips Co. | 230,500 | 16,635,185 | |
Encana Corp. | 646,900 | 8,926,360 | |
Suncor Energy, Inc. | 356,500 | 15,012,546 | |
Valero Energy Corp. | 115,500 | 13,669,425 | |
102,169,140 | |||
TOTAL ENERGY | 113,985,126 | ||
FINANCIALS - 22.8% | |||
Banks - 10.5% | |||
Bank of America Corp. | 1,227,100 | 37,892,848 | |
Citigroup, Inc. | 397,600 | 28,583,464 | |
First Horizon National Corp. | 382,400 | 6,841,136 | |
Huntington Bancshares, Inc. | 913,000 | 14,096,720 | |
KeyCorp | 260,000 | 5,426,200 | |
U.S. Bancorp | 89,300 | 4,733,793 | |
Wells Fargo & Co. | 252,800 | 14,482,912 | |
112,057,073 | |||
Capital Markets - 3.1% | |||
BlackRock, Inc. Class A | 13,100 | 6,586,156 | |
E*TRADE Financial Corp. (a) | 88,600 | 5,299,166 | |
Goldman Sachs Group, Inc. | 56,000 | 13,296,080 | |
Northern Trust Corp. | 43,000 | 4,696,460 | |
TD Ameritrade Holding Corp. | 46,400 | 2,651,760 | |
32,529,622 | |||
Consumer Finance - 2.8% | |||
Capital One Financial Corp. | 193,700 | 18,269,784 | |
Discover Financial Services | 60,500 | 4,320,305 | |
SLM Corp. (a) | 273,500 | 3,087,815 | |
Synchrony Financial | 131,000 | 3,791,140 | |
29,469,044 | |||
Diversified Financial Services - 2.3% | |||
Berkshire Hathaway, Inc. Class B (a) | 126,157 | 24,962,686 | |
Insurance - 4.1% | |||
American International Group, Inc. | 349,300 | 19,284,853 | |
Aspen Insurance Holdings Ltd. | 30,700 | 1,241,815 | |
Hartford Financial Services Group, Inc. | 63,700 | 3,356,990 | |
Kansas City Life Insurance Co. (b) | 15,176 | 572,894 | |
MetLife, Inc. | 195,700 | 8,951,318 | |
The Travelers Companies, Inc. | 77,600 | 10,098,864 | |
43,506,734 | |||
TOTAL FINANCIALS | 242,525,159 | ||
HEALTH CARE - 13.8% | |||
Biotechnology - 0.1% | |||
Alexion Pharmaceuticals, Inc. (a) | 10,300 | 1,369,488 | |
Health Care Equipment & Supplies - 3.3% | |||
Abbott Laboratories | 149,600 | 9,804,784 | |
Baxter International, Inc. | 74,400 | 5,390,280 | |
Becton, Dickinson & Co. | 24,800 | 6,209,176 | |
Boston Scientific Corp. (a) | 56,700 | 1,905,687 | |
Medtronic PLC | 127,320 | 11,488,084 | |
34,798,011 | |||
Health Care Providers & Services - 2.2% | |||
Aetna, Inc. | 23,700 | 4,464,843 | |
Anthem, Inc. | 17,300 | 4,376,900 | |
Cigna Corp. | 26,432 | 4,742,429 | |
CVS Health Corp. | 81,200 | 5,266,632 | |
Express Scripts Holding Co. (a) | 34,400 | 2,733,424 | |
HCA Holdings, Inc. | 16,900 | 2,099,487 | |
23,683,715 | |||
Life Sciences Tools & Services - 0.8% | |||
Thermo Fisher Scientific, Inc. | 38,400 | 9,005,952 | |
Pharmaceuticals - 7.4% | |||
Allergan PLC | 34,300 | 6,314,287 | |
Bristol-Myers Squibb Co. | 45,500 | 2,673,125 | |
Jazz Pharmaceuticals PLC (a) | 59,327 | 10,268,317 | |
Johnson & Johnson | 178,285 | 23,626,328 | |
Merck & Co., Inc. | 224,159 | 14,765,353 | |
Pfizer, Inc. | 520,771 | 20,794,386 | |
78,441,796 | |||
TOTAL HEALTH CARE | 147,298,962 | ||
INDUSTRIALS - 6.5% | |||
Aerospace & Defense - 1.3% | |||
United Technologies Corp. | 98,896 | 13,424,143 | |
Airlines - 0.6% | |||
American Airlines Group, Inc. | 166,518 | 6,584,122 | |
Construction & Engineering - 0.8% | |||
AECOM (a) | 264,730 | 8,884,339 | |
Electrical Equipment - 0.5% | |||
Sensata Technologies, Inc. PLC (a) | 100,286 | 5,452,550 | |
Industrial Conglomerates - 1.1% | |||
General Electric Co. | 820,252 | 11,180,035 | |
Honeywell International, Inc. | 5,616 | 896,594 | |
12,076,629 | |||
Machinery - 0.1% | |||
Caterpillar, Inc. | 3,700 | 532,060 | |
Marine - 0.4% | |||
A.P. Moller - Maersk A/S Series B | 2,713 | 3,895,425 | |
Professional Services - 0.4% | |||
Nielsen Holdings PLC | 185,600 | 4,372,736 | |
Road & Rail - 0.7% | |||
Norfolk Southern Corp. | 44,458 | 7,513,402 | |
Trading Companies & Distributors - 0.6% | |||
HD Supply Holdings, Inc. (a) | 147,199 | 6,473,812 | |
TOTAL INDUSTRIALS | 69,209,218 | ||
INFORMATION TECHNOLOGY - 9.7% | |||
Communications Equipment - 2.0% | |||
Cisco Systems, Inc. | 493,900 | 20,887,031 | |
Electronic Equipment & Components - 0.2% | |||
Dell Technologies, Inc. (a) | 27,500 | 2,544,300 | |
Internet Software & Services - 0.6% | |||
Alphabet, Inc. Class A (a) | 5,500 | 6,749,710 | |
IT Services - 2.5% | |||
Amdocs Ltd. | 188,250 | 12,721,935 | |
IBM Corp. | 37,200 | 5,391,396 | |
Leidos Holdings, Inc. | 124,800 | 8,538,816 | |
26,652,147 | |||
Semiconductors & Semiconductor Equipment - 2.5% | |||
Broadcom, Inc. | 20,800 | 4,612,816 | |
Intel Corp. | 110,000 | 5,291,000 | |
NXP Semiconductors NV (a) | 44,100 | 4,204,494 | |
Qualcomm, Inc. | 198,500 | 12,721,865 | |
26,830,175 | |||
Software - 1.6% | |||
Microsoft Corp. | 34,800 | 3,691,584 | |
Oracle Corp. | 277,300 | 13,221,664 | |
16,913,248 | |||
Technology Hardware, Storage & Peripherals - 0.3% | |||
Apple, Inc. | 15,400 | 2,930,466 | |
TOTAL INFORMATION TECHNOLOGY | 103,507,077 | ||
MATERIALS - 4.1% | |||
Chemicals - 3.3% | |||
DowDuPont, Inc. | 279,543 | 19,224,172 | |
LyondellBasell Industries NV Class A | 50,900 | 5,639,211 | |
Nutrien Ltd. | 104,900 | 5,697,186 | |
Westlake Chemical Corp. | 41,800 | 4,481,796 | |
35,042,365 | |||
Construction Materials - 0.4% | |||
Eagle Materials, Inc. | 38,500 | 3,824,975 | |
Containers & Packaging - 0.4% | |||
Crown Holdings, Inc. (a) | 94,200 | 4,264,434 | |
TOTAL MATERIALS | 43,131,774 | ||
REAL ESTATE - 4.7% | |||
Equity Real Estate Investment Trusts (REITs) - 4.6% | |||
American Tower Corp. | 15,300 | 2,268,072 | |
Boston Properties, Inc. | 52,700 | 6,615,431 | |
Colony NorthStar, Inc. | 336,444 | 2,072,495 | |
Corporate Office Properties Trust (SBI) | 98,800 | 2,938,312 | |
Equity Residential (SBI) | 79,700 | 5,214,771 | |
Gaming & Leisure Properties | 54,500 | 1,979,440 | |
Prologis, Inc. | 88,300 | 5,794,246 | |
Public Storage | 28,000 | 6,099,240 | |
Safety Income and Growth, Inc. | 131,952 | 2,348,746 | |
Spirit Realty Capital, Inc. | 377,800 | 3,162,186 | |
Store Capital Corp. | 99,118 | 2,720,789 | |
The Macerich Co. | 68,600 | 4,051,516 | |
Welltower, Inc. | 49,000 | 3,067,400 | |
48,332,644 | |||
Real Estate Management & Development - 0.1% | |||
CBRE Group, Inc. (a) | 29,300 | 1,459,140 | |
TOTAL REAL ESTATE | 49,791,784 | ||
TELECOMMUNICATION SERVICES - 3.3% | |||
Diversified Telecommunication Services - 2.9% | |||
AT&T, Inc. | 349,829 | 11,184,033 | |
Verizon Communications, Inc. | 391,691 | 20,226,923 | |
31,410,956 | |||
Wireless Telecommunication Services - 0.4% | |||
T-Mobile U.S., Inc. (a) | 69,822 | 4,189,320 | |
TOTAL TELECOMMUNICATION SERVICES | 35,600,276 | ||
UTILITIES - 5.2% | |||
Electric Utilities - 3.7% | |||
Evergy, Inc. | 142,200 | 7,975,998 | |
Exelon Corp. | 180,300 | 7,662,750 | |
NextEra Energy, Inc. | 67,210 | 11,260,363 | |
PG&E Corp. | 38,200 | 1,645,656 | |
PPL Corp. | 259,300 | 7,460,061 | |
Vistra Energy Corp. (a) | 160,900 | 3,636,340 | |
39,641,168 | |||
Independent Power and Renewable Electricity Producers - 0.9% | |||
NRG Energy, Inc. | 169,100 | 5,355,397 | |
The AES Corp. | 297,380 | 3,972,997 | |
9,328,394 | |||
Multi-Utilities - 0.6% | |||
Sempra Energy | 59,350 | 6,860,267 | |
TOTAL UTILITIES | 55,829,829 | ||
TOTAL COMMON STOCKS | |||
(Cost $988,545,955) | 1,021,964,249 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.1% | |||
U.S. Treasury Bills, yield at date of purchase 1.88% to 1.95% 9/20/18 to 10/18/18 (c) | |||
(Cost $398,702) | 400,000 | 398,697 | |
Shares | Value | ||
Money Market Funds - 3.3% | |||
Fidelity Cash Central Fund, 1.96% (d) | 35,317,113 | $35,324,176 | |
Fidelity Securities Lending Cash Central Fund 1.97% (d)(e) | 28,077 | 28,080 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $35,352,259) | 35,352,256 | ||
TOTAL INVESTMENT IN SECURITIES - 99.4% | |||
(Cost $1,024,296,916) | 1,057,715,202 | ||
NET OTHER ASSETS (LIABILITIES) - 0.6% | 6,641,398 | ||
NET ASSETS - 100% | $1,064,356,600 |
Futures Contracts | |||||
Number of contracts | Expiration Date | Notional Amount | Value | Unrealized Appreciation/(Depreciation) | |
Purchased | |||||
Equity Index Contracts | |||||
CME E-mini Russell 1000 Value Index Contracts (United States) | 137 | Sept. 2018 | $8,437,830 | $80,224 | $80,224 |
The notional amount of futures purchased as a percentage of Net Assets is 0.8%
Legend
(a) Non-income producing
(b) Security or a portion of the security is on loan at period end.
(c) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $398,697.
(d) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(e) Investment made with cash collateral received from securities on loan.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $339,228 |
Fidelity Securities Lending Cash Central Fund | 20,872 |
Total | $360,100 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $92,051,579 | $92,051,579 | $-- | $-- |
Consumer Staples | 69,033,465 | 69,033,465 | -- | -- |
Energy | 113,985,126 | 113,985,126 | -- | -- |
Financials | 242,525,159 | 242,525,159 | -- | -- |
Health Care | 147,298,962 | 147,298,962 | -- | -- |
Industrials | 69,209,218 | 65,313,793 | 3,895,425 | -- |
Information Technology | 103,507,077 | 103,507,077 | -- | -- |
Materials | 43,131,774 | 43,131,774 | -- | -- |
Real Estate | 49,791,784 | 49,791,784 | -- | -- |
Telecommunication Services | 35,600,276 | 35,600,276 | -- | -- |
Utilities | 55,829,829 | 55,829,829 | -- | -- |
U.S. Government and Government Agency Obligations | 398,697 | -- | 398,697 | -- |
Money Market Funds | 35,352,256 | 35,352,256 | -- | -- |
Total Investments in Securities: | $1,057,715,202 | $1,053,421,080 | $4,294,122 | $-- |
Derivative Instruments: | ||||
Assets | ||||
Futures Contracts | $80,224 | $80,224 | $-- | $-- |
Total Assets | $80,224 | $80,224 | $-- | $-- |
Total Derivative Instruments: | $80,224 | $80,224 | $-- | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of July 31, 2018. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
Primary Risk Exposure / Derivative Type | Value | |
Asset | Liability | |
Equity Risk | ||
Futures Contracts(a) | $80,224 | $0 |
Total Equity Risk | 80,224 | 0 |
Total Value of Derivatives | $80,224 | $0 |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin on futures contracts, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 88.9% |
Canada | 3.7% |
Ireland | 2.7% |
United Kingdom | 1.2% |
Bailiwick of Guernsey | 1.2% |
Others (Individually Less Than 1%) | 2.3% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $26,425) — See accompanying schedule: Unaffiliated issuers (cost $988,944,657) | $1,022,362,946 | |
Fidelity Central Funds (cost $35,352,259) | 35,352,256 | |
Total Investment in Securities (cost $1,024,296,916) | $1,057,715,202 | |
Receivable for investments sold | 25,126,443 | |
Receivable for fund shares sold | 523,669 | |
Dividends receivable | 807,301 | |
Distributions receivable from Fidelity Central Funds | 51,962 | |
Receivable for daily variation margin for on futures contracts | 19,805 | |
Prepaid expenses | 2,651 | |
Other receivables | 36,105 | |
Total assets | 1,084,283,138 | |
Liabilities | ||
Payable to custodian bank | $1,861,634 | |
Payable for investments purchased | 1,651,495 | |
Payable for fund shares redeemed | 15,737,565 | |
Accrued management fee | 402,880 | |
Distribution and service plan fees payable | 17,305 | |
Other affiliated payables | 186,233 | |
Other payables and accrued expenses | 42,301 | |
Collateral on securities loaned | 27,125 | |
Total liabilities | 19,926,538 | |
Net Assets | $1,064,356,600 | |
Net Assets consist of: | ||
Paid in capital | $965,494,119 | |
Undistributed net investment income | 7,524,458 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 57,839,464 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 33,498,559 | |
Net Assets | $1,064,356,600 | |
Calculation of Maximum Offering Price | ||
Class A: | ||
Net Asset Value and redemption price per share ($25,391,670 ÷ 1,213,913 shares) | $20.92 | |
Maximum offering price per share (100/94.25 of $20.92) | $22.20 | |
Class M: | ||
Net Asset Value and redemption price per share ($10,313,380 ÷ 494,409 shares) | $20.86 | |
Maximum offering price per share (100/96.50 of $20.86) | $21.62 | |
Class C: | ||
Net Asset Value and offering price per share ($9,347,537 ÷ 458,519 shares)(a) | $20.39 | |
Stock Selector Large Cap Value: | ||
Net Asset Value, offering price and redemption price per share ($908,768,891 ÷ 43,086,564 shares) | $21.09 | |
Class I: | ||
Net Asset Value, offering price and redemption price per share ($110,059,160 ÷ 5,249,459 shares) | $20.97 | |
Class Z: | ||
Net Asset Value, offering price and redemption price per share ($475,962 ÷ 22,662 shares) | $21.00 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $10,808,953 | |
Interest | 3,357 | |
Income from Fidelity Central Funds | 360,100 | |
Total income | 11,172,410 | |
Expenses | ||
Management fee | ||
Basic fee | $2,895,643 | |
Performance adjustment | (500,822) | |
Transfer agent fees | 949,090 | |
Distribution and service plan fees | 104,308 | |
Accounting and security lending fees | 176,599 | |
Custodian fees and expenses | 18,700 | |
Independent trustees' fees and expenses | 2,542 | |
Registration fees | 40,264 | |
Audit | 28,995 | |
Legal | 4,060 | |
Miscellaneous | 4,516 | |
Total expenses before reductions | 3,723,895 | |
Expense reductions | (74,698) | |
Total expenses after reductions | 3,649,197 | |
Net investment income (loss) | 7,523,213 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 62,115,212 | |
Fidelity Central Funds | (405) | |
Foreign currency transactions | (15,979) | |
Futures contracts | 253,278 | |
Total net realized gain (loss) | 62,352,106 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (89,232,710) | |
Fidelity Central Funds | 733 | |
Assets and liabilities in foreign currencies | (1,023) | |
Futures contracts | (39,622) | |
Total change in net unrealized appreciation (depreciation) | (89,272,622) | |
Net gain (loss) | (26,920,516) | |
Net increase (decrease) in net assets resulting from operations | $(19,397,303) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $7,523,213 | $15,900,448 |
Net realized gain (loss) | 62,352,106 | 95,916,836 |
Change in net unrealized appreciation (depreciation) | (89,272,622) | 43,245,181 |
Net increase (decrease) in net assets resulting from operations | (19,397,303) | 155,062,465 |
Distributions to shareholders from net investment income | – | (12,317,467) |
Share transactions - net increase (decrease) | (73,068,884) | 246,522,959 |
Total increase (decrease) in net assets | (92,466,187) | 389,267,957 |
Net Assets | ||
Beginning of period | 1,156,822,787 | 767,554,830 |
End of period | $1,064,356,600 | $1,156,822,787 |
Other Information | ||
Undistributed net investment income end of period | $7,524,458 | $1,245 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Stock Selector Large Cap Value Fund Class A
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $21.26 | $18.63 | $15.37 | $16.41 | $14.72 | $12.43 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .12 | .25B | .19 | .15 | .15 | .13 |
Net realized and unrealized gain (loss) | (.46) | 2.54 | 3.27 | (1.03) | 1.65 | 2.35 |
Total from investment operations | (.34) | 2.79 | 3.46 | (.88) | 1.80 | 2.48 |
Distributions from net investment income | – | (.16) | (.20) | (.16) | (.11) | (.15) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.16) | (.20) | (.16) | (.11) | (.19)C |
Net asset value, end of period | $20.92 | $21.26 | $18.63 | $15.37 | $16.41 | $14.72 |
Total ReturnD,E,F | (1.60)% | 15.02% | 22.48% | (5.40)% | 12.25% | 20.01% |
Ratios to Average Net AssetsG,H | ||||||
Expenses before reductions | .96%I | 1.02% | 1.05% | 1.10% | 1.07% | 1.00% |
Expenses net of fee waivers, if any | .96%I | 1.02% | 1.05% | 1.10% | 1.07% | 1.00% |
Expenses net of all reductions | .94%I | 1.01% | 1.05% | 1.09% | 1.07% | 1.00% |
Net investment income (loss) | 1.14%I | 1.27%B | 1.10% | .90% | .94% | .95% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $25,392 | $27,297 | $31,054 | $24,201 | $26,536 | $21,266 |
Portfolio turnover rateJ | 109%I | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .90%.
C Total distributions of $.19 per share is comprised of distributions from net investment income of $.147 and distributions from net realized gain of $.047 per share.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Total returns do not include the effect of the sales charges.
G Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
H Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
I Annualized
J Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund Class M
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $21.24 | $18.61 | $15.36 | $16.40 | $14.71 | $12.44 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .08 | .19B | .13 | .10 | .10 | .09 |
Net realized and unrealized gain (loss) | (.46) | 2.54 | 3.26 | (1.03) | 1.66 | 2.34 |
Total from investment operations | (.38) | 2.73 | 3.39 | (.93) | 1.76 | 2.43 |
Distributions from net investment income | – | (.10) | (.14) | (.11) | (.07) | (.11) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.10) | (.14) | (.11) | (.07) | (.16) |
Net asset value, end of period | $20.86 | $21.24 | $18.61 | $15.36 | $16.40 | $14.71 |
Total ReturnC,D,E | (1.79)% | 14.70% | 22.04% | (5.71)% | 11.95% | 19.54% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | 1.28%H | 1.34% | 1.39% | 1.42% | 1.39% | 1.32% |
Expenses net of fee waivers, if any | 1.28%H | 1.34% | 1.39% | 1.42% | 1.39% | 1.32% |
Expenses net of all reductions | 1.27%H | 1.33% | 1.39% | 1.41% | 1.39% | 1.31% |
Net investment income (loss) | .82%H | .95%B | .76% | .58% | .62% | .63% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $10,313 | $10,615 | $10,704 | $9,515 | $10,469 | $8,244 |
Portfolio turnover rateI | 109%H | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .58%.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund Class C
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $20.81 | $18.25 | $15.09 | $16.18 | $14.53 | $12.30 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .03 | .08B | .05 | .01 | .02 | .02 |
Net realized and unrealized gain (loss) | (.45) | 2.49 | 3.18 | (1.00) | 1.63 | 2.31 |
Total from investment operations | (.42) | 2.57 | 3.23 | (.99) | 1.65 | 2.33 |
Distributions from net investment income | – | (.01) | (.07) | (.10) | – | (.05) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.01) | (.07) | (.10) | – | (.10) |
Net asset value, end of period | $20.39 | $20.81 | $18.25 | $15.09 | $16.18 | $14.53 |
Total ReturnC,D,E | (2.02)% | 14.07% | 21.43% | (6.13)% | 11.36% | 18.94% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | 1.80%H | 1.86% | 1.88% | 1.93% | 1.89% | 1.81% |
Expenses net of fee waivers, if any | 1.80%H | 1.85% | 1.88% | 1.93% | 1.89% | 1.80% |
Expenses net of all reductions | 1.79%H | 1.85% | 1.87% | 1.93% | 1.89% | 1.80% |
Net investment income (loss) | .30%H | .43%B | .27% | .07% | .12% | .14% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $9,348 | $10,703 | $10,802 | $8,956 | $10,118 | $7,789 |
Portfolio turnover rateI | 109%H | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .06%.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the contingent deferred sales charge.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $21.41 | $18.76 | $15.47 | $16.51 | $14.81 | $12.51 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .15 | .31B | .24 | .20 | .20 | .17 |
Net realized and unrealized gain (loss) | (.47) | 2.57 | 3.29 | (1.03) | 1.66 | 2.37 |
Total from investment operations | (.32) | 2.88 | 3.53 | (.83) | 1.86 | 2.54 |
Distributions from net investment income | – | (.23) | (.24) | (.21) | (.16) | (.19) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.23) | (.24) | (.21) | (.16) | (.24) |
Net asset value, end of period | $21.09 | $21.41 | $18.76 | $15.47 | $16.51 | $14.81 |
Total ReturnC,D | (1.49)% | 15.39% | 22.82% | (5.10)% | 12.54% | 20.31% |
Ratios to Average Net AssetsE,F | ||||||
Expenses before reductions | .67%G | .73% | .77% | .81% | .78% | .72% |
Expenses net of fee waivers, if any | .67%G | .73% | .77% | .81% | .78% | .72% |
Expenses net of all reductions | .66%G | .72% | .76% | .80% | .78% | .71% |
Net investment income (loss) | 1.43%G | 1.56%B | 1.38% | 1.19% | 1.23% | 1.23% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $908,769 | $989,001 | $703,722 | $644,182 | $761,542 | $518,206 |
Portfolio turnover rateH | 109%G | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.19%.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund Class I
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $21.28 | $18.66 | $15.40 | $16.44 | $14.74 | $12.46 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .14 | .30B | .23 | .20 | .20 | .17 |
Net realized and unrealized gain (loss) | (.45) | 2.55 | 3.27 | (1.04) | 1.66 | 2.35 |
Total from investment operations | (.31) | 2.85 | 3.50 | (.84) | 1.86 | 2.52 |
Distributions from net investment income | – | (.23) | (.24) | (.20) | (.16) | (.19) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.23) | (.24) | (.20) | (.16) | (.24) |
Net asset value, end of period | $20.97 | $21.28 | $18.66 | $15.40 | $16.44 | $14.74 |
Total ReturnC,D | (1.46)% | 15.33% | 22.72% | (5.14)% | 12.58% | 20.25% |
Ratios to Average Net AssetsE,F | ||||||
Expenses before reductions | .69%G | .76% | .84% | .82% | .81% | .73% |
Expenses net of fee waivers, if any | .69%G | .76% | .84% | .82% | .81% | .73% |
Expenses net of all reductions | .68%G | .75% | .84% | .81% | .81% | .73% |
Net investment income (loss) | 1.41%G | 1.53%B | 1.30% | 1.18% | 1.20% | 1.22% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $110,059 | $118,319 | $11,273 | $6,164 | $9,544 | $3,881 |
Portfolio turnover rateH | 109%G | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.16%.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund Class Z
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |
2018 | 2018A | |
Selected Per–Share Data | ||
Net asset value, beginning of period | $21.30 | $18.64 |
Income from Investment Operations | ||
Net investment income (loss)B | .16 | .34C |
Net realized and unrealized gain (loss) | (.46) | 2.57 |
Total from investment operations | (.30) | 2.91 |
Distributions from net investment income | – | (.25) |
Distributions from net realized gain | – | – |
Total distributions | – | (.25) |
Net asset value, end of period | $21.00 | $21.30 |
Total ReturnD,E | (1.41)% | 15.65% |
Ratios to Average Net AssetsF,G | ||
Expenses before reductions | .54%H | .60% |
Expenses net of fee waivers, if any | .54%H | .60% |
Expenses net of all reductions | .53%H | .59% |
Net investment income (loss) | 1.55%H | 1.68%C |
Supplemental Data | ||
Net assets, end of period (000 omitted) | $476 | $888 |
Portfolio turnover rateI | 109%H | 90% |
A For the period February 1, 2017 (commencement of sale of shares) to January 31, 2018.
B Calculated based on average shares outstanding during the period.
C Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.31%.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Stock Selector Large Cap Value Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund offers Class A, Class M, Class C, Stock Selector Large Cap Value, Class I, and Class Z shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded and are categorized as Level 1 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of July 31, 2018 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost and include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent and distribution and service plan fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to futures contracts, foreign currency transactions, partnerships, market discount, capital loss carryforwards, expiring capital loss carryforwards and losses deferred due to wash sales.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $74,253,136 |
Gross unrealized depreciation | (46,157,543) |
Net unrealized appreciation (depreciation) | $28,095,593 |
Tax cost | $1,029,699,833 |
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Fund's investment objective allows the Fund to enter into various types of derivative contracts, including futures contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Fund used derivatives to increase returns and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Fund may not achieve its objectives.
