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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM N-Q

 

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

 

 

Investment Company Act file number: 811-5003

 

 

Blue Chip Value Fund, Inc.

 (Exact name of registrant as specified in charter)

 

 

1225 17th Street, 26th Floor, Denver, Colorado 80202

 (Address of principal executive offices) (Zip code)

 

 

Michael P. Malloy
Drinker Biddle & Reath LLP

One Logan Square

18th & Cherry Streets

Philadelphia, Pennsylvania 19103-6996

 (Name and address of agent for service)

 

 

Registrant’s Telephone Number, including Area Code: (800) 624-4190

 

 

Date of fiscal year end: December 31

 

 

Date of reporting period: March 31, 2010

 


 


Item 1 – Schedule of Investments.

 

 

Blue Chip Value Fund, Inc.

 

STATEMENT OF INVESTMENTS

March 31, 2010 (Unaudited)

 

 

 

 

 

Market

 

Shares

 

Cost

 

Value

COMMON STOCKS - 109.08%

 

 

 

 

 

BASIC MATERIALS - 6.86%

 

 

 

 

 

Forestry & Paper - 5.08%

 

 

 

 

 

Ball Corp.

41,940

 

$2,200,538

 

$2,238,757

International Paper Co.

138,600

 

3,349,015

 

3,410,946

 

 

 

5,549,553

 

5,649,703

Specialty Chemicals - 1.78%

 

 

 

 

 

The Mosaic Co.

32,500

 

1,706,361

 

1,975,025

 

 

 

 

 

 

TOTAL BASIC MATERIALS

 

 

7,255,914

 

7,624,728

CAPITAL GOODS - 5.32%

 

 

 

 

 

Aerospace & Defense  - 3.13%

 

 

 

 

 

General Dynamics Corp.

22,100

 

1,444,761

 

1,706,120

Raytheon Co.

31,000

 

1,465,509

 

1,770,720

 

 

 

2,910,270

 

3,476,840

Industrial Products - 2.19%

 

 

 

 

 

ITT Corp.

45,500

 

2,500,494

 

2,439,255

 

 

 

 

 

 

TOTAL CAPITAL GOODS

 

 

5,410,764

 

5,916,095

COMMERCIAL SERVICES - 4.70%

 

 

 

 

 

Business Products & Services    - 1.95%

 

 

 

 

 

Quanta Services Inc.**

113,000

 

3,475,189

 

2,165,080

 

 

 

 

 

 

IT Services - 1.52%

 

 

 

 

 

Computer Sciences Corp.**

31,050

 

1,630,333

 

1,691,914

 

 

 

 

 

 

Transaction Processing - 1.23%

 

 

 

 

 

The Western Union Co.

81,000

 

1,341,107

 

1,373,760

 

 

 

 

 

 

TOTAL COMMERCIAL SERVICES

 

 

6,446,629

 

5,230,754

COMMUNICATIONS - 8.16%

 

 

 

 

 

Networking - 3.32%

 

 

 

 

 

Cisco Systems Inc.**

141,700

 

3,444,101

 

3,688,451

 

 

 

 

 

 

Telecomm Equipment & Solutions - 4.84%

 

 

 

 

 

Nokia Corp. - ADR (Finland)

126,930

 

1,842,673

 

1,972,492

QUALCOMM Inc.

81,200

 

3,667,187

 

3,409,588

 

 

 

5,509,860

 

5,382,080

TOTAL COMMUNICATIONS

 

 

8,953,961

 

9,070,531

CONSUMER CYCLICAL - 13.15%

 

 

 

 

 

Apparel & Footwear Manufacturers - 2.06%

 

 

 

 

 

Nike Inc.

31,150

 

1,956,597

 

2,289,525

 

 

 

 

 

 

Department Stores - 2.62%

 

 

 

 

 

Macy's Inc.

133,700

 

2,378,598

 

2,910,649

 

 

 

 

 

 

Other Consumer Services - 2.52%

 

 

 

 

 

Expedia Inc.

112,400

 

3,017,526

 

2,805,504

 

 

 

 

 

 

 

 

 


 


 

 

 

Publishing & Media  - 1.73%

 

 

 

 

 

Walt Disney Co.

55,000

 

1,591,931

 

1,920,050

 

 

 

 

 

 

Restaurants - 1.15%

 

 

 

 

 

Darden Restaurants Inc.

