N-CSR 1 primary-document.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 
FORM N-CSR
 
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
 
Investment Company Act file number 811-05878
 
Franklin Value Investors Trust

(Exact name of registrant as specified in charter)
 
One Franklin Parkway, San Mateo, CA 94403-1906

(Address of principal executive offices)(Zip code)
 
Alison Baur, One Franklin Parkway, San Mateo, CA  94403-1906

(Name and address of agent for service)
 
Registrant's telephone number, including area code: 650 312-2000
 
Date of fiscal year end: 10/31
 
Date of reporting period: 10/31/22
 
Item 1. Reports to Stockholders.
a.)
 
The following is a copy of the report transmitted to shareholders pursuant to Rule30e-1 under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30e-1.)


b.)
 
Include a copy of each notice transmitted to stockholders in reliance on Rule 30e-3 under the Act (17 CFR 270.30e-3) that contains disclosures specified by paragraph (c)(3) of that rule.
Not Applicable
.
 
ANNUAL
REPORT
AND
SHAREHOLDER
LETTER
Franklin
Value
Investors
Trust
October
31,
2022
Sign
up
for
electronic
delivery
at
franklintempleton.com/edelivery
Franklin
MicroCap
Value
Fund
Franklin
Mutual
U.S.
Mid
Cap
Value
Fund
Formerly,
Franklin
Mutual
U.S.
Value
Fund
Franklin
Small
Cap
Value
Fund
Not
FDIC
Insured
May
Lose
Value
No
Bank
Guarantee
franklintempleton.com
Annual
Report
1
SHAREHOLDER
LETTER
Dear
Franklin
Fund
Shareholder:
The
past
12
months
were
eventful
and
volatile.
Several
themes
carried
over
from
the
winter
of
2021
into
the
new
calendar
year,
but
with
seemingly
increased
intensity.
Mounting
inflation,
more
hawkish
central
banks,
continuing
supply-chain
difficulties
and
renewed
COVID
lockdowns
remained
a
part
of
the
economic
landscape,
joined
by
new
elements,
like
war
in
Europe.
Corporate
earnings
and
other
economic
indicators
generally
remained
strong
for
much
of
the
12
months.
However,
some
elements
such
as
consumer
spending
patterns
and
corporate
inventories
showed
strain
as
inflationary
pressures
and
concern
over
the
possibility
of
a
recession
took
their
toll
on
the
general
population,
companies
and
investors.
Equity
markets
generally
declined
during
the
year,
pressured
by
high
inflation,
tightening
monetary
policy
and
continued
knock-on
effects
from
Russia’s
invasion
of
Ukraine.
Supply-
chain
disruptions
helped
drive
inflation
in
many
countries
to
reach
the
highest
levels
in
decades.
In
response,
some
of
the
world’s
central
banks
tightened
monetary
policy,
including
the
U.S.
Federal
Reserve,
which
made
its
first
rate
hike
in
over
three
years
in
March,
followed
by
additional
increases
throughout
the
remainder
of
the
period.
Rising
rates
can
cool
economic
growth
and
a
recession
may
be
on
the
horizon.
Some
U.S.
large-cap
valuations
reflect
this
recession
risk.
Furthermore,
many
U.S.
small-cap
value
stocks
are
trading
well
below
their
52-week
highs
and
valuations
of
profitable
companies
are
near
20-year
lows
relative
to
large-cap
value
stocks.
Higher
interest
rates
also
continue
to
work
against
long-duration
growth
stocks
by
increasing
the
discount
rate
of
a
company’s
projected
future
cash
flows.
This
downward
pressure
on
technology
and
other
long-duration
growth
names
is
helping
to
support
investor
interest
in
more
defensive
value
stocks,
which
handily
outperformed
their
growth
counterparts
over
the
past
12
months.
Even
though
the
initial
shock
of
Russia’s
invasion
of
Ukraine
has
receded,
