N-CSRS 1 a_largecapvalue.htm PUTNAM LARGE CAP VALUE FUND a_largecapvalue.htm


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES



Investment Company Act file number: (811-02742)
Exact name of registrant as specified in charter: Putnam Large Cap Value Fund
Address of principal executive offices: 100 Federal Street, Boston, Massachusetts 02110
Name and address of agent for service: Stephen Tate, Vice President
100 Federal Street
Boston, Massachusetts 02110
Copy to:         Bryan Chegwidden, Esq.
Ropes & Gray LLP
1211 Avenue of the Americas
New York, New York 10036
Registrant’s telephone number, including area code: (617) 292-1000
Date of fiscal year end: October 31, 2022
Date of reporting period: November 1, 2021 – April 30, 2022



Item 1. Report to Stockholders:

The following is a copy of the report transmitted to stockholders pursuant to Rule 30e-1 under the Investment Company Act of 1940:




Message from the Trustees

June 10, 2022

Dear Fellow Shareholder:

The year to date has been difficult for investors, with bond and stock prices falling in repeated market downturns. Inflation has climbed to levels not seen in decades, prompting the U.S. Federal Reserve to reverse the stimulus that had helped support financial assets since 2020. Markets globally also have reacted to the Russia-Ukraine War and the worsening Covid-19 pandemic in China. In the underlying economy, we have seen encouraging signs, such as abundant job openings and wage gains in the United States.

History has shown us that markets eventually recover from crises and may reward those focused on long-term goals rather than short-term uncertainties. At Putnam, professional, active investors are working for you. They are monitoring risks while looking for strong potential investments for your fund. Learn more in the interview with your fund manager(s) in the following pages.

Thank you for investing with Putnam.




Value-style investing is grounded in a basic concept: The stock market always offers something at a discount. Putnam Large Cap Value Fund Portfolio Managers Darren Jaroch and Lauren DeMore scour the universe of large companies, seeking attractively priced stocks of businesses that they believe are poised for positive change.


2 Large Cap Value Fund 

 


Pursuing positive returns in all types of markets

For rolling five-year periods over the past 15 years, Putnam Large Cap Value Fund delivered a positive return 97% of the time.


A multidimensional approach to value investing

The fund targets a wider array of opportunities than many other large-cap value funds, with an emphasis on businesses that could enhance capital appreciation potential.


Large Cap Value Fund 3 

 



Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. Share price, principal value, and return will fluctuate, and you may have a gain or a loss when you sell your shares. Performance of class A shares assumes reinvestment of distributions and does not account for taxes. Fund returns in the bar chart do not reflect a sales charge of 5.75%; had they, returns would have been lower. See below and pages 9–11 for additional performance information. For a portion of the periods, the fund had expense limitations, without which returns would have been lower. To obtain the most recent month-end performance, visit putnam.com.

Returns for periods of less than one year are not annualized.

Lipper peer group average is provided by Lipper, a Refinitiv company.

* The fund’s benchmark, the Russell 1000 Value Index, was introduced on 12/31/78, which post-dates the inception of the fund’s class A shares.


This comparison shows your fund’s performance in the context of broad market indexes for the six months ended 4/30/22. See above and pages 9–11 for additional fund performance information. Index descriptions can be found on pages 14–15.

All Bloomberg indices are provided by Bloomberg Index Services Limited.

4 Large Cap Value Fund 

 



 

How was the investing environment for the reporting period?

LAUREN The six-month reporting period was a very challenging time for financial markets. The performance of large-cap value stocks was negative, as measured by the Russell 1000 Value Index, the fund’s benchmark. At the same time, value stocks performed much better than growth stocks. Throughout the period, investors were faced with multiple macroeconomic challenges, including rising inflation, the potential for interest-rate hikes, and continued supply chain disruptions. Stocks declined sharply in late 2021 with the emergence of the Omicron variant of Covid-19. New Covid cases mounted and concerns grew about the potential for renewed economic shutdowns. Despite the headwinds, stocks ended 2021 with solid gains for a third consecutive year.