28,840

 

904,419

 

1,284,534

 

 

 

 

 

 

Specialty Retail - 3.07%

 

 

 

 

 

Best Buy Co. Inc

80,200

 

3,222,815

 

3,411,708

 

 

 

 

 

 

TOTAL CONSUMER CYCLICAL

 

 

13,071,886

 

14,621,970

CONSUMER STAPLES - 7.46%

 

 

 

 

 

Consumer Products - 2.79%

 

 

 

 

 

Colgate Palmolive Co.

36,400

 

2,894,135

 

3,103,464

 

 

 

 

 

 

Food & Agricultural Products - 4.67%

 

 

 

 

 

Campbell Soup Co.

67,900

 

2,476,554

 

2,400,265

Unilever N.V. (Netherlands)

92,700

 

3,284,852

 

2,795,832

 

 

 

5,761,406

 

5,196,097

TOTAL CONSUMER STAPLES

 

 

8,655,541

 

8,299,561

ENERGY - 11.05%

 

 

 

 

 

Exploration & Production - 3.51%

 

 

 

 

 

Occidental Petroleum Corp.

46,180

 

3,199,115

 

3,904,057

 

 

 

 

 

 

Integrated Oils - 4.23%

 

 

 

 

 

Exxon Mobil Corp.

25,500

 

1,852,956

 

1,707,990

Marathon Oil Corp.

94,800

 

3,366,930

 

2,999,472

 

 

 

5,219,886

 

4,707,462

Oil Services - 3.31%

 

 

 

 

 

Transocean Inc. (Switzerland)**

42,549

 

3,933,951

 

3,675,383

 

 

 

 

 

 

TOTAL ENERGY

 

 

12,352,952

 

12,286,902

INTEREST RATE SENSITIVE - 15.63%

 

 

 

 

 

Money Center Banks - 5.42%

 

 

 

 

 

Bank of America Corp.

194,000

 

3,225,368

 

3,462,900

JPMorgan Chase & Co.

57,200

 

2,479,199

 

2,559,700

 

 

 

5,704,567

 

6,022,600

Property Casualty Insurance - 3.12%

 

 

 

 

 

ACE Ltd. (Switzerland)

38,700

 

2,109,636

 

2,024,010

The Travelers Cos. Inc.

26,900

 

1,295,715

 

1,450,986

 

 

 

3,405,351

 

3,474,996

Regional Banks - 3.12%

 

 

 

 

 

Comerica Inc.

32,200

 

1,138,099

 

1,224,888

SunTrust Banks Inc.

83,800

 

1,843,469

 

2,245,002

 

 

 

2,981,568

 

3,469,890

Securities & Asset Management - 3.97%

 

 

 

 

 

The Bank of New York Mellon Corp.

71,400

 

2,205,945

 

2,204,832

Invesco Ltd.

100,700

 

2,283,742

 

2,206,337

 

 

 

4,489,687

 

4,411,169

TOTAL INTEREST RATE SENSITIVE

 

 

16,581,173

 

17,378,655

MEDICAL & HEALTHCARE - 12.69%

 

 

 

 

 

Medical Technology - 2.61%

 

 

 

 

 

Zimmer Holdings Inc.**

49,000

 

3,345,140

 

2,900,800

 

 

 

 

 

 

Pharmaceuticals - 10.08%

 

 

 

 

 

Abbott Laboratories

53,000

 

2,802,905

 

2,792,040

Amgen Inc.**

54,500

 

3,254,315

 

3,256,920

Forest Laboratories Inc.**

80,000

 

2,176,616

 

2,508,800

Pfizer Inc.

154,868

 

2,774,241

 

2,655,986

 

 

 

11,008,077

 

11,213,746

TOTAL MEDICAL & HEALTHCARE

 

 

14,353,217

 

14,114,546

           

 


TECHNOLOGY - 16.71%

 

 

 

 

 

Computer Software - 6.33%

 

 

 

 

 

Microsoft Corp.

134,200

 

3,626,075

 

3,928,034

Symantec Corp.**

184,200

 

3,261,615

 

3,116,664

 

 

 

6,887,690

 

7,044,698

PC's & Servers - 6.61%

 

 

 

 

 

Dell Inc.**

213,700

 

3,178,249

 

3,207,637

International Business Machines Corp.

32,300

 

3,849,141

 

4,142,475

 

 

 

7,027,390

 

7,350,112

Semiconductors - 3.77%

 

 

 

 

 

Altera Corp.