The Fund's use of derivatives increased or decreased its exposure to the following risks:
Equity Risk | Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment. |
The Fund is also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Fund will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Fund. Counterparty credit risk related to exchange-traded futures contracts may be mitigated by the protection provided by the exchange on which they trade.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. The Fund used futures contracts to manage its exposure to the stock market.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin on futures contracts in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract. The net realized gain (loss) and change in net unrealized appreciation (depreciation) on futures contracts during the period is presented in the Statement of Operations.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The notional amount at value reflects each contract's exposure to the underlying instrument or index at period end and is representative of volume of activity during the period. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $564,308,786 and $614,362,633, respectively.
6. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and an annualized group fee rate that averaged .24% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the relative investment performance of Stock Selector Large Cap Value as compared to its benchmark index, the Russell 1000 Value Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .45% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Distribution and Service Plan Fees. In accordance with Rule 12b-1 of the 1940 Act, the Fund has adopted separate Distribution and Service Plans for each class of shares. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of the investment adviser, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates, total fees and amounts retained by FDC were as follows:
Distribution Fee | Service Fee | Total Fees | Retained by FDC | |
Class A | -% | .25% | $32,312 | $1,344 |
Class M | .25% | .25% | 24,860 | 230 |
Class C | .75% | .25% | 47,136 | 1,188 |
$104,308 | $2,762 |
Sales Load. FDC may receive a front-end sales charge of up to 5.75% for selling Class A shares and 3.50% for selling Class M shares, some of which is paid to financial intermediaries for selling shares of the Fund. Depending on the holding period, FDC may receive contingent deferred sales charges levied on Class A, Class M and Class C redemptions. The deferred sales charges are 1.00% for Class C shares, 1.00% for certain purchases of Class A shares and .25% for certain purchases of Class M shares.
For the period, sales charge amounts retained by FDC were as follows:
Retained by FDC | |
Class A | $2,733 |
Class M | 1,031 |
Class C(a) | 376 |
$4,140 |
(a) When Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, is the transfer, dividend disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of the respective classes of the Fund, except for Class Z. FIIOC receives an asset-based fee of Class Z's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Class A | $27,199 | .21 |
Class M | 13,972 | .28 |
Class C | 14,174 | .30 |
Stock Selector Large Cap Value | 786,488 | .17 |
Class I | 107,129 | .19 |
Class Z | 128 | .05 |
$949,090 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions. For the period, the fees were equivalent to an annualized rate of .03%.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $19,613 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
7. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $1,515 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
8. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. At period end, there were no security loans outstanding with FCM. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $20,872, including $606 from securities loaned to FCM.
9. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $69,000 for the period.
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $5,698.
10. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended July 31, 2018 | Year ended January 31, 2018 | |
From net investment income | ||
Class A | $– | $213,926 |
Class M | – | 51,493 |
Class C | – | 3,631 |
Stock Selector Large Cap Value | – | 10,768,661 |
Class I | – | 1,276,155 |
Class Z | – | 3,601 |
Total | $– | $12,317,467 |
11. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended July 31, 2018 | Year ended January 31, 2018 | Six months ended July 31, 2018 | Year ended January 31, 2018 | |
Class A | ||||
Shares sold | 72,681 | 142,643 | $1,472,848 | $2,774,911 |
Reinvestment of distributions | – | 10,056 | – | 204,781 |
Shares redeemed | (142,690) | (535,801) | (2,923,076) | (10,491,253) |
Net increase (decrease) | (70,009) | (383,102) | $(1,450,228) | $(7,511,561) |
Class M | ||||
Shares sold | 39,132 | 50,024 | $793,251 | $973,280 |
Reinvestment of distributions | – | 2,521 | – | 51,356 |
Shares redeemed | (44,579) | (127,746) | (903,713) | (2,483,907) |
Net increase (decrease) | (5,447) | (75,201) | $(110,462) | $(1,459,271) |
Class C | ||||
Shares sold | 20,489 | 70,502 | $407,229 | $1,337,012 |
Reinvestment of distributions | – | 177 | – | 3,538 |
Shares redeemed | (76,338) | (148,280) | (1,504,707) | (2,819,699) |
Net increase (decrease) | (55,849) | (77,601) | $(1,097,478) | $(1,479,149) |
Stock Selector Large Cap Value | ||||
Shares sold | 1,592,213 | 26,144,587 | $32,324,288 | $507,261,485 |
Reinvestment of distributions | – | 514,761 | – | 10,548,864 |
Shares redeemed | (4,706,085) | (17,968,756) | (96,018,476) | (356,628,139) |
Net increase (decrease) | (3,113,872) | 8,690,592 | $(63,694,188) | $161,182,210 |
Class I | ||||
Shares sold | 259,260 | 6,091,211 | $5,233,522 | $117,544,858 |
Reinvestment of distributions | – | 59,129 | – | 1,206,146 |
Shares redeemed | (569,551) | (1,194,545) | (11,563,291) | (23,802,625) |
Net increase (decrease) | (310,291) | 4,955,795 | $(6,329,769) | $94,948,379 |
Class Z | ||||
Shares sold | 43,061 | 43,042 | $879,109 | $869,605 |
Reinvestment of distributions | – | 149 | – | 3,036 |
Shares redeemed | (62,095) | (1,495) | (1,265,868) | (30,290) |
Net increase (decrease) | (19,034) | 41,696 | $(386,759) | $842,351 |
12. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying table for each class of the Fund 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the Fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of the Fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Class A | .96% | |||
Actual | $1,000.00 | $984.00 | $4.72 | |
Hypothetical-C | $1,000.00 | $1,020.03 | $4.81 | |
Class M | 1.28% | |||
Actual | $1,000.00 | $982.10 | $6.29 | |
Hypothetical-C | $1,000.00 | $1,018.45 | $6.41 | |
Class C | 1.80% | |||
Actual | $1,000.00 | $979.80 | $8.84 | |
Hypothetical-C | $1,000.00 | $1,015.87 | $9.00 | |
Stock Selector Large Cap Value | .67% | |||
Actual | $1,000.00 | $985.10 | $3.30 | |
Hypothetical-C | $1,000.00 | $1,021.47 | $3.36 | |
Class I | .69% | |||
Actual | $1,000.00 | $985.40 | $3.40 | |
Hypothetical-C | $1,000.00 | $1,021.37 | $3.46 | |
Class Z | .54% | |||
Actual | $1,000.00 | $985.90 | $2.66 | |
Hypothetical-C | $1,000.00 | $1,022.12 | $2.71 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Stock Selector Large Cap Value Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
ALCV-SANN-0918
1.838402.109
Fidelity® Stock Selector Large Cap Value Fund Semi-Annual Report July 31, 2018 |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
Bank of America Corp. | 3.6 |
Citigroup, Inc. | 2.7 |
Berkshire Hathaway, Inc. Class B | 2.3 |
Johnson & Johnson | 2.2 |
Cisco Systems, Inc. | 2.0 |
Pfizer, Inc. | 2.0 |
Verizon Communications, Inc. | 1.9 |
American International Group, Inc. | 1.8 |
DowDuPont, Inc. | 1.8 |
Capital One Financial Corp. | 1.7 |
22.0 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 22.8 |
Health Care | 13.8 |
Energy | 10.7 |
Information Technology | 9.7 |
Consumer Discretionary | 8.7 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks and Equity Futures | 96.8% | |
Short-Term Investments and Net Other Assets (Liabilities) | 3.2% |
* Foreign investments - 11.1%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 96.0% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 8.7% | |||
Auto Components - 0.5% | |||
Delphi Technologies PLC | 104,930 | $4,739,688 | |
Diversified Consumer Services - 0.3% | |||
ServiceMaster Global Holdings, Inc. (a) | 62,429 | 3,557,829 | |
Hotels, Restaurants & Leisure - 1.7% | |||
McDonald's Corp. | 81,350 | 12,815,879 | |
Royal Caribbean Cruises Ltd. | 41,380 | 4,666,009 | |
U.S. Foods Holding Corp. (a) | 16,900 | 571,389 | |
18,053,277 | |||
Household Durables - 0.9% | |||
Lennar Corp. Class A | 36,000 | 1,881,720 | |
Mohawk Industries, Inc. (a) | 42,650 | 8,033,554 | |
9,915,274 | |||
Internet & Direct Marketing Retail - 0.5% | |||
Liberty Interactive Corp. QVC Group Series A (a) | 228,014 | 4,854,418 | |
Media - 3.1% | |||
Comcast Corp. Class A | 300,740 | 10,760,477 | |
Liberty Broadband Corp. Class C (a) | 82,797 | 6,579,878 | |
The Walt Disney Co. | 132,900 | 15,092,124 | |
32,432,479 | |||
Multiline Retail - 0.6% | |||
Dollar Tree, Inc. (a) | 73,410 | 6,700,865 | |
Specialty Retail - 0.5% | |||
Burlington Stores, Inc. (a) | 35,831 | 5,475,335 | |
Textiles, Apparel& Luxury Goods - 0.6% | |||
PVH Corp. | 41,183 | 6,322,414 | |
TOTAL CONSUMER DISCRETIONARY | 92,051,579 | ||
CONSUMER STAPLES - 6.5% | |||
Beverages - 0.5% | |||
Molson Coors Brewing Co. Class B | 13,100 | 877,700 | |
PepsiCo, Inc. | 25,500 | 2,932,500 | |
The Coca-Cola Co. | 42,100 | 1,963,123 | |
5,773,323 | |||
Food & Staples Retailing - 0.9% | |||
Walmart, Inc. | 109,745 | 9,792,546 | |
Food Products - 1.8% | |||
ConAgra Foods, Inc. | 65,300 | 2,397,163 | |
General Mills, Inc. | 28,600 | 1,317,316 | |
Mondelez International, Inc. | 194,300 | 8,428,734 | |
The J.M. Smucker Co. | 9,300 | 1,033,416 | |
The Kraft Heinz Co. | 61,400 | 3,699,350 | |
Tyson Foods, Inc. Class A | 29,100 | 1,677,615 | |
18,553,594 | |||
Household Products - 2.0% | |||
Church & Dwight Co., Inc. | 43,200 | 2,414,880 | |
Colgate-Palmolive Co. | 41,300 | 2,767,513 | |
Procter & Gamble Co. | 184,680 | 14,936,918 | |
Spectrum Brands Holdings, Inc. | 9,400 | 821,278 | |
20,940,589 | |||
Personal Products - 0.1% | |||
Coty, Inc. Class A | 80,300 | 1,076,823 | |
Tobacco - 1.2% | |||
Altria Group, Inc. | 20,500 | 1,202,940 | |
Philip Morris International, Inc. | 135,500 | 11,693,650 | |
12,896,590 | |||
TOTAL CONSUMER STAPLES | 69,033,465 | ||
ENERGY - 10.7% | |||
Energy Equipment & Services - 1.1% | |||
Baker Hughes, a GE Co. Class A | 341,700 | 11,815,986 | |
Oil, Gas & Consumable Fuels - 9.6% | |||
Anadarko Petroleum Corp. | 108,900 | 7,966,035 | |
BP PLC sponsored ADR | 194,900 | 8,788,041 | |
Cenovus Energy, Inc. | 918,600 | 9,215,305 | |
Cheniere Energy, Inc. (a) | 115,300 | 7,321,550 | |
Chevron Corp. | 115,900 | 14,634,693 | |
ConocoPhillips Co. | 230,500 | 16,635,185 | |
Encana Corp. | 646,900 | 8,926,360 | |
Suncor Energy, Inc. | 356,500 | 15,012,546 | |
Valero Energy Corp. | 115,500 | 13,669,425 | |
102,169,140 | |||
TOTAL ENERGY | 113,985,126 | ||
FINANCIALS - 22.8% | |||
Banks - 10.5% | |||
Bank of America Corp. | 1,227,100 | 37,892,848 | |
Citigroup, Inc. | 397,600 | 28,583,464 | |
First Horizon National Corp. | 382,400 | 6,841,136 | |
Huntington Bancshares, Inc. | 913,000 | 14,096,720 | |
KeyCorp | 260,000 | 5,426,200 | |
U.S. Bancorp | 89,300 | 4,733,793 | |
Wells Fargo & Co. | 252,800 | 14,482,912 | |
112,057,073 | |||
Capital Markets - 3.1% | |||
BlackRock, Inc. Class A | 13,100 | 6,586,156 | |
E*TRADE Financial Corp. (a) | 88,600 | 5,299,166 | |
Goldman Sachs Group, Inc. | 56,000 | 13,296,080 | |
Northern Trust Corp. | 43,000 | 4,696,460 | |
TD Ameritrade Holding Corp. | 46,400 | 2,651,760 | |
32,529,622 | |||
Consumer Finance - 2.8% | |||
Capital One Financial Corp. | 193,700 | 18,269,784 | |
Discover Financial Services | 60,500 | 4,320,305 | |
SLM Corp. (a) | 273,500 | 3,087,815 | |
Synchrony Financial | 131,000 | 3,791,140 | |
29,469,044 | |||
Diversified Financial Services - 2.3% | |||
Berkshire Hathaway, Inc. Class B (a) | 126,157 | 24,962,686 | |
Insurance - 4.1% | |||
American International Group, Inc. | 349,300 | 19,284,853 | |
Aspen Insurance Holdings Ltd. | 30,700 | 1,241,815 | |
Hartford Financial Services Group, Inc. | 63,700 | 3,356,990 | |
Kansas City Life Insurance Co. (b) | 15,176 | 572,894 | |
MetLife, Inc. | 195,700 | 8,951,318 | |
The Travelers Companies, Inc. | 77,600 | 10,098,864 | |
43,506,734 | |||
TOTAL FINANCIALS | 242,525,159 | ||
HEALTH CARE - 13.8% | |||
Biotechnology - 0.1% | |||
Alexion Pharmaceuticals, Inc. (a) | 10,300 | 1,369,488 | |
Health Care Equipment & Supplies - 3.3% | |||
Abbott Laboratories | 149,600 | 9,804,784 | |
Baxter International, Inc. | 74,400 | 5,390,280 | |
Becton, Dickinson & Co. | 24,800 | 6,209,176 | |
Boston Scientific Corp. (a) | 56,700 | 1,905,687 | |
Medtronic PLC | 127,320 | 11,488,084 | |
34,798,011 | |||
Health Care Providers & Services - 2.2% | |||
Aetna, Inc. | 23,700 | 4,464,843 | |
Anthem, Inc. | 17,300 | 4,376,900 | |
Cigna Corp. | 26,432 | 4,742,429 | |
CVS Health Corp. | 81,200 | 5,266,632 | |
Express Scripts Holding Co. (a) | 34,400 | 2,733,424 | |
HCA Holdings, Inc. | 16,900 | 2,099,487 | |
23,683,715 | |||
Life Sciences Tools & Services - 0.8% | |||
Thermo Fisher Scientific, Inc. | 38,400 | 9,005,952 | |
Pharmaceuticals - 7.4% | |||
Allergan PLC | 34,300 | 6,314,287 | |
Bristol-Myers Squibb Co. | 45,500 | 2,673,125 | |
Jazz Pharmaceuticals PLC (a) | 59,327 | 10,268,317 | |
Johnson & Johnson | 178,285 | 23,626,328 | |
Merck & Co., Inc. | 224,159 | 14,765,353 | |
Pfizer, Inc. | 520,771 | 20,794,386 | |
78,441,796 | |||
TOTAL HEALTH CARE | 147,298,962 | ||
INDUSTRIALS - 6.5% | |||
Aerospace & Defense - 1.3% | |||
United Technologies Corp. | 98,896 | 13,424,143 | |
Airlines - 0.6% | |||
American Airlines Group, Inc. | 166,518 | 6,584,122 | |
Construction & Engineering - 0.8% | |||
AECOM (a) | 264,730 | 8,884,339 | |
Electrical Equipment - 0.5% | |||
Sensata Technologies, Inc. PLC (a) | 100,286 | 5,452,550 | |
Industrial Conglomerates - 1.1% | |||
General Electric Co. | 820,252 | 11,180,035 | |
Honeywell International, Inc. | 5,616 | 896,594 | |
12,076,629 | |||
Machinery - 0.1% | |||
Caterpillar, Inc. | 3,700 | 532,060 | |
Marine - 0.4% | |||
A.P. Moller - Maersk A/S Series B | 2,713 | 3,895,425 | |
Professional Services - 0.4% | |||
Nielsen Holdings PLC | 185,600 | 4,372,736 | |
Road & Rail - 0.7% | |||
Norfolk Southern Corp. | 44,458 | 7,513,402 | |
Trading Companies & Distributors - 0.6% | |||
HD Supply Holdings, Inc. (a) | 147,199 | 6,473,812 | |
TOTAL INDUSTRIALS | 69,209,218 | ||
INFORMATION TECHNOLOGY - 9.7% | |||
Communications Equipment - 2.0% | |||
Cisco Systems, Inc. | 493,900 | 20,887,031 | |
Electronic Equipment & Components - 0.2% | |||
Dell Technologies, Inc. (a) | 27,500 | 2,544,300 | |
Internet Software & Services - 0.6% | |||
Alphabet, Inc. Class A (a) | 5,500 | 6,749,710 | |
IT Services - 2.5% | |||
Amdocs Ltd. | 188,250 | 12,721,935 | |
IBM Corp. | 37,200 | 5,391,396 | |
Leidos Holdings, Inc. | 124,800 | 8,538,816 | |
26,652,147 | |||
Semiconductors & Semiconductor Equipment - 2.5% | |||
Broadcom, Inc. | 20,800 | 4,612,816 | |
Intel Corp. | 110,000 | 5,291,000 | |
NXP Semiconductors NV (a) | 44,100 | 4,204,494 | |
Qualcomm, Inc. | 198,500 | 12,721,865 | |
26,830,175 | |||
Software - 1.6% | |||
Microsoft Corp. | 34,800 | 3,691,584 | |
Oracle Corp. | 277,300 | 13,221,664 | |
16,913,248 | |||
Technology Hardware, Storage & Peripherals - 0.3% | |||
Apple, Inc. | 15,400 | 2,930,466 | |
TOTAL INFORMATION TECHNOLOGY | 103,507,077 | ||
MATERIALS - 4.1% | |||
Chemicals - 3.3% | |||
DowDuPont, Inc. | 279,543 | 19,224,172 | |
LyondellBasell Industries NV Class A | 50,900 | 5,639,211 | |
Nutrien Ltd. | 104,900 | 5,697,186 | |
Westlake Chemical Corp. | 41,800 | 4,481,796 | |
35,042,365 | |||
Construction Materials - 0.4% | |||
Eagle Materials, Inc. | 38,500 | 3,824,975 | |
Containers & Packaging - 0.4% | |||
Crown Holdings, Inc. (a) | 94,200 | 4,264,434 | |
TOTAL MATERIALS | 43,131,774 | ||
REAL ESTATE - 4.7% | |||
Equity Real Estate Investment Trusts (REITs) - 4.6% | |||
American Tower Corp. | 15,300 | 2,268,072 | |
Boston Properties, Inc. | 52,700 | 6,615,431 | |
Colony NorthStar, Inc. | 336,444 | 2,072,495 | |
Corporate Office Properties Trust (SBI) | 98,800 | 2,938,312 | |
Equity Residential (SBI) | 79,700 | 5,214,771 | |
Gaming & Leisure Properties | 54,500 | 1,979,440 | |
Prologis, Inc. | 88,300 | 5,794,246 | |
Public Storage | 28,000 | 6,099,240 | |
Safety Income and Growth, Inc. | 131,952 | 2,348,746 | |
Spirit Realty Capital, Inc. | 377,800 | 3,162,186 | |
Store Capital Corp. | 99,118 | 2,720,789 | |
The Macerich Co. | 68,600 | 4,051,516 | |
Welltower, Inc. | 49,000 | 3,067,400 | |
48,332,644 | |||
Real Estate Management & Development - 0.1% | |||
CBRE Group, Inc. (a) | 29,300 | 1,459,140 | |
TOTAL REAL ESTATE | 49,791,784 | ||
TELECOMMUNICATION SERVICES - 3.3% | |||
Diversified Telecommunication Services - 2.9% | |||
AT&T, Inc. | 349,829 | 11,184,033 | |
Verizon Communications, Inc. | 391,691 | 20,226,923 | |
31,410,956 | |||
Wireless Telecommunication Services - 0.4% | |||
T-Mobile U.S., Inc. (a) | 69,822 | 4,189,320 | |
TOTAL TELECOMMUNICATION SERVICES | 35,600,276 | ||
UTILITIES - 5.2% | |||
Electric Utilities - 3.7% | |||
Evergy, Inc. | 142,200 | 7,975,998 | |
Exelon Corp. | 180,300 | 7,662,750 | |
NextEra Energy, Inc. | 67,210 | 11,260,363 | |
PG&E Corp. | 38,200 | 1,645,656 | |
PPL Corp. | 259,300 | 7,460,061 | |
Vistra Energy Corp. (a) | 160,900 | 3,636,340 | |
39,641,168 | |||
Independent Power and Renewable Electricity Producers - 0.9% | |||
NRG Energy, Inc. | 169,100 | 5,355,397 | |
The AES Corp. | 297,380 | 3,972,997 | |
9,328,394 | |||
Multi-Utilities - 0.6% | |||
Sempra Energy | 59,350 | 6,860,267 | |
TOTAL UTILITIES | 55,829,829 | ||
TOTAL COMMON STOCKS | |||
(Cost $988,545,955) | 1,021,964,249 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.1% | |||
U.S. Treasury Bills, yield at date of purchase 1.88% to 1.95% 9/20/18 to 10/18/18 (c) | |||
(Cost $398,702) | 400,000 | 398,697 | |
Shares | Value | ||
Money Market Funds - 3.3% | |||
Fidelity Cash Central Fund, 1.96% (d) | 35,317,113 | $35,324,176 | |
Fidelity Securities Lending Cash Central Fund 1.97% (d)(e) | 28,077 | 28,080 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $35,352,259) | 35,352,256 | ||
TOTAL INVESTMENT IN SECURITIES - 99.4% | |||
(Cost $1,024,296,916) | 1,057,715,202 | ||
NET OTHER ASSETS (LIABILITIES) - 0.6% | 6,641,398 | ||
NET ASSETS - 100% | $1,064,356,600 |
Futures Contracts | |||||
Number of contracts | Expiration Date | Notional Amount | Value | Unrealized Appreciation/(Depreciation) | |
Purchased | |||||
Equity Index Contracts | |||||
CME E-mini Russell 1000 Value Index Contracts (United States) | 137 | Sept. 2018 | $8,437,830 | $80,224 | $80,224 |
The notional amount of futures purchased as a percentage of Net Assets is 0.8%
Legend
(a) Non-income producing
(b) Security or a portion of the security is on loan at period end.
(c) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $398,697.
(d) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(e) Investment made with cash collateral received from securities on loan.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $339,228 |
Fidelity Securities Lending Cash Central Fund | 20,872 |
Total | $360,100 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $92,051,579 | $92,051,579 | $-- | $-- |
Consumer Staples | 69,033,465 | 69,033,465 | -- | -- |
Energy | 113,985,126 | 113,985,126 | -- | -- |
Financials | 242,525,159 | 242,525,159 | -- | -- |
Health Care | 147,298,962 | 147,298,962 | -- | -- |
Industrials | 69,209,218 | 65,313,793 | 3,895,425 | -- |
Information Technology | 103,507,077 | 103,507,077 | -- | -- |
Materials | 43,131,774 | 43,131,774 | -- | -- |
Real Estate | 49,791,784 | 49,791,784 | -- | -- |
Telecommunication Services | 35,600,276 | 35,600,276 | -- | -- |
Utilities | 55,829,829 | 55,829,829 | -- | -- |
U.S. Government and Government Agency Obligations | 398,697 | -- | 398,697 | -- |
Money Market Funds | 35,352,256 | 35,352,256 | -- | -- |
Total Investments in Securities: | $1,057,715,202 | $1,053,421,080 | $4,294,122 | $-- |
Derivative Instruments: | ||||
Assets | ||||
Futures Contracts | $80,224 | $80,224 | $-- | $-- |
Total Assets | $80,224 | $80,224 | $-- | $-- |
Total Derivative Instruments: | $80,224 | $80,224 | $-- | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of July 31, 2018. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
Primary Risk Exposure / Derivative Type | Value | |
Asset | Liability | |
Equity Risk | ||
Futures Contracts(a) | $80,224 | $0 |
Total Equity Risk | 80,224 | 0 |
Total Value of Derivatives | $80,224 | $0 |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin on futures contracts, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 88.9% |
Canada | 3.7% |
Ireland | 2.7% |
United Kingdom | 1.2% |
Bailiwick of Guernsey | 1.2% |
Others (Individually Less Than 1%) | 2.3% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $26,425) — See accompanying schedule: Unaffiliated issuers (cost $988,944,657) | $1,022,362,946 | |
Fidelity Central Funds (cost $35,352,259) | 35,352,256 | |
Total Investment in Securities (cost $1,024,296,916) | $1,057,715,202 | |
Receivable for investments sold | 25,126,443 | |
Receivable for fund shares sold | 523,669 | |
Dividends receivable | 807,301 | |
Distributions receivable from Fidelity Central Funds | 51,962 | |
Receivable for daily variation margin for on futures contracts | 19,805 | |
Prepaid expenses | 2,651 | |
Other receivables | 36,105 | |
Total assets | 1,084,283,138 | |
Liabilities | ||
Payable to custodian bank | $1,861,634 | |
Payable for investments purchased | 1,651,495 | |
Payable for fund shares redeemed | 15,737,565 | |
Accrued management fee | 402,880 | |
Distribution and service plan fees payable | 17,305 | |
Other affiliated payables | 186,233 | |
Other payables and accrued expenses | 42,301 | |
Collateral on securities loaned | 27,125 | |
Total liabilities | 19,926,538 | |
Net Assets | $1,064,356,600 | |
Net Assets consist of: | ||
Paid in capital | $965,494,119 | |
Undistributed net investment income | 7,524,458 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 57,839,464 | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 33,498,559 | |
Net Assets | $1,064,356,600 | |
Calculation of Maximum Offering Price | ||
Class A: | ||
Net Asset Value and redemption price per share ($25,391,670 ÷ 1,213,913 shares) | $20.92 | |
Maximum offering price per share (100/94.25 of $20.92) | $22.20 | |
Class M: | ||
Net Asset Value and redemption price per share ($10,313,380 ÷ 494,409 shares) | $20.86 | |
Maximum offering price per share (100/96.50 of $20.86) | $21.62 | |
Class C: | ||
Net Asset Value and offering price per share ($9,347,537 ÷ 458,519 shares)(a) | $20.39 | |
Stock Selector Large Cap Value: | ||
Net Asset Value, offering price and redemption price per share ($908,768,891 ÷ 43,086,564 shares) | $21.09 | |
Class I: | ||
Net Asset Value, offering price and redemption price per share ($110,059,160 ÷ 5,249,459 shares) | $20.97 | |
Class Z: | ||
Net Asset Value, offering price and redemption price per share ($475,962 ÷ 22,662 shares) | $21.00 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $10,808,953 | |
Interest | 3,357 | |
Income from Fidelity Central Funds | 360,100 | |
Total income | 11,172,410 | |
Expenses | ||
Management fee | ||
Basic fee | $2,895,643 | |
Performance adjustment | (500,822) | |
Transfer agent fees | 949,090 | |
Distribution and service plan fees | 104,308 | |
Accounting and security lending fees | 176,599 | |
Custodian fees and expenses | 18,700 | |
Independent trustees' fees and expenses | 2,542 | |
Registration fees | 40,264 | |
Audit | 28,995 | |
Legal | 4,060 | |
Miscellaneous | 4,516 | |
Total expenses before reductions | 3,723,895 | |
Expense reductions | (74,698) | |
Total expenses after reductions | 3,649,197 | |
Net investment income (loss) | 7,523,213 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 62,115,212 | |
Fidelity Central Funds | (405) | |
Foreign currency transactions | (15,979) | |
Futures contracts | 253,278 | |
Total net realized gain (loss) | 62,352,106 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (89,232,710) | |
Fidelity Central Funds | 733 | |
Assets and liabilities in foreign currencies | (1,023) | |
Futures contracts | (39,622) | |
Total change in net unrealized appreciation (depreciation) | (89,272,622) | |
Net gain (loss) | (26,920,516) | |
Net increase (decrease) in net assets resulting from operations | $(19,397,303) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $7,523,213 | $15,900,448 |
Net realized gain (loss) | 62,352,106 | 95,916,836 |
Change in net unrealized appreciation (depreciation) | (89,272,622) | 43,245,181 |
Net increase (decrease) in net assets resulting from operations | (19,397,303) | 155,062,465 |
Distributions to shareholders from net investment income | – | (12,317,467) |
Share transactions - net increase (decrease) | (73,068,884) | 246,522,959 |
Total increase (decrease) in net assets | (92,466,187) | 389,267,957 |
Net Assets | ||
Beginning of period | 1,156,822,787 | 767,554,830 |
End of period | $1,064,356,600 | $1,156,822,787 |
Other Information | ||
Undistributed net investment income end of period | $7,524,458 | $1,245 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Stock Selector Large Cap Value Fund Class A
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $21.26 | $18.63 | $15.37 | $16.41 | $14.72 | $12.43 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .12 | .25B | .19 | .15 | .15 | .13 |
Net realized and unrealized gain (loss) | (.46) | 2.54 | 3.27 | (1.03) | 1.65 | 2.35 |
Total from investment operations | (.34) | 2.79 | 3.46 | (.88) | 1.80 | 2.48 |
Distributions from net investment income | – | (.16) | (.20) | (.16) | (.11) | (.15) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.16) | (.20) | (.16) | (.11) | (.19)C |
Net asset value, end of period | $20.92 | $21.26 | $18.63 | $15.37 | $16.41 | $14.72 |
Total ReturnD,E,F | (1.60)% | 15.02% | 22.48% | (5.40)% | 12.25% | 20.01% |
Ratios to Average Net AssetsG,H | ||||||
Expenses before reductions | .96%I | 1.02% | 1.05% | 1.10% | 1.07% | 1.00% |
Expenses net of fee waivers, if any | .96%I | 1.02% | 1.05% | 1.10% | 1.07% | 1.00% |
Expenses net of all reductions | .94%I | 1.01% | 1.05% | 1.09% | 1.07% | 1.00% |
Net investment income (loss) | 1.14%I | 1.27%B | 1.10% | .90% | .94% | .95% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $25,392 | $27,297 | $31,054 | $24,201 | $26,536 | $21,266 |
Portfolio turnover rateJ | 109%I | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .90%.