the
conflict
continues
to
roil
markets
as
Russia
leverages
its
position
as
a
prominent
supplier
of
oil
and
natural
gas
to
much
of
Europe.
Many
European
countries
and
companies
have
been
exploring
alternate
ways
to
fulfill
their
need
for
energy.
Aside
from
energy
shortages,
other
supply-chain
disruptions
continued
through
the
end
of
the
period,
although
there
are
early
signs
of
improvement.
As
China
gets
closer
to
a
meaningful
reopening,
we
are
optimistic
their
full
reengagement
in
the
global
economy
will
be
a
significant
catalyst
to
supply-chain
issues
easing.
Not
all
progress
is
evidenced
by
a
steady
march
forward.
In
the
near-term,
market
activity
will
likely
be
influenced
by
developments
around
the
Ukraine
conflict,
inflation
concerns,
supply-chain
constraints,
and
changes
to
monetary
and
fiscal
support.
We
remain
focused
on
identifying
opportunities
to
acquire
stocks
at
attractive
valuations
based
upon
our
assessment
of
fundamental
value,
while
taking
advantage
of
volatility.
Our
process
of
finding
underappreciated
and
misunderstood
companies
with
identifiable
catalysts
to
unlock
shareholder
value
may
provide
meaningful
upside
potential
and
possible
downside
risk
management
during
turbulent
periods.
In
addition,
we
continue
to
focus
on
event-driven
situations
across
equity
and
fixed
income
with
catalysts
less
correlated
to
the
overall
markets.
While
unnerving,
volatility
remains
an
inherent
part
of
investing
in
risk
assets,
and
the
market
historically
rewards
investors
who
take
an
opportunistic
long-term
perspective.
On
the
following
pages,
the
portfolio
management
team
of
each
Fund
reviews
investment
decisions
made
during
this
period.
Please
remember
all
securities
markets
fluctuate,
as
do
mutual
fund
share
prices.
We
thank
you
for
investing
with
Franklin
Templeton,
welcome
your
questions
and
comments,
and
look
forward
to
continuing
to
serve
your
investment
needs
in
the
years
ahead.
Sincerely,
Christian
Correa,
CFA
President
and
Chief
Investment
Officer
Franklin
Value
Investors
Trust
This
letter
reflects
our
analysis
and
opinions
as
of
October
31,
2022,
unless
otherwise
indicated.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
fund.
Statements
of
fact
are
from
sources
considered
reliable.
CFA
®
is
a
trademark
owned
by
CFA
Institute.
franklintempleton.com
Annual
Report
2
Contents
Annual
Report
Economic
and
Market
Overview
3
Franklin
MicroCap
Value
Fund
4
Franklin
Mutual
U.S.
Mid
Cap
Value
Fund
11
Franklin
Small
Cap
Value
Fund
18
Financial
Highlights
and
Schedules
of
Investments
25
Financial
Statements
49
Notes
to
Financial
Statements
54
Report
of
Independent
Registered
Public
Accounting
Firm
70
Tax
Information
71
Board
Members
and
Officers
72
Shareholder
Information
76
Visit
franklintempleton.com
for
fund
updates,
to
access
your
account,
or
to
find
helpful
financial
planning
tools.
3
franklintempleton.com
Annual
Report
ANNUAL
REPORT
Economic
and
Market
Overview
U.S.
equities,
as
measured
by
the
Standard
&
Poor’s
®
500
Index
(S&P
500
®
),
posted
a
-14.61%
total
return
for
the
12
months
ended
October
31,
2022.
1
High
inflation,
rising
interest
rates
and
geopolitical
instability
contributed
to
a
sharp
decline
in
equity
prices.
Although
consumer
spending
continued
to
rise,
deteriorating
financial
conditions
negatively
impacted
consumer
sentiment,
which
improved
slightly
at
the
end
of
the
period
after
falling
in
June
2022
to
the
lowest
level
ever
recorded
in
over
60
years.
Elevated
inflation
was
a
major
