N-Q 1 a07-22668_1nq.htm N-Q

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act File Number

 

811-21832

Eaton Vance Tax-Managed Diversified Equity Income Fund

(Exact Name of Registrant as Specified in Charter)

The Eaton Vance Building,
255 State Street, Boston, Massachusetts

 

02109

(Address of Principal Executive Offices)

 

(Zip code)

Alan R. Dynner, Esq.

Eaton Vance Management, 255 State Street, Boston, Massachusetts 02109

(Name and Address of Agent for Services)

Registrant’s Telephone Number, Including Area Code:

 

(617) 482-8260

Date of Fiscal Year End:

 

October 31

Date of Reporting Period:

 

July 31, 2007

 

 



Item 1. Schedule of Investments



Eaton Vance Tax-Managed Diversified Equity Income Fund                                                         as of July 31, 2007

PORTFOLIO OF INVESTMENTS (Unaudited)

Common Stocks — 97.6%

Security

 

Shares

 

Value

 

Aerospace & Defense — 2.6%

 

 

 

 

 

Boeing Co.

 

324,725

 

$

33,586,307

 

European Aeronautic Defence and Space Co.

 

338,257

 

10,146,650

 

United Technologies Corp.

 

431,833

 

31,510,854

 

 

 

 

 

$

75,243,811

 

Air Freight & Logistics — 1.1%

 

 

 

 

 

Deutsche Post AG

 

315,590

 

$

9,226,033

 

FedEx Corp.

 

204,006

 

22,591,625

 

 

 

 

 

$

31,817,658

 

Auto Components — 0.7%

 

 

 

 

 

Johnson Controls, Inc.

 

189,747

 

$

21,469,873

 

 

 

 

 

$

21,469,873

 

Automobiles — 0.8%

 

 

 

 

 

Peugeot SA

 

133,030

 

$

11,198,120

 

Renault SA

 

78,410

 

11,337,643

 

 

 

 

 

$

22,535,763

 

Beverages — 1.9%

 

 

 

 

 

Coca-Cola Co.

 

538,143

 

$

28,042,632

 

PepsiCo, Inc.

 

418,898

 

27,488,087

 

 

 

 

 

$

55,530,719

 

Biotechnology — 1.5%

 

 

 

 

 

Biogen Idec, Inc. (1)

 

289,669

 

$

16,377,885

 

Cephalon, Inc. (1)

 

160,285

 

12,043,815

 

Gilead Sciences, Inc. (1)

 

374,254

 

13,933,476

 

 

 

 

 

$

42,355,176

 

Building Products — 0.4%

 

 

 

 

 

Compagnie de Saint-Gobain

 

107,252

 

$

11,842,122

 

 

 

 

 

$

11,842,122

 

Capital Markets — 5.7%

 

 

 

 

 

Affiliated Managers Group, Inc. (1)

 

119,320

 

$

13,483,160

 

Bank of New York Mellon Corp. (The)

 

607,572

 

25,852,189

 

Credit Suisse Group

 

553,051

 

36,028,615

 

Deutsche Bank AG

 

417,112

 

56,527,367

 

E*Trade Financial Corp. (1)

 

529,000

 

9,797,080

 

Goldman Sachs Group, Inc.

 

119,516

 

22,509,643

 

 

 

 

 

$

164,198,054

 

1



 

 

 

Chemicals — 1.8%

 

 

 

 

 

Air Liquide SA

 

87,172

 

$

11,280,495

 

Du Pont E.I. de Nemours and Co.

 

509,469

 

23,807,486

 

Monsanto Co.

 

256,815

 

16,551,727

 

 

 

 

 

$

51,639,708

 

Commercial Banks — 10.3%

 

 

 

 

 

Banca Monte dei Paschi Siena SpA

 

795,919

 

$

5,067,147

 

Banca Popolare di Milano Scarl

 

321,453

 

4,612,624

 

BNP Paribas

 

302,782

 

33,300,286

 

Commerzbank AG

 

216,282

 

9,309,095

 

Credit Agricole SA

 

692,612

 

26,477,794

 

Dexia SA

 

160,662

 

4,594,613

 

Intesa Sanpaolo SpA

 

7,702,438

 

58,296,737

 

National Bank of Greece SA

 

95,251

 

5,573,327

 

Societe Generale

 

301,446

 

51,838,632

 

UniCredito Italiano SpA

 

4,205,091

 

35,689,868

 

Unione di Banche Italiane ScpA

 

175,844

 

4,346,519

 

Wachovia Corp.

