N-Q 1 d177445dnq.htm AB LARGE CAP GROWTH FUND, INC. AB Large Cap Growth Fund, Inc.

 

 

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: 811-06730

AB LARGE CAP GROWTH FUND, INC.

(Exact name of registrant as specified in charter)

1345 Avenue of the Americas, New York, New York 10105

(Address of principal executive offices) (Zip code)

Joseph J. Mantineo

AllianceBernstein L.P.

1345 Avenue of the Americas

New York, New York 10105

(Name and address of agent for service)

Registrant’s telephone number, including area code: (800) 221-5672

Date of fiscal year end: July 31, 2016

Date of reporting period: April 30, 2016

 

 

 


ITEM 1. SCHEDULE OF INVESTMENTS.


AB Large Cap Growth Fund, Inc.

Portfolio of Investments

April 30, 2016 (unaudited)

 

Company

   Shares        U.S. $ Value  

COMMON STOCKS - 92.8%

       

Technology - 27.8%

       

Computer Services, Software & Systems - 18.2%

       

Adobe Systems, Inc. (a)

     366,469         $ 34,528,709   

Alphabet, Inc. - Class A (a)

     38,465           27,228,604   

Alphabet, Inc. - Class C (a)

     234,238           162,329,276   

ANSYS, Inc. (a)

     299,100           27,149,307   

Aspen Technology, Inc. (a)

     742,860           28,250,966   

Cognizant Technology Solutions Corp. - Class A (a)

     792,480           46,257,058   

Facebook, Inc. - Class A (a)

     1,537,426           180,770,432   

Palo Alto Networks, Inc. (a)

     185,860           28,040,698   

ServiceNow, Inc. (a)

     348,376           24,901,916   

Twitter, Inc. (a)

     894,390           13,075,982   
       

 

 

 
          572,532,948   
       

 

 

 

Computer Technology - 4.1%

  

Apple, Inc.

     1,371,072           128,524,289   
       

 

 

 

Electronic Components - 1.1%

  

Amphenol Corp. - Class A

     624,383           34,859,303   
       

 

 

 

Semiconductors & Component - 3.4%

  

NVIDIA Corp.

     1,672,178           59,412,484   

Xilinx, Inc.

     1,148,400           49,473,072   
       

 

 

 
          108,885,556   
       

 

 

 

Telecommunications Equipment - 1.0%

  

Arista Networks, Inc. (a) (b)

     477,596           31,817,446   
       

 

 

 
          876,619,542   
       

 

 

 

Consumer Discretionary - 27.4%

  

Cable Television Services - 4.4%

  

AMC Networks, Inc. - Class A (a)

     763,888           49,828,414   

Comcast Corp. - Class A

     1,444,170           87,747,769   
       

 

 

 
          137,576,183   
       

 

 

 

Cosmetics - 1.6%

  

Estee Lauder Cos., Inc. (The) - Class A

     521,670           50,012,503   
       

 

 

 

Diversified Retail - 3.8%

  

Costco Wholesale Corp.

     259,660           38,463,436   

Dollar Tree, Inc. (a)

     1,010,880           80,577,244   
       

 

 

 
          119,040,680   
       

 

 

 

Entertainment - 2.7%

  

Walt Disney Co. (The)

     835,907           86,315,757   
       

 

 

 

Leisure Time - 2.4%

  

Priceline Group, Inc. (The) (a)

     57,040           76,642,366   
       

 

 

 

Restaurants - 2.4%

  

Starbucks Corp.

     1,331,982           74,897,348   
       

 

 

 

Specialty Retail - 7.4%

  

Home Depot, Inc. (The)

     941,904           126,111,526   

L Brands, Inc.

     305,610           23,926,207   


Company

   Shares        U.S. $ Value  

O’Reilly Automotive, Inc. (a)

     107,170           28,151,416   

Ulta Salon Cosmetics & Fragrance, Inc. (a)

     257,170           53,563,368   
       

 

 

 
          231,752,517   
       

 

 

 

Textiles, Apparel & Shoes - 2.7%

  

NIKE, Inc. - Class B

     1,445,554           85,200,953   
       

 

 

 
          861,438,307   
       

 

 

 

Health Care - 20.8%

  

Biotechnology - 6.8%

  

Alexion Pharmaceuticals, Inc. (a)

     558,519           77,790,527   

Biogen, Inc. (a)

     494,676           136,030,953   
       

 

 

 
          213,821,480   
       

 

 

 

Health Care Management Services - 3.7%

  

UnitedHealth Group, Inc.

