Global Equity Dividend Fund

Capital at risk. Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy.

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Overview

Strategy

Fund Summary

We seek to balance cyclical and defensive dividend stocks to pursue both yield and performance. We leverage our strong sector and regional research expertise to identify the most attractive dividend opportunities globally – in areas we believe are often overlooked by other dividend-focused portfolios. The promotion of environmental and/or social characteristics is achieved through the fund's commitment to maintain at least 10% of the value of its portfolio invested in Sustainable Investments, as defined by the SFDR. Additionally, we apply a proprietary responsible screen (exclusion list). The manager is not constrained by the fund’s benchmark, which is used for performance comparison purposes only.

30-Jun-2022 - Yoichiro Kai, Portfolio Manager,

We seek high-quality dividend-paying companies with durable growth prospects, capital allocation discipline, and a strong focus on shareholder returns. This objective continued to guide our investment decisions during the quarter. We leaned into idiosyncratic ideas, favoring companies that we expect to benefit from distinct growth drivers or exposures to structural tailwinds. Amid pockets of indiscriminate sell-offs, we saw attractive entry points to invest in some names that we like. Our attention to valuations also led us to sell shares in areas where we saw reduced room for upside.

Consumer Discretionary

We have a positive bias to the sector. Notwithstanding widespread economic concerns, we think that consumer demand has stayed resilient as credit levels, incomes and other indicators remain in broadly good shape.

We bought shares of InterContinental Hotels (IHG). The global hotel operator has an asset-light business model, with most of the rooms (or units) in its portfolio falling under franchise or management agreements. We think that the market has underappreciated the potential for IHG's net unit growth to accelerate, which is a key stock driver from our perspective. We anticipate strong free cash flow generation and earnings growth for the company. We also believe it may restart share buybacks after reinstating its dividend recently.
Magna International is one of the world's largest auto parts suppliers and we purchased its shares. In our view, the stock has historically tracked the auto production cycle, and we expect production to increase on the back of pent-up demand and improved semiconductor chip supply. In the longer term, we see Magna tapping its strong manufacturing capabilities to develop comprehensive electric vehicle offerings. We are positive on the company's earnings growth potential.

Financials

The sector remains a sizeable part of the portfolio, even after we reduced our exposure during the quarter. Our key financials holdings include insurers, financial services companies, and banks that demonstrate high-quality characteristics by our assessment.

We sold shares of Al Rajhi Bank in Saudi Arabia following the stock's recent rally. We saw the bank deliver much of the growth we had anticipated, and we think there is limited room for its valuation to climb further. We are also cautious about the potential for higher funding costs and increased competition in mortgages to compress the bank's net interest margin.
CME Group is a global derivatives marketplace. We consider trading volumes to be a key driver for the stock, and we expect volume growth to taper off following a spike driven by increased market volatility. We turned more cautious about CME's risk-and-reward profile in the near term and reduced our holding.

Communication Services

We are selective in a sector where capital-intensive telecommunication companies with limited growth opportunities tend to dominate. We seek telecom companies that appear best-positioned in their industry, and we also favor music companies that display room for growth.

We sold shares of Comcast, a global media company and a major U.S. cable operator. We are mindful of secular headwinds in the pay-television industry, and we see increased uncertainty around the value of investments that Comcast may undertake in this area.

Team

Yoichiro Kai,
Portfolio Manager

Yoichiro Kai is a portfolio manager for the T. Rowe Price Global Equity Dividend Strategy.

Portfolio Manager since

2018

Years at T. Rowe Price

Years investment experience

Benchmark Data Source: MSCI. MSCI index returns are shown with reinvestment of dividends after the deduction of withholding taxes. MSCI and its affiliates and third party sources and providers (collectively, “MSCI”) makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed, or produced by MSCI. Historical MSCI data and analysis should not be taken as an indication or guarantee of any future performance analysis, forecast or prediction. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such.

Past performance is not a reliable indicator of future performance.

Source for performance: T. Rowe Price. Fund performance is calculated using the official NAV with dividends reinvested, if any. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested. It will be affected by changes in the exchange rate between the base currency of the fund and the subscription currency, if different. Sales charges (up to a maximum of 5% for the A Class), taxes and other locally applied costs have not been deducted and if applicable, they will reduce the performance figures.

Daily performance data is based on the latest available NAV.

The Funds are sub-funds of the T. Rowe Price Funds SICAV, a Luxembourg investment company with variable capital which is registered with Commission de Surveillance du Secteur Financier and which qualifies as an undertaking for collective investment in transferable securities (“UCITS”). Full details of the objectives, investment policies and risks are located in the prospectus which is available with the key investor information documents and/or key information document (KID) in English and in an official language of the jurisdictions in which the Funds are registered for public sale, together with the articles of incorporation and the annual and semi-annual reports (together “Fund Documents”). Any decision to invest should be made on the basis of the Fund Documents which are available free of charge from the local representative, local information/paying agent or from authorised distributors. They can also be found along with a summary of investor rights in English at www.troweprice.com. The Management Company reserves the right to terminate marketing arrangements.

Please note that the Fund typically has a risk of high volatility.

The specific securities identified and described in this website do not represent all of the securities purchased, sold, or recommended for the sub-fund and no assumptions should be made that the securities identified and discussed were or will be profitable.

©2023 Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

A full list of the currently issued Share Classes including Distributing, Hedged, and Accumulating Categories may be obtained, free of charge and upon request, from the registered office of the Company.

Consumer Discretionary

Financials

Communication Services

Risks

Typical Investor

Commentary for