 

480,529

 

22,685,774

 

Wells Fargo & Co.

 

761,435

 

25,713,660

 

Westpac Banking Corp.

 

477,676

 

10,619,434

 

 

 

 

 

$

298,125,510

 

Communications Equipment — 2.1%

 

 

 

 

 

Cisco Systems, Inc. (1)

 

1,085,727

 

$

31,388,368

 

Corning, Inc. (1)

 

468,487

 

11,168,730

 

QUALCOMM, Inc.

 

432,769

 

18,024,829

 

 

 

 

 

$

60,581,927

 

Computer Peripherals — 4.0%

 

 

 

 

 

Apple, Inc. (1)

 

178,051

 

$

23,460,000

 

Dell, Inc. (1)

 

573,457

 

16,039,592

 

EMC Corp. (1)

 

857,636

 

15,874,842

 

Hewlett-Packard Co.

 

548,180

 

25,232,725

 

International Business Machines Corp.

 

313,271

 

34,663,436

 

 

 

 

 

$

115,270,595

 

Construction Materials — 0.4%

 

 

 

 

 

Lafarge SA

 

63,501

 

$

10,761,530

 

 

 

 

 

$

10,761,530

 

Consumer Finance — 0.8%

 

 

 

 

 

American Express Co.

 

386,719

 

$

22,638,530

 

 

 

 

 

$

22,638,530

 

2



 

 

 

Diversified Financial Services — 4.9%

 

 

 

 

 

Bank of America Corp.

 

776,741

 

$

36,833,058

 

Citigroup, Inc.

 

900,507

 

41,936,611

 

Deutsche Boerse AG

 

92,398

 

10,752,872

 

Fortis

 

476,290

 

18,781,557

 

JPMorgan Chase & Co.

 

782,594

 

34,441,962

 

 

 

 

 

$

142,746,060

 

Diversified Telecommunication Services — 4.7%

 

 

 

 

 

AT&T, Inc.

 

1,086,230

 

$

42,536,767

 

France Telecom SA

 

2,171,674

 

58,413,312

 

Telekom Austria AG

 

207,270

 

5,051,968

 

Verizon Communications, Inc.

 

714,818

 

30,465,543

 

 

 

 

 

$

136,467,590

 

Electric Utilities — 3.4%

 

 

 

 

 

Edison International

 

405,234

 

$

21,432,826

 

Enel SpA

 

5,702,103

 

58,892,775

 

Exelon Corp.

 

272,701

 

19,129,975

 

 

 

 

 

$

99,455,576

 

Electrical Equipment — 0.9%

 

 

 

 

 

Emerson Electric Co.

 

566,132

 

$

26,647,833

 

 

 

 

 

$

26,647,833

 

Energy Equipment & Services — 1.6%

 

 

 

 

 

Schlumberger, Ltd.

 

304,985

 

$

28,888,179

 

Transocean, Inc. (1)

 

164,101

 

17,632,653

 

 

 

 

 

$

46,520,832

 

Food & Staples Retailing — 1.8%

 

 

 

 

 

Casino Guichard Perrachon Foreign

 

50,031

 

$

4,874,566

 

Walgreen Co.

 

366,010

 

16,170,322

 

Wal-Mart Stores, Inc.

 

680,008

 

31,246,368

 

 

 

 

 

$

52,291,256

 

Food Products — 0.4%

 

 

 

 

 

Unilever NV

 

343,216

 

$

10,378,371

 

 

 

 

 

$

10,378,371

 

Gas Utilities — 0.2%

 

 

 

 

 

Gaz de France

 

113,057

 

$

5,253,267

 

 

 

 

 

$

5,253,267

 

Health Care Equipment & Supplies — 1.4%

 

 

 

 

 

Baxter International, Inc.