     883,932           116,396,166   
       

 

 

 

Health Care Services - 0.9%

  

Premier, Inc. - Class A (a)

     884,787           29,914,648   
       

 

 

 

Medical & Dental Instruments & Supplies - 2.0%

  

Align Technology, Inc. (a)

     570,160           41,159,850   

Edwards Lifesciences Corp. (a)

     206,050           21,884,571   
       

 

 

 
          63,044,421   
       

 

 

 

Medical Equipment - 4.9%

  

Illumina, Inc. (a)

     164,839           22,251,617   

Intuitive Surgical, Inc. (a)

     211,383           132,401,856   
       

 

 

 
          154,653,473   
       

 

 

 

Pharmaceuticals - 2.5%

  

Gilead Sciences, Inc.

     888,340           78,360,471   
       

 

 

 
          656,190,659   
       

 

 

 

Producer Durables - 5.6%

  

Aerospace - 1.3%

  

Rockwell Collins, Inc.

     474,191           41,818,904   
       

 

 

 

Air Transport - 0.3%

  

Alaska Air Group, Inc.

     153,942           10,842,135   
       

 

 

 

Back Office Support, HR & Consulting - 0.5%

  

Robert Half International, Inc.

     400,880           15,357,713   
       

 

 

 

Diversified Manufacturing Operations - 1.4%

  

Danaher Corp.

     452,257           43,755,865   
       

 

 

 

Scientific Instruments: Control & Filter - 0.6%

  

Roper Technologies, Inc.

     98,750           17,388,888   
       

 

 

 

Scientific Instruments: Electrical - 0.7%

  

AO Smith Corp.

     277,660           21,440,905   
       

 

 

 

Scientific Instruments: Gauges & Meters - 0.8%

  

Mettler-Toledo International, Inc. (a)

     69,980           25,049,341   
       

 

 

 
          175,653,751   
       

 

 

 


Company

   Shares        U.S. $ Value  

Financial Services - 5.5%

  

Asset Management & Custodian - 0.8%

  

BlackRock, Inc. - Class A

     68,680           24,472,744   
       

 

 

 

Financial Data & Systems - 4.7%

  

Vantiv, Inc. - Class A (a)

     403,580           22,011,253   

Visa, Inc. - Class A

     1,642,770           126,887,555   
       

 

 

 
          148,898,808   
       

 

 

 
          173,371,552   
       

 

 

 

Consumer Staples - 4.6%

  

Beverage: Soft Drinks - 1.8%

  

Monster Beverage Corp. (a)

     398,550           57,478,881   
       

 

 

 

Drug & Grocery Store Chains - 2.8%

  

CVS Health Corp.

     867,608           87,194,604   
       

 

 

 
          144,673,485   
       

 

 

 

Materials & Processing - 1.1%

  

Building Materials - 1.1%

  

Acuity Brands, Inc.

     139,157           33,939,001   
       

 

 

 

Total Common Stocks
(cost $2,461,576,262)

          2,921,886,297   
       

 

 

 

SHORT-TERM INVESTMENTS - 6.9%

  

Investment Companies - 6.9%

  

AB Fixed Income Shares, Inc. - Government STIF Portfolio, 0.36% (c) (d)
(cost $218,786,016)

     218,786,016           218,786,016   
       

 

 

 

Total Investments Before Security Lending Collateral for Securities Loaned - 99.7%
(cost $2,680,362,278)

          3,140,672,313   
       

 

 

 

INVESTMENTS OF CASH COLLATERAL FOR SECURITIES LOANED - 1.2%

       

Investment Companies - 1.2%

  

AB Exchange Reserves - Class I, 0.32% (c) (d)
(cost $37,734,570)

     37,734,570           37,734,570   
       

 

 

 

Total Investments - 100.9%
(cost $2,718,096,848) (e)

   

       3,178,406,883   

Other assets less liabilities - (0.9)%

          (29,013,252
       

 

 

 

Net Assets - 100.0%

        $ 3,149,393,631   
       

 

 

 

 

(a) Non-income producing security.
(b) Represents entire or partial securities out on loan.
(c) Investment in affiliated money market mutual fund. The rate shown represents the 7-day yield as of period end.
(d) To obtain a copy of the fund’s financial statements, please go to the Securities and Exchange Commission’s website at www.sec.gov, or call AB at (800) 227-4618.
(e) As of April 30, 2016, the cost basis of investment securities owned was substantially identical for both book and tax purposes. Gross unrealized appreciation of investments was $505,507,369 and gross unrealized depreciation of investments was $(45,197,334), resulting in net unrealized appreciation of $460,310,035.