As the Omicron threat eased and U.S. Covid cases began to decline in early 2022, new challenges emerged. On February 24, Russia launched a large-scale invasion of Ukraine, rattling global financial markets. Stock market volatility surged and uncertainty grew over the long-term impact of this humanitarian and geopolitical crisis. Also, the U.S. Federal

Large Cap Value Fund 5 

 



Allocations are shown as a percentage of the fund’s net assets as of 4/30/22. Cash and net other assets, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Summary information may differ from the portfolio schedule included in the financial statements due to the inclusion of derivative securities, any interest accruals, the exclusion of as-of trades, if any, the use of different classifications of securities for presentation purposes, and rounding. Holdings and allocations may vary over time.


This table shows the fund’s top 10 holdings by percentage of the fund’s net assets as of 4/30/22. Short-term investments and derivatives, if any, are excluded. Holdings may vary over time.

6 Large Cap Value Fund 

 


Reserve voted to raise interest rates for the first time since 2018 in an effort to ease inflation. The Fed is expected to raise rates several times in 2022, leading to investor concerns about the impact of rate hikes on stock performance. Markets have been volatile so far in 2022, and at the close of the period, stocks had declined for four consecutive weeks. In April, all three major indexes recorded steep losses, including the S&P 500 Index, which posted its worst monthly performance since March 2020.

How did the fund perform in this environment?

DARREN The fund posted a return of –2.96% for the six-month reporting period, outperforming its benchmark, which returned –3.94%. The fund also outperformed the average return of –3.95% for funds in its Lipper peer group.

Could you provide some examples of stocks that contributed to the fund’s performance for the period?

DARREN One top contributor was Northrop Grumman, a diversified defense contractor. Northrop is the lead contractor for two key programs that have become a strategic priority for the U.S. Department of Defense as it looks to modernize outdated capabilities. The company may also benefit from higher defense spending in the U.S. and Europe, which we believe is more likely following Russia’s invasion of Ukraine. Northrop has delivered consistent growth in earnings, which has driven consistent growth in shareholder returns. We believe Northrop maintains a significant growth opportunity in its space systems business as defense priorities evolve and demand for satellite technology grows.

LAUREN Another highlight was ConocoPhillips — one of the largest oil and gas exploration and production companies in North America. The stock rallied strongly on the back of a significant rise in crude oil prices. Conoco has been aggressive in its merger and acquisition activity over the past few years. This has consolidated its position in key Permian Basin assets and has allowed Conoco to extract and produce energy at lower costs. The sharp rise in oil prices helped improve Conoco’s profitability and cash flows, which makes strong shareholder returns via dividends and stock buybacks more likely, in our view.


What were some stocks that detracted from performance during the reporting period?

DARREN One notable detractor was Charter Communications, which is among the largest broadband providers in the United States. Charter, along with most other cable operators, struggled when demand declined more than expected after pandemic lockdowns were lifted. Investors were also concerned about competition from wireless broadband [5G], which we believe will present a further headwind to subscriber growth for Charter.

LAUREN Citigroup was also a detractor from performance for the period. Along with most U.S. banks, it lagged the market meaningfully over the period. The stock was pressured by headwinds facing all banks — less-than-stellar earnings results and a flattening yield curve, which raised concerns about a recession and the credit cycle. In addition, for Citigroup specifically, management announced return targets that were in line with expectations, but had a longer time frame than the market hoped for. We continue to own the stock as we believe it offers attractive value relative to its peer group.

Did derivatives play a role in the fund’s performance?

DARREN On occasion, the fund employs forward currency contracts to hedge foreign exchange risk. These investments contributed to performance during the period.

Large Cap Value Fund 7 

 


What is your outlook for the coming months?