C Total distributions of $.19 per share is comprised of distributions from net investment income of $.147 and distributions from net realized gain of $.047 per share.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Total returns do not include the effect of the sales charges.
G Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
H Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
I Annualized
J Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund Class M
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $21.24 | $18.61 | $15.36 | $16.40 | $14.71 | $12.44 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .08 | .19B | .13 | .10 | .10 | .09 |
Net realized and unrealized gain (loss) | (.46) | 2.54 | 3.26 | (1.03) | 1.66 | 2.34 |
Total from investment operations | (.38) | 2.73 | 3.39 | (.93) | 1.76 | 2.43 |
Distributions from net investment income | – | (.10) | (.14) | (.11) | (.07) | (.11) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.10) | (.14) | (.11) | (.07) | (.16) |
Net asset value, end of period | $20.86 | $21.24 | $18.61 | $15.36 | $16.40 | $14.71 |
Total ReturnC,D,E | (1.79)% | 14.70% | 22.04% | (5.71)% | 11.95% | 19.54% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | 1.28%H | 1.34% | 1.39% | 1.42% | 1.39% | 1.32% |
Expenses net of fee waivers, if any | 1.28%H | 1.34% | 1.39% | 1.42% | 1.39% | 1.32% |
Expenses net of all reductions | 1.27%H | 1.33% | 1.39% | 1.41% | 1.39% | 1.31% |
Net investment income (loss) | .82%H | .95%B | .76% | .58% | .62% | .63% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $10,313 | $10,615 | $10,704 | $9,515 | $10,469 | $8,244 |
Portfolio turnover rateI | 109%H | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .58%.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the sales charges.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund Class C
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $20.81 | $18.25 | $15.09 | $16.18 | $14.53 | $12.30 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .03 | .08B | .05 | .01 | .02 | .02 |
Net realized and unrealized gain (loss) | (.45) | 2.49 | 3.18 | (1.00) | 1.63 | 2.31 |
Total from investment operations | (.42) | 2.57 | 3.23 | (.99) | 1.65 | 2.33 |
Distributions from net investment income | – | (.01) | (.07) | (.10) | – | (.05) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.01) | (.07) | (.10) | – | (.10) |
Net asset value, end of period | $20.39 | $20.81 | $18.25 | $15.09 | $16.18 | $14.53 |
Total ReturnC,D,E | (2.02)% | 14.07% | 21.43% | (6.13)% | 11.36% | 18.94% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | 1.80%H | 1.86% | 1.88% | 1.93% | 1.89% | 1.81% |
Expenses net of fee waivers, if any | 1.80%H | 1.85% | 1.88% | 1.93% | 1.89% | 1.80% |
Expenses net of all reductions | 1.79%H | 1.85% | 1.87% | 1.93% | 1.89% | 1.80% |
Net investment income (loss) | .30%H | .43%B | .27% | .07% | .12% | .14% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $9,348 | $10,703 | $10,802 | $8,956 | $10,118 | $7,789 |
Portfolio turnover rateI | 109%H | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .06%.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Total returns do not include the effect of the contingent deferred sales charge.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $21.41 | $18.76 | $15.47 | $16.51 | $14.81 | $12.51 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .15 | .31B | .24 | .20 | .20 | .17 |
Net realized and unrealized gain (loss) | (.47) | 2.57 | 3.29 | (1.03) | 1.66 | 2.37 |
Total from investment operations | (.32) | 2.88 | 3.53 | (.83) | 1.86 | 2.54 |
Distributions from net investment income | – | (.23) | (.24) | (.21) | (.16) | (.19) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.23) | (.24) | (.21) | (.16) | (.24) |
Net asset value, end of period | $21.09 | $21.41 | $18.76 | $15.47 | $16.51 | $14.81 |
Total ReturnC,D | (1.49)% | 15.39% | 22.82% | (5.10)% | 12.54% | 20.31% |
Ratios to Average Net AssetsE,F | ||||||
Expenses before reductions | .67%G | .73% | .77% | .81% | .78% | .72% |
Expenses net of fee waivers, if any | .67%G | .73% | .77% | .81% | .78% | .72% |
Expenses net of all reductions | .66%G | .72% | .76% | .80% | .78% | .71% |
Net investment income (loss) | 1.43%G | 1.56%B | 1.38% | 1.19% | 1.23% | 1.23% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $908,769 | $989,001 | $703,722 | $644,182 | $761,542 | $518,206 |
Portfolio turnover rateH | 109%G | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.19%.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund Class I
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $21.28 | $18.66 | $15.40 | $16.44 | $14.74 | $12.46 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .14 | .30B | .23 | .20 | .20 | .17 |
Net realized and unrealized gain (loss) | (.45) | 2.55 | 3.27 | (1.04) | 1.66 | 2.35 |
Total from investment operations | (.31) | 2.85 | 3.50 | (.84) | 1.86 | 2.52 |
Distributions from net investment income | – | (.23) | (.24) | (.20) | (.16) | (.19) |
Distributions from net realized gain | – | – | – | – | – | (.05) |
Total distributions | – | (.23) | (.24) | (.20) | (.16) | (.24) |
Net asset value, end of period | $20.97 | $21.28 | $18.66 | $15.40 | $16.44 | $14.74 |
Total ReturnC,D | (1.46)% | 15.33% | 22.72% | (5.14)% | 12.58% | 20.25% |
Ratios to Average Net AssetsE,F | ||||||
Expenses before reductions | .69%G | .76% | .84% | .82% | .81% | .73% |
Expenses net of fee waivers, if any | .69%G | .76% | .84% | .82% | .81% | .73% |
Expenses net of all reductions | .68%G | .75% | .84% | .81% | .81% | .73% |
Net investment income (loss) | 1.41%G | 1.53%B | 1.30% | 1.18% | 1.20% | 1.22% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $110,059 | $118,319 | $11,273 | $6,164 | $9,544 | $3,881 |
Portfolio turnover rateH | 109%G | 90% | 51% | 67% | 60% | 64% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.16%.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Fidelity Stock Selector Large Cap Value Fund Class Z
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |
2018 | 2018A | |
Selected Per–Share Data | ||
Net asset value, beginning of period | $21.30 | $18.64 |
Income from Investment Operations | ||
Net investment income (loss)B | .16 | .34C |
Net realized and unrealized gain (loss) | (.46) | 2.57 |
Total from investment operations | (.30) | 2.91 |
Distributions from net investment income | – | (.25) |
Distributions from net realized gain | – | – |
Total distributions | – | (.25) |
Net asset value, end of period | $21.00 | $21.30 |
Total ReturnD,E | (1.41)% | 15.65% |
Ratios to Average Net AssetsF,G | ||
Expenses before reductions | .54%H | .60% |
Expenses net of fee waivers, if any | .54%H | .60% |
Expenses net of all reductions | .53%H | .59% |
Net investment income (loss) | 1.55%H | 1.68%C |
Supplemental Data | ||
Net assets, end of period (000 omitted) | $476 | $888 |
Portfolio turnover rateI | 109%H | 90% |
A For the period February 1, 2017 (commencement of sale of shares) to January 31, 2018.
B Calculated based on average shares outstanding during the period.
C Net investment income per share reflects a large, non-recurring dividend which amounted to $.07 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.31%.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Stock Selector Large Cap Value Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund offers Class A, Class M, Class C, Stock Selector Large Cap Value, Class I, and Class Z shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded and are categorized as Level 1 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of July 31, 2018 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost and include proceeds received from litigation. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent and distribution and service plan fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to futures contracts, foreign currency transactions, partnerships, market discount, capital loss carryforwards, expiring capital loss carryforwards and losses deferred due to wash sales.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $74,253,136 |
Gross unrealized depreciation | (46,157,543) |
Net unrealized appreciation (depreciation) | $28,095,593 |
Tax cost | $1,029,699,833 |
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Fund's investment objective allows the Fund to enter into various types of derivative contracts, including futures contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Fund used derivatives to increase returns and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Fund may not achieve its objectives.
The Fund's use of derivatives increased or decreased its exposure to the following risks:
Equity Risk | Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment. |
The Fund is also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Fund will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Fund. Counterparty credit risk related to exchange-traded futures contracts may be mitigated by the protection provided by the exchange on which they trade.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. The Fund used futures contracts to manage its exposure to the stock market.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin on futures contracts in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract. The net realized gain (loss) and change in net unrealized appreciation (depreciation) on futures contracts during the period is presented in the Statement of Operations.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The notional amount at value reflects each contract's exposure to the underlying instrument or index at period end and is representative of volume of activity during the period. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $564,308,786 and $614,362,633, respectively.
6. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and an annualized group fee rate that averaged .24% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the relative investment performance of Stock Selector Large Cap Value as compared to its benchmark index, the Russell 1000 Value Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .45% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Distribution and Service Plan Fees. In accordance with Rule 12b-1 of the 1940 Act, the Fund has adopted separate Distribution and Service Plans for each class of shares. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of the investment adviser, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates, total fees and amounts retained by FDC were as follows:
Distribution Fee | Service Fee | Total Fees | Retained by FDC | |
Class A | -% | .25% | $32,312 | $1,344 |
Class M | .25% | .25% | 24,860 | 230 |
Class C | .75% | .25% | 47,136 | 1,188 |
$104,308 | $2,762 |
Sales Load. FDC may receive a front-end sales charge of up to 5.75% for selling Class A shares and 3.50% for selling Class M shares, some of which is paid to financial intermediaries for selling shares of the Fund. Depending on the holding period, FDC may receive contingent deferred sales charges levied on Class A, Class M and Class C redemptions. The deferred sales charges are 1.00% for Class C shares, 1.00% for certain purchases of Class A shares and .25% for certain purchases of Class M shares.
For the period, sales charge amounts retained by FDC were as follows:
Retained by FDC | |
Class A | $2,733 |
Class M | 1,031 |
Class C(a) | 376 |
$4,140 |
(a) When Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, is the transfer, dividend disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of the respective classes of the Fund, except for Class Z. FIIOC receives an asset-based fee of Class Z's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Class A | $27,199 | .21 |
Class M | 13,972 | .28 |
Class C | 14,174 | .30 |
Stock Selector Large Cap Value | 786,488 | .17 |
Class I | 107,129 | .19 |
Class Z | 128 | .05 |
$949,090 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions. For the period, the fees were equivalent to an annualized rate of .03%.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $19,613 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
7. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $1,515 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
8. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. At period end, there were no security loans outstanding with FCM. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $20,872, including $606 from securities loaned to FCM.
9. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $69,000 for the period.
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $5,698.
10. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended July 31, 2018 | Year ended January 31, 2018 | |
From net investment income | ||
Class A | $– | $213,926 |
Class M | – | 51,493 |
Class C | – | 3,631 |
Stock Selector Large Cap Value | – | 10,768,661 |
Class I | – | 1,276,155 |
Class Z | – | 3,601 |
Total | $– | $12,317,467 |
11. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended July 31, 2018 | Year ended January 31, 2018 | Six months ended July 31, 2018 | Year ended January 31, 2018 | |
Class A | ||||
Shares sold | 72,681 | 142,643 | $1,472,848 | $2,774,911 |
Reinvestment of distributions | – | 10,056 | – | 204,781 |
Shares redeemed | (142,690) | (535,801) | (2,923,076) | (10,491,253) |
Net increase (decrease) | (70,009) | (383,102) | $(1,450,228) | $(7,511,561) |
Class M | ||||
Shares sold | 39,132 | 50,024 | $793,251 | $973,280 |
Reinvestment of distributions | – | 2,521 | – | 51,356 |
Shares redeemed | (44,579) | (127,746) | (903,713) | (2,483,907) |
Net increase (decrease) | (5,447) | (75,201) | $(110,462) | $(1,459,271) |
Class C | ||||
Shares sold | 20,489 | 70,502 | $407,229 | $1,337,012 |
Reinvestment of distributions | – | 177 | – | 3,538 |
Shares redeemed | (76,338) | (148,280) | (1,504,707) | (2,819,699) |
Net increase (decrease) | (55,849) | (77,601) | $(1,097,478) | $(1,479,149) |
Stock Selector Large Cap Value | ||||
Shares sold | 1,592,213 | 26,144,587 | $32,324,288 | $507,261,485 |
Reinvestment of distributions | – | 514,761 | – | 10,548,864 |
Shares redeemed | (4,706,085) | (17,968,756) | (96,018,476) | (356,628,139) |
Net increase (decrease) | (3,113,872) | 8,690,592 | $(63,694,188) | $161,182,210 |
Class I | ||||
Shares sold | 259,260 | 6,091,211 | $5,233,522 | $117,544,858 |
Reinvestment of distributions | – | 59,129 | – | 1,206,146 |
Shares redeemed | (569,551) | (1,194,545) | (11,563,291) | (23,802,625) |
Net increase (decrease) | (310,291) | 4,955,795 | $(6,329,769) | $94,948,379 |
Class Z | ||||
Shares sold | 43,061 | 43,042 | $879,109 | $869,605 |
Reinvestment of distributions | – | 149 | – | 3,036 |
Shares redeemed | (62,095) | (1,495) | (1,265,868) | (30,290) |
Net increase (decrease) | (19,034) | 41,696 | $(386,759) | $842,351 |
12. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying table for each class of the Fund 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the Fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of the Fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Class A | .96% | |||
Actual | $1,000.00 | $984.00 | $4.72 | |
Hypothetical-C | $1,000.00 | $1,020.03 | $4.81 | |
Class M | 1.28% | |||
Actual | $1,000.00 | $982.10 | $6.29 | |
Hypothetical-C | $1,000.00 | $1,018.45 | $6.41 | |
Class C | 1.80% | |||
Actual | $1,000.00 | $979.80 | $8.84 | |
Hypothetical-C | $1,000.00 | $1,015.87 | $9.00 | |
Stock Selector Large Cap Value | .67% | |||
Actual | $1,000.00 | $985.10 | $3.30 | |
Hypothetical-C | $1,000.00 | $1,021.47 | $3.36 | |
Class I | .69% | |||
Actual | $1,000.00 | $985.40 | $3.40 | |
Hypothetical-C | $1,000.00 | $1,021.37 | $3.46 | |
Class Z | .54% | |||
Actual | $1,000.00 | $985.90 | $2.66 | |
Hypothetical-C | $1,000.00 | $1,022.12 | $2.71 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Stock Selector Large Cap Value Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
LCV-SANN-0918
1.900197.109
Fidelity Advisor® Mid Cap Value Fund - Semi-Annual Report July 31, 2018 Class A, Class M, Class C, Class I and Class Z are classes of Fidelity® Mid Cap Value Fund |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-877-208-0098 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
CBRE Group, Inc. | 2.2 |
M&T Bank Corp. | 1.9 |
Cimarex Energy Co. | 1.9 |
Huntsman Corp. | 1.8 |
Xcel Energy, Inc. | 1.7 |
Regions Financial Corp. | 1.7 |
AMETEK, Inc. | 1.7 |
Best Buy Co., Inc. | 1.7 |
Ingersoll-Rand PLC | 1.7 |
Lear Corp. | 1.6 |
17.9 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 20.0 |
Industrials | 13.9 |
Real Estate | 12.5 |
Consumer Discretionary | 10.4 |
Utilities | 9.6 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks | 97.9% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.1% |
* Foreign investments - 8.0%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 97.9% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 10.4% | |||
Auto Components - 2.1% | |||
Gentex Corp. | 610,000 | $14,152,000 | |
Lear Corp. | 248,800 | 44,816,344 | |
58,968,344 | |||
Household Durables - 1.4% | |||
PulteGroup, Inc. | 440,000 | 12,535,600 | |
Toll Brothers, Inc. | 720,800 | 25,415,408 | |
37,951,008 | |||
Leisure Products - 0.5% | |||
Brunswick Corp. | 220,600 | 14,184,580 | |
Media - 2.0% | |||
John Wiley & Sons, Inc. Class A | 390,600 | 24,666,390 | |
Omnicom Group, Inc. | 436,500 | 30,044,295 | |
54,710,685 | |||
Multiline Retail - 0.8% | |||
Macy's, Inc. | 578,400 | 22,979,832 | |
Specialty Retail - 3.6% | |||
Best Buy Co., Inc. | 615,500 | 46,180,965 | |
Dick's Sporting Goods, Inc. | 399,000 | 13,621,860 | |
Williams-Sonoma, Inc. (a) | 655,000 | 38,310,950 | |
98,113,775 | |||
TOTAL CONSUMER DISCRETIONARY | 286,908,224 | ||
CONSUMER STAPLES - 4.8% | |||
Beverages - 0.8% | |||
Molson Coors Brewing Co. Class B | 337,400 | 22,605,800 | |
Food Products - 4.0% | |||
Ingredion, Inc. | 237,700 | 24,079,010 | |
Pilgrim's Pride Corp. (b) | 524,600 | 9,348,372 | |
The Hershey Co. | 168,500 | 16,548,385 | |
The J.M. Smucker Co. | 282,000 | 31,335,840 | |
Tyson Foods, Inc. Class A | 528,000 | 30,439,200 | |
111,750,807 | |||
TOTAL CONSUMER STAPLES | 134,356,607 | ||
ENERGY - 6.1% | |||
Energy Equipment & Services - 1.2% | |||
RPC, Inc. (a) | 2,165,900 | 32,055,320 | |
Oil, Gas & Consumable Fuels - 4.9% | |||
Cimarex Energy Co. | 529,400 | 52,198,840 | |
HollyFrontier Corp. | 591,370 | 44,104,375 | |
PBF Energy, Inc. Class A | 839,600 | 39,209,320 | |
135,512,535 | |||
TOTAL ENERGY | 167,567,855 | ||
FINANCIALS - 20.0% | |||
Banks - 6.0% | |||
First Hawaiian, Inc. | 764,400 | 21,601,944 | |
M&T Bank Corp. | 305,600 | 52,975,760 | |
Popular, Inc. | 508,706 | 25,247,079 | |
Regions Financial Corp. | 2,559,800 | 47,637,878 | |
Synovus Financial Corp. | 361,000 | 17,840,620 | |
165,303,281 | |||
Capital Markets - 4.1% | |||
Affiliated Managers Group, Inc. | 128,400 | 20,545,284 | |
Invesco Ltd. | 1,200,100 | 32,390,699 | |
Lazard Ltd. Class A | 680,500 | 36,951,150 | |
Legg Mason, Inc. | 702,000 | 23,959,260 | |
113,846,393 | |||
Consumer Finance - 3.0% | |||
Discover Financial Services | 584,000 | 41,703,440 | |
Synchrony Financial | 1,467,400 | 42,466,556 | |
84,169,996 | |||
Insurance - 6.5% | |||
American National Insurance Co. | 136,300 | 17,581,337 | |
First American Financial Corp. | 789,226 | 44,196,656 | |
Old Republic International Corp. | 1,474,169 | 31,414,541 | |
Principal Financial Group, Inc. | 732,600 | 42,549,408 | |
Torchmark Corp. | 239,400 | 21,083,958 | |
Unum Group | 555,500 | 22,070,015 | |
178,895,915 | |||
Mortgage Real Estate Investment Trusts - 0.4% | |||
Chimera Investment Corp. | 590,200 | 11,272,820 | |
TOTAL FINANCIALS | 553,488,405 | ||
HEALTH CARE - 6.5% | |||
Biotechnology - 0.7% | |||
United Therapeutics Corp. (b) | 162,000 | 19,911,420 | |
Health Care Providers & Services - 5.2% | |||
Cardinal Health, Inc. | 464,000 | 23,176,800 | |
Laboratory Corp. of America Holdings (b) | 242,500 | 42,519,950 | |
MEDNAX, Inc. (b) | 316,900 | 13,560,151 | |
Quest Diagnostics, Inc. | 273,100 | 29,418,332 | |
Universal Health Services, Inc. Class B | 272,500 | 33,272,250 | |
141,947,483 | |||
Pharmaceuticals - 0.6% | |||
Jazz Pharmaceuticals PLC (b) | 100,600 | 17,411,848 | |
TOTAL HEALTH CARE | 179,270,751 | ||
INDUSTRIALS - 13.9% | |||
Airlines - 0.9% | |||
Copa Holdings SA Class A | 260,600 | 25,366,804 | |
Commercial Services & Supplies - 0.6% | |||
Deluxe Corp. | 295,000 | 17,384,350 | |
Construction & Engineering - 0.5% | |||
AECOM (b) | 429,300 | 14,407,308 | |
Electrical Equipment - 2.6% | |||
Acuity Brands, Inc. | 183,400 | 25,498,102 | |
AMETEK, Inc. | 596,600 | 46,415,480 | |
71,913,582 | |||
Machinery - 8.7% | |||
Apergy Corp. (b) | 902,800 | 37,014,800 | |
Crane Co. | 316,000 | 28,620,120 | |
Cummins, Inc. | 237,200 | 33,874,532 | |
Ingersoll-Rand PLC | 468,600 | 46,161,786 | |
PACCAR, Inc. | 623,000 | 40,943,560 | |
Parker Hannifin Corp. | 132,800 | 22,449,840 | |
Snap-On, Inc. | 188,900 | 32,035,551 | |
241,100,189 | |||
Trading Companies & Distributors - 0.6% | |||
MSC Industrial Direct Co., Inc. Class A | 185,200 | 15,673,476 | |
TOTAL INDUSTRIALS | 385,845,709 | ||
INFORMATION TECHNOLOGY - 8.2% | |||
Communications Equipment - 1.9% | |||
F5 Networks, Inc. (b) | 151,900 | 26,032,622 | |
Juniper Networks, Inc. | 1,051,454 | 27,695,298 | |
53,727,920 | |||
Electronic Equipment & Components - 0.5% | |||
Coherent, Inc. (b) | 88,600 | 14,004,116 | |
IT Services - 3.9% | |||
Amdocs Ltd. | 564,246 | 38,131,745 | |
DXC Technology Co. | 490,900 | 41,598,866 | |
Leidos Holdings, Inc. | 393,900 | 26,950,638 | |
106,681,249 | |||
Semiconductors & Semiconductor Equipment - 1.0% | |||
Skyworks Solutions, Inc. | 200,200 | 18,934,916 | |
Teradyne, Inc. | 175,277 | 7,580,730 | |
26,515,646 | |||
Technology Hardware, Storage & Peripherals - 0.9% | |||
Western Digital Corp. | 361,000 | 25,324,150 | |
TOTAL INFORMATION TECHNOLOGY | 226,253,081 | ||
MATERIALS - 5.9% | |||
Chemicals - 3.2% | |||
Huntsman Corp. | 1,482,600 | 49,711,578 | |
Innospec, Inc. | 226,026 | 18,296,805 | |
Westlake Chemical Corp. | 210,200 | 22,537,644 | |
90,546,027 | |||
Construction Materials - 0.8% | |||
nVent Electric PLC | 792,700 | 21,719,980 | |
Metals & Mining - 1.9% | |||
Freeport-McMoRan, Inc. | 1,939,200 | 31,996,800 | |
Reliance Steel & Aluminum Co. | 219,900 | 19,834,980 | |
51,831,780 | |||
TOTAL MATERIALS | 164,097,787 | ||
REAL ESTATE - 12.5% | |||
Equity Real Estate Investment Trusts (REITs) - 7.5% | |||
Apple Hospitality (REIT), Inc. | 1,794,600 | 32,284,854 | |
Brixmor Property Group, Inc. | 1,303,600 | 23,060,684 | |
Empire State Realty Trust, Inc. | 737,000 | 12,285,790 | |
Gaming & Leisure Properties | 794,400 | 28,852,608 | |
Park Hotels & Resorts, Inc. | 664,100 | 20,773,048 | |
Public Storage | 75,800 | 16,511,514 | |
Store Capital Corp. | 1,292,100 | 35,468,145 | |
VEREIT, Inc. | 4,926,100 | 37,586,143 | |
206,822,786 | |||
Real Estate Management & Development - 5.0% | |||
CBRE Group, Inc. (b) | 1,193,600 | 59,441,280 | |
Jones Lang LaSalle, Inc. | 247,500 | 42,324,975 | |
Realogy Holdings Corp. (a) | 1,703,900 | 37,264,293 | |
139,030,548 | |||
TOTAL REAL ESTATE | 345,853,334 | ||
UTILITIES - 9.6% | |||
Electric Utilities - 3.8% | |||
FirstEnergy Corp. | 836,900 | 29,651,367 | |
Hawaiian Electric Industries, Inc. | 181,944 | 6,398,970 | |
OGE Energy Corp. | 577,000 | 20,910,480 | |
Xcel Energy, Inc. | 1,030,000 | 48,265,800 | |
105,226,617 | |||
Independent Power and Renewable Electricity Producers - 0.7% | |||
NRG Energy, Inc. | 591,600 | 18,735,972 | |
Multi-Utilities - 5.1% | |||
Ameren Corp. | 658,300 | 40,854,098 | |
CenterPoint Energy, Inc. | 785,700 | 22,376,736 | |
MDU Resources Group, Inc. | 1,170,100 | 33,932,900 | |
WEC Energy Group, Inc. | 663,500 | 44,036,495 | |
141,200,229 | |||
TOTAL UTILITIES | 265,162,818 | ||
TOTAL COMMON STOCKS | |||
(Cost $2,608,510,005) | 2,708,804,571 | ||
Money Market Funds - 4.6% | |||
Fidelity Cash Central Fund, 1.96% (c) | 37,803,546 | 37,811,107 | |
Fidelity Securities Lending Cash Central Fund 1.97% (c)(d) | 89,906,907 | 89,915,898 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $127,727,779) | 127,727,005 | ||
TOTAL INVESTMENT IN SECURITIES - 102.5% | |||
(Cost $2,736,237,784) | 2,836,531,576 | ||
NET OTHER ASSETS (LIABILITIES) - (2.5)% | (69,082,084) | ||
NET ASSETS - 100% | $2,767,449,492 |
Legend
(a) Security or a portion of the security is on loan at period end.