 

334,859

 

$

17,613,583

 

Medtronic, Inc.

 

428,576

 

21,715,946

 

 

 

 

 

$

39,329,529

 

3



 

 

 

Health Care Providers & Services — 1.4%

 

 

 

 

 

Aetna, Inc.

 

390,328

 

$

18,763,067

 

UnitedHealth Group, Inc.

 

446,578

 

21,627,773

 

 

 

 

 

$

40,390,840

 

Hotels, Restaurants & Leisure — 2.1%

 

 

 

 

 

Accor SA

 

110,544

 

$

9,420,014

 

Cheesecake Factory, Inc. (1)

 

411,117

 

10,121,701

 

InterContinental Hotels Group PLC

 

957,339

 

21,796,652

 

Lottomatica SpA

 

126,256

 

4,661,766

 

Marriott International, Inc., Class A

 

361,802

 

15,032,873

 

 

 

 

 

$

61,033,006

 

Household Durables — 0.3%

 

 

 

 

 

D.R. Horton, Inc.

 

501,111

 

$

8,178,132

 

 

 

 

 

$

8,178,132

 

Household Products — 1.4%

 

 

 

 

 

Procter & Gamble Co.

 

645,635

 

$

39,938,981

 

 

 

 

 

$

39,938,981

 

Industrial Conglomerates — 2.3%

 

 

 

 

 

General Electric Co.

 

1,704,585

 

$

66,069,715

 

 

 

 

 

$

66,069,715

 

Insurance — 4.4%

 

 

 

 

 

Alleanza Assicurazioni SpA

 

372,272

 

$

4,703,519

 

American International Group, Inc.

 

520,530

 

33,407,615

 

AMP, Ltd.

 

608,277

 

5,194,228

 

Assicurazioni Generali SpA

 

254,065

 

9,984,581

 

AXA

 

460,335

 

17,973,619

 

Hartford Financial Services Group, Inc.

 

223,780

 

20,558,669

 

Lincoln National Corp.

 

352,831

 

21,282,766

 

MBIA, Inc.

 

257,754

 

14,459,999

 

 

 

 

 

$

127,564,996

 

Internet Software & Services — 0.7%

 

 

 

 

 

Google, Inc., Class A (1)

 

40,646

 

$

20,729,460

 

 

 

 

 

$

20,729,460

 

IT Services — 0.4%

 

 

 

 

 

Electronic Data Systems Corp.

 

453,570

 

$

12,241,854

 

 

 

 

 

$

12,241,854

 

Life Sciences Tools & Services — 0.6%

 

 

 

 

 

Thermo Fisher Scientific, Inc. (1)

 

323,901

 

$

16,910,871

 

 

 

 

 

$

16,910,871

 

4



 

 

 

Machinery — 7.0%

 

 

 

 

 

Atlas Copco AB, Class A

 

3,320,318

 

$

57,133,840

 

Deere & Co.

 

140,043

 

16,863,978

 

Eaton Corp.

 

219,170

 

21,298,941

 

Sandvik AB

 

1,086,201

 

21,836,515

 

SKF AB

 

2,892,950

 

60,292,049

 

Vallourec SA

 

92,813

 

24,020,354

 

 

 

 

 

$

201,445,677

 

Media — 3.1%

 

 

 

 

 

Citadel Broadcasting Corp.

 

51,428

 

$

258,169

 

Comcast Corp., Class A (1)

 

803,294

 

21,102,533

 

McGraw-Hill Companies, Inc.,

 

308,938

 

18,690,749

 

Mediaset SpA

 

483,782

 

5,038,455

 

The Walt Disney Co.

 

669,676

 

22,099,308

 

Time Warner, Inc.

 

1,191,477

 

22,947,847

 

 

 

 

 

$

90,137,061

 

Multiline Retail — 1.2%

 

 

 

 

 

PPR

 

62,518

 

$

10,902,359

 

Target Corp.