DARREN The financial markets are likely to face continued volatility due to uncertainty related to the Russia-Ukraine War, inflation, supply chain disruptions, and shortages of critical goods. In managing our portfolios, we don’t try to predict the direction, the timing, or the magnitude of macroeconomic factors like these. We are focused on how they will affect the fundamentals of individual companies — those we own or those we are considering for the fund. We seek companies we believe have lasting advantages as well as fundamental strength and solid return potential over the long term. We aim to shift out of stocks that have hit our valuation targets and redeploy those assets into stocks that many investors have overlooked.

Thank you both for your time and for bringing us up to date.

The views expressed in this report are exclusively those of Putnam Management and are subject to change. They are not meant as investment advice.

Please note that the holdings discussed in this report may not have been held by the fund for the entire period. Portfolio composition is subject to review in accordance with the fund’s investment strategy and may vary in the future. Current and future portfolio holdings are subject to risk.


This table shows the fund’s largest allocation shifts, by percentage, over the past six months. Allocations are shown as a percentage of the fund’s net assets. Current period summary information may differ from the portfolio schedule included in the financial statements due to the inclusion of derivative securities, any interest accruals, the exclusion of as-of trades, if any, the use of different classifications of securities for presentation purposes, and rounding. Holdings and allocations may vary over time.

8 Large Cap Value Fund 

 


Your fund’s performance

This section shows your fund’s performance, price, and distribution information for periods ended April 30, 2022, the end of the first half of its current fiscal year. In accordance with regulatory requirements for mutual funds, we also include performance information as of the most recent calendar quarter-end and expense information taken from the fund’s current prospectus. Performance should always be considered in light of a fund’s investment strategy. Data represent past performance. Past performance does not guarantee future results. More recent returns may be less or more than those shown. Investment return and principal value will fluctuate, and you may have a gain or a loss when you sell your shares. Performance information does not reflect any deduction for taxes a shareholder may owe on fund distributions or on the redemption of fund shares. For the most recent month-end performance, please visit the Individual Investors section at putnam.com or call Putnam at 1-800-225-1581. Class R, R5, R6, and Y shares are not available to all investors. See the Terms and definitions section in this report for definitions of the share classes offered by your fund.

Annualized fund performance Total return for periods ended 4/30/22

  Life of fund  10 years  5 years  3 years  1 year  6 months 
Class A (6/15/77)             
Before sales charge  10.37%  12.30%  11.71%  12.64%  5.45%  –2.96% 
After sales charge  10.22  11.64  10.40  10.44  –0.61  –8.54 
Class B (9/13/93)             
Before CDSC  10.17  11.62  10.88  11.80  4.68  –3.31 
After CDSC  10.17  11.62  10.62  10.99  –0.24  –7.86 
Class C (2/1/99)             
Before CDSC  10.22  11.62  10.88  11.80  4.64  –3.34 
After CDSC  10.22  11.62  10.88  11.80  3.66  –4.25 
Class R (1/21/03)             
Net asset value  10.09  12.02  11.44  12.36  5.18  –3.07 
Class R5 (7/2/12)             
Net asset value  10.52  12.63  12.00  12.94  5.70  –2.86 
Class R6 (7/2/12)             
Net asset value  10.54  12.74  12.11  13.05  5.80  –2.81 
Class Y (10/1/98)             
Net asset value  10.51  12.58  11.99  12.92  5.71  –2.86 

 

Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. After-sales-charge returns for class A shares reflect the deduction of the maximum 5.75% sales charge levied at the time of purchase. Class B share returns after contingent deferred sales charge (CDSC) reflect the applicable CDSC, which is 5% in the first year, declining over time to 1% in the sixth year, and is eliminated thereafter. Class C share returns after CDSC reflect a 1% CDSC for the first year that is eliminated thereafter. Class R, R5, R6, and Y shares have no initial sales charge or CDSC. Performance for class B, C, R, and Y shares before their inception is derived from the historical performance of class A shares, adjusted for the applicable sales charge (or CDSC) and the higher operating expenses for such shares, except for class Y shares, for which 12b-1 fees are not applicable. Performance for class R5 and R6 shares prior to their inception is derived from the historical performance of class Y shares and has not been adjusted for the lower investor servicing fees applicable to class R5 and R6 shares; had it, returns would have been higher.