(b) Non-income producing
(c) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(d) Investment made with cash collateral received from securities on loan.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $352,058 |
Fidelity Securities Lending Cash Central Fund | 120,431 |
Total | $472,489 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $87,136,812) — See accompanying schedule: Unaffiliated issuers (cost $2,608,510,005) | $2,708,804,571 | |
Fidelity Central Funds (cost $127,727,779) | 127,727,005 | |
Total Investment in Securities (cost $2,736,237,784) | $2,836,531,576 | |
Receivable for investments sold | 32,488,694 | |
Receivable for fund shares sold | 857,519 | |
Dividends receivable | 585,801 | |
Distributions receivable from Fidelity Central Funds | 115,032 | |
Prepaid expenses | 7,065 | |
Other receivables | 183,891 | |
Total assets | 2,870,769,578 | |
Liabilities | ||
Payable to custodian bank | $42,212 | |
Payable for investments purchased | 6,768,663 | |
Payable for fund shares redeemed | 5,195,693 | |
Accrued management fee | 706,848 | |
Distribution and service plan fees payable | 162,774 | |
Other affiliated payables | 493,447 | |
Other payables and accrued expenses | 40,734 | |
Collateral on securities loaned | 89,909,715 | |
Total liabilities | 103,320,086 | |
Net Assets | $2,767,449,492 | |
Net Assets consist of: | ||
Paid in capital | $2,497,667,180 | |
Undistributed net investment income | 25,999,865 | |
Accumulated undistributed net realized gain (loss) on investments | 143,488,655 | |
Net unrealized appreciation (depreciation) on investments | 100,293,792 | |
Net Assets | $2,767,449,492 | |
Calculation of Maximum Offering Price | ||
Class A: | ||
Net Asset Value and redemption price per share ($220,715,156 ÷ 9,029,037 shares) | $24.45 | |
Maximum offering price per share (100/94.25 of $24.45) | $25.94 | |
Class M: | ||
Net Asset Value and redemption price per share ($47,800,013 ÷ 1,966,627 shares) | $24.31 | |
Maximum offering price per share (100/96.50 of $24.31) | $25.19 | |
Class C: | ||
Net Asset Value and offering price per share ($115,158,427 ÷ 4,891,088 shares)(a) | $23.54 | |
Mid Cap Value: | ||
Net Asset Value, offering price and redemption price per share ($2,005,329,812 ÷ 80,785,836 shares) | $24.82 | |
Class I: | ||
Net Asset Value, offering price and redemption price per share ($346,258,100 ÷ 14,069,994 shares) | $24.61 | |
Class Z: | ||
Net Asset Value, offering price and redemption price per share ($32,187,984 ÷ 1,307,662 shares) | $24.61 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $34,706,469 | |
Income from Fidelity Central Funds | 472,489 | |
Total income | 35,178,958 | |
Expenses | ||
Management fee | ||
Basic fee | $7,858,107 | |
Performance adjustment | (2,777,341) | |
Transfer agent fees | 2,620,639 | |
Distribution and service plan fees | 1,034,921 | |
Accounting and security lending fees | 435,538 | |
Custodian fees and expenses | 16,445 | |
Independent trustees' fees and expenses | 7,006 | |
Registration fees | 66,518 | |
Audit | 31,601 | |
Legal | 7,310 | |
Miscellaneous | 12,906 | |
Total expenses before reductions | 9,313,650 | |
Expense reductions | (353,191) | |
Total expenses after reductions | 8,960,459 | |
Net investment income (loss) | 26,218,499 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 145,117,614 | |
Fidelity Central Funds | (1,970) | |
Total net realized gain (loss) | 145,115,644 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (296,331,543) | |
Fidelity Central Funds | (774) | |
Total change in net unrealized appreciation (depreciation) | (296,332,317) | |
Net gain (loss) | (151,216,673) | |
Net increase (decrease) in net assets resulting from operations | $(124,998,174) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $26,218,499 | $61,030,404 |
Net realized gain (loss) | 145,115,644 | 487,601,104 |
Change in net unrealized appreciation (depreciation) | (296,332,317) | (59,357,105) |
Net increase (decrease) in net assets resulting from operations | (124,998,174) | 489,274,403 |
Distributions to shareholders from net investment income | (3,526,255) | (54,603,613) |
Distributions to shareholders from net realized gain | (133,712,611) | (213,044,374) |
Total distributions | (137,238,866) | (267,647,987) |
Share transactions - net increase (decrease) | (198,517,431) | (288,117,505) |
Total increase (decrease) in net assets | (460,754,471) | (66,491,089) |
Net Assets | ||
Beginning of period | 3,228,203,963 | 3,294,695,052 |
End of period | $2,767,449,492 | $3,228,203,963 |
Other Information | ||
Undistributed net investment income end of period | $25,999,865 | $3,307,621 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Mid Cap Value Fund Class A
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.62 | $24.94 | $20.52 | $23.90 | $21.78 | $19.24 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .19 | .44B | .29 | .29 | .24 | .24 |
Net realized and unrealized gain (loss) | (1.20) | 3.54 | 4.40 | (2.57) | 3.45 | 4.29 |
Total from investment operations | (1.01) | 3.98 | 4.69 | (2.28) | 3.69 | 4.53 |
Distributions from net investment income | (.03) | (.43) | (.27) | (.28) | (.17) | (.19) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.82) | (1.40) | (1.79) |
Total distributions | (1.16)C | (2.30) | (.27) | (1.10) | (1.57) | (1.99)D |
Redemption fees added to paid in capitalA | – | – | –E | –E | –E | –E |
Net asset value, end of period | $24.45 | $26.62 | $24.94 | $20.52 | $23.90 | $21.78 |
Total ReturnF,G,H | (3.84)% | 16.13% | 22.87% | (9.83)% | 17.32% | 23.69% |
Ratios to Average Net AssetsI,J | ||||||
Expenses before reductions | .86%K | .98% | 1.01% | 1.14% | 1.15% | 1.15% |
Expenses net of fee waivers, if any | .85%K | .98% | 1.01% | 1.14% | 1.15% | 1.15% |
Expenses net of all reductions | .83%K | .97% | 1.00% | 1.14% | 1.15% | 1.14% |
Net investment income (loss) | 1.59%K | 1.67%B | 1.25% | 1.21% | 1.04% | 1.11% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $220,715 | $255,907 | $299,124 | $277,462 | $171,263 | $67,826 |
Portfolio turnover rateL | 103%K,M | 138%M | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.18%.
C Total distributions of $1.16 per share is comprised of distributions from net investment income of $.025 and distributions from net realized gain of $1.136 per share.
D Total distributions of $1.99 per share is comprised of distributions from net investment income of $.193 and distributions from net realized gain of $1.793 per share.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Total returns do not include the effect of the sales charges.
I Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
J Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
K Annualized
L Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
M Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund Class M
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.51 | $24.84 | $20.46 | $23.81 | $21.70 | $19.21 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .16 | .36B | .22 | .22 | .17 | .18 |
Net realized and unrealized gain (loss) | (1.21) | 3.54 | 4.38 | (2.54) | 3.44 | 4.27 |
Total from investment operations | (1.05) | 3.90 | 4.60 | (2.32) | 3.61 | 4.45 |
Distributions from net investment income | (.02) | (.35) | (.22) | (.21) | (.10) | (.17) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.82) | (1.40) | (1.79) |
Total distributions | (1.15)C | (2.23)D | (.22) | (1.03) | (1.50) | (1.96) |
Redemption fees added to paid in capitalA | – | – | –E | –E | –E | –E |
Net asset value, end of period | $24.31 | $26.51 | $24.84 | $20.46 | $23.81 | $21.70 |
Total ReturnF,G,H | (4.00)% | 15.84% | 22.48% | (10.04)% | 16.98% | 23.32% |
Ratios to Average Net AssetsI,J | ||||||
Expenses before reductions | 1.13%K | 1.25% | 1.29% | 1.42% | 1.44% | 1.42% |
Expenses net of fee waivers, if any | 1.13%K | 1.25% | 1.29% | 1.42% | 1.44% | 1.42% |
Expenses net of all reductions | 1.11%K | 1.24% | 1.29% | 1.42% | 1.44% | 1.41% |
Net investment income (loss) | 1.31%K | 1.40%B | .96% | .93% | .74% | .84% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $47,800 | $57,807 | $60,761 | $46,084 | $40,752 | $24,136 |
Portfolio turnover rateL | 103%K,M | 138%M | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .91%.
C Total distributions of $1.15 per share is comprised of distributions from net investment income of $.018 and distributions from net realized gain of $1.136 per share.
D Total distributions of $2.23 per share is comprised of distributions from net investment income of $.352 and distributions from net realized gain of $1.873 per share.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Total returns do not include the effect of the sales charges.
I Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
J Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
K Annualized
L Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
M Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund Class C
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $25.76 | $24.22 | $19.95 | $23.30 | $21.31 | $18.93 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .10 | .23B | .11 | .11 | .07 | .08 |
Net realized and unrealized gain (loss) | (1.18) | 3.43 | 4.27 | (2.49) | 3.37 | 4.20 |
Total from investment operations | (1.08) | 3.66 | 4.38 | (2.38) | 3.44 | 4.28 |
Distributions from net investment income | (.01) | (.25) | (.11) | (.15) | (.06) | (.11) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.81) | (1.39) | (1.79) |
Total distributions | (1.14)C | (2.12) | (.11) | (.97)D | (1.45) | (1.90) |
Redemption fees added to paid in capitalA | – | – | –E | –E | –E | –E |
Net asset value, end of period | $23.54 | $25.76 | $24.22 | $19.95 | $23.30 | $21.31 |
Total ReturnF,G,H | (4.24)% | 15.28% | 21.97% | (10.52)% | 16.48% | 22.77% |
Ratios to Average Net AssetsI,J | ||||||
Expenses before reductions | 1.60%K | 1.72% | 1.76% | 1.89% | 1.89% | 1.89% |
Expenses net of fee waivers, if any | 1.60%K | 1.72% | 1.76% | 1.89% | 1.89% | 1.89% |
Expenses net of all reductions | 1.57%K | 1.71% | 1.75% | 1.88% | 1.89% | 1.89% |
Net investment income (loss) | .85%K | .93%B | .50% | .47% | .29% | .36% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $115,158 | $138,506 | $144,503 | $130,636 | $71,263 | $25,177 |
Portfolio turnover rateL | 103%K,M | 138%M | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.16 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .44%.
C Total distributions of $1.14 per share is comprised of distributions from net investment income of $.007 and distributions from net realized gain of $1.136 per share.
D Total distributions of $.97 per share is comprised of distributions from net investment income of $.153 and distributions from net realized gain of $.812 per share.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Total returns do not include the effect of the contingent deferred sales charge.
I Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
J Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
K Annualized
L Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
M Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.99 | $25.24 | $20.76 | $24.15 | $21.96 | $19.37 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .23 | .52B | .35 | .36 | .32 | .32 |
Net realized and unrealized gain (loss) | (1.23) | 3.60 | 4.46 | (2.60) | 3.49 | 4.31 |
Total from investment operations | (1.00) | 4.12 | 4.81 | (2.24) | 3.81 | 4.63 |
Distributions from net investment income | (.03) | (.50) | (.33) | (.33) | (.22) | (.25) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.82) | (1.40) | (1.79) |
Total distributions | (1.17) | (2.37) | (.33) | (1.15) | (1.62) | (2.04) |
Redemption fees added to paid in capitalA | – | – | –C | –C | –C | –C |
Net asset value, end of period | $24.82 | $26.99 | $25.24 | $20.76 | $24.15 | $21.96 |
Total ReturnD,E | (3.76)% | 16.51% | 23.19% | (9.58)% | 17.75% | 24.08% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | .56%H | .69% | .73% | .86% | .83% | .80% |
Expenses net of fee waivers, if any | .56%H | .69% | .73% | .85% | .83% | .80% |
Expenses net of all reductions | .54%H | .68% | .72% | .85% | .83% | .80% |
Net investment income (loss) | 1.88%H | 1.96%B | 1.53% | 1.50% | 1.36% | 1.45% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $2,005,330 | $2,332,143 | $2,426,359 | $2,331,665 | $2,691,765 | $1,404,968 |
Portfolio turnover rateI | 103%H,J | 138%J | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.47%.
C Amount represents less than $.005 per share.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
J Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund Class I
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.77 | $25.05 | $20.61 | $24.00 | $21.84 | $19.29 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .23 | .51B | .35 | .35 | .32 | .31 |
Net realized and unrealized gain (loss) | (1.22) | 3.58 | 4.43 | (2.58) | 3.47 | 4.28 |
Total from investment operations | (.99) | 4.09 | 4.78 | (2.23) | 3.79 | 4.59 |
Distributions from net investment income | (.03) | (.50) | (.34) | (.34) | (.23) | (.25) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.82) | (1.40) | (1.79) |
Total distributions | (1.17) | (2.37) | (.34) | (1.16) | (1.63) | (2.04) |
Redemption fees added to paid in capitalA | – | – | –C | –C | –C | –C |
Net asset value, end of period | $24.61 | $26.77 | $25.05 | $20.61 | $24.00 | $21.84 |
Total ReturnD,E | (3.75)% | 16.52% | 23.19% | (9.60)% | 17.75% | 23.98% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | .57%H | .69% | .73% | .87% | .85% | .85% |
Expenses net of fee waivers, if any | .57%H | .69% | .73% | .86% | .85% | .85% |
Expenses net of all reductions | .54%H | .68% | .73% | .86% | .85% | .85% |
Net investment income (loss) | 1.87%H | 1.95%B | 1.53% | 1.49% | 1.33% | 1.40% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $346,258 | $410,868 | $363,949 | $261,686 | $148,390 | $26,277 |
Portfolio turnover rateI | 103%H,J | 138%J | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.47%.
C Amount represents less than $.005 per share.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
J Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund Class Z
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |
2018 | 2018A | |
Selected Per–Share Data | ||
Net asset value, beginning of period | $26.76 | $25.03 |
Income from Investment Operations | ||
Net investment income (loss)B | .25 | .56C |
Net realized and unrealized gain (loss) | (1.23) | 3.59 |
Total from investment operations | (.98) | 4.15 |
Distributions from net investment income | (.04) | (.54) |
Distributions from net realized gain | (1.14) | (1.87) |
Total distributions | (1.17)D | (2.42)E |
Redemption fees added to paid in capitalB | – | – |
Net asset value, end of period | $24.61 | $26.76 |
Total ReturnF,G | (3.70)% | 16.74% |
Ratios to Average Net AssetsH,I | ||
Expenses before reductions | .43%J | .56% |
Expenses net of fee waivers, if any | .43%J | .56% |
Expenses net of all reductions | .41%J | .55% |
Net investment income (loss) | 2.01%J | 2.09%C |
Supplemental Data | ||
Net assets, end of period (000 omitted) | $32,188 | $32,974 |
Portfolio turnover rateK | 103%J,L | 138%L |
A For the period February 1, 2017 (commencement of sale of shares) to January 31, 2018.
B Calculated based on average shares outstanding during the period.
C Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.60%.
D Total distributions of $1.17 per share is comprised of distributions from net investment income of $.035 and distributions from net realized gain of $1.136 per share.
E Total distributions of $2.42 per share is comprised of distributions from net investment income of $.542 and distributions from net realized gain of $1.873 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
L Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Mid Cap Value Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund offers Class A, Class M, Class C, Mid Cap Value, Class I and Class Z shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent and distribution and service plan fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, partnerships, market discount, redemptions in-kind, passive foreign investment companies (PFIC), certain conversion ratio adjustments, capital loss carryforwards and losses deferred due to wash sales and excise tax regulations.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $234,524,980 |
Gross unrealized depreciation | (134,808,422) |
Net unrealized appreciation (depreciation) | $99,716,558 |
Tax cost | $2,736,815,018 |
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and in-kind transactions, aggregated $1,476,111,569 and $1,792,065,742, respectively.
Redemptions In-Kind. During the period, 876,174 shares of the Fund held by unaffiliated entities were redeemed in-kind for investments and cash with a value of $21,501,311. The net realized gain of $2,657,810 on investments delivered through the in-kind redemptions is included in the accompanying Statement of Operations. The amount of the redemptions is included in share transactions activity shown in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
Prior Fiscal Year Redemptions In-Kind. During the prior period, 339,737 shares of the Fund held by unaffiliated entities were redeemed in-kind for investments and cash with a value of $9,318,982. The Fund had a net realized gain of $1,830,856 on investments delivered through the in-kind redemptions. The amount of the in-kind redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and an annualized group fee rate that averaged .24% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the relative investment performance of Mid Cap Value as compared to its benchmark index, the Russell Midcap Value Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .35% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Distribution and Service Plan Fees. In accordance with Rule 12b-1 of the 1940 Act, the Fund has adopted separate Distribution and Service Plans for each class of shares, except for the Class I. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of the investment adviser, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates, total fees and amounts retained by FDC were as follows:
Distribution Fee | Service Fee | Total Fees | Retained by FDC | |
Class A | -% | .25% | $288,212 | $2,647 |
Class M | .25% | .25% | 126,938 | – |
Class C | .75% | .25% | 619,771 | 42,953 |
$1,034,921 | $45,600 |
Sales Load. FDC may receive a front-end sales charge of up to 5.75% for selling Class A shares and 3.50% for selling Class M shares, some of which is paid to financial intermediaries for selling shares of the Fund. Depending on the holding period, FDC may receive contingent deferred sales charges levied on Class A, Class M and Class C redemptions. The deferred sales charges are 1.00% for Class C shares, 1.00% for certain purchases of Class A shares and .25% for certain purchases of Class M shares.
For the period, sales charge amounts retained by FDC were as follows:
Retained by FDC | |
Class A | $26,871 |
Class M | 2,731 |
Class C(a) | 4,495 |
$34,097 |
(a) When Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, is the transfer, dividend disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of the respective classes of the Fund, except for Class Z. FIIOC receives an asset-based fee of Class Z's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Class A | $248,835 | .22 |
Class M | 61,421 | .24 |
Class C | 127,985 | .21 |
Mid Cap Value | 1,841,944 | .18 |
Class I | 333,483 | .18 |
Class Z | 6,971 | .05 |
$2,620,639 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions. For the period, the fees were equivalent to an annualized rate of .03%.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $45,173 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
Prior Fiscal Year Redemptions In-Kind. During the prior period, 1,289,800 shares of the Fund held by an affiliated entity were redeemed in-kind for investments and cash with a value of $33,895,948. The Fund had a net realized gain of $5,708,374 on investments delivered through in-kind redemptions. The amount of the in-kind redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $4,196 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. The value of securities loaned to FCM at period end was $1,348,280. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $120,431, including $341 from securities loaned to FCM.
7. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $336,858 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $144.
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $16,189.
8. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended July 31, 2018 | Year ended January 31, 2018 | |
From net investment income | ||
Class A | $236,252 | $3,842,007 |
Class M | 39,198 | 738,141 |
Class C | 37,023 | 1,381,368 |
Mid Cap Value | 2,707,816 | 40,728,436 |
Class I | 465,088 | 7,342,642 |
Class Z | 40,878 | 571,019 |
Total | $3,526,255 | $54,603,613 |
From net realized gain | ||
Class A | $10,733,153 | $16,772,494 |
Class M | 2,473,882 | 3,919,760 |
Class C | 6,008,224 | 10,304,692 |
Mid Cap Value | 96,127,346 | 152,568,612 |
Class I | 17,043,208 | 27,505,536 |
Class Z | 1,326,798 | 1,973,280 |
Total | $133,712,611 | $213,044,374 |
9. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended July 31, 2018 | Year ended January 31, 2018 | Six months ended July 31, 2018 | Year ended January 31, 2018 | |
Class A | ||||
Shares sold | 648,427 | 2,274,304 | $15,943,551 | $59,043,864 |
Reinvestment of distributions | 438,070 | 778,331 | 10,829,109 | 20,353,335 |
Shares redeemed | (1,669,091) | (5,434,078) | (40,845,626) | (140,309,711) |
Net increase (decrease) | (582,594) | (2,381,443) | $(14,072,966) | $(60,912,512) |
Class M | ||||
Shares sold | 130,366 | 384,088 | $3,174,139 | $9,897,586 |
Reinvestment of distributions | 101,165 | 177,219 | 2,488,663 | 4,616,549 |
Shares redeemed | (445,650) | (826,528) | (10,811,202) | (21,629,388) |
Net increase (decrease) | (214,119) | (265,221) | $(5,148,400) | $(7,115,253) |
Class C | ||||
Shares sold | 193,970 | 1,098,519 | $4,594,121 | $27,338,918 |
Reinvestment of distributions | 244,024 | 444,532 | 5,827,282 | 11,259,992 |
Shares redeemed | (923,597) | (2,132,994) | (21,731,334) | (53,838,984) |
Net increase (decrease) | (485,603) | (589,943) | $(11,309,931) | $(15,240,074) |
Mid Cap Value | ||||
Shares sold | 3,190,570 | 10,422,988 | $79,431,267 | $274,556,299 |
Reinvestment of distributions | 3,767,418 | 6,952,016 | 94,449,171 | 184,228,438 |
Shares redeemed | (12,589,427)(a) | (27,076,600)(b) | (312,292,613)(a) | (716,090,892)(b) |
Net increase (decrease) | (5,631,439) | (9,701,596) | $(138,412,175) | $(257,306,155) |
Class I | ||||
Shares sold | 1,966,622 | 6,767,714 | $48,515,546 | $175,618,477 |
Reinvestment of distributions | 673,638 | 1,268,528 | 16,746,637 | 33,336,905 |
Shares redeemed | (3,921,069) | (7,211,785) | (96,482,374) | (188,764,174) |
Net increase (decrease) | (1,280,809) | 824,457 | $(31,220,191) | $20,191,208 |
Class Z | ||||
Shares sold | 645,693 | 1,341,663 | $16,025,200 | $35,340,459 |
Reinvestment of distributions | 47,198 | 84,138 | 1,172,862 | 2,210,303 |
Shares redeemed | (617,559) | (193,471) | (15,551,830) | (5,285,481) |
Net increase (decrease) | 75,332 | 1,232,330 | $1,646,232 | $32,265,281 |
(a) Amount includes in-kind redemptions (see the Redemptions In-Kind notes for additional details).
(b) Amount includes in-kind redemptions (see the Prior Fiscal Year Redemptions In-Kind notes for additional details).
10. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying table for each class of the Fund 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the Fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of the Fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Class A | .85% | |||
Actual | $1,000.00 | $961.60 | $4.13 | |
Hypothetical-C | $1,000.00 | $1,020.58 | $4.26 | |
Class M | 1.13% | |||
Actual | $1,000.00 | $960.00 | $5.49 | |
Hypothetical-C | $1,000.00 | $1,019.19 | $5.66 | |
Class C | 1.60% | |||
Actual | $1,000.00 | $957.60 | $7.77 | |
Hypothetical-C | $1,000.00 | $1,016.86 | $8.00 | |
Mid Cap Value | .56% | |||
Actual | $1,000.00 | $962.40 | $2.72 | |
Hypothetical-C | $1,000.00 | $1,022.02 | $2.81 | |
Class I | .57% | |||
Actual | $1,000.00 | $962.50 | $2.77 | |
Hypothetical-C | $1,000.00 | $1,021.97 | $2.86 | |
Class Z | .43% | |||
Actual | $1,000.00 | $963.00 | $2.09 | |
Hypothetical-C | $1,000.00 | $1,022.66 | $2.16 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Mid Cap Value Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
AMCV-SANN-0918
1.838443.109
Fidelity® Mid Cap Value Fund Semi-Annual Report July 31, 2018 |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
CBRE Group, Inc. | 2.2 |
M&T Bank Corp. | 1.9 |
Cimarex Energy Co. | 1.9 |
Huntsman Corp. | 1.8 |
Xcel Energy, Inc. | 1.7 |
Regions Financial Corp. | 1.7 |
AMETEK, Inc. | 1.7 |
Best Buy Co., Inc. | 1.7 |
Ingersoll-Rand PLC | 1.7 |
Lear Corp. | 1.6 |
17.9 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 20.0 |
Industrials | 13.9 |
Real Estate | 12.5 |
Consumer Discretionary | 10.4 |
Utilities | 9.6 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks | 97.9% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.1% |
* Foreign investments - 8.0%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 97.9% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 10.4% | |||
Auto Components - 2.1% | |||
Gentex Corp. | 610,000 | $14,152,000 | |
Lear Corp. | 248,800 | 44,816,344 | |
58,968,344 | |||
Household Durables - 1.4% | |||
PulteGroup, Inc. | 440,000 | 12,535,600 | |
Toll Brothers, Inc. | 720,800 | 25,415,408 | |
37,951,008 | |||
Leisure Products - 0.5% | |||
Brunswick Corp. | 220,600 | 14,184,580 | |
Media - 2.0% | |||
John Wiley & Sons, Inc. Class A | 390,600 | 24,666,390 | |
Omnicom Group, Inc. | 436,500 | 30,044,295 | |
54,710,685 | |||
Multiline Retail - 0.8% | |||
Macy's, Inc. | 578,400 | 22,979,832 | |
Specialty Retail - 3.6% | |||
Best Buy Co., Inc. | 615,500 | 46,180,965 | |
Dick's Sporting Goods, Inc. | 399,000 | 13,621,860 | |
Williams-Sonoma, Inc. (a) | 655,000 | 38,310,950 | |
98,113,775 | |||
TOTAL CONSUMER DISCRETIONARY | 286,908,224 | ||
CONSUMER STAPLES - 4.8% | |||
Beverages - 0.8% | |||
Molson Coors Brewing Co. Class B | 337,400 | 22,605,800 | |
Food Products - 4.0% | |||
Ingredion, Inc. | 237,700 | 24,079,010 | |
Pilgrim's Pride Corp. (b) | 524,600 | 9,348,372 | |
The Hershey Co. | 168,500 | 16,548,385 | |
The J.M. Smucker Co. | 282,000 | 31,335,840 | |
Tyson Foods, Inc. Class A | 528,000 | 30,439,200 | |
111,750,807 | |||
TOTAL CONSUMER STAPLES | 134,356,607 | ||
ENERGY - 6.1% | |||
Energy Equipment & Services - 1.2% | |||
RPC, Inc. (a) | 2,165,900 | 32,055,320 | |
Oil, Gas & Consumable Fuels - 4.9% | |||
Cimarex Energy Co. | 529,400 | 52,198,840 | |
HollyFrontier Corp. | 591,370 | 44,104,375 | |
PBF Energy, Inc. Class A | 839,600 | 39,209,320 | |
135,512,535 | |||
TOTAL ENERGY | 167,567,855 | ||
FINANCIALS - 20.0% | |||
Banks - 6.0% | |||
First Hawaiian, Inc. | 764,400 | 21,601,944 | |
M&T Bank Corp. | 305,600 | 52,975,760 | |
Popular, Inc. | 508,706 | 25,247,079 | |
Regions Financial Corp. | 2,559,800 | 47,637,878 | |
Synovus Financial Corp. | 361,000 | 17,840,620 | |
165,303,281 | |||
Capital Markets - 4.1% | |||
Affiliated Managers Group, Inc. | 128,400 | 20,545,284 | |
Invesco Ltd. | 1,200,100 | 32,390,699 | |
Lazard Ltd. Class A | 680,500 | 36,951,150 | |
Legg Mason, Inc. | 702,000 | 23,959,260 | |
113,846,393 | |||
Consumer Finance - 3.0% | |||
Discover Financial Services | 584,000 | 41,703,440 | |
Synchrony Financial | 1,467,400 | 42,466,556 | |
84,169,996 | |||
Insurance - 6.5% | |||
American National Insurance Co. | 136,300 | 17,581,337 | |
First American Financial Corp. | 789,226 | 44,196,656 | |
Old Republic International Corp. | 1,474,169 | 31,414,541 | |
Principal Financial Group, Inc. | 732,600 | 42,549,408 | |
Torchmark Corp. | 239,400 | 21,083,958 | |
Unum Group | 555,500 | 22,070,015 | |
178,895,915 | |||
Mortgage Real Estate Investment Trusts - 0.4% | |||
Chimera Investment Corp. | 590,200 | 11,272,820 | |
TOTAL FINANCIALS | 553,488,405 | ||
HEALTH CARE - 6.5% | |||
Biotechnology - 0.7% | |||
United Therapeutics Corp. (b) | 162,000 | 19,911,420 | |
Health Care Providers & Services - 5.2% | |||
Cardinal Health, Inc. | 464,000 | 23,176,800 | |
Laboratory Corp. of America Holdings (b) | 242,500 | 42,519,950 | |
MEDNAX, Inc. (b) | 316,900 | 13,560,151 | |
Quest Diagnostics, Inc. | 273,100 | 29,418,332 | |
Universal Health Services, Inc. Class B | 272,500 | 33,272,250 | |
141,947,483 | |||
Pharmaceuticals - 0.6% | |||
Jazz Pharmaceuticals PLC (b) | 100,600 | 17,411,848 | |
TOTAL HEALTH CARE | 179,270,751 | ||
INDUSTRIALS - 13.9% | |||
Airlines - 0.9% | |||
Copa Holdings SA Class A | 260,600 | 25,366,804 | |
Commercial Services & Supplies - 0.6% | |||
Deluxe Corp. | 295,000 | 17,384,350 | |
Construction & Engineering - 0.5% | |||
AECOM (b) | 429,300 | 14,407,308 | |
Electrical Equipment - 2.6% | |||
Acuity Brands, Inc. | 183,400 | 25,498,102 | |
AMETEK, Inc. | 596,600 | 46,415,480 | |
71,913,582 | |||
Machinery - 8.7% | |||
Apergy Corp. (b) | 902,800 | 37,014,800 | |
Crane Co. | 316,000 | 28,620,120 | |
Cummins, Inc. | 237,200 | 33,874,532 | |
Ingersoll-Rand PLC | 468,600 | 46,161,786 | |
PACCAR, Inc. | 623,000 | 40,943,560 | |
Parker Hannifin Corp. | 132,800 | 22,449,840 | |
Snap-On, Inc. | 188,900 | 32,035,551 | |
241,100,189 | |||
Trading Companies & Distributors - 0.6% | |||
MSC Industrial Direct Co., Inc. Class A | 185,200 | 15,673,476 | |
TOTAL INDUSTRIALS | 385,845,709 | ||
INFORMATION TECHNOLOGY - 8.2% | |||
Communications Equipment - 1.9% | |||
F5 Networks, Inc. (b) | 151,900 | 26,032,622 | |
Juniper Networks, Inc. | 1,051,454 | 27,695,298 | |
53,727,920 | |||
Electronic Equipment & Components - 0.5% | |||
Coherent, Inc. (b) | 88,600 | 14,004,116 | |
IT Services - 3.9% | |||
Amdocs Ltd. | 564,246 | 38,131,745 | |
DXC Technology Co. | 490,900 | 41,598,866 | |
Leidos Holdings, Inc. | 393,900 | 26,950,638 | |
106,681,249 | |||
Semiconductors & Semiconductor Equipment - 1.0% | |||
Skyworks Solutions, Inc. | 200,200 | 18,934,916 | |
Teradyne, Inc. | 175,277 | 7,580,730 | |
26,515,646 | |||
Technology Hardware, Storage & Peripherals - 0.9% | |||
Western Digital Corp. | 361,000 | 25,324,150 | |
TOTAL INFORMATION TECHNOLOGY | 226,253,081 | ||
MATERIALS - 5.9% | |||
Chemicals - 3.2% | |||
Huntsman Corp. | 1,482,600 | 49,711,578 | |
Innospec, Inc. | 226,026 | 18,296,805 | |
Westlake Chemical Corp. | 210,200 | 22,537,644 | |
90,546,027 | |||
Construction Materials - 0.8% | |||
nVent Electric PLC | 792,700 | 21,719,980 | |
Metals & Mining - 1.9% | |||
Freeport-McMoRan, Inc. | 1,939,200 | 31,996,800 | |
Reliance Steel & Aluminum Co. | 219,900 | 19,834,980 | |
51,831,780 | |||
TOTAL MATERIALS | 164,097,787 | ||
REAL ESTATE - 12.5% | |||
Equity Real Estate Investment Trusts (REITs) - 7.5% | |||
Apple Hospitality (REIT), Inc. | 1,794,600 | 32,284,854 | |
Brixmor Property Group, Inc. | 1,303,600 | 23,060,684 | |
Empire State Realty Trust, Inc. | 737,000 | 12,285,790 | |
Gaming & Leisure Properties | 794,400 | 28,852,608 | |
Park Hotels & Resorts, Inc. | 664,100 | 20,773,048 | |
Public Storage | 75,800 | 16,511,514 | |
Store Capital Corp. | 1,292,100 | 35,468,145 | |
VEREIT, Inc. | 4,926,100 | 37,586,143 | |
206,822,786 | |||
Real Estate Management & Development - 5.0% | |||
CBRE Group, Inc. (b) | 1,193,600 | 59,441,280 | |
Jones Lang LaSalle, Inc. | 247,500 | 42,324,975 | |
Realogy Holdings Corp. (a) | 1,703,900 | 37,264,293 | |
139,030,548 | |||
TOTAL REAL ESTATE | 345,853,334 | ||
UTILITIES - 9.6% | |||
Electric Utilities - 3.8% | |||
FirstEnergy Corp. | 836,900 | 29,651,367 | |
Hawaiian Electric Industries, Inc. | 181,944 | 6,398,970 | |
OGE Energy Corp. | 577,000 | 20,910,480 | |
Xcel Energy, Inc. | 1,030,000 | 48,265,800 | |
105,226,617 | |||
Independent Power and Renewable Electricity Producers - 0.7% | |||
NRG Energy, Inc. | 591,600 | 18,735,972 | |
Multi-Utilities - 5.1% | |||
Ameren Corp. | 658,300 | 40,854,098 | |
CenterPoint Energy, Inc. | 785,700 | 22,376,736 | |
MDU Resources Group, Inc. | 1,170,100 | 33,932,900 | |
WEC Energy Group, Inc. | 663,500 | 44,036,495 | |
141,200,229 | |||
TOTAL UTILITIES | 265,162,818 | ||
TOTAL COMMON STOCKS | |||
(Cost $2,608,510,005) | 2,708,804,571 | ||
Money Market Funds - 4.6% | |||
Fidelity Cash Central Fund, 1.96% (c) | 37,803,546 | 37,811,107 | |
Fidelity Securities Lending Cash Central Fund 1.97% (c)(d) | 89,906,907 | 89,915,898 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $127,727,779) | 127,727,005 | ||
TOTAL INVESTMENT IN SECURITIES - 102.5% | |||
(Cost $2,736,237,784) | 2,836,531,576 | ||
NET OTHER ASSETS (LIABILITIES) - (2.5)% | (69,082,084) | ||
NET ASSETS - 100% | $2,767,449,492 |
Legend
(a) Security or a portion of the security is on loan at period end.
(b) Non-income producing
(c) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(d) Investment made with cash collateral received from securities on loan.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $352,058 |
Fidelity Securities Lending Cash Central Fund | 120,431 |
Total | $472,489 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $87,136,812) — See accompanying schedule: Unaffiliated issuers (cost $2,608,510,005) | $2,708,804,571 | |
Fidelity Central Funds (cost $127,727,779) | 127,727,005 | |
Total Investment in Securities (cost $2,736,237,784) | $2,836,531,576 | |
Receivable for investments sold | 32,488,694 | |
Receivable for fund shares sold | 857,519 | |
Dividends receivable | 585,801 | |
Distributions receivable from Fidelity Central Funds | 115,032 | |
Prepaid expenses | 7,065 | |
Other receivables | 183,891 | |
Total assets | 2,870,769,578 | |
Liabilities | ||
Payable to custodian bank | $42,212 | |
Payable for investments purchased | 6,768,663 | |
Payable for fund shares redeemed | 5,195,693 | |
Accrued management fee | 706,848 | |
Distribution and service plan fees payable | 162,774 | |
Other affiliated payables | 493,447 | |
Other payables and accrued expenses | 40,734 | |
Collateral on securities loaned | 89,909,715 | |
Total liabilities | 103,320,086 | |
Net Assets | $2,767,449,492 | |
Net Assets consist of: | ||
Paid in capital | $2,497,667,180 | |
Undistributed net investment income | 25,999,865 | |
Accumulated undistributed net realized gain (loss) on investments | 143,488,655 | |
Net unrealized appreciation (depreciation) on investments | 100,293,792 | |
Net Assets | $2,767,449,492 | |
Calculation of Maximum Offering Price | ||
Class A: | ||
Net Asset Value and redemption price per share ($220,715,156 ÷ 9,029,037 shares) | $24.45 | |
Maximum offering price per share (100/94.25 of $24.45) | $25.94 | |
Class M: | ||
Net Asset Value and redemption price per share ($47,800,013 ÷ 1,966,627 shares) | $24.31 | |
Maximum offering price per share (100/96.50 of $24.31) | $25.19 | |
Class C: | ||
Net Asset Value and offering price per share ($115,158,427 ÷ 4,891,088 shares)(a) | $23.54 | |
Mid Cap Value: | ||
Net Asset Value, offering price and redemption price per share ($2,005,329,812 ÷ 80,785,836 shares) | $24.82 | |
Class I: | ||
Net Asset Value, offering price and redemption price per share ($346,258,100 ÷ 14,069,994 shares) | $24.61 | |
Class Z: | ||
Net Asset Value, offering price and redemption price per share ($32,187,984 ÷ 1,307,662 shares) | $24.61 |
(a) Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $34,706,469 | |
Income from Fidelity Central Funds | 472,489 | |
Total income | 35,178,958 | |
Expenses | ||
Management fee | ||
Basic fee | $7,858,107 | |
Performance adjustment | (2,777,341) | |
Transfer agent fees | 2,620,639 | |
Distribution and service plan fees | 1,034,921 | |
Accounting and security lending fees | 435,538 | |
Custodian fees and expenses | 16,445 | |
Independent trustees' fees and expenses | 7,006 | |
Registration fees | 66,518 | |
Audit | 31,601 | |
Legal | 7,310 | |
Miscellaneous | 12,906 | |
Total expenses before reductions | 9,313,650 | |
Expense reductions | (353,191) | |
Total expenses after reductions | 8,960,459 | |
Net investment income (loss) | 26,218,499 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 145,117,614 | |
Fidelity Central Funds | (1,970) | |
Total net realized gain (loss) | 145,115,644 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (296,331,543) | |
Fidelity Central Funds | (774) | |
Total change in net unrealized appreciation (depreciation) | (296,332,317) | |
Net gain (loss) | (151,216,673) | |
Net increase (decrease) in net assets resulting from operations | $(124,998,174) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | Year ended January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $26,218,499 | $61,030,404 |
Net realized gain (loss) | 145,115,644 | 487,601,104 |
Change in net unrealized appreciation (depreciation) | (296,332,317) | (59,357,105) |
Net increase (decrease) in net assets resulting from operations | (124,998,174) | 489,274,403 |
Distributions to shareholders from net investment income | (3,526,255) | (54,603,613) |
Distributions to shareholders from net realized gain | (133,712,611) | (213,044,374) |
Total distributions | (137,238,866) | (267,647,987) |
Share transactions - net increase (decrease) | (198,517,431) | (288,117,505) |
Total increase (decrease) in net assets | (460,754,471) | (66,491,089) |
Net Assets | ||
Beginning of period | 3,228,203,963 | 3,294,695,052 |
End of period | $2,767,449,492 | $3,228,203,963 |
Other Information | ||
Undistributed net investment income end of period | $25,999,865 | $3,307,621 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Mid Cap Value Fund Class A
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.62 | $24.94 | $20.52 | $23.90 | $21.78 | $19.24 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .19 | .44B | .29 | .29 | .24 | .24 |
Net realized and unrealized gain (loss) | (1.20) | 3.54 | 4.40 | (2.57) | 3.45 | 4.29 |
Total from investment operations | (1.01) | 3.98 | 4.69 | (2.28) | 3.69 | 4.53 |
Distributions from net investment income | (.03) | (.43) | (.27) | (.28) | (.17) | (.19) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.82) | (1.40) | (1.79) |
Total distributions | (1.16)C | (2.30) | (.27) | (1.10) | (1.57) | (1.99)D |
Redemption fees added to paid in capitalA | – | – | –E | –E | –E | –E |
Net asset value, end of period | $24.45 | $26.62 | $24.94 | $20.52 | $23.90 | $21.78 |
Total ReturnF,G,H | (3.84)% | 16.13% | 22.87% | (9.83)% | 17.32% | 23.69% |
Ratios to Average Net AssetsI,J | ||||||
Expenses before reductions | .86%K | .98% | 1.01% | 1.14% | 1.15% | 1.15% |
Expenses net of fee waivers, if any | .85%K | .98% | 1.01% | 1.14% | 1.15% | 1.15% |
Expenses net of all reductions | .83%K | .97% | 1.00% | 1.14% | 1.15% | 1.14% |
Net investment income (loss) | 1.59%K | 1.67%B | 1.25% | 1.21% | 1.04% | 1.11% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $220,715 | $255,907 | $299,124 | $277,462 | $171,263 | $67,826 |
Portfolio turnover rateL | 103%K,M | 138%M | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.18%.
C Total distributions of $1.16 per share is comprised of distributions from net investment income of $.025 and distributions from net realized gain of $1.136 per share.
D Total distributions of $1.99 per share is comprised of distributions from net investment income of $.193 and distributions from net realized gain of $1.793 per share.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Total returns do not include the effect of the sales charges.
I Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
J Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
K Annualized
L Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
M Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund Class M
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.51 | $24.84 | $20.46 | $23.81 | $21.70 | $19.21 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .16 | .36B | .22 | .22 | .17 | .18 |
Net realized and unrealized gain (loss) | (1.21) | 3.54 | 4.38 | (2.54) | 3.44 | 4.27 |
Total from investment operations | (1.05) | 3.90 | 4.60 | (2.32) | 3.61 | 4.45 |
Distributions from net investment income | (.02) | (.35) | (.22) | (.21) | (.10) | (.17) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.82) | (1.40) | (1.79) |
Total distributions | (1.15)C | (2.23)D | (.22) | (1.03) | (1.50) | (1.96) |
Redemption fees added to paid in capitalA | – | – | –E | –E | –E | –E |
Net asset value, end of period | $24.31 | $26.51 | $24.84 | $20.46 | $23.81 | $21.70 |
Total ReturnF,G,H | (4.00)% | 15.84% | 22.48% | (10.04)% | 16.98% | 23.32% |
Ratios to Average Net AssetsI,J | ||||||
Expenses before reductions | 1.13%K | 1.25% | 1.29% | 1.42% | 1.44% | 1.42% |
Expenses net of fee waivers, if any | 1.13%K | 1.25% | 1.29% | 1.42% | 1.44% | 1.42% |
Expenses net of all reductions | 1.11%K | 1.24% | 1.29% | 1.42%�� | 1.44% | 1.41% |
Net investment income (loss) | 1.31%K | 1.40%B | .96% | .93% | .74% | .84% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $47,800 | $57,807 | $60,761 | $46,084 | $40,752 | $24,136 |
Portfolio turnover rateL | 103%K,M | 138%M | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .91%.
C Total distributions of $1.15 per share is comprised of distributions from net investment income of $.018 and distributions from net realized gain of $1.136 per share.
D Total distributions of $2.23 per share is comprised of distributions from net investment income of $.352 and distributions from net realized gain of $1.873 per share.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Total returns do not include the effect of the sales charges.
I Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
J Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
K Annualized
L Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
M Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund Class C
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $25.76 | $24.22 | $19.95 | $23.30 | $21.31 | $18.93 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .10 | .23B | .11 | .11 | .07 | .08 |
Net realized and unrealized gain (loss) | (1.18) | 3.43 | 4.27 | (2.49) | 3.37 | 4.20 |
Total from investment operations | (1.08) | 3.66 | 4.38 | (2.38) | 3.44 | 4.28 |
Distributions from net investment income | (.01) | (.25) | (.11) | (.15) | (.06) | (.11) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.81) | (1.39) | (1.79) |
Total distributions | (1.14)C | (2.12) | (.11) | (.97)D | (1.45) | (1.90) |
Redemption fees added to paid in capitalA | – | – | –E | –E | –E | –E |
Net asset value, end of period | $23.54 | $25.76 | $24.22 | $19.95 | $23.30 | $21.31 |
Total ReturnF,G,H | (4.24)% | 15.28% | 21.97% | (10.52)% | 16.48% | 22.77% |
Ratios to Average Net AssetsI,J | ||||||
Expenses before reductions | 1.60%K | 1.72% | 1.76% | 1.89% | 1.89% | 1.89% |
Expenses net of fee waivers, if any | 1.60%K | 1.72% | 1.76% | 1.89% | 1.89% | 1.89% |
Expenses net of all reductions | 1.57%K | 1.71% | 1.75% | 1.88% | 1.89% | 1.89% |
Net investment income (loss) | .85%K | .93%B | .50% | .47% | .29% | .36% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $115,158 | $138,506 | $144,503 | $130,636 | $71,263 | $25,177 |
Portfolio turnover rateL | 103%K,M | 138%M | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.16 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been .44%.
C Total distributions of $1.14 per share is comprised of distributions from net investment income of $.007 and distributions from net realized gain of $1.136 per share.
D Total distributions of $.97 per share is comprised of distributions from net investment income of $.153 and distributions from net realized gain of $.812 per share.
E Amount represents less than $.005 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Total returns do not include the effect of the contingent deferred sales charge.
I Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
J Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
K Annualized
L Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
M Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.99 | $25.24 | $20.76 | $24.15 | $21.96 | $19.37 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .23 | .52B | .35 | .36 | .32 | .32 |
Net realized and unrealized gain (loss) | (1.23) | 3.60 | 4.46 | (2.60) | 3.49 | 4.31 |
Total from investment operations | (1.00) | 4.12 | 4.81 | (2.24) | 3.81 | 4.63 |
Distributions from net investment income | (.03) | (.50) | (.33) | (.33) | (.22) | (.25) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.82) | (1.40) | (1.79) |
Total distributions | (1.17) | (2.37) | (.33) | (1.15) | (1.62) | (2.04) |
Redemption fees added to paid in capitalA | – | – | –C | –C | –C | –C |
Net asset value, end of period | $24.82 | $26.99 | $25.24 | $20.76 | $24.15 | $21.96 |
Total ReturnD,E | (3.76)% | 16.51% | 23.19% | (9.58)% | 17.75% | 24.08% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | .56%H | .69% | .73% | .86% | .83% | .80% |
Expenses net of fee waivers, if any | .56%H | .69% | .73% | .85% | .83% | .80% |
Expenses net of all reductions | .54%H | .68% | .72% | .85% | .83% | .80% |
Net investment income (loss) | 1.88%H | 1.96%B | 1.53% | 1.50% | 1.36% | 1.45% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $2,005,330 | $2,332,143 | $2,426,359 | $2,331,665 | $2,691,765 | $1,404,968 |
Portfolio turnover rateI | 103%H,J | 138%J | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.47%.
C Amount represents less than $.005 per share.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
J Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund Class I
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |||||
2018 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $26.77 | $25.05 | $20.61 | $24.00 | $21.84 | $19.29 |
Income from Investment Operations | ||||||
Net investment income (loss)A | .23 | .51B | .35 | .35 | .32 | .31 |
Net realized and unrealized gain (loss) | (1.22) | 3.58 | 4.43 | (2.58) | 3.47 | 4.28 |
Total from investment operations | (.99) | 4.09 | 4.78 | (2.23) | 3.79 | 4.59 |
Distributions from net investment income | (.03) | (.50) | (.34) | (.34) | (.23) | (.25) |
Distributions from net realized gain | (1.14) | (1.87) | – | (.82) | (1.40) | (1.79) |
Total distributions | (1.17) | (2.37) | (.34) | (1.16) | (1.63) | (2.04) |
Redemption fees added to paid in capitalA | – | – | –C | –C | –C | –C |
Net asset value, end of period | $24.61 | $26.77 | $25.05 | $20.61 | $24.00 | $21.84 |
Total ReturnD,E | (3.75)% | 16.52% | 23.19% | (9.60)% | 17.75% | 23.98% |
Ratios to Average Net AssetsF,G | ||||||
Expenses before reductions | .57%H | .69% | .73% | .87% | .85% | .85% |
Expenses net of fee waivers, if any | .57%H | .69% | .73% | .86% | .85% | .85% |
Expenses net of all reductions | .54%H | .68% | .73% | .86% | .85% | .85% |
Net investment income (loss) | 1.87%H | 1.95%B | 1.53% | 1.49% | 1.33% | 1.40% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $346,258 | $410,868 | $363,949 | $261,686 | $148,390 | $26,277 |
Portfolio turnover rateI | 103%H,J | 138%J | 83% | 83% | 69% | 169% |
A Calculated based on average shares outstanding during the period.
B Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.47%.
C Amount represents less than $.005 per share.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
H Annualized
I Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
J Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Fidelity Mid Cap Value Fund Class Z
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |
2018 | 2018A | |
Selected Per–Share Data | ||
Net asset value, beginning of period | $26.76 | $25.03 |
Income from Investment Operations | ||
Net investment income (loss)B | .25 | .56C |
Net realized and unrealized gain (loss) | (1.23) | 3.59 |
Total from investment operations | (.98) | 4.15 |
Distributions from net investment income | (.04) | (.54) |
Distributions from net realized gain | (1.14) | (1.87) |
Total distributions | (1.17)D | (2.42)E |
Redemption fees added to paid in capitalB | – | – |
Net asset value, end of period | $24.61 | $26.76 |
Total ReturnF,G | (3.70)% | 16.74% |
Ratios to Average Net AssetsH,I | ||
Expenses before reductions | .43%J | .56% |
Expenses net of fee waivers, if any | .43%J | .56% |
Expenses net of all reductions | .41%J | .55% |
Net investment income (loss) | 2.01%J | 2.09%C |
Supplemental Data | ||
Net assets, end of period (000 omitted) | $32,188 | $32,974 |
Portfolio turnover rateK | 103%J,L | 138%L |
A For the period February 1, 2017 (commencement of sale of shares) to January 31, 2018.
B Calculated based on average shares outstanding during the period.
C Net investment income per share reflects a large, non-recurring dividend which amounted to $.17 per share. Excluding this non-recurring dividend, the ratio of net investment income (loss) to average net assets would have been 1.60%.
D Total distributions of $1.17 per share is comprised of distributions from net investment income of $.035 and distributions from net realized gain of $1.136 per share.