 

379,478

 

22,984,983

 

 

 

 

 

$

33,887,342

 

Multi-Utilities — 1.0%

 

 

 

 

 

CMS Energy Corp.

 

797,474

 

$

12,887,180

 

Dominion Resources, Inc.

 

188,182

 

15,848,688

 

 

 

 

 

$

28,735,868

 

Oil, Gas & Consumable Fuels — 8.1%

 

 

 

 

 

ConocoPhillips

 

407,791

 

$

32,965,824

 

ENI SpA

 

1,267,386

 

44,376,753

 

Exxon Mobil Corp.

 

853,120

 

72,626,106

 

Norsk Hydro ASA

 

597,905

 

23,041,659

 

Occidental Petroleum Corp.

 

434,152

 

24,625,101

 

Statoil ASA

 

738,839

 

21,862,576

 

Williams Cos., Inc.

 

478,036

 

15,416,661

 

 

 

 

 

$

234,914,680

 

Paper and Forest Products — 0.5%

 

 

 

 

 

Weyerhaeuser Co.

 

204,315

 

$

14,555,401

 

 

 

 

 

$

14,555,401

 

Pharmaceuticals — 3.1%

 

 

 

 

 

Abbott Laboratories

 

514,331

 

$

26,071,438

 

Allergan, Inc.

 

341,676

 

19,861,626

 

Sanofi-Aventis

 

232,997

 

19,526,323

 

Wyeth

 

475,449

 

23,068,786

 

 

 

 

 

$

88,528,173

 

5



 

 

 

Semiconductors & Semiconductor Equipment — 2.0%

 

 

 

 

 

Intel Corp.

 

1,302,929

 

$

30,775,183

 

STMicroelectrionics NV

 

547,512

 

9,414,330

 

Texas Instruments, Inc.

 

499,919

 

17,592,150

 

 

 

 

 

$

57,781,663

 

Software — 2.0%

 

 

 

 

 

Microsoft Corp.

 

1,450,160

 

$

42,040,138

 

Oracle Corp. (1)

 

883,947

 

16,901,067

 

 

 

 

 

$

58,941,205

 

Specialty Retail — 1.0%

 

 

 

 

 

Lowe’s Cos., Inc.

 

595,448

 

$

16,678,499

 

Staples, Inc.

 

556,721

 

12,815,717

 

 

 

 

 

$

29,494,216

 

Thrifts & Mortgage Finance — 0.3%

 

 

 

 

 

Countrywide Financial Corp.

 

330,920

 

$

9,322,016

 

 

 

 

 

$

9,322,016

 

Tobacco — 1.0%

 

 

 

 

 

Altria Group, Inc.

 

434,643

 

$

28,890,720

 

 

 

 

 

$

28,890,720

 

Water Utilities — 0.3%

 

 

 

 

 

Kelda Group PLC

 

595,070

 

$

10,080,272

 

 

 

 

 

$

10,080,272

 

Total Common Stocks
(identified cost $2,837,390,913)

 

 

 

$

2,822,873,439

 

 

Other Issues — 0.0%

Security

 

Shares

 

Value

 

Cairn Energy PLC, Class B, Deferred Shares (1)(2)

 

800,000

 

$

0

 

Kelda Group PLC, Deferred Shares (1)(2)

 

773,591

 

0

 

Total Other Issues
(identified cost, $0)

 

 

 

$

0

 

 

Short-Term Investments — 1.9%

 

 

Interest

 

 

 

Description

 

(000’s omitted)

 

Value

 

Investment in Cash Management Portfolio, 4.86%, (3)

 

56,059

 

$

56,059,295

 

Total Short-Term Investments
(identified cost, $56,059,295)

 

 

 

$

56,059,295

 

Total Investments — 99.5%
(identified cost $2,893,450,208)

 

 

 

$

2,878,932,734

 

 

6



 

 

Covered Call Options Written — 0.0%

 

 

Number of

 

Premium

 

 

 

Type of Contract

 

Contracts

 

Received

 

Value

 

S&P 500 Index, Expires 08/18/07, Strike 1,560 

 

858

 

$

1,971,770

 

$

(51,480

)