Returns for periods of less than one year are not annualized.

For a portion of the periods, the fund had expense limitations, without which returns would have been lower.

Class B and C share performance reflects conversion to class A shares after eight years.

Large Cap Value Fund 9 

 


Comparative annualized index returns For periods ended 4/30/22

  Life of fund  10 years  5 years  3 years  1 year  6 months 
Russell 1000 Value Index  —*  11.17%  9.06%  9.58%  1.32%  –3.94% 
Lipper Large Cap Value             
Funds category average†  11.90%  10.96  9.95  10.37  2.24  –3.95 

 

Index and Lipper results should be compared with fund performance before sales charge, before CDSC, or at net asset value.

Returns for periods of less than one year are not annualized.

Lipper peer group average is provided by Lipper, a Refinitiv company.

* The fund’s benchmark, the Russell 1000 Value Index, was introduced on 12/31/78, which post-dates the inception of the fund’s class A shares.

† Over the 6-month, 1-year, 3-year, 5-year, 10-year, and life-of-fund periods ended 4/30/22, there were 400, 388, 355, 342, 283, and 10 funds, respectively, in this Lipper category.

Fund price and distribution information For the six-month period ended 4/30/22

Distributions  Class A  Class B  Class C  Class R  Class R5  Class R6  Class Y 
Number  2  2  2  2  2  2  2 
Income  $0.164  $0.038  $0.049  $0.126  $0.202  $0.218  $0.203 
Capital gains                 
Long-term gains  1.798  1.798  1.798  1.798  1.798  1.798  1.798 
Short-term gains  0.047  0.047  0.047  0.047  0.047  0.047  0.047 
Total  $2.009  $1.883  $1.894  $1.971  $2.047  $2.063  $2.048 
  Before  After  Net  Net  Net  Net  Net  Net 
  sales  sales  asset  asset  asset  asset  asset  asset 
Share value  charge  charge  value  value  value  value  value  value 
10/31/21  $32.65  $34.64  $32.21  $32.19  $32.36  $32.68  $32.68  $32.67 
4/30/22  29.72  31.53  29.31  29.27  29.44  29.74  29.74  29.73 
  Before  After  Net  Net  Net  Net  Net  Net 
Current rate  sales  sales  asset  asset  asset  asset  asset  asset 
(end of period)  charge  charge  value  value  value  value  value  value 
Current dividend rate1  1.10%  1.04%  0.29%  0.36%  0.87%  1.34%  1.45%  1.36% 
Current 30-day                 
SEC yield2  N/A  0.95  0.24  0.24  0.75  1.26  1.36  1.27 

 

The classification of distributions, if any, is an estimate. Before-sales-charge share value and current dividend rate for class A shares, if applicable, do not take into account any sales charge levied at the time of purchase. After-sales-charge share value, current dividend rate, and current 30-day SEC yield, if applicable, are calculated assuming that the maximum sales charge (5.75% for class A shares) was levied at the time of purchase. Final distribution information will appear on your year-end tax forms.

1 Most recent distribution, including any return of capital and excluding capital gains, annualized and divided by share price before or after sales charge at period-end.

2 Based only on investment income and calculated using the maximum offering price for each share class, in accordance with SEC guidelines.