E Total distributions of $2.42 per share is comprised of distributions from net investment income of $.542 and distributions from net realized gain of $1.873 per share.
F Total returns for periods of less than one year are not annualized.
G Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
H Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
I Expense ratios reflect operating expenses of the class. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the class during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer-term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the class.
J Annualized
K Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
L Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Mid Cap Value Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund offers Class A, Class M, Class C, Mid Cap Value, Class I and Class Z shares, each of which has equal rights as to assets and voting privileges. Each class has exclusive voting rights with respect to matters that affect that class.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain.
Class Allocations and Expenses. Investment income, realized and unrealized capital gains and losses, common expenses of the Fund, and certain fund-level expense reductions, if any, are allocated daily on a pro-rata basis to each class based on the relative net assets of each class to the total net assets of the Fund. Each class differs with respect to transfer agent and distribution and service plan fees incurred. Certain expense reductions may also differ by class. For the reporting period, the allocated portion of income and expenses to each class as a percent of its average net assets may vary due to the timing of recording these transactions in relation to fluctuating net assets of the classes. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are declared separately for each class. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, partnerships, market discount, redemptions in-kind, passive foreign investment companies (PFIC), certain conversion ratio adjustments, capital loss carryforwards and losses deferred due to wash sales and excise tax regulations.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $234,524,980 |
Gross unrealized depreciation | (134,808,422) |
Net unrealized appreciation (depreciation) | $99,716,558 |
Tax cost | $2,736,815,018 |
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and in-kind transactions, aggregated $1,476,111,569 and $1,792,065,742, respectively.
Redemptions In-Kind. During the period, 876,174 shares of the Fund held by unaffiliated entities were redeemed in-kind for investments and cash with a value of $21,501,311. The net realized gain of $2,657,810 on investments delivered through the in-kind redemptions is included in the accompanying Statement of Operations. The amount of the redemptions is included in share transactions activity shown in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
Prior Fiscal Year Redemptions In-Kind. During the prior period, 339,737 shares of the Fund held by unaffiliated entities were redeemed in-kind for investments and cash with a value of $9,318,982. The Fund had a net realized gain of $1,830,856 on investments delivered through the in-kind redemptions. The amount of the in-kind redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .30% of the Fund's average net assets and an annualized group fee rate that averaged .24% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by the investment adviser, including any mutual funds previously advised by the investment adviser that are currently advised by Fidelity SelectCo, LLC, an affiliate of the investment adviser. The group fee rate decreases as assets under management increase and increases as assets under management decrease. In addition, the management fee is subject to a performance adjustment (up to a maximum of +/- .20% of the Fund's average net assets over a 36 month performance period). The upward or downward adjustment to the management fee is based on the relative investment performance of Mid Cap Value as compared to its benchmark index, the Russell Midcap Value Index, over the same 36 month performance period. For the reporting period, the total annualized management fee rate, including the performance adjustment, was .35% of the Fund's average net assets. The performance adjustment included in the management fee rate may be higher or lower than the maximum performance adjustment rate due to the difference between the average net assets for the reporting and performance periods.
Distribution and Service Plan Fees. In accordance with Rule 12b-1 of the 1940 Act, the Fund has adopted separate Distribution and Service Plans for each class of shares, except for the Class I. Certain classes pay Fidelity Distributors Corporation (FDC), an affiliate of the investment adviser, separate Distribution and Service Fees, each of which is based on an annual percentage of each class' average net assets. In addition, FDC may pay financial intermediaries for selling shares of the Fund and providing shareholder support services. For the period, the Distribution and Service Fee rates, total fees and amounts retained by FDC were as follows:
Distribution Fee | Service Fee | Total Fees | Retained by FDC | |
Class A | -% | .25% | $288,212 | $2,647 |
Class M | .25% | .25% | 126,938 | – |
Class C | .75% | .25% | 619,771 | 42,953 |
$1,034,921 | $45,600 |
Sales Load. FDC may receive a front-end sales charge of up to 5.75% for selling Class A shares and 3.50% for selling Class M shares, some of which is paid to financial intermediaries for selling shares of the Fund. Depending on the holding period, FDC may receive contingent deferred sales charges levied on Class A, Class M and Class C redemptions. The deferred sales charges are 1.00% for Class C shares, 1.00% for certain purchases of Class A shares and .25% for certain purchases of Class M shares.
For the period, sales charge amounts retained by FDC were as follows:
Retained by FDC | |
Class A | $26,871 |
Class M | 2,731 |
Class C(a) | 4,495 |
$34,097 |
(a) When Class C shares are initially sold, FDC pays commissions from its own resources to financial intermediaries through which the sales are made.
Transfer Agent Fees. Fidelity Investments Institutional Operations Company, Inc., (FIIOC), an affiliate of the investment adviser, is the transfer, dividend disbursing and shareholder servicing agent for each class of the Fund. FIIOC receives account fees and asset-based fees that vary according to the account size and type of account of the shareholders of the respective classes of the Fund, except for Class Z. FIIOC receives an asset-based fee of Class Z's average net assets. FIIOC pays for typesetting, printing and mailing of shareholder reports, except proxy statements.
For the period, transfer agent fees for each class were as follows:
Amount | % of Class-Level Average Net Assets(a) | |
Class A | $248,835 | .22 |
Class M | 61,421 | .24 |
Class C | 127,985 | .21 |
Mid Cap Value | 1,841,944 | .18 |
Class I | 333,483 | .18 |
Class Z | 6,971 | .05 |
$2,620,639 |
(a) Annualized
Accounting and Security Lending Fees. Fidelity Service Company, Inc. (FSC), an affiliate of the investment adviser, maintains the Fund's accounting records. The accounting fee is based on the level of average net assets for each month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions. For the period, the fees were equivalent to an annualized rate of .03%.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $45,173 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
Prior Fiscal Year Redemptions In-Kind. During the prior period, 1,289,800 shares of the Fund held by an affiliated entity were redeemed in-kind for investments and cash with a value of $33,895,948. The Fund had a net realized gain of $5,708,374 on investments delivered through in-kind redemptions. The amount of the in-kind redemptions is included in share transactions in the accompanying Statement of Changes in Net Assets as well as the Notes to Financial Statements. The Fund recognized no gain or loss for federal income tax purposes.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $4,196 and is reflected in Miscellaneous expenses on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. The value of securities loaned to FCM at period end was $1,348,280. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $120,431, including $341 from securities loaned to FCM.
7. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $336,858 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $144.
In addition, during the period the investment adviser reimbursed and/or waived a portion of fund-level operating expenses in the amount of $16,189.
8. Distributions to Shareholders.
Distributions to shareholders of each class were as follows:
Six months ended July 31, 2018 | Year ended January 31, 2018 | |
From net investment income | ||
Class A | $236,252 | $3,842,007 |
Class M | 39,198 | 738,141 |
Class C | 37,023 | 1,381,368 |
Mid Cap Value | 2,707,816 | 40,728,436 |
Class I | 465,088 | 7,342,642 |
Class Z | 40,878 | 571,019 |
Total | $3,526,255 | $54,603,613 |
From net realized gain | ||
Class A | $10,733,153 | $16,772,494 |
Class M | 2,473,882 | 3,919,760 |
Class C | 6,008,224 | 10,304,692 |
Mid Cap Value | 96,127,346 | 152,568,612 |
Class I | 17,043,208 | 27,505,536 |
Class Z | 1,326,798 | 1,973,280 |
Total | $133,712,611 | $213,044,374 |
9. Share Transactions.
Share transactions for each class were as follows and may contain automatic conversions between classes or exchanges between affiliated funds:
Shares | Shares | Dollars | Dollars | |
Six months ended July 31, 2018 | Year ended January 31, 2018 | Six months ended July 31, 2018 | Year ended January 31, 2018 | |
Class A | ||||
Shares sold | 648,427 | 2,274,304 | $15,943,551 | $59,043,864 |
Reinvestment of distributions | 438,070 | 778,331 | 10,829,109 | 20,353,335 |
Shares redeemed | (1,669,091) | (5,434,078) | (40,845,626) | (140,309,711) |
Net increase (decrease) | (582,594) | (2,381,443) | $(14,072,966) | $(60,912,512) |
Class M | ||||
Shares sold | 130,366 | 384,088 | $3,174,139 | $9,897,586 |
Reinvestment of distributions | 101,165 | 177,219 | 2,488,663 | 4,616,549 |
Shares redeemed | (445,650) | (826,528) | (10,811,202) | (21,629,388) |
Net increase (decrease) | (214,119) | (265,221) | $(5,148,400) | $(7,115,253) |
Class C | ||||
Shares sold | 193,970 | 1,098,519 | $4,594,121 | $27,338,918 |
Reinvestment of distributions | 244,024 | 444,532 | 5,827,282 | 11,259,992 |
Shares redeemed | (923,597) | (2,132,994) | (21,731,334) | (53,838,984) |
Net increase (decrease) | (485,603) | (589,943) | $(11,309,931) | $(15,240,074) |
Mid Cap Value | ||||
Shares sold | 3,190,570 | 10,422,988 | $79,431,267 | $274,556,299 |
Reinvestment of distributions | 3,767,418 | 6,952,016 | 94,449,171 | 184,228,438 |
Shares redeemed | (12,589,427)(a) | (27,076,600)(b) | (312,292,613)(a) | (716,090,892)(b) |
Net increase (decrease) | (5,631,439) | (9,701,596) | $(138,412,175) | $(257,306,155) |
Class I | ||||
Shares sold | 1,966,622 | 6,767,714 | $48,515,546 | $175,618,477 |
Reinvestment of distributions | 673,638 | 1,268,528 | 16,746,637 | 33,336,905 |
Shares redeemed | (3,921,069) | (7,211,785) | (96,482,374) | (188,764,174) |
Net increase (decrease) | (1,280,809) | 824,457 | $(31,220,191) | $20,191,208 |
Class Z | ||||
Shares sold | 645,693 | 1,341,663 | $16,025,200 | $35,340,459 |
Reinvestment of distributions | 47,198 | 84,138 | 1,172,862 | 2,210,303 |
Shares redeemed | (617,559) | (193,471) | (15,551,830) | (5,285,481) |
Net increase (decrease) | 75,332 | 1,232,330 | $1,646,232 | $32,265,281 |
(a) Amount includes in-kind redemptions (see the Redemptions In-Kind notes for additional details).
(b) Amount includes in-kind redemptions (see the Prior Fiscal Year Redemptions In-Kind notes for additional details).
10. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments or redemption proceeds, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying table for each class of the Fund 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line for a class of the Fund under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table for each class of the Fund provides information about hypothetical account values and hypothetical expenses based on a Class' actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Class' actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. A small balance maintenance fee of $12.00 that is charged once a year may apply for certain accounts with a value of less than $2,000. This fee is not included in the table below. If it was, the estimate of expenses you paid during the period would be higher, and your ending account value lower, by this amount. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Class A | .85% | |||
Actual | $1,000.00 | $961.60 | $4.13 | |
Hypothetical-C | $1,000.00 | $1,020.58 | $4.26 | |
Class M | 1.13% | |||
Actual | $1,000.00 | $960.00 | $5.49 | |
Hypothetical-C | $1,000.00 | $1,019.19 | $5.66 | |
Class C | 1.60% | |||
Actual | $1,000.00 | $957.60 | $7.77 | |
Hypothetical-C | $1,000.00 | $1,016.86 | $8.00 | |
Mid Cap Value | .56% | |||
Actual | $1,000.00 | $962.40 | $2.72 | |
Hypothetical-C | $1,000.00 | $1,022.02 | $2.81 | |
Class I | .57% | |||
Actual | $1,000.00 | $962.50 | $2.77 | |
Hypothetical-C | $1,000.00 | $1,021.97 | $2.86 | |
Class Z | .43% | |||
Actual | $1,000.00 | $963.00 | $2.09 | |
Hypothetical-C | $1,000.00 | $1,022.66 | $2.16 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to each Class' annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Mid Cap Value Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
MCV-SANN-0918
1.900183.109
Fidelity Flex℠ Funds Fidelity Flex℠ Mid Cap Value Fund Semi-Annual Report July 31, 2018 |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-835-5092 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
Sempra Energy | 2.8 |
PPL Corp. | 2.7 |
Synchrony Financial | 2.4 |
The Blackstone Group LP | 2.4 |
Jazz Pharmaceuticals PLC | 2.4 |
Leidos Holdings, Inc. | 2.2 |
National Retail Properties, Inc. | 2.2 |
Apollo Global Management LLC Class A | 2.1 |
Equinix, Inc. | 2.0 |
Equity Lifestyle Properties, Inc. | 2.0 |
23.2 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 17.4 |
Consumer Discretionary | 14.2 |
Industrials | 12.3 |
Real Estate | 11.8 |
Information Technology | 11.7 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks | 98.6% | |
Short-Term Investments and Net Other Assets (Liabilities) | 1.4% |
* Foreign investments - 14.0%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 98.6% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 14.2% | |||
Diversified Consumer Services - 0.4% | |||
Houghton Mifflin Harcourt Co. (a) | 2,173 | $13,799 | |
Hotels, Restaurants & Leisure - 2.4% | |||
Eldorado Resorts, Inc. (a) | 654 | 28,024 | |
U.S. Foods Holding Corp. (a) | 1,713 | 57,917 | |
85,941 | |||
Household Durables - 2.5% | |||
D.R. Horton, Inc. | 906 | 39,592 | |
Mohawk Industries, Inc. (a) | 258 | 48,597 | |
88,189 | |||
Internet & Direct Marketing Retail - 0.8% | |||
Liberty Interactive Corp. QVC Group Series A (a) | 1,424 | 30,317 | |
Leisure Products - 1.2% | |||
Mattel, Inc. | 2,655 | 42,135 | |
Media - 4.7% | |||
Discovery Communications, Inc. Class A (a) | 931 | 24,746 | |
GCI Liberty, Inc. (a) | 897 | 43,155 | |
Interpublic Group of Companies, Inc. | 1,439 | 32,449 | |
Liberty Global PLC Class C (a) | 1,280 | 34,739 | |
Sinclair Broadcast Group, Inc. Class A | 1,224 | 31,579 | |
166,668 | |||
Multiline Retail - 1.6% | |||
Dollar Tree, Inc. (a) | 628 | 57,324 | |
Specialty Retail - 0.6% | |||
Lowe's Companies, Inc. | 198 | 19,669 | |
TOTAL CONSUMER DISCRETIONARY | 504,042 | ||
CONSUMER STAPLES - 5.7% | |||
Food Products - 1.8% | |||
Darling International, Inc. (a) | 3,283 | 65,955 | |
Household Products - 1.9% | |||
Spectrum Brands Holdings, Inc. | 763 | 66,663 | |
Personal Products - 1.0% | |||
Coty, Inc. Class A | 2,663 | 35,711 | |
Tobacco - 1.0% | |||
British American Tobacco PLC (United Kingdom) | 632 | 34,743 | |
TOTAL CONSUMER STAPLES | 203,072 | ||
ENERGY - 7.5% | |||
Energy Equipment & Services - 0.7% | |||
Baker Hughes, a GE Co. Class A | 711 | 24,586 | |
Oil, Gas & Consumable Fuels - 6.8% | |||
Anadarko Petroleum Corp. | 222 | 16,239 | |
Cheniere Energy, Inc. (a) | 696 | 44,196 | |
Encana Corp. | 2,563 | 35,366 | |
EQT Corp. | 487 | 24,194 | |
GasLog Ltd. | 1,154 | 19,445 | |
Lundin Petroleum AB | 1,462 | 48,235 | |
Noble Energy, Inc. | 614 | 22,159 | |
Teekay Corp. | 1,488 | 10,371 | |
Valero Energy Corp. | 195 | 23,078 | |
243,283 | |||
TOTAL ENERGY | 267,869 | ||
FINANCIALS - 17.4% | |||
Banks - 2.5% | |||
U.S. Bancorp | 836 | 44,316 | |
Wells Fargo & Co. | 773 | 44,285 | |
88,601 | |||
Capital Markets - 8.7% | |||
Ameriprise Financial, Inc. | 286 | 41,662 | |
Apollo Global Management LLC Class A | 2,070 | 73,485 | |
Legg Mason, Inc. | 1,684 | 57,475 | |
State Street Corp. | 582 | 51,396 | |
The Blackstone Group LP | 2,425 | 84,681 | |
308,699 | |||
Consumer Finance - 4.2% | |||
OneMain Holdings, Inc. (a) | 845 | 28,096 | |
SLM Corp. (a) | 3,350 | 37,822 | |
Synchrony Financial | 2,943 | 85,170 | |
151,088 | |||
Diversified Financial Services - 0.5% | |||
Donnelley Financial Solutions, Inc. (a) | 879 | 18,283 | |
Insurance - 1.5% | |||
American International Group, Inc. | 396 | 21,863 | |
Chubb Ltd. | 219 | 30,599 | |
52,462 | |||
TOTAL FINANCIALS | 619,133 | ||
HEALTH CARE - 4.0% | |||
Health Care Providers & Services - 1.1% | |||
Cigna Corp. | 91 | 16,327 | |
CVS Health Corp. | 358 | 23,220 | |
39,547 | |||
Pharmaceuticals - 2.9% | |||
Allergan PLC | 100 | 18,409 | |
Jazz Pharmaceuticals PLC (a) | 481 | 83,251 | |
101,660 | |||
TOTAL HEALTH CARE | 141,207 | ||
INDUSTRIALS - 12.3% | |||
Aerospace & Defense - 1.6% | |||
Huntington Ingalls Industries, Inc. | 249 | 58,029 | |
Airlines - 0.9% | |||
American Airlines Group, Inc. | 807 | 31,909 | |
Commercial Services & Supplies - 1.4% | |||
The Brink's Co. | 617 | 49,267 | |
Construction & Engineering - 1.6% | |||
AECOM (a) | 1,666 | 55,911 | |
Electrical Equipment - 1.0% | |||
Acuity Brands, Inc. | 251 | 34,897 | |
Machinery - 0.7% | |||
Allison Transmission Holdings, Inc. | 563 | 26,461 | |
Professional Services - 0.6% | |||
Nielsen Holdings PLC | 973 | 22,924 | |
Trading Companies & Distributors - 3.6% | |||
AerCap Holdings NV (a) | 979 | 54,951 | |
Fortress Transportation & Infrastructure Investors LLC | 1,188 | 22,132 | |
HD Supply Holdings, Inc. (a) | 1,143 | 50,269 | |
127,352 | |||
Transportation Infrastructure - 0.9% | |||
Macquarie Infrastructure Co. LLC | 702 | 31,878 | |
TOTAL INDUSTRIALS | 438,628 | ||
INFORMATION TECHNOLOGY - 11.7% | |||
Communications Equipment - 1.1% | |||
CommScope Holding Co., Inc. (a) | 1,221 | 39,206 | |
Electronic Equipment & Components - 1.7% | |||
Avnet, Inc. | 674 | 29,555 | |
Dell Technologies, Inc. (a) | 343 | 31,734 | |
61,289 | |||
IT Services - 6.7% | |||
Cognizant Technology Solutions Corp. Class A | 203 | 16,545 | |
Conduent, Inc. (a) | 2,428 | 43,607 | |
DXC Technology Co. | 487 | 41,268 | |
First Data Corp. Class A (a) | 2,501 | 58,173 | |
Leidos Holdings, Inc. | 1,131 | 77,383 | |
236,976 | |||
Semiconductors & Semiconductor Equipment - 1.9% | |||
Analog Devices, Inc. | 379 | 36,437 | |
Qualcomm, Inc. | 478 | 30,635 | |
67,072 | |||
Software - 0.3% | |||
Micro Focus International PLC | 681 | 11,112 | |
TOTAL INFORMATION TECHNOLOGY | 415,655 | ||
MATERIALS - 7.4% | |||
Chemicals - 5.0% | |||
DowDuPont, Inc. | 507 | 34,866 | |
LyondellBasell Industries NV Class A | 256 | 28,362 | |
Nutrien Ltd. | 1,111 | 60,339 | |
Westlake Chemical Corp. | 506 | 54,253 | |
177,820 | |||
Construction Materials - 1.1% | |||
Eagle Materials, Inc. | 408 | 40,535 | |
Containers & Packaging - 1.3% | |||
Crown Holdings, Inc. (a) | 981 | 44,410 | |
TOTAL MATERIALS | 262,765 | ||
REAL ESTATE - 11.8% | |||
Equity Real Estate Investment Trusts (REITs) - 10.5% | |||
American Tower Corp. | 342 | 50,698 | |
Douglas Emmett, Inc. | 1,557 | 60,474 | |
Equinix, Inc. | 163 | 71,603 | |
Equity Lifestyle Properties, Inc. | 769 | 69,971 | |
National Retail Properties, Inc. | 1,728 | 77,086 | |
Public Storage | 206 | 44,873 | |
374,705 | |||
Real Estate Management & Development - 1.3% | |||
CBRE Group, Inc. (a) | 951 | 47,360 | |
TOTAL REAL ESTATE | 422,065 | ||
UTILITIES - 6.6% | |||
Electric Utilities - 3.8% | |||
Exelon Corp. | 909 | 38,633 | |
PPL Corp. | 3,408 | 98,048 | |
136,681 | |||
Multi-Utilities - 2.8% | |||
Sempra Energy | 864 | 99,873 | |
TOTAL UTILITIES | 236,554 | ||
TOTAL COMMON STOCKS | |||
(Cost $3,398,403) | 3,510,990 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.8% | |||
U.S. Treasury Bills, yield at date of purchase 1.8% 8/2/18 | |||
(Cost $29,999) | 30,000 | 29,999 | |
Shares | Value | ||
Money Market Funds - 0.2% | |||
Fidelity Cash Central Fund, 1.96% (b) | |||
(Cost $5,680) | 5,678 | 5,680 | |
TOTAL INVESTMENT IN SECURITIES - 99.6% | |||
(Cost $3,434,082) | 3,546,669 | ||
NET OTHER ASSETS (LIABILITIES) - 0.4% | 13,817 | ||
NET ASSETS - 100% | $3,560,486 |
Legend
(a) Non-income producing
(b) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $610 |
Total | $610 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $504,042 | $504,042 | $-- | $-- |
Consumer Staples | 203,072 | 168,329 | 34,743 | -- |
Energy | 267,869 | 267,869 | -- | -- |
Financials | 619,133 | 619,133 | -- | -- |
Health Care | 141,207 | 141,207 | -- | -- |
Industrials | 438,628 | 438,628 | -- | -- |
Information Technology | 415,655 | 404,543 | 11,112 | -- |
Materials | 262,765 | 262,765 | -- | -- |
Real Estate | 422,065 | 422,065 | -- | -- |
Utilities | 236,554 | 236,554 | -- | -- |
U.S. Government and Government Agency Obligations | 29,999 | -- | 29,999 | -- |
Money Market Funds | 5,680 | 5,680 | -- | -- |
Total Investments in Securities: | $3,546,669 | $3,470,815 | $75,854 | $-- |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 86.0% |
United Kingdom | 2.9% |
Ireland | 2.9% |
Canada | 2.7% |
Netherlands | 2.4% |
Sweden | 1.4% |
Others (Individually Less Than 1%) | 1.7% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $3,428,402) | $3,540,989 | |
Fidelity Central Funds (cost $5,680) | 5,680 | |
Total Investment in Securities (cost $3,434,082) | $3,546,669 | |
Cash | 16,946 | |
Foreign currency held at value (cost $50) | 50 | |
Receivable for investments sold | 6,613 | |
Receivable for fund shares sold | 226 | |
Dividends receivable | 2,822 | |
Distributions receivable from Fidelity Central Funds | 16 | |
Other receivables | 49 | |
Total assets | 3,573,391 | |
Liabilities | ||
Payable for investments purchased | $12,815 | |
Other payables and accrued expenses | 90 | |
Total liabilities | 12,905 | |
Net Assets | $3,560,486 | |
Net Assets consist of: | ||
Paid in capital | $3,339,260 | |
Undistributed net investment income | 35,944 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | 72,695 | |
Net unrealized appreciation (depreciation) on investments | 112,587 | |
Net Assets, for 324,171 shares outstanding | $3,560,486 | |
Net Asset Value, offering price and redemption price per share ($3,560,486 ÷ 324,171 shares) | $10.98 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $32,298 | |
Non-Cash dividends | 2,321 | |
Income from Fidelity Central Funds | 610 | |
Total income | 35,229 | |
Expenses | ||
Independent trustees' fees and expenses | $8 | |
Commitment fees | 5 | |
Total expenses | 13 | |
Net investment income (loss) | 35,216 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | 97,190 | |
Foreign currency transactions | (52) | |
Futures contracts | 3,266 | |
Total net realized gain (loss) | 100,404 | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (125,772) | |
Assets and liabilities in foreign currencies | (3) | |
Total change in net unrealized appreciation (depreciation) | (125,775) | |
Net gain (loss) | (25,371) | |
Net increase (decrease) in net assets resulting from operations | $9,845 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | For the period March 8, 2017 (commencement of operations) to January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $35,216 | $30,522 |
Net realized gain (loss) | 100,404 | 7,093 |
Change in net unrealized appreciation (depreciation) | (125,775) | 238,362 |
Net increase (decrease) in net assets resulting from operations | 9,845 | 275,977 |
Distributions to shareholders from net investment income | – | (29,513) |
Distributions to shareholders from net realized gain | (27,487) | (7,597) |
Total distributions | (27,487) | (37,110) |
Share transactions | ||
Proceeds from sales of shares | 2,377,855 | 3,725,242 |
Reinvestment of distributions | 27,487 | 37,110 |
Cost of shares redeemed | (1,696,438) | (1,131,995) |
Net increase (decrease) in net assets resulting from share transactions | 708,904 | 2,630,357 |
Total increase (decrease) in net assets | 691,262 | 2,869,224 |
Net Assets | ||
Beginning of period | 2,869,224 | – |
End of period | $3,560,486 | $2,869,224 |
Other Information | ||
Undistributed net investment income end of period | $35,944 | $728 |
Shares | ||
Sold | 222,731 | 360,007 |
Issued in reinvestment of distributions | 2,547 | 3,462 |
Redeemed | (158,721) | (105,855) |
Net increase (decrease) | 66,557 | 257,614 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Flex Mid Cap Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |
2018 | 2018 A | |
Selected Per–Share Data | ||
Net asset value, beginning of period | $11.14 | $10.00 |
Income from Investment Operations | ||
Net investment income (loss)B | .10 | .17 |
Net realized and unrealized gain (loss) | (.18) | 1.10 |
Total from investment operations | (.08) | 1.27 |
Distributions from net investment income | – | (.10) |
Distributions from net realized gain | (.08) | (.03) |
Total distributions | (.08) | (.13) |
Net asset value, end of period | $10.98 | $11.14 |
Total ReturnC | (.68)% | 12.72% |
Ratios to Average Net AssetsD,E | ||
Expenses before reductions | - %F,G | - %F,G |
Expenses net of fee waivers, if any | - %F,G | - %F,G |
Expenses net of all reductions | - %F,G | - %F,G |
Net investment income (loss) | 1.90%F | 1.76%F |
Supplemental Data | ||
Net assets, end of period (000 omitted) | $3,560 | $2,869 |
Portfolio turnover rateH | 279%F | 137%F |
A For the period March 8, 2017 (commencement of operations) to January 31, 2018.