concern
for
both
consumers
and
investors,
as
inflation
accelerated
in
June
2022
to
the
highest
rate
since
1981.
Continued
supply-chain
disruptions,
strong
consumer
demand,
and
volatile
energy
prices
drove
inflation
higher.
Russia’s
invasion
of
Ukraine
also
disrupted
financial
markets
and
led
to
a
rise
in
oil
and
commodity
prices,
although
much
of
that
increase
abated
by
period-end.
Amid
notable
employment
gains
in
the
leisure
and
hospitality
and
health
care
sectors,
the
U.S.
unemployment
rate
declined
from
4.6%
in
October
2021
to
3.5%
in
September
2022,
before
rising
modestly
to
3.7%
in
October
2022.
Wages
climbed
at
the
fastest
rate
in
decades,
which
added
to
some
investors’
inflation
concerns.
U.S.
gross
domestic
product
(GDP)
growth
was
robust
in
the
fourth
quarter
of
2021
as
strong
consumer
spending
and
business
investment
in
growing
inventories
supported
the
economy.
GDP
contracted
in
the
first
half
of
2022
due
to
declining
residential
and
business
investment
and
lower
levels
of
government
spending,
but
grew
in
2022’s
third
quarter
amid
a
narrowing
trade
deficit
and
strong
consumer
spending.
Increased
nonresidential
fixed
investment
and
government
spending
also
positively
contributed
to
the
third
quarter
economic
growth.
Rising
interest
rates
translated
to
higher
borrowing
costs
for
individuals
and
businesses.
Mortgage
rates
reached
the
highest
level
since
2007,
and
new
home
construction
slowed
toward
period-end.
In
an
effort
to
control
inflation,
the
U.S.
Federal
Reserve
(Fed)
began
to
raise
the
federal
funds
target
rate
in
March
2022,
the
first
such
increase
since
2018.
The
Fed
raised
the
federal
funds
rate
again
at
each
of
its
four
subsequent
meetings
to
end
the
period
at
a
range
of
3.00%–3.25%.
The
Fed
noted
in
its
September
2022
meeting
that
inflation
remained
elevated
amid
robust
job
growth
and
low
unemployment.
Furthermore,
the
Fed
said
it
would
continue
to
reduce
its
bond
holdings,
and
Fed
Chair
Jerome
Powell
indicated
that
reducing
inflation
was
likely
to
require
a
period
of
below-trend
growth.
The
foregoing
information
reflects
our
analysis
and
opinions
as
of
October
31,
2022.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
fund.
Statements
of
fact
are
from
sources
considered
reliable.
1.
Source:
Morningstar.
See
www.franklintempletondatasources.com
for
additional
data
provider
information
4
franklintempleton.com
Annual
Report
Franklin
MicroCap
Value
Fund
This
annual
report
for
Franklin
MicroCap
Value
Fund
covers
the
fiscal
year
ended
October
31,
2022.
Your
Fund’s
Goal
and
Main
Investments
The
Fund
seeks
high
total
return,
of
which
capital
appreciation
and
income
are
components.
The
Fund
normally
invests
at
least
80%
of
its
net
assets
in
securities
of
microcap
companies
with
total
market
capitalizations
of
$1
billion
or
less
or
within
the
bottom
40%
of
the
Russell
2000
®
Value
Index,
whichever
is
higher
at
the
time
of
purchase.
1
The
Fund
generally
invests
in
equity
securities,
predominantly
common
stocks,
of
companies
that
we
believe
are
undervalued
and
have
the
potential
for
capital
appreciation.
The
Fund
may
invest
up
to
25%
of
its
total
assets
in
foreign
securities.
Performance
Overview
The
Fund’s
Class
A
shares
posted
a
-2.00%
cumulative
total
return
for
the
12
months
under
review.
In
comparison,
the
Russell
2000
®
Value
Index,
which
measures
the
performance
of
those
Russell
2000
®
Index
companies
with
relatively
lower
price-to-book
ratios
and
lower
forecasted
growth
rates,
posted
a
-10.73%