10 Large Cap Value Fund 

 


Annualized fund performance as of most recent calendar quarter
Total return for periods ended 3/31/22

  Life of fund  10 years  5 years  3 years  1 year  6 months 
Class A (6/15/77)             
Before sales charge  10.50%  12.66%  12.73%  16.13%  14.58%  7.68% 
After sales charge  10.36  11.99  11.40  13.86  7.99  1.49 
Class B (9/13/93)             
Before CDSC  10.30  11.98  11.88  15.26  13.71  7.27 
After CDSC  10.30  11.98  11.62  14.51  8.71  2.27 
Class C (2/1/99)             
Before CDSC  10.35  11.98  11.88  15.26  13.71  7.28 
After CDSC  10.35  11.98  11.88  15.26  12.71  6.28 
Class R (1/21/03)             
Net asset value  10.23  12.38  12.45  15.85  14.29  7.55 
Class R5 (7/2/12)             
Net asset value  10.66  12.99  13.02  16.43  14.84  7.81 
Class R6 (7/2/12)             
Net asset value  10.68  13.09  13.13  16.55  14.95  7.83 
Class Y (10/1/98)             
Net asset value  10.65  12.94  13.01  16.42  14.85  7.78 

 

See the discussion following the fund performance table on page 9 for information about the calculation of fund performance.

Returns for periods of less than one year are not annualized.

Your fund’s expenses

As a mutual fund investor, you pay ongoing expenses, such as management fees, distribution fees (12b-1 fees), and other expenses. Using the following information, you can estimate how these expenses affect your investment and compare them with the expenses of other funds. You may also pay one-time transaction expenses, including sales charges (loads) and redemption fees, which are not shown in this section and would have resulted in higher total expenses. For more information, see your fund’s prospectus or talk to your financial representative.

Expense ratios

  Class A  Class B  Class C  Class R  Class R5  Class R6  Class Y 
Total annual operating expenses for the               
fiscal year ended 10/31/21*  0.88%  1.63%  1.63%  1.13%  0.64%  0.54%  0.63% 
Annualized expense ratio for the               
six-month period ended 4/30/22†  0.89%  1.64%  1.64%  1.14%  0.65%  0.55%  0.64% 

 

Fiscal year expense information in this table is taken from the most recent prospectus, is subject to change, and may differ from that shown for the annualized expense ratio and in the financial highlights of this report.

Expenses are shown as a percentage of average net assets.

* Annualized.

† Includes one-time annualized proxy cost of 0.01%.

Large Cap Value Fund 11 

 


Expenses per $1,000

The following table shows the expenses you would have paid on a $1,000 investment in each class of the fund from 11/1/21 to 4/30/22. It also shows how much a $1,000 investment would be worth at the close of the period, assuming actual returns and expenses.

  Class A  Class B  Class C  Class R  Class R5  Class R6  Class Y 
Expenses paid per $1,000*†  $4.35  $8.00  $8.00  $5.57  $3.18  $2.69  $3.13 
Ending value (after expenses)  $970.40  $966.90  $966.60  $969.30  $971.40  $971.90  $971.40 

 

* Expenses for each share class are calculated using the fund’s annualized expense ratio for each class, which represents the ongoing expenses as a percentage of average net assets for the six months ended 4/30/22. The expense ratio may differ for each share class.

† Expenses are calculated by multiplying the expense ratio by the average account value for the period; then multiplying the result by the number of days in the period (181); and then dividing that result by the number of days in the year (365).

Estimate the expenses you paid

To estimate the ongoing expenses you paid for the six months ended 4/30/22, use the following calculation method. To find the value of your investment on 11/1/21, call Putnam at 1-800-225-1581.


Compare expenses using the SEC’s method

The Securities and Exchange Commission (SEC) has established guidelines to help investors assess fund expenses. Per these guidelines, the following table shows your fund’s expenses based on a $1,000 investment, assuming a hypothetical 5% annualized return. You can use this information to compare the ongoing expenses (but not transaction expenses or total costs) of investing in the fund with those of other funds. All mutual fund shareholder reports will provide this information to help you make this comparison. Please note that you cannot use this information to estimate your actual ending account balance and expenses paid during the period.