B Calculated based on average shares outstanding during the period.
C Total returns for periods of less than one year are not annualized.
D Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
E Expense ratios reflect operating expenses of the Fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the Fund during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
F Annualized
G Amount represents less than .005%.
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Flex Mid Cap Value Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. Share transactions on the Statement of Changes in Net Assets may contain exchanges between affiliated funds. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund is available only to certain fee-based accounts offered by Fidelity.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of July 31, 2018 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, passive foreign investment companies (PFIC), market discount, partnerships and losses deferred due to wash sales.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $200,269 |
Gross unrealized depreciation | (121,080) |
Net unrealized appreciation (depreciation) | $79,189 |
Tax cost | $3,467,480 |
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Fund's investment objective allows the Fund to enter into various types of derivative contracts, including futures contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Fund used derivatives to increase returns and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Fund may not achieve its objectives.
The Fund's use of derivatives increased or decreased its exposure to the following risk:
Equity Risk | Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment. |
The Fund is also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Fund will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Fund. Counterparty credit risk related to exchange-traded futures contracts may be mitigated by the protection provided by the exchange on which they trade.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. The Fund used futures contracts to manage its exposure to the stock market.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin on futures contracts in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract. The net realized gain (loss) and change in net unrealized appreciation (depreciation) on futures contracts during the period is presented in the Statement of Operations.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The notional amount at value reflects each contract's exposure to the underlying instrument or index at period end.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $5,470,795 and $4,743,281 respectively.
6. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services and the Fund does not pay any fees for these services. Under the management contract, the investment adviser or an affiliate pays all other expenses of the Fund, excluding fees and expenses of the independent Trustees, and certain miscellaneous expenses such as proxy and shareholder meeting expenses.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $290 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
7. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $5 and is reflected in Commitment fees on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
8. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
At the end of the period, the investment adviser or its affiliates were the owners of record of 16% of the total outstanding shares of the Fund.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Actual | - %-C | $1,000.00 | $993.20 | $--D |
Hypothetical-E | $1,000.00 | $1,024.79 | $--D |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C Amount represents less than .005%.
D Amount represents less than $.005.
E 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Flex Mid Cap Value Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
ZMV-SANN-0918
1.9881566.101
Fidelity Flex℠ Funds Fidelity Flex℠ Large Cap Value Fund Semi-Annual Report July 31, 2018 |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-835-5092 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
Bank of America Corp. | 3.6 |
Citigroup, Inc. | 2.6 |
Berkshire Hathaway, Inc. Class B | 2.4 |
Johnson & Johnson | 2.2 |
Cisco Systems, Inc. | 2.0 |
Pfizer, Inc. | 2.0 |
Verizon Communications, Inc. | 1.9 |
American International Group, Inc. | 1.8 |
DowDuPont, Inc. | 1.8 |
Capital One Financial Corp. | 1.7 |
22.0 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 22.7 |
Health Care | 13.8 |
Energy | 10.7 |
Information Technology | 9.8 |
Consumer Discretionary | 8.7 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018 * | ||
Stocks and Equity Futures | 96.9% | |
Short-Term Investments and Net Other Assets (Liabilities) | 3.1% |
* Foreign investments – 10.9%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 95.4% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 8.7% | |||
Auto Components - 0.5% | |||
Delphi Technologies PLC | 1,622 | $73,266 | |
Diversified Consumer Services - 0.3% | |||
ServiceMaster Global Holdings, Inc. (a) | 938 | 53,457 | |
Hotels, Restaurants & Leisure - 1.7% | |||
McDonald's Corp. | 1,257 | 198,028 | |
Royal Caribbean Cruises Ltd. | 640 | 72,166 | |
U.S. Foods Holding Corp. (a) | 200 | 6,762 | |
276,956 | |||
Household Durables - 0.9% | |||
Lennar Corp. Class A | 500 | 26,135 | |
Mohawk Industries, Inc. (a) | 659 | 124,129 | |
150,264 | |||
Internet & Direct Marketing Retail - 0.5% | |||
Liberty Interactive Corp. QVC Group Series A (a) | 3,524 | 75,026 | |
Media - 3.1% | |||
Comcast Corp. Class A | 4,648 | 166,305 | |
Liberty Broadband Corp. Class C (a) | 1,280 | 101,722 | |
The Walt Disney Co. | 2,054 | 233,252 | |
501,279 | |||
Multiline Retail - 0.6% | |||
Dollar Tree, Inc. (a) | 1,135 | 103,603 | |
Specialty Retail - 0.5% | |||
Burlington Stores, Inc. (a) | 554 | 84,657 | |
Textiles, Apparel & Luxury Goods - 0.6% | |||
PVH Corp. | 637 | 97,792 | |
TOTAL CONSUMER DISCRETIONARY | 1,416,300 | ||
CONSUMER STAPLES - 6.4% | |||
Beverages - 0.5% | |||
Molson Coors Brewing Co. Class B | 200 | 13,400 | |
PepsiCo, Inc. | 358 | 41,170 | |
The Coca-Cola Co. | 600 | 27,978 | |
82,548 | |||
Food & Staples Retailing - 0.9% | |||
Walmart, Inc. | 1,676 | 149,549 | |
Food Products - 1.7% | |||
ConAgra Foods, Inc. | 960 | 35,242 | |
General Mills, Inc. | 400 | 18,424 | |
Mondelez International, Inc. | 3,255 | 141,202 | |
The J.M. Smucker Co. | 100 | 11,112 | |
The Kraft Heinz Co. | 910 | 54,828 | |
Tyson Foods, Inc. Class A | 422 | 24,328 | |
285,136 | |||
Household Products - 2.0% | |||
Church & Dwight Co., Inc. | 713 | 39,857 | |
Colgate-Palmolive Co. | 640 | 42,886 | |
Procter & Gamble Co. | 2,865 | 231,721 | |
Spectrum Brands Holdings, Inc. | 100 | 8,737 | |
323,201 | |||
Personal Products - 0.1% | |||
Coty, Inc. Class A | 1,226 | 16,441 | |
Tobacco - 1.2% | |||
Altria Group, Inc. | 278 | 16,313 | |
Philip Morris International, Inc. | 2,102 | 181,403 | |
197,716 | |||
TOTAL CONSUMER STAPLES | 1,054,591 | ||
ENERGY - 10.7% | |||
Energy Equipment & Services - 1.1% | |||
Baker Hughes, a GE Co. Class A | 5,185 | 179,297 | |
Oil, Gas & Consumable Fuels - 9.6% | |||
Anadarko Petroleum Corp. | 1,652 | 120,844 | |
BP PLC sponsored ADR | 2,957 | 133,331 | |
Cenovus Energy, Inc. | 15,470 | 155,194 | |
Cheniere Energy, Inc. (a) | 1,749 | 111,062 | |
Chevron Corp. | 1,758 | 221,983 | |
ConocoPhillips Co. | 3,499 | 252,523 | |
Encana Corp. | 9,816 | 135,448 | |
Suncor Energy, Inc. | 5,409 | 227,778 | |
Valero Energy Corp. | 1,752 | 207,349 | |
1,565,512 | |||
TOTAL ENERGY | 1,744,809 | ||
FINANCIALS - 22.7% | |||
Banks - 10.4% | |||
Bank of America Corp. | 18,804 | 580,663 | |
Citigroup, Inc. | 5,997 | 431,124 | |
First Horizon National Corp. | 5,806 | 103,869 | |
Huntington Bancshares, Inc. | 13,910 | 214,770 | |
KeyCorp | 4,012 | 83,730 | |
U.S. Bancorp | 1,353 | 71,723 | |
Wells Fargo & Co. | 3,843 | 220,165 | |
1,706,044 | |||
Capital Markets - 3.1% | |||
BlackRock, Inc. Class A | 224 | 112,618 | |
E*TRADE Financial Corp. (a) | 1,375 | 82,239 | |
Goldman Sachs Group, Inc. | 834 | 198,017 | |
Northern Trust Corp. | 615 | 67,170 | |
TD Ameritrade Holding Corp. | 705 | 40,291 | |
500,335 | |||
Consumer Finance - 2.7% | |||
Capital One Financial Corp. | 2,859 | 269,661 | |
Discover Financial Services | 910 | 64,983 | |
SLM Corp. (a) | 4,139 | 46,729 | |
Synchrony Financial | 1,964 | 56,838 | |
438,211 | |||
Diversified Financial Services - 2.4% | |||
Berkshire Hathaway, Inc. Class B (a) | 2,016 | 398,906 | |
Insurance - 4.1% | |||
American International Group, Inc. | 5,316 | 293,496 | |
Aspen Insurance Holdings Ltd. | 470 | 19,012 | |
Hartford Financial Services Group, Inc. | 965 | 50,856 | |
MetLife, Inc. | 2,946 | 134,750 | |
The Travelers Companies, Inc. | 1,344 | 174,908 | |
673,022 | |||
TOTAL FINANCIALS | 3,716,518 | ||
HEALTH CARE - 13.8% | |||
Biotechnology - 0.1% | |||
Alexion Pharmaceuticals, Inc. (a) | 156 | 20,742 | |
Health Care Equipment & Supplies - 3.2% | |||
Abbott Laboratories | 2,320 | 152,053 | |
Baxter International, Inc. | 1,154 | 83,607 | |
Becton, Dickinson & Co. | 384 | 96,142 | |
Boston Scientific Corp. (a) | 800 | 26,888 | |
Medtronic PLC | 1,920 | 173,242 | |
531,932 | |||
Health Care Providers & Services - 2.2% | |||
Aetna, Inc. | 367 | 69,139 | |
Anthem, Inc. | 240 | 60,720 | |
Cigna Corp. | 435 | 78,048 | |
CVS Health Corp. | 1,260 | 81,724 | |
Express Scripts Holding Co. (a) | 521 | 41,399 | |
HCA Holdings, Inc. | 200 | 24,846 | |
355,876 | |||
Life Sciences Tools & Services - 0.9% | |||
Thermo Fisher Scientific, Inc. | 596 | 139,780 | |
Pharmaceuticals - 7.4% | |||
Allergan PLC | 532 | 97,936 | |
Bristol-Myers Squibb Co. | 706 | 41,478 | |
Jazz Pharmaceuticals PLC (a) | 894 | 154,734 | |
Johnson & Johnson | 2,765 | 366,418 | |
Merck & Co., Inc. | 3,476 | 228,964 | |
Pfizer, Inc. | 8,079 | 322,594 | |
1,212,124 | |||
TOTAL HEALTH CARE | 2,260,454 | ||
INDUSTRIALS - 6.2% | |||
Aerospace & Defense - 1.2% | |||
United Technologies Corp. | 1,467 | 199,131 | |
Airlines - 0.6% | |||
American Airlines Group, Inc. | 2,472 | 97,743 | |
Construction & Engineering - 0.8% | |||
AECOM (a) | 3,895 | 130,716 | |
Electrical Equipment - 0.5% | |||
Sensata Technologies, Inc. PLC (a) | 1,429 | 77,695 | |
Industrial Conglomerates - 1.1% | |||
General Electric Co. | 12,176 | 165,959 | |
Honeywell International, Inc. | 84 | 13,411 | |
179,370 | |||
Marine - 0.3% | |||
A.P. Moller - Maersk A/S Series B | 40 | 57,433 | |
Professional Services - 0.4% | |||
Nielsen Holdings PLC | 2,755 | 64,908 | |
Road & Rail - 0.7% | |||
Norfolk Southern Corp. | 635 | 107,315 | |
Trading Companies & Distributors - 0.6% | |||
HD Supply Holdings, Inc. (a) | 2,186 | 96,140 | |
TOTAL INDUSTRIALS | 1,010,451 | ||
INFORMATION TECHNOLOGY - 9.8% | |||
Communications Equipment - 2.0% | |||
Cisco Systems, Inc. | 7,687 | 325,083 | |
Electronic Equipment & Components - 0.2% | |||
Dell Technologies, Inc. (a) | 398 | 36,823 | |
Internet Software & Services - 0.7% | |||
Alphabet, Inc. Class A (a) | 94 | 115,359 | |
IT Services - 2.5% | |||
Amdocs Ltd. | 2,876 | 194,360 | |
IBM Corp. | 594 | 86,088 | |
Leidos Holdings, Inc. | 1,904 | 130,272 | |
410,720 | |||
Semiconductors & Semiconductor Equipment - 2.5% | |||
Broadcom, Inc. | 300 | 66,531 | |
Intel Corp. | 1,757 | 84,512 | |
NXP Semiconductors NV (a) | 671 | 63,973 | |
Qualcomm, Inc. | 3,079 | 197,333 | |
412,349 | |||
Software - 1.6% | |||
Microsoft Corp. | 540 | 57,283 | |
Oracle Corp. | 4,258 | 203,021 | |
260,304 | |||
Technology Hardware, Storage & Peripherals - 0.3% | |||
Apple, Inc. | 269 | 51,188 | |
TOTAL INFORMATION TECHNOLOGY | 1,611,826 | ||
MATERIALS - 4.0% | |||
Chemicals - 3.2% | |||
DowDuPont, Inc. | 4,210 | 289,522 | |
LyondellBasell Industries NV Class A | 767 | 84,976 | |
Nutrien Ltd. | 1,581 | 85,865 | |
Westlake Chemical Corp. | 629 | 67,441 | |
527,804 | |||
Construction Materials - 0.4% | |||
Eagle Materials, Inc. | 580 | 57,623 | |
Containers & Packaging - 0.4% | |||
Crown Holdings, Inc. (a) | 1,419 | 64,238 | |
TOTAL MATERIALS | 649,665 | ||
REAL ESTATE - 4.4% | |||
Equity Real Estate Investment Trusts (REITs) - 4.2% | |||
American Tower Corp. | 166 | 24,608 | |
Boston Properties, Inc. | 707 | 88,750 | |
Colony NorthStar, Inc. | 4,898 | 30,172 | |
Corporate Office Properties Trust (SBI) | 1,460 | 43,420 | |
Equity Residential (SBI) | 1,267 | 82,900 | |
Gaming & Leisure Properties | 871 | 31,635 | |
Prologis, Inc. | 1,355 | 88,915 | |
Public Storage | 466 | 101,509 | |
Spirit Realty Capital, Inc. | 5,706 | 47,759 | |
Store Capital Corp. | 1,494 | 41,010 | |
The Macerich Co. | 1,094 | 64,612 | |
Welltower, Inc. | 736 | 46,074 | |
691,364 | |||
Real Estate Management & Development - 0.2% | |||
CBRE Group, Inc. (a) | 439 | 21,862 | |
TOTAL REAL ESTATE | 713,226 | ||
TELECOMMUNICATION SERVICES - 3.4% | |||
Diversified Telecommunication Services - 3.0% | |||
AT&T, Inc. | 5,480 | 175,196 | |
Verizon Communications, Inc. | 6,075 | 313,713 | |
488,909 | |||
Wireless Telecommunication Services - 0.4% | |||
T-Mobile U.S., Inc. (a) | 1,095 | 65,700 | |
TOTAL TELECOMMUNICATION SERVICES | 554,609 | ||
UTILITIES - 5.3% | |||
Electric Utilities - 3.7% | |||
Evergy, Inc. | 2,201 | 123,454 | |
Exelon Corp. | 2,771 | 117,768 | |
NextEra Energy, Inc. | 1,040 | 174,242 | |
PG&E Corp. | 592 | 25,503 | |
PPL Corp. | 4,013 | 115,454 | |
Vistra Energy Corp. (a) | 2,532 | 57,223 | |
613,644 | |||
Independent Power and Renewable Electricity Producers - 0.9% | |||
NRG Energy, Inc. | 2,620 | 82,975 | |
The AES Corp. | 4,596 | 61,403 | |
144,378 | |||
Multi-Utilities - 0.7% | |||
Sempra Energy | 931 | 107,614 | |
TOTAL UTILITIES | 865,636 | ||
TOTAL COMMON STOCKS | |||
(Cost $14,805,999) | 15,598,085 | ||
Principal Amount | Value | ||
U.S. Treasury Obligations - 0.1% | |||
U.S. Treasury Bills, yield at date of purchase 1.8% 8/2/18 (b) | |||
(Cost $19,999) | 20,000 | 19,999 | |
Shares | Value | ||
Money Market Funds - 3.0% | |||
Fidelity Cash Central Fund, 1.96% (c) | |||
(Cost $478,841) | 478,745 | 478,841 | |
TOTAL INVESTMENT IN SECURITIES - 98.5% | |||
(Cost $15,304,839) | 16,096,925 | ||
NET OTHER ASSETS (LIABILITIES) - 1.5% | 251,251 | ||
NET ASSETS - 100% | $16,348,176 |
Futures Contracts | |||||
Number of contracts | Expiration Date | Notional Amount | Value | Unrealized Appreciation/(Depreciation) | |
Purchased | |||||
Equity Index Contracts | |||||
CME E-mini Russell 1000 Value Index Contracts (United States) | 4 | Sept. 2018 | $246,360 | $5,155 | $5,155 |
The notional amount of futures purchased as a percentage of Net Assets is 1.5%
For the period, the average monthly underlying face amount at value for futures contracts in the aggregate was $160,283.
Legend
(a) Non-income producing
(b) Security or a portion of the security was pledged to cover margin requirements for futures contracts. At period end, the value of securities pledged amounted to $19,999.
(c) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $7,401 |
Total | $7,401 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
The following is a summary of the inputs used, as of July 31, 2018, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $1,416,300 | $1,416,300 | $-- | $-- |
Consumer Staples | 1,054,591 | 1,054,591 | -- | -- |
Energy | 1,744,809 | 1,744,809 | -- | -- |
Financials | 3,716,518 | 3,716,518 | -- | -- |
Health Care | 2,260,454 | 2,260,454 | -- | -- |
Industrials | 1,010,451 | 953,018 | 57,433 | -- |
Information Technology | 1,611,826 | 1,611,826 | -- | -- |
Materials | 649,665 | 649,665 | -- | -- |
Real Estate | 713,226 | 713,226 | -- | -- |
Telecommunication Services | 554,609 | 554,609 | -- | -- |
Utilities | 865,636 | 865,636 | -- | -- |
U.S. Government and Government Agency Obligations | 19,999 | -- | 19,999 | -- |
Money Market Funds | 478,841 | 478,841 | -- | -- |
Total Investments in Securities: | $16,096,925 | $16,019,493 | $77,432 | $-- |
Derivative Instruments: | ||||
Assets | ||||
Futures Contracts | $5,155 | $5,155 | $-- | $-- |
Total Assets | $5,155 | $5,155 | $-- | $-- |
Total Derivative Instruments: | $5,155 | $5,155 | $-- | $-- |
Value of Derivative Instruments
The following table is a summary of the Fund's value of derivative instruments by primary risk exposure as of July 31, 2018. For additional information on derivative instruments, please refer to the Derivative Instruments section in the accompanying Notes to Financial Statements.
Primary Risk Exposure / Derivative Type | Value | |
Asset | Liability | |
Equity Risk | ||
Futures Contracts(a) | $5,155 | $0 |
Total Equity Risk | 5,155 | 0 |
Total Value of Derivatives | $5,155 | $0 |
(a) Reflects gross cumulative appreciation (depreciation) on futures contracts as presented in the Schedule of Investments. In the Statement of Assets and Liabilities, the period end daily variation margin is included in receivable or payable for daily variation margin on futures contracts, and the net cumulative appreciation (depreciation) is included in net unrealized appreciation (depreciation).
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 89.1% |
Canada | 3.7% |
Ireland | 2.5% |
United Kingdom | 1.2% |
Bailiwick of Guernsey | 1.2% |
Others (Individually Less Than 1%) | 2.3% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $14,825,998) | $15,618,084 | |
Fidelity Central Funds (cost $478,841) | 478,841 | |
Total Investment in Securities (cost $15,304,839) | $16,096,925 | |
Cash | 167,452 | |
Receivable for investments sold | 126,775 | |
Receivable for fund shares sold | 4,766 | |
Dividends receivable | 12,141 | |
Distributions receivable from Fidelity Central Funds | 685 | |
Receivable for daily variation margin for on futures contracts | 900 | |
Other receivables | 302 | |
Total assets | 16,409,946 | |
Liabilities | ||
Payable for investments purchased | $56,128 | |
Payable for fund shares redeemed | 5,642 | |
Total liabilities | 61,770 | |
Net Assets | $16,348,176 | |
Net Assets consist of: | ||
Paid in capital | $15,443,184 | |
Undistributed net investment income | 162,355 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | (54,604) | |
Net unrealized appreciation (depreciation) on investments | 797,241 | |
Net Assets, for 1,490,487 shares outstanding | $16,348,176 | |
Net Asset Value, offering price and redemption price per share ($16,348,176 ÷ 1,490,487 shares) | $10.97 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $155,277 | |
Interest | 164 | |
Income from Fidelity Central Funds | 7,401 | |
Total income | 162,842 | |
Expenses | ||
Independent trustees' fees and expenses | $35 | |
Commitment fees | 21 | |
Total expenses | 56 | |
Net investment income (loss) | 162,786 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | (9,306) | |
Foreign currency transactions | (197) | |
Futures contracts | (16,052) | |
Total net realized gain (loss) | (25,555) | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (7,965) | |
Futures contracts | 3,914 | |
Total change in net unrealized appreciation (depreciation) | (4,051) | |
Net gain (loss) | (29,606) | |
Net increase (decrease) in net assets resulting from operations | $133,180 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | For the period March 7, 2017 (commencement of operations) to January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $162,786 | $78,257 |
Net realized gain (loss) | (25,555) | (12,783) |
Change in net unrealized appreciation (depreciation) | (4,051) | 801,292 |
Net increase (decrease) in net assets resulting from operations | 133,180 | 866,766 |
Distributions to shareholders from net investment income | (8,245) | (70,439) |
Distributions to shareholders from net realized gain | (8,245) | (8,025) |
Total distributions | (16,490) | (78,464) |
Share transactions | ||
Proceeds from sales of shares | 13,188,282 | 10,990,695 |
Reinvestment of distributions | 16,490 | 78,464 |
Cost of shares redeemed | (7,640,490) | (1,190,257) |
Net increase (decrease) in net assets resulting from share transactions | 5,564,282 | 9,878,902 |
Total increase (decrease) in net assets | 5,680,972 | 10,667,204 |
Net Assets | ||
Beginning of period | 10,667,204 | – |
End of period | $16,348,176 | $10,667,204 |
Other Information | ||
Undistributed net investment income end of period | $162,355 | $7,814 |
Shares | ||
Sold | 1,250,041 | 1,065,066 |
Issued in reinvestment of distributions | 1,524 | 7,354 |
Redeemed | (720,181) | (113,317) |
Net increase (decrease) | 531,384 | 959,103 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Flex Large Cap Value Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |
2018 | 2018 A | |
Selected Per–Share Data | ||
Net asset value, beginning of period | $11.12 | $10.00 |
Income from Investment Operations | ||
Net investment income (loss)B | .11 | .18 |
Net realized and unrealized gain (loss) | (.25) | 1.03 |
Total from investment operations | (.14) | 1.21 |
Distributions from net investment income | (.01) | (.08) |
Distributions from net realized gain | (.01) | (.01) |
Total distributions | (.01)C | (.09) |
Net asset value, end of period | $10.97 | $11.12 |
Total ReturnD,E | (1.24)% | 12.12% |
Ratios to Average Net AssetsF,G | ||
Expenses before reductions | - %H,I | - %H,I |
Expenses net of fee waivers, if any | - %H,I | - %H,I |
Expenses net of all reductions | - %H,I | - %H,I |
Net investment income (loss) | 2.00%H | 1.95%H |
Supplemental Data | ||
Net assets, end of period (000 omitted) | $16,348 | $10,667 |
Portfolio turnover rateJ | 149%H | 56%H |
A For the period March 7, 2017 (commencement of operations) to January 31, 2018.
B Calculated based on average shares outstanding during the period.
C Total distributions of $.01 per share is comprised of distributions from net investment income of $.006 and distributions from net realized gain of $.006 per share.
D Total returns for periods of less than one year are not annualized.
E Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
F Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
G Expense ratios reflect operating expenses of the Fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
H Annualized
I Amount represents less than .005%.
J Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Flex Large Cap Value Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. Share transactions on the Statement of Changes in Net Assets may contain exchanges between affiliated funds. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The Fund is available only to certain fee-based accounts offered by Fidelity.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. U.S. government and government agency obligations are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded and are categorized as Level 1 in the hierarchy. Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of July 31, 2018, is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to futures contracts, foreign currency transactions, market discount, partnerships and losses deferred due to wash sales.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $1,106,616 |
Gross unrealized depreciation | (393,783) |
Net unrealized appreciation (depreciation) | $712,833 |
Tax cost | $15,389,247 |
4. Derivative Instruments.
Risk Exposures and the Use of Derivative Instruments. The Fund's investment objective allows the Fund to enter into various types of derivative contracts, including futures contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Fund used derivatives to increase returns and to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Fund may not achieve its objectives.
The Fund's use of derivatives increased or decreased its exposure to the following risk:
Equity Risk | Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment. |
The Fund is also exposed to additional risks from investing in derivatives, such as liquidity risk and counterparty credit risk. Liquidity risk is the risk that the Fund will be unable to close out the derivative in the open market in a timely manner. Counterparty credit risk is the risk that the counterparty will not be able to fulfill its obligation to the Fund. Counterparty credit risk related to exchange-traded futures contracts may be mitigated by the protection provided by the exchange on which they trade.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received and amounts recognized in the Statement of Assets and Liabilities. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Futures Contracts. A futures contract is an agreement between two parties to buy or sell a specified underlying instrument for a fixed price at a specified future date. The Fund used futures contracts to manage its exposure to the stock market.
Upon entering into a futures contract, a fund is required to deposit either cash or securities (initial margin) with a clearing broker in an amount equal to a certain percentage of the face value of the contract. Futures contracts are marked-to-market daily and subsequent daily payments (variation margin) are made or received by a fund depending on the daily fluctuations in the value of the futures contracts and are recorded as unrealized appreciation or (depreciation). This receivable and/or payable, if any, is included in daily variation margin on futures contracts in the Statement of Assets and Liabilities. Realized gain or (loss) is recorded upon the expiration or closing of a futures contract. The net realized gain (loss) and change in net unrealized appreciation (depreciation) on futures contracts during the period is presented in the Statement of Operations.