cumulative
total
return
for
the
same
period.
2
You
can
find
more
of
the
Fund’s
performance
data
in
the
Performance
Summary
beginning
on
page
7
.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Investment
Strategy
Our
strategy
is
to
buy
shares
of
companies
that
we
believe
are
undervalued
at
the
time
of
purchase
and
have
the
potential
for
capital
appreciation.
The
types
of
companies
the
Fund
may
invest
in
include,
among
other
things,
those
that
may
be
considered
out
of
favor
due
to
actual
or
perceived
cyclical
or
secular
challenges,
or
are
experiencing
temporary
setbacks,
diminished
expectations,
mismanagement
or
undermanagement,
or
are
financially
stressed.
Environmental,
social
and
governance
(ESG)
related
assessments
of
companies
may
be
considered.
In
choosing
investments,
we
conduct
an
in-depth
analysis
of
a
company’s
long-term
or
normalized
earnings
and
free
cash
flow
potential,
quality
of
management,
ownership
of
valuable
franchises,
trademarks
or
trade
names,
control
of
distribution
networks,
underutilized
assets
and
market
share
for
particular
products,
balance
sheet,
and
other
factors
that
may
identify
the
issuer
as
a
potential
investment.
The
investment
manager
considers
selling
a
security
when
it
no
longer
meets
its
value
criteria.
*Categories
within
the
Other
category
are
listed
in
full
in
the
Fund’s
Schedule
of
Investments
(SOI),
which
can
be
found
later
in
this
report.
Manager’s
Discussion
During
the
12-month
reporting
period,
security
selection
in
the
financials,
information
technology
and
communication
services
sectors
supported
relative
results.
Conversely,
stock
selection
in
the
consumer
discretionary
and
industrials
sectors,
as
well
as
stock
selection
and
an
underweight
in
utilities,
hampered
relative
results.
Portfolio
Composition
10/31/22
%
of
Total
Net
Assets
Banks
22.6%
Machinery
6.0%
Health
Care
Equipment
&
Supplies
5.0%
Equity
Real
Estate
Investment
Trusts
(REITs)
5.0%
Hotels,
Restaurants
&
Leisure
4.2%
Communications
Equipment
4.1%
Construction
&
Engineering
3.9%
Electrical
Equipment
3.4%
Energy
Equipment
&
Services
3.4%
Thrifts
&
Mortgage
Finance
3.0%
Biotechnology
2.9%
Electronic
Equipment,
Instruments
&
Components
2.4%
Textiles,
Apparel
&
Luxury
Goods
2.3%
Health
Care
Technology
1.8%
Other*
21.2%
Short-Term
Investments
&
Other
Net
Assets
8.8%
1.
Frank
Russell
Company
is
the
source
and
owner
of
the
trademarks,
service
marks
and
copyrights
related
to
the
Russell
Indexes.
Russell
®
is
a
trademark
of
Frank
Russell
Company.
Russell
2000
®
Value
Index
is
market
capitalization
weighted
and
measures
the
performance
of
those
Russell
2000
®
Index
companies
with
relatively
lower
price-to-
book
ratios
and
lower
forecasted
growth
rates.
2.
Source:
Morningstar.
The
index
is
unmanaged
and
includes
reinvestment
of
any
income
or
distributions.
It
does
not
reflect
any
fees,
expenses
or
sales
charges.
One
cannot
invest
directly
in
an
index,
and
an
index
is
not
representative
of
the
Fund’s
portfolio.
See
www.franklintempletondatasources.com
for
additional
data
provider
information.
The
dollar
value,
number
of
shares
or
principal
amount,
and
names
of
all
portfolio
holdings
are
listed
in
the
Fund’s
Schedule
of
Investments
(SOI).
The
SOI
begins
on
page
28
.
Franklin
MicroCap
Value
Fund
5
franklintempleton.com
Annual
Report
Major
positive
contributors
relative
to
the
Fund’s
benchmark
index
over
the
12-month
period
included
Ardmore
Shipping
(not
held
at
period-end),
Digi
International
and
IntriCon
(not