80,700

 

1,604,600

 

1,961,817

Intel Corp.

100,000

 

1,893,457

 

2,226,000

 

 

 

3,498,057

 

4,187,817

TOTAL TECHNOLOGY

 

 

17,413,137

 

18,582,627

TRANSPORTATION - 4.29%

 

 

 

 

 

Railroads - 4.29%

 

 

 

 

 

Norfolk Southern Corp.

49,800

 

2,622,314

 

2,783,322

Union Pacific Corp.

27,100

 

1,672,102

 

1,986,430

 

 

 

4,294,416

 

4,769,752

TOTAL TRANSPORTATION

 

 

4,294,416

 

4,769,752

UTILITIES - 3.06%

 

 

 

 

 

Independent Power - 1.08%

 

 

 

 

 

PPL Corp.

43,450

 

1,999,930

 

1,204,000

 

 

 

 

 

 

Regulated Electric - 1.98%

 

 

 

 

 

Edison International

64,200

 

2,046,266

 

2,193,714

 

 

 

 

 

 

TOTAL UTILITIES

 

 

4,046,196

 

3,397,714

TOTAL COMMON STOCKS

 

 

118,835,786

 

121,293,835

 

 

 

 

 

 

SHORT TERM INVESTMENTS - 0.30%

 

 

 

 

 

Fidelity Institutional Money Market Government Portfolio -
Class I (7 Day Yield 0.04%)

332,530

 

332,530

 

332,530

TOTAL SHORT TERM INVESTMENTS

 

 

332,530

 

332,530

 

 

 

 

 

 

TOTAL INVESTMENTS

109.38%

 

$119,168,316

 

$121,626,365

Liabilities in Excess of Other Assets

(9.38)%

 

 

 

(10,427,287)

NET ASSETS

100.00%

 

 

 

$111,199,078

 

**   Non-dividend paying stock

 

ADR - American Depositary Receipt

  

Sector and industry classifications presented herein are based on the sector and industry categorization methodology of the Investment Adviser to the Fund.

 

 

 

 


 


 

 

 

 

COUNTRY BREAKDOWN

As of March 31, 2010 (Unaudited)

 

 

 

 

Market

 

 

Country

 

 

Value

 

%     

United States

 

 

$111,158,648

 

99.96%

Switzerland

 

 

5,699,393

 

5.13%

Netherlands

 

 

2,795,832

 

2.52%

Finland

 

 

1,972,492

 

1.77%

Total Investments

 

 

$121,626,365

 

109.38%

Liabilities in Excess of Other Assets

 

 

(10,427,287)

 

(9.38%)

Net Assets

 

 

$111,199,078

 

100.00%

 

Please note the country classification is based on the company headquarters. All of the Fund's investments are traded on U.S. exchanges.

 

See accompanying notes to statement of investments.

 

 

 

 

 


 


 

 

 

BLUE CHIP VALUE FUND

NOTES TO STATEMENT OF INVESTMENTS

March 31, 2010 (Unaudited)

 

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

 

Blue Chip Value Fund, Inc. (the “Fund”) is registered under the Investment Company Act of 1940, as amended, as a diversified, closed-end management investment company.

 

The following is a summary of significant accounting policies followed by the Fund in the preparation of its statement of investments.

 

Security Valuation–All securities of the Fund are valued as of the close of regular trading on the New York Stock Exchange (“NYSE”), currently 4:00 p.m. (Eastern Time), on each day that the NYSE is open. Listed securities are generally valued at the last sales price as of the close of regular trading on the NYSE. Securities traded on the National Association of Securities Dealers Automated Quotation (“NASDAQ”) are generally valued at the NASDAQ Official Closing Price (“NOCP”). In the absence of sales and NOCP, such securities are valued at the mean of the bid and asked prices.

 

Securities having a remaining maturity of 60 days or less are valued at amortized cost which approximates market value.

 

When market quotations are not readily available or when events occur that make established valuation methods unreliable, securities of the Fund may be valued at fair value determined in good faith by or under the direction of the Board of Directors.  Factors which may be considered when determining the fair value of a security include (a) the fundamental data relating to the investment; (b) an evaluation of the forces which influence the market in which the security is sold, including the liquidity and depth of the market; (c) the market value at date of purchase; (d) information as to any transactions or offers with respect to the security or comparable securities; and (e) any other relevant matters.