S&P 500 Index, Expires 08/18/07, Strike 1,580

 

1,950

 

2,139,345

 

(48,750

)

S&P 500 Index, Expires 08/18/07, Strike 1,550

 

1,431

 

3,244,935

 

(128,790

)

S&P 500 Index, Expires 08/18/07, Strike 1,555

 

2,954

 

5,922,932

 

(236,320

)

S&P 500 Index, Expires 08/18/07, Strike 1,565

 

1,716

 

3,471,640

 

(128,700

)

Total Covered Call Options Written
(premiums received $16,750,622)

 

 

 

 

 

$ 

(594,040

)

Other Assets, Less Liabilities — 0.5%

 

 

 

 

 

$

13,102,980

 

Net Assets — 100.0%

 

 

 

 

 

$

2,891,441,674

 

 

(1)

Non-income producing security.

(2)

Security valued at fair value using methods determined in good faith by or at the direction of the Trustees.

(3)

Affiliated investment company available to Eaton Vance portfolios and funds which invests in high quality, U.S. dollar denominated money market instruments. The rate shown is the annualized seven-day yield as of July 31, 2007. Net income allocated from this investment for the three months ended July 31, 2007, was $854,264.

 

Country Concentration of Portfolio

 

 

Percentage

 

 

 

 

 

Of Total

 

 

 

Country

 

Investments

 

Value

 

United States

 

65.6

%

$

1,889,566,879

 

France

 

11.1

%

318,420,436

 

Italy

 

8.2

%

235,670,744

 

Sweden

 

4.8

%

139,262,404

 

Germany

 

3.0

%

85,815,367

 

Norway

 

1.6

%

44,904,235

 

Switzerland

 

1.3

%

36,028,615

 

United Kingdom

 

1.1

%

31,876,924

 

Netherlands

 

1.0

%

29,939,351

 

Belgium

 

0.8

%

23,376,170

 

Cayman Islands

 

0.6

%

17,632,652

 

Australia

 

0.5

%

15,813,662

 

Greece

 

0.2

%

5,573,327

 

Austria

 

0.2

%

5,051,968

 

 

 

100.0

%

$

2,878,932,734

 

 

7



 

 

The cost and unrealized appreciation (depreciation) in value of the investments owned by the Fund at July 31, 2007 as computed on a federal income tax basis, were as follows:

Aggregate cost

 

$

2,893,450,208

 

Gross unrealized appreciation

 

$

147,667,713

 

Gross unrealized depreciation

 

(162,185,187

)

Net unrealized depreciation

 

$

(14,517,474

)

 

The net unrealized appreciation on foreign currency at July 31, 2007 was $216,193.

Written call option activity for the period ended July 31, 2007 was as follows:

 

 

Number of
Contracts

 

Premiums
Received

 

Outstanding, beginning of period

 

—

 

$

—

 

Options written

 

91,657

 

124,693,281

 

Options terminated in closing purchase transactions

 

(76,038

)

(107,282,373

)

Options expired

 

(6,710

)

(660,286

)

Outstanding, end of period

 

8,909

 

$

16,750,622

 

 

At July 31, 2007 the Fund had sufficient cash and/or securities to cover commitments under these contracts.

8



Item 2. Controls and Procedures

(a) It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant on this Form N-Q has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant on this Form N-Q has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure.

(b) There have been no changes in the registrant’s internal controls over financial reporting during the fiscal quarter for which the report is being filed that have materially affected, or are reasonably likely to materially affect the registrant’s internal control over financial reporting.



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.

Eaton Vance Tax-Managed Diversified Equity Income Fund

By:

 

/s/ Duncan W. Richardson

 

 

Duncan W. Richardson

 

 

President and Principal Executive Officer

 

Date:

 

September 20, 2007

 

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/ Duncan W. Richardson

 

 

Duncan W. Richardson

 

 

President and Principal Executive Officer

 

Date:

 

September 20, 2007

 

By:

 

/s/ Barbara E. Campbell

 

 

Barbara E. Campbell

 

 

Treasurer and Principal Financial Officer

 

Date:

 

September 20, 2007