held
at
period-end).
Digi
International
is
listed
among
the
Fund’s
largest
positions
in
the
Top
10
Holdings
table
on
this
page.
Oil
tanker
company
Ardmore
Shipping
was
a
notable
positive
relative
contributor.
The
company
is
seeing
an
improvement
in
its
business,
which
it
expects
to
continue
throughout
2022.
However,
Ardmore
did
note
that
it
was
monitoring
several
competing
factors,
including
the
pandemic’s
evolution
and
the
global
economic
recovery,
as
well
as
geopolitical
concerns
and
whether
currently
high
oil
prices
will
lead
to
reduced
shipments.
Similar
to
other
high
leverage
energy-
related
stocks,
Ardmore
is
highly
cyclical
and
volatile.
We
sold
the
stock
because
valuation
appeared
full
at
price-to-
book
versus
its
10-year
historical
average.
We
redeployed
the
proceeds
into
other
names
in
the
portfolio
with
better
valuation
and
risk/reward
profiles,
including
other
energy
companies.
Digi
International,
an
“internet
of
things”
products
maker,
boosted
relative
results,
following
strong
fiscal
third-quarter
2022
results,
supported
by
a
jump
in
sales.
The
company
attributed
the
stronger
revenues
to
increased
sales
of
console
servers
and
cellular
products
driven
in
part
by
data
center
demand.
Digi
also
boosted
its
fiscal
fourth-quarter
earnings
estimates
and
continues
to
expect
sustained
cash
flow
generation
over
the
longer
term.
IntriCon,
which
helps
to
design
and
manufacture
implantable
and
body-worn
devices,
positively
contributed
to
relative
performance
following
news
that
it
was
being
taken
over
by
an
investment
firm
focused
on
the
health
care
industry.
Additionally,
IntriCon’s
recent
financial
results
have
been
strong,
with
the
company
seeing
growth
across
its
businesses.
IntriCon
was
acquired
in
May
2022
by
an
affiliate
of
Altaris
Capital
Partners,
a
private
equity
firm.
Key
detractors
relative
to
the
Fund’s
benchmark
index
included
Invacare
(not
held
at
period-end),
Rocky
Brands
and
Vera
Bradley.
Medical
equipment
manufacturer
Invacare
detracted
from
relative
returns
over
the
period.
The
company
has
seen
strong
demand
and
orders
for
its
products
during
the
period,
but
after
many
years
of
underperformance
and
poor
management
execution,
we
sold
the
position.
Invacare
had
just
initiated
yet
another
restructuring
program
to
get
its
costs
under
control,
as
management
could
not
seem
to
manage
input
cost
inflation
and
supply-chain
challenges
appropriately.
In
addition,
the
balance
sheet
has
a
lot
of
debt,
which
made
the
stock
even
more
risky
going
into
a
potential
recession
in
2023.
Rocky
Brands
detracted
in
the
period,
as
inflationary
pressures
continued
to
pressure
its
earnings
in
the
second
quarter
of
2022.
Although
the
apparel
company’s
sales
growth
has
been
strong,
it
is
seeing
gross
margin
pressure
due
to
higher
product
and
freight
costs.
Rocky
Brands
has
begun
raising
prices
to
offset
some
of
these
pressures,
which
it
expects
will
begin
to
ease
later
in
the
year.
Apparel
retailer
Vera
Bradley
further
hindered
relative
performance,
as
its
second-quarter
2022
results
were
weaker
than
anticipated.
The
company
reported
a
drop
in
same-store
sales,
and
noted
that
inflationary
pressures,
including
rising
gas
prices,
are
having
an
impact
on
spending
among
lower
end
consumers.
The
company
is
reducing
costs
to
deal
with
rising
freight
and
material
expenses
as
appropriate. 
Thank
you
for
your
participation
in
Franklin
MicroCap
Value
Fund.
We
look
forward
to
continuing
to
serve
your
investment
needs.
Oliver
H.