 

Investment Transactions–Investment transactions are accounted for on the date the investments are purchased or sold (trade date). Realized gains and losses from investment transactions and unrealized appreciation and depreciation of investment are determined on the “specific identification” basis for both financial statement and federal income tax purposes. Dividend income is recorded on the ex-dividend date. Interest income, which includes interest earned on money market funds, is accrued and recorded daily.

 

Use of Estimates–The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and disclosures made in the accompanying notes to the financial statements. Actual results could differ from those estimates.

 

 


 


 

2. FAIR VALUE MEASUREMENTS

 

A three-tier hierarchy has been established to measure fair value based on the extent of use of “observable inputs” as compared to “unobservable inputs” for disclosure purposes and requires additional disclosures about these valuations measurements. Inputs refer broadly to the assumptions that market participants would use in pricing a security. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the security developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the security developed based on the best information available in the circumstances.

 

The three-tier hierarchy is summarized as follows:

 

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).

 

 

The following is a summary of the inputs used as of March 31, 2010 in valuing the Fund’s assets:

 

 

Investments in Securities at Value*

Level 1 - Quoted
Prices

Level 2 - Other
Significant
Observable Inputs

Level 3 - Significant
Unobservable
Inputs

Total

Common Stocks

$121,293,835

 $–

 $–

 $121,293,835

Short-Term Investments

 332,530

 –

 –

332,530

TOTAL

$121,626,365

$–

$–

$121,626,365

 

*For detailed Industry descriptions, see accompanying Statement of Investments

 

All securities of the Fund were valued using Level 1 inputs during the three months ended March 31, 2010. Thus, a reconciliation of assets in which significant unobservable inputs (Level 3) were used in determining fair value is not applicable.

 

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

 

 

 

 


 


 

 

 

 

 

3. UNREALIZED APPRECIATION AND DEPRECIATION OF INVESTMENTS (TAX BASIS)

 

As of March 31, 2010:

 

 

Gross appreciation (excess of value over tax cost)  

$         8,283,477

Gross depreciation (excess of tax cost over value)      

      (5,825,428)

Net unrealized appreciation 

$       2,458,049

Cost of investments for income tax purposes

$   119,168,316

 

 

4. LOAN OUTSTANDING

 

The Fund has a line of credit with The Bank of New York Mellon (“BONY”) in which the Fund may borrow up to the lesser of 15% of the Fund’s total assets, $15,000,000 or the maximum amount the Fund is permitted to borrow under the Investment Company Act of 1940. For the period January 1, 2010 through February 28, 2010 the interest rate reset daily at overnight Federal Funds Rate plus 1.00%. Effective March 1, 2010, the interest rate changed to overnight Federal Funds Rate plus 1.25% and the Fund pays an annual loan facility fee of 0.03%. The borrowings under the BONY loan are secured by a perfected security interest on all of the Funds’ assets.

 

Details of the loan outstanding are as follows:

 

                                                                                                               

 

  Average for the

 

As of Period Ended

 

March 31, March 31,

 

2010 2010

Loan outstanding

$  10,425,000 $ 11,117,889

Interest rate       

1.41%* 1.22%

% of Fund's total assets   

8.56% 9.13%

Amount of debt per share outstanding      

$             0.37 $            0.39

Number of shares outstanding (in thousands)   

28,464 28,464**

 

*Annualized

**Weighted average

 

 


 


 

 

 

Item 2 - Controls and Procedures.

 

(a)        The registrant's  Principal Executive Officer and Principal Financial Officer have evaluated the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) within 90 days of the filing date of this report and have concluded that the registrant's disclosure controls and procedures were effective, as of that date.

 

(b)        There was no change in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during registrant's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

 

Item 3 – Exhibits.

 

Separate certifications for the registrant's Principal Executive Officer and Principal Financial Officer, as required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached as Ex99.CERT.

 

 

 

 


 


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.

 

BLUE CHIP VALUE FUND, INC.

 

By:       /s/ Todger Anderson

            Todger Anderson

            President / Principal   Executive Officer

 

Date:    May 28, 2010

 

 

            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/ Todger Anderson

            Todger Anderson

            President / Principal   Executive Officer

 

Date:    May 28, 2010

 

 

By:       /s/ Jasper R. Frontz

            Jasper R. Frontz

            Treasurer / Principal Financial Officer

 

Date:    May 28, 2010