Please note: The sector classifications presented herein are based on the Russell sector classification scheme which was developed by Russell Investments. Russell classifies index members into industries that most closely describe the nature of its business and its primary economic orientation.


AB Large Cap Growth Fund

April 30, 2016 (unaudited)

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability (including those valued based on their market values). Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized 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, credit risk, etc.)

   

Level 3—significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

Where readily available market prices or relevant bid prices are not available for certain equity investments, such investments may be valued based on similar publicly traded investments, movements in relevant indices since last available prices or based upon underlying company fundamentals and comparable company data (such as multiples to earnings or other multiples to equity). Where an investment is valued using an observable input, by pricing vendors, such as another publicly traded security, the investment will be classified as Level 2. If management determines that an adjustment is appropriate based on restrictions on resale, illiquidity or uncertainty, and such adjustment is a significant component of the valuation, the investment will be classified as Level 3. An investment will also be classified as Level 3 where management uses company fundamentals and other significant inputs to determine the valuation.

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2016:

 

Investments in Securities:

   Level 1     Level 2     Level 3     Total  

Assets:

  

Common Stocks (a)

   $ 2,921,886,297      $ – 0  –    $ – 0  –    $ 2,921,886,297   

Short-Term Investments

     218,786,016        – 0  –      – 0  –      218,786,016   

Investments of Cash Collateral for Securities Loaned in Affiliated Money Market Fund

     37,734,570        – 0  –      – 0  –      37,734,570   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Investments in Securities

     3,178,406,883        – 0  –      – 0  –      3,178,406,883   

Other Financial Instruments (b)

     – 0  –      – 0  –      – 0  –      – 0  – 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total (c)

   $     3,178,406,883      $             – 0  –    $             – 0  –    $     3,178,406,883   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) See Portfolio of Investments for sector classifications.
(a) Other financial instruments are derivative instruments, such as futures, forwards and swaps, which are valued at the unrealized appreciation/depreciation on the instrument.
(c) There were no transfers between any levels during the reporting period.

The Fund recognizes all transfers between levels of the fair value hierarchy assuming the financial instruments were transferred at the beginning of the reporting period.

The Adviser established the Valuation Committee (the “Committee”) to oversee the pricing and valuation of all securities held in the Fund. The Committee operates under pricing and valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated), and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.


The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments and process at vendors, 2) daily compare of security valuation versus prior day for all securities that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

A Summary of the Fund’s transactions of investments in affiliated issuers for the quarter ended April 30, 2016 is as follows:

 

       Distributions  

Affiliated Issuer

   Market Value
July 31, 2015
(000)
     Purchases
at Cost
(000)
     Sales
Proceeds
(000)
     Realized
Gain (Loss)
(000)
     Change in
Unrealized

Appr./(Depr.)
(000)
     Market Value
April 30,  2016
(000)
     Income
(000)
     Realized
Gains
(000)
 

AB Fixed Income Shares, Inc. - Government STIF Portfolio

   $ 190,465       $ 1,001,499       $ 973,178       $ 0       $ 0       $ 218,786       $ 369       $ 0   

AB Exchange Reserves - Class I

     30,258         200,223         192,746         0         0         37,735         0         0   


ITEM 2. CONTROLS AND PROCEDURES.

(a) The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) are effective at the reasonable assurance level based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this document.

(b) There were no changes in the registrant’s internal controls over financial reporting that occurred during the second fiscal quarter of the period that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

ITEM 3. EXHIBITS.

The following exhibits are attached to this Form N-Q:

 

EXHIBIT NO.

 

DESCRIPTION OF EXHIBIT

3 (a) (1)   Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
3 (a) (2)   Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002


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.

(Registrant): AB Large Cap Growth Fund, Inc.

 

By:   /s/    Robert M. Keith
  Robert M. Keith
  President
Date:   June 24, 2016

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/    Robert M. Keith
  Robert M. Keith
  President
Date:   June 24, 2016
By:   /s/    Joseph J. Mantineo
  Joseph J. Mantineo
  Treasurer and Chief Financial Officer
Date:   June 24, 2016