Wong,
CFA
Portfolio
Manager
The
foregoing
information
reflects
our
analysis,
opinions
and
portfolio
holdings
as
of
October
31,
2022,
the
end
of
the
reporting
period.
The
way
we
implement
our
main
investment
strategies
and
the
resulting
portfolio
holdings
Top
10
Holdings
10/31/22
Company
Industry
,
Country
%
of
Total
Net
Assets
a
a
First
Business
Financial
Services,
Inc.
2.3%
Banks,
United
States
Digi
International,
Inc.
2.1%
Communications
Equipment,
United
States
Peapack-Gladstone
Financial
Corp.
2.1%
Banks,
United
States
Northeast
Bank
2.0%
Banks,
United
States
Investar
Holding
Corp.
1.8%
Banks,
United
States
Southern
Missouri
Bancorp,
Inc.
1.8%
Thrifts
&
Mortgage
Finance,
United
States
CTO
Realty
Growth,
Inc.
1.7%
Equity
Real
Estate
Investment
Trusts
(REITs),
United
States
Utah
Medical
Products,
Inc.
1.7%
Health
Care
Equipment
&
Supplies,
United
States
Helix
Energy
Solutions
Group,
Inc.
1.7%
Energy
Equipment
&
Services,
United
States
Premier
Financial
Corp.
1.7%
Banks,
United
States
Franklin
MicroCap
Value
Fund
6
franklintempleton.com
Annual
Report
may
change
depending
on
factors
such
as
market
and
economic
conditions.
These
opinions
may
not
be
relied
upon
as
investment
advice
or
an
offer
for
a
particular
security.
The
information
is
not
a
complete
analysis
of
every
aspect
of
any
market,
country,
industry,
security
or
the
Fund.
Statements
of
fact
are
from
sources
considered
reliable,
but
the
investment
manager
makes
no
representation
or
warranty
as
to
their
completeness
or
accuracy.
Although
historical
performance
is
no
guarantee
of
future
results,
these
insights
may
help
you
understand
our
investment
management
philosophy.
Performance
Summary
as
of
October
31,
2022
Franklin
MicroCap
Value
Fund
7
franklintempleton.com
Annual
Report
The
performance
table
and
graphs
do
not
reflect
any
taxes
that
a
shareholder
would
pay
on
Fund
dividends,
capital
gain
distributions,
if
any,
or
any
realized
gains
on
the
sale
of
Fund
shares.
Total
return
reflects
reinvestment
of
the
Fund’s
dividends
and
capital
gain
distributions,
if
any,
and
any
unrealized
gains
or
losses.
Your
dividend
income
will
vary
depending
on
dividends
or
interest
paid
by
securities
in
the
Fund’s
portfolio,
adjusted
for
operating
expenses
of
each
class.
Capital
gain
distributions
are
net
profits
realized
from
the
sale
of
portfolio
securities.
Performance
as
of
10/31/22
1
Cumulative
total
return
excludes
sales
charges.
Average
annual
total
return
includes
maximum
sales
charges.
Sales
charges
will
vary
depending
on
the
size
of
the
investment
and
the
class
of
share
purchased.
The
maximum
is
5.50%
and
the
minimum
is
0%.
Class
A
:
5.50%
maximum
initial
sales
charge;
Advisor
Class:
no
sales
charges.
For
other
share
classes,
visit
franklintempleton.com.
Performance
data
represent
past
performance,
which
does
not
guarantee
future
results.
Investment
return
and
principal
value
will
fluctuate,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
Current
performance
may
differ
from
figures
shown.
For
most
recent
month-end
performance,
go
to
franklintempleton.com
or
call
(800)
342-5236
.
Share
Class
Cumulative
Total
Return
2
Average
Annual
Total
Return
3
A
4
1-Year
-2.00%
-7.40%
5-Year
+25.77%
+3.51%
10-Year
+118.38%
+7.51%
Advisor
1-Year
-1.77%
-1.77%
5-Year
+27.28%
+4.94%
10-Year
+123.67%
+8.38%
See
page
9
for
Performance
Summary
footnotes.
Franklin
MicroCap
Value
Fund
Performance
Summary
8
franklintempleton.com
Annual
Report
See
page
9
for
Performance
Summary
footnotes.