Any open futures contracts at period end are presented in the Schedule of Investments under the caption "Futures Contracts". The notional amount at value reflects each contract's exposure to the underlying instrument or index at period end. Securities deposited to meet initial margin requirements are identified in the Schedule of Investments.
5. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $16,925,604 and $11,107,687, respectively.
6. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services and the Fund does not pay any fees for these services. Under the management contract, the investment adviser or an affiliate pays all other expenses of the Fund, excluding fees and expenses of the independent Trustees, and certain miscellaneous expenses such as proxy and shareholder meeting expenses.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $436 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
7. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $21 and is reflected in Commitment fees on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
8. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Actual | - %C | $1,000.00 | 987.60 | $-D |
Hypothetical-E | $1,000.00 | 1,024.79 | $-D |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C Amount represents less than .005% .
D Amount represents less than $.005.
E 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Flex Large Cap Value Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
ZXU-SANN-0918
1.9881562.101
Fidelity® Mid Cap Value K6 Fund Semi-Annual Report July 31, 2018 |
Contents
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-835-5092 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2018 FMR LLC. All rights reserved.
This report and the financial statements contained herein are submitted for the general information of the shareholders of the Fund. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective prospectus.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
For a complete list of a fund's portfolio holdings, view the most recent holdings listing, semiannual report, or annual report on Fidelity's web site at http://www.fidelity.com, http://www.institutional.fidelity.com, or http://www.401k.com, as applicable.
NOT FDIC INSURED •MAY LOSE VALUE •NO BANK GUARANTEE
Neither the Fund nor Fidelity Distributors Corporation is a bank.
Investment Summary (Unaudited)
Top Ten Stocks as of July 31, 2018
% of fund's net assets | |
CBRE Group, Inc. | 2.2 |
M&T Bank Corp. | 1.9 |
Cimarex Energy Co. | 1.9 |
Huntsman Corp. | 1.8 |
Xcel Energy, Inc. | 1.7 |
Regions Financial Corp. | 1.7 |
AMETEK, Inc. | 1.7 |
Ingersoll-Rand PLC | 1.7 |
Best Buy Co., Inc. | 1.6 |
Lear Corp. | 1.7 |
17.9 |
Top Five Market Sectors as of July 31, 2018
% of fund's net assets | |
Financials | 20.1 |
Industrials | 14.0 |
Real Estate | 12.5 |
Consumer Discretionary | 10.4 |
Utilities | 9.5 |
Asset Allocation (% of fund's net assets)
As of July 31, 2018* | ||
Stocks | 97.9% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.1% |
* Foreign investments - 8.0%
Schedule of Investments July 31, 2018 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 97.9% | |||
Shares | Value | ||
CONSUMER DISCRETIONARY - 10.4% | |||
Auto Components - 2.2% | |||
Gentex Corp. | 17,400 | $403,680 | |
Lear Corp. | 6,942 | 1,250,462 | |
1,654,142 | |||
Household Durables - 1.4% | |||
PulteGroup, Inc. | 12,300 | 350,427 | |
Toll Brothers, Inc. | 19,943 | 703,190 | |
1,053,617 | |||
Leisure Products - 0.5% | |||
Brunswick Corp. | 6,111 | 392,937 | |
Media - 2.0% | |||
John Wiley & Sons, Inc. Class A | 10,861 | 685,872 | |
Omnicom Group, Inc. | 12,169 | 837,592 | |
1,523,464 | |||
Multiline Retail - 0.8% | |||
Macy's, Inc. | 16,346 | 649,427 | |
Specialty Retail - 3.5% | |||
Best Buy Co., Inc. | 17,030 | 1,277,761 | |
Dick's Sporting Goods, Inc. | 11,100 | 378,954 | |
Williams-Sonoma, Inc. (a) | 18,198 | 1,064,401 | |
2,721,116 | |||
TOTAL CONSUMER DISCRETIONARY | 7,994,703 | ||
CONSUMER STAPLES - 4.9% | |||
Beverages - 0.8% | |||
Molson Coors Brewing Co. Class B | 9,514 | 637,438 | |
Food Products - 4.1% | |||
Ingredion, Inc. | 6,577 | 666,250 | |
Pilgrim's Pride Corp. (b) | 14,600 | 260,172 | |
The Hershey Co. | 4,800 | 471,408 | |
The J.M. Smucker Co. | 7,802 | 866,958 | |
Tyson Foods, Inc. Class A | 14,589 | 841,056 | |
3,105,844 | |||
TOTAL CONSUMER STAPLES | 3,743,282 | ||
ENERGY - 6.1% | |||
Energy Equipment & Services - 1.2% | |||
RPC, Inc. (a) | 60,315 | 892,662 | |
Oil, Gas & Consumable Fuels - 4.9% | |||
Cimarex Energy Co. | 14,747 | 1,454,054 | |
HollyFrontier Corp. | 16,473 | 1,228,556 | |
PBF Energy, Inc. Class A | 23,388 | 1,092,220 | |
3,774,830 | |||
TOTAL ENERGY | 4,667,492 | ||
FINANCIALS - 20.1% | |||
Banks - 6.0% | |||
First Hawaiian, Inc. | 21,400 | 604,764 | |
M&T Bank Corp. | 8,513 | 1,475,729 | |
Popular, Inc. | 14,414 | 715,367 | |
Regions Financial Corp. | 71,306 | 1,327,005 | |
Synovus Financial Corp. | 10,100 | 499,142 | |
4,622,007 | |||
Capital Markets - 4.1% | |||
Affiliated Managers Group, Inc. | 3,620 | 579,236 | |
Invesco Ltd. | 33,205 | 896,203 | |
Lazard Ltd. Class A | 18,956 | 1,029,311 | |
Legg Mason, Inc. | 19,423 | 662,907 | |
3,167,657 | |||
Consumer Finance - 3.1% | |||
Discover Financial Services | 16,268 | 1,161,698 | |
Synchrony Financial | 40,807 | 1,180,955 | |
2,342,653 | |||
Insurance - 6.5% | |||
American National Insurance Co. | 3,813 | 491,839 | |
First American Financial Corp. | 21,985 | 1,231,160 | |
Old Republic International Corp. | 41,065 | 875,095 | |
Principal Financial Group, Inc. | 20,407 | 1,185,239 | |
Torchmark Corp. | 6,700 | 590,069 | |
Unum Group | 15,370 | 610,650 | |
4,984,052 | |||
Mortgage Real Estate Investment Trusts - 0.4% | |||
Chimera Investment Corp. | 16,800 | 320,880 | |
TOTAL FINANCIALS | 15,437,249 | ||
HEALTH CARE - 6.4% | |||
Biotechnology - 0.7% | |||
United Therapeutics Corp. (b) | 4,482 | 550,883 | |
Health Care Providers & Services - 5.1% | |||
Cardinal Health, Inc. | 12,838 | 641,258 | |
Laboratory Corp. of America Holdings (b) | 6,755 | 1,184,422 | |
MEDNAX, Inc. (b) | 8,900 | 380,831 | |
Quest Diagnostics, Inc. | 7,562 | 814,579 | |
Universal Health Services, Inc. Class B | 7,479 | 913,186 | |
3,934,276 | |||
Pharmaceuticals - 0.6% | |||
Jazz Pharmaceuticals PLC (b) | 2,783 | 481,682 | |
TOTAL HEALTH CARE | 4,966,841 | ||
INDUSTRIALS - 14.0% | |||
Airlines - 0.9% | |||
Copa Holdings SA Class A | 7,233 | 704,060 | |
Commercial Services & Supplies - 0.7% | |||
Deluxe Corp. | 8,262 | 486,880 | |
Construction & Engineering - 0.5% | |||
AECOM (b) | 12,000 | 402,720 | |
Electrical Equipment - 2.6% | |||
Acuity Brands, Inc. | 5,074 | 705,438 | |
AMETEK, Inc. | 16,619 | 1,292,958 | |
1,998,396 | |||
Machinery - 8.7% | |||
Apergy Corp. (b) | 25,149 | 1,031,109 | |
Crane Co. | 8,743 | 791,854 | |
Cummins, Inc. | 6,563 | 937,262 | |
Ingersoll-Rand PLC | 13,053 | 1,285,851 | |
PACCAR, Inc. | 17,354 | 1,140,505 | |
Parker Hannifin Corp. | 3,674 | 621,090 | |
Snap-On, Inc. | 5,262 | 892,383 | |
6,700,054 | |||
Trading Companies & Distributors - 0.6% | |||
MSC Industrial Direct Co., Inc. Class A | 5,300 | 448,539 | |
TOTAL INDUSTRIALS | 10,740,649 | ||
INFORMATION TECHNOLOGY - 8.1% | |||
Communications Equipment - 1.9% | |||
F5 Networks, Inc. (b) | 4,231 | 725,109 | |
Juniper Networks, Inc. | 29,299 | 771,736 | |
1,496,845 | |||
Electronic Equipment & Components - 0.5% | |||
Coherent, Inc. (b) | 2,400 | 379,344 | |
IT Services - 3.9% | |||
Amdocs Ltd. | 15,718 | 1,062,222 | |
DXC Technology Co. | 13,582 | 1,150,939 | |
Leidos Holdings, Inc. | 10,899 | 745,710 | |
2,958,871 | |||
Semiconductors & Semiconductor Equipment - 0.9% | |||
Skyworks Solutions, Inc. | 5,539 | 523,879 | |
Teradyne, Inc. | 4,039 | 174,687 | |
698,566 | |||
Technology Hardware, Storage & Peripherals - 0.9% | |||
Western Digital Corp. | 10,083 | 707,322 | |
TOTAL INFORMATION TECHNOLOGY | 6,240,948 | ||
MATERIALS - 5.9% | |||
Chemicals - 3.2% | |||
Huntsman Corp. | 41,021 | 1,375,434 | |
Innospec, Inc. | 6,254 | 506,261 | |
Westlake Chemical Corp. | 5,816 | 623,592 | |
2,505,287 | |||
Construction Materials - 0.8% | |||
nVent Electric PLC | 21,933 | 600,964 | |
Metals & Mining - 1.9% | |||
Freeport-McMoRan, Inc. | 53,654 | 885,291 | |
Reliance Steel & Aluminum Co. | 6,135 | 553,377 | |
1,438,668 | |||
TOTAL MATERIALS | 4,544,919 | ||
REAL ESTATE - 12.5% | |||
Equity Real Estate Investment Trusts (REITs) - 7.5% | |||
Apple Hospitality (REIT), Inc. | 49,991 | 899,338 | |
Brixmor Property Group, Inc. | 36,068 | 638,043 | |
Empire State Realty Trust, Inc. | 21,000 | 350,070 | |
Gaming & Leisure Properties | 22,154 | 804,633 | |
Park Hotels & Resorts, Inc. | 18,375 | 574,770 | |
Public Storage | 2,161 | 470,731 | |
Store Capital Corp. | 35,993 | 988,008 | |
VEREIT, Inc. | 137,222 | 1,047,004 | |
5,772,597 | |||
Real Estate Management & Development - 5.0% | |||
CBRE Group, Inc. (b) | 33,249 | 1,655,795 | |
Jones Lang LaSalle, Inc. | 6,894 | 1,178,943 | |
Realogy Holdings Corp. | 47,144 | 1,031,039 | |
3,865,777 | |||
TOTAL REAL ESTATE | 9,638,374 | ||
UTILITIES - 9.5% | |||
Electric Utilities - 3.7% | |||
FirstEnergy Corp. | 23,156 | 820,417 | |
Hawaiian Electric Industries, Inc. | 3,815 | 134,174 | |
OGE Energy Corp. | 16,000 | 579,840 | |
Xcel Energy, Inc. | 28,692 | 1,344,507 | |
2,878,938 | |||
Independent Power and Renewable Electricity Producers - 0.7% | |||
NRG Energy, Inc. | 16,500 | 522,555 | |
Multi-Utilities - 5.1% | |||
Ameren Corp. | 18,338 | 1,138,056 | |
CenterPoint Energy, Inc. | 21,995 | 626,418 | |
MDU Resources Group, Inc. | 32,594 | 945,226 | |
WEC Energy Group, Inc. | 18,483 | 1,226,717 | |
3,936,417 | |||
TOTAL UTILITIES | 7,337,910 | ||
TOTAL COMMON STOCKS | |||
(Cost $74,175,665) | 75,312,367 | ||
Money Market Funds - 3.4% | |||
Fidelity Cash Central Fund, 1.96% (c) | 1,065,551 | 1,065,764 | |
Fidelity Securities Lending Cash Central Fund 1.97% (c)(d) | 1,534,938 | 1,535,091 | |
TOTAL MONEY MARKET FUNDS | |||
(Cost $2,600,857) | 2,600,855 | ||
TOTAL INVESTMENT IN SECURITIES - 101.3% | |||
(Cost $76,776,522) | 77,913,222 | ||
NET OTHER ASSETS (LIABILITIES) - (1.3)% | (969,496) | ||
NET ASSETS - 100% | $76,943,726 |
Legend
(a) Security or a portion of the security is on loan at period end.
(b) Non-income producing
(c) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
(d) Investment made with cash collateral received from securities on loan.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $10,365 |
Fidelity Securities Lending Cash Central Fund | 2,520 |
Total | $12,885 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations if applicable.
Investment Valuation
All investments are categorized as Level 1 under the Fair Value Hierarchy. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
July 31, 2018 (Unaudited) | ||
Assets | ||
Investment in securities, at value (including securities loaned of $1,486,351) — See accompanying schedule: Unaffiliated issuers (cost $74,175,665) | $75,312,367 | |
Fidelity Central Funds (cost $2,600,857) | 2,600,855 | |
Total Investment in Securities (cost $76,776,522) | $77,913,222 | |
Cash | 20,120 | |
Receivable for investments sold | 975,255 | |
Dividends receivable | 16,477 | |
Distributions receivable from Fidelity Central Funds | 3,382 | |
Other receivables | 3,937 | |
Total assets | 78,932,393 | |
Liabilities | ||
Payable for investments purchased | $178,249 | |
Payable for fund shares redeemed | 245,960 | |
Accrued management fee | 29,433 | |
Collateral on securities loaned | 1,535,025 | |
Total liabilities | 1,988,667 | |
Net Assets | $76,943,726 | |
Net Assets consist of: | ||
Paid in capital | $75,590,247 | |
Undistributed net investment income | 691,505 | |
Accumulated undistributed net realized gain (loss) on investments | (474,726) | |
Net unrealized appreciation (depreciation) on investments | 1,136,700 | |
Net Assets, for 7,067,647 shares outstanding | $76,943,726 | |
Net Asset Value, offering price and redemption price per share ($76,943,726 ÷ 7,067,647 shares) | $10.89 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended July 31, 2018 (Unaudited) | ||
Investment Income | ||
Dividends | $851,578 | |
Income from Fidelity Central Funds | 12,885 | |
Total income | 864,463 | |
Expenses | ||
Management fee | $162,171 | |
Independent trustees' fees and expenses | 157 | |
Commitment fees | 61 | |
Total expenses before reductions | 162,389 | |
Expense reductions | (7,749) | |
Total expenses after reductions | 154,640 | |
Net investment income (loss) | 709,823 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | (401,738) | |
Fidelity Central Funds | 71 | |
Total net realized gain (loss) | (401,667) | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | (2,581,737) | |
Fidelity Central Funds | (2) | |
Total change in net unrealized appreciation (depreciation) | (2,581,739) | |
Net gain (loss) | (2,983,406) | |
Net increase (decrease) in net assets resulting from operations | $(2,273,583) |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended July 31, 2018 (Unaudited) | For the period May 25, 2017 (commencement of operations) to January 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $709,823 | $309,300 |
Net realized gain (loss) | (401,667) | 208,072 |
Change in net unrealized appreciation (depreciation) | (2,581,739) | 3,718,439 |
Net increase (decrease) in net assets resulting from operations | (2,273,583) | 4,235,811 |
Distributions to shareholders from net investment income | – | (341,268) |
Distributions to shareholders from net realized gain | (267,481) | – |
Total distributions | (267,481) | (341,268) |
Share transactions | ||
Proceeds from sales of shares | 26,948,033 | 72,219,816 |
Reinvestment of distributions | 267,481 | 341,268 |
Cost of shares redeemed | (15,293,503) | (8,892,848) |
Net increase (decrease) in net assets resulting from share transactions | 11,922,011 | 63,668,236 |
Total increase (decrease) in net assets | 9,380,947 | 67,562,779 |
Net Assets | ||
Beginning of period | 67,562,779 | – |
End of period | $76,943,726 | $67,562,779 |
Other Information | ||
Undistributed net investment income end of period | $691,505 | $– |
Distributions in excess of net investment income end of period | $– | $(18,318) |
Shares | ||
Sold | 2,506,106 | 6,754,384 |
Issued in reinvestment of distributions | 24,339 | 30,662 |
Redeemed | (1,417,928) | (829,916) |
Net increase (decrease) | 1,112,517 | 5,955,130 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Mid Cap Value K6 Fund
Six months ended (Unaudited) July 31, | Years endedJanuary 31, | |
2018 | 2018 A | |
Selected Per–Share Data | ||
Net asset value, beginning of period | $11.35 | $10.00 |
Income from Investment Operations | ||
Net investment income (loss)B | .11 | .11 |
Net realized and unrealized gain (loss) | (.52) | 1.33 |
Total from investment operations | (.41) | 1.44 |
Distributions from net investment income | – | (.09) |
Distributions from net realized gain | (.05) | – |
Total distributions | (.05) | (.09) |
Net asset value, end of period | $10.89 | $11.35 |
Total ReturnC,D | (3.65)% | 14.38% |
Ratios to Average Net AssetsE,F | ||
Expenses before reductions | .45%G | .45%G |
Expenses net of fee waivers, if any | .45%G | .45%G |
Expenses net of all reductions | .43%G | .45%G |
Net investment income (loss) | 1.97%G | 1.52%G |
Supplemental Data | ||
Net assets, end of period (000 omitted) | $76,944 | $67,563 |
Portfolio turnover rateH | 118%G,I | 142%G,I |
A For the period May 25, 2017 (commencement of operations) to January 31, 2018.
B Calculated based on average shares outstanding during the period.
C Total returns for periods of less than one year are not annualized.
D Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
E Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
F Expense ratios reflect operating expenses of the Fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or reductions from other expense offset arrangements and do not represent the amount paid by the Fund during periods when reimbursements or reductions occur. Expense ratios before reductions for start-up periods may not be representative of longer term operating periods. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
I Portfolio turnover rate excludes securities received or delivered in-kind.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended July 31, 2018
1. Organization.
Fidelity Mid Cap Value K6 Fund (the Fund) is a fund of Fidelity Devonshire Trust (the Trust) and is authorized to issue an unlimited number of shares. Share transactions on the Statement of Changes in Net Assets may contain exchanges between affiliated funds. The Trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. Shares generally are available only to employer-sponsored retirement plans that are recordkept by Fidelity, or to certain employer-sponsored retirement plans that are not recordkept by Fidelity.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Trustees (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. Utilizing these techniques may result in transfers between Level 1 and Level 2. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction.
Distributions are declared and recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to foreign currency transactions, partnerships and losses deferred due to wash sales and excise tax regulations.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $4,608,666 |
Gross unrealized depreciation | (3,718,925) |
Net unrealized appreciation (depreciation) | $889,741 |
Tax cost | $77,023,481 |
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities and in-kind transactions, aggregated $39,905,354 and $49,177,053, respectively.
Exchanges In-Kind. Investments and cash, received in-kind through subscriptions totaled $21,501,311 in exchange for 1,998,263 shares of the Fund. The amount of in-kind exchanges is included in share transactions in the accompanying Statement of Changes in Net Assets. The Fund recognized no gain or loss for federal income tax purposes.
Prior Fiscal Year Exchanges In-Kind. During the prior period, an unaffiliated entity completed an exchange in-kind with the Fund. The unaffiliated entity delivered investments and cash, valued at $9,318,982 in exchange for 874,201 shares of the Fund. The amount of in-kind exchanges is included in share transactions in the accompanying Statement of Changes in Net Assets. The Fund recognized no gain or loss for federal income tax purposes.
5. Fees and Other Transactions with Affiliates.
Management Fee. Fidelity Management & Research Company (the investment adviser) and its affiliates provide the Fund with investment management related services for which the Fund pays a monthly management fee that is based on an annual rate of .45% of average net assets. Under the management contract, the investment adviser or an affiliate pays all other expenses of the Fund, excluding fees and expenses of the independent Trustees, and certain miscellaneous expenses such as proxy and shareholder meeting expenses.
Brokerage Commissions. The Fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. Brokerage commissions are included in net realized gain (loss) and change in net unrealized appreciation (depreciation) in the Statement of Operations. The commissions paid to these affiliated firms were $1,252 for the period.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
Prior Fiscal Year Exchanges In-Kind. During the prior period, an affiliated entity completed an exchange in-kind with the Fund. The affiliated entity delivered investments and cash valued at $33,895,948 in exchange for 3,323,132 shares of the Fund. The amount of in-kind exchanges is included in share transactions in the accompanying Statement of Changes in Net Assets. The Fund recognized no gain or loss for federal income tax purposes.
6. Committed Line of Credit.
The Fund participates with other funds managed by the investment adviser or an affiliate in a $4.25 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The Fund has agreed to pay commitment fees on its pro-rata portion of the line of credit, which amounted to $61 and is reflected in Commitment fees on the Statement of Operations. During the period, the Fund did not borrow on this line of credit.
7. Security Lending.
The Fund lends portfolio securities through a lending agent from time to time in order to earn additional income. For equity securities, a lending agent is used and may loan securities to certain qualified borrowers, including Fidelity Capital Markets (FCM), a broker-dealer affiliated with the Fund. On the settlement date of the loan, the Fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the Fund and any additional required collateral is delivered to the Fund on the next business day. The Fund or borrower may terminate the loan at any time, and if the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, the Fund may apply collateral received from the borrower against the obligation. The Fund may experience delays and costs in recovering the securities loaned. Any cash collateral received is invested in the Fidelity Securities Lending Cash Central Fund. The value of loaned securities and cash collateral at period end are disclosed on the Fund's Statement of Assets and Liabilities. The value of securities loaned to FCM at period end was $131,720. Security lending income represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities. Security lending income is presented in the Statement of Operations as a component of income from Fidelity Central Funds. Total security lending income during the period amounted to $2,520, including $3 from securities loaned to FCM.
8. Expense Reductions.
Commissions paid to certain brokers with whom the investment adviser, or its affiliates, places trades on behalf of the Fund include an amount in addition to trade execution, which may be rebated back to the Fund to offset certain expenses. This amount totaled $7,742 for the period. In addition, through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's management fee. During the period, these credits reduced the Fund's management fee by $7.
9. Other.
The Fund's organizational documents provide former and current trustees and officers with a limited indemnification against liabilities arising 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 as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to 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 period (February 1, 2018 to July 31, 2018).
Actual Expenses
The first line of the accompanying 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 $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. 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% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value February 1, 2018 | Ending Account Value July 31, 2018 | Expenses Paid During Period-B February 1, 2018 to July 31, 2018 | |
Actual | .45% | $1,000.00 | $963.50 | $2.19 |
Hypothetical-C | $1,000.00 | $1,022.56 | $2.26 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts
Fidelity Mid Cap Value K6 Fund
At its July 2018 meeting, the Board of Trustees, including the Independent Trustees (together, the Board), voted to continue the management contract with Fidelity Management & Research Company (FMR) and the sub-advisory agreements (together, the Advisory Contracts) for the fund for six months through January 31, 2019, in connection with the reunification of the Fidelity Equity High Income Funds Board, which oversees the fund, and the Sector Portfolios Board.
The Board considered that the approval of the fund's Advisory Contracts will not result in any changes in (i) the investment process or strategies employed in the management of the fund's assets; (ii) the fees and expenses paid by shareholders; (iii) the nature, extent or quality of services provided under the fund's Advisory Contracts; or (iv) the day-to-day management of the fund or the persons primarily responsible for such management. The Board concluded that the fund's Advisory Contracts are fair and reasonable, and that the fund's Advisory Contracts should be renewed, without modification, through January 31, 2019, with the understanding that the Board will consider the annual renewal for a full one year period in January 2019.
In connection with its consideration of future renewals of the fund's Advisory Contracts, the Board will consider: (i) the nature, extent and quality of services provided to the fund, including shareholder and administrative services and investment performance; (ii) the competitiveness of the management fee and total expenses for the fund; (iii) the costs of the services and profitability, including the revenues earned and the expenses incurred in conducting the business of developing, marketing, distributing, managing, administering, and servicing the fund and its shareholders, to the extent applicable, as well as potential fall-out benefits from Fidelity's non-fund businesses; and (iv) whether there have been economies of scale in respect of the Fidelity funds, whether the Fidelity funds (including the fund) have appropriately benefited from any such economies of scale, and whether there is the potential for realization of any further economies.
Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board ultimately concluded that the fund's management fee structure is fair and reasonable, and that the continuation of the fund's Advisory Contracts should be approved.
Corporate Headquarters
245 Summer St.
Boston, MA 02210
www.fidelity.com
MCVK6-SANN-0918
1.9883982.101
Item 2.
Code of Ethics
Not applicable.
Item 3.
Audit Committee Financial Expert
Not applicable.
Item 4.
Principal Accountant Fees and Services
Not applicable.
Item 5.
Audit Committee of Listed Registrants
Not applicable.
Item 6.
Investments
(a)
Not applicable.
(b)
Not applicable
Item 7.
Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable.
Item 8.
Portfolio Managers of Closed-End Management Investment Companies
Not applicable.
Item 9.
Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable.
Item 10.
Submission of Matters to a Vote of Security Holders
There were no material changes to the procedures by which shareholders may recommend nominees to the Fidelity Devonshire Trust’s Board of Trustees.
Item 11.
Controls and Procedures
(a)(i) The President and Treasurer and the Chief Financial Officer have concluded that the Fidelity Devonshire Trust’s (the “Trust”) disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act) provide reasonable
assurances that material information relating to the Trust is made known to them by the appropriate persons, based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.
(a)(ii) There was no change in the Trust’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act) that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Trust’s internal control over financial reporting.
Item 12.
Disclosure of Securities Lending Activities for Closed-End Management
Investment Companies
Not applicable.
Item 13.
Exhibits
(a) | (1) | Not applicable. |
(a) | (2) | Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT. |
(a) | (3) | Not applicable. |
(b) | Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT. |
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.
Fidelity Devonshire Trust
By: | /s/Stacie M. Smith |
Stacie M. Smith | |
President and Treasurer | |
Date: | September 25, 2018 |
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/Stacie M. Smith |
Stacie M. Smith | |
President and Treasurer | |
Date: | September 25, 2018 |
By: | /s/John J. Burke III |
John J. Burke III | |
Chief Financial Officer | |
Date: | September 25, 2018 |