  Class A  Class B  Class C  Class R  Class R5  Class R6  Class Y 
Expenses paid per $1,000*†  $4.46  $8.20  $8.20  $5.71  $3.26  $2.76  $3.21 
Ending value (after expenses)  $1,020.38  $1,016.66  $1,016.66  $1,019.14  $1,021.57  $1,022.07  $1,021.62 

 

* Expenses for each share class are calculated using the fund’s annualized expense ratio for each class, which represents the ongoing expenses as a percentage of average net assets for the six months ended 4/30/22. The expense ratio may differ for each share class.

† Expenses are calculated by multiplying the expense ratio by the average account value for the six-month period; then multiplying the result by the number of days in the six-month period (181); and then dividing that result by the number of days in the year (365).

12 Large Cap Value Fund 

 


Consider these risks before investing

Value stocks may fail to rebound, and the market may not favor value-style investing. Income provided by the fund may be reduced by changes in the dividend policies of, and the capital resources available at, the companies in which the fund invests. The value of investments in the fund’s portfolio may fall or fail to rise over extended periods of time for a variety of reasons, including general economic, political, or financial market conditions; investor sentiment and market perceptions; government actions; geopolitical events or changes; and factors related to a specific issuer, geography, industry, or sector. These and other factors may lead to increased volatility and reduced liquidity in the fund’s portfolio holdings.

From time to time, the fund may invest a significant portion of its assets in companies in one or more related industries or sectors, which would make the fund more vulnerable to adverse developments affecting those companies, industries, or sectors. International investing involves currency, economic, and political risks.

Our investment techniques, analyses, and judgments may not produce the outcome we intend. The investments we select for the fund may not perform as well as other securities that we do not select for the fund. We, or the fund’s other service providers, may experience disruptions or operating errors that could have a negative effect on the fund. You can lose money by investing in the fund.

Large Cap Value Fund 13 

 


Terms and definitions

Important terms

Total return shows how the value of the fund’s shares changed over time, assuming you held the shares through the entire period and reinvested all distributions in the fund.

Before sales charge, or net asset value, is the price, or value, of one share of a mutual fund, without a sales charge. Before-sales-charge figures fluctuate with market conditions. They are calculated by dividing the net assets of each class of shares by the number of outstanding shares in the class.

After sales charge is the price of a mutual fund share plus the maximum sales charge levied at the time of purchase. After-sales-charge performance figures shown here assume the 5.75% maximum sales charge for class A shares.

Contingent deferred sales charge (CDSC) is generally a charge applied at the time of the redemption of class B or C shares and assumes redemption at the end of the period. Your fund’s class B CDSC declines over time from a 5% maximum during the first year to 1% during the sixth year. After the sixth year, the CDSC no longer applies. The CDSC for class C shares is 1% for one year after purchase.

Share classes

Class A shares are generally subject to an initial sales charge and no CDSC (except on certain redemptions of shares bought without an initial sales charge).

Class B shares are closed to new investments and are only available by exchange from class B shares of another Putnam fund or through dividend and/or capital gains reinvestment. They are not subject to an initial sales charge and may be subject to a CDSC.

Class C shares are not subject to an initial sales charge and are subject to a CDSC only if the shares are redeemed during the first year.

Class R shares are not subject to an initial sales charge or CDSC and are only available to employer-sponsored retirement plans.

Class R5 shares are not subject to an initial sales charge or CDSC and carry no 12b-1 fee. They are only available to employer-sponsored retirement plans.

Class R6 shares are not subject to an initial sales charge or CDSC and carry no 12b-1 fee. They are generally only available to employer-sponsored retirement plans, corporate and institutional clients, and clients in other approved programs.

Class Y shares are not subject to an initial sales charge or CDSC and carry no 12b-1 fee. They are generally only available to corporate and institutional clients and clients in other approved programs.

Comparative indexes

Bloomberg U.S. Aggregate Bond Index is an unmanaged index of U.S. investment-grade fixed-income securities.

ICE BofA (Intercontinental Exchange Bank of America) U.S. 3-Month Treasury Bill Index is an unmanaged index that