Total
Return
Index
Comparison
for
a
Hypothetical
$10,000
Investment
1
Total
return
represents
the
change
in
value
of
an
investment
over
the
periods
shown.
It
includes
any
applicable
maximum
sales
charge,
Fund
expenses,
account
fees
and
reinvested
distributions.
The
unmanaged
index
includes
reinvestment
of
any
income
or
distributions.
It
differs
from
the
Fund
in
composition
and
does
not
pay
management
fees
or
expenses.
One
cannot
invest
directly
in
an
index.
Class
A
(10/31/12–10/31/22)
Advisor
Class
(10/31/12–10/31/22)
Franklin
MicroCap
Value
Fund
Performance
Summary
9
franklintempleton.com
Annual
Report
Each
class
of
shares
is
available
to
certain
eligible
investors
and
has
different
annual
fees
and
expenses,
as
described
in
the
prospectus.
All
investments
involve
risks,
including
possible
loss
of
principal.
The
Fund’s
ability
to
invest
in
smaller-company
securities
that
may
have
limited
liquidity
involves
additional
risks,
such
as
relatively
small
revenues,
limited
product
lines
and
small
market
share.
Historically,
these
stocks
have
exhibited
greater
price
volatility
than
larger-company
stocks,
especially
over
the
short
term.
In
addition,
the
Fund
may
invest
up
to
25%
of
its
total
assets
in
foreign
securities,
which
involve
special
risks,
including
currency
fluctuations
and
economic
and
political
uncertainty.
Value
securities
may
not
increase
in
price
as
anticipated
or
may
decline
further
in
value.
The
manager’s
portfolio
selection
strategy
is
not
solely
based
on
ESG
considerations,
and
therefore
the
issuers
in
which
the
Fund
invests
may
not
be
considered
ESG-focused
companies.
Integrating
ESG
considerations
into
the
investment
process
is
not
a
guarantee
that
better
performance
will
be
achieved.
Events
such
as
the
spread
of
deadly
diseases,
disasters,
and
financial,
political
or
social
disruptions,
may
heighten
risks
and
adversely
affect
performance.
The
Fund’s
prospectus
also
includes
a
description
of
the
main
investment
risks.
Russia’s
military
invasion
of
Ukraine
in
February
2022,
the
resulting
responses
by
the
United
States
and
other
countries,
and
the
potential
for
wider
conflict
could
increase
volatility
and
uncertainty
in
the
financial
markets
and
adversely
affect
regional
and
global
economies.
The
United
States
and
other
countries
have
imposed
broad-ranging
economic
sanctions
on
Russia
and
certain
Russian
individuals,
banking
entities
and
corporations
as
a
response
to
its
invasion
of
Ukraine.
The
United
States
and
other
countries
have
also
imposed
economic
sanctions
on
Belarus
and
may
impose
sanctions
on
other
countries
that
support
Russia’s
military
invasion.
These
sanctions,
as
well
as
any
other
economic
consequences
related
to
the
invasion,
such
as
additional
sanctions,
boycotts
or
changes
in
consumer
or
purchaser
preferences
or
cyberattacks
on
governments,
companies
or
individuals,
may
further
decrease
the
value
and
liquidity
of
certain
Russian
securities
and
securities
of
issuers
in
other
countries
that
are
subject
to
economic
sanctions
related
to
the
invasion.
1.
The
total
annual
operating
expenses
are
sourced
from
the
Fund's
prospectus
available
at
the
time
of
publication.
Actual
expenses
may
be
higher
and
may
impact
portfolio
returns.
2.
Cumulative
total
return
represents
the
change
in
value
of
an
investment
over
the
periods
indicated.
3.
Average
annual
total
return
represents
the
average
annual
change
in
value
of
an
investment
over
the
periods
indicated.
Return
for
less
than
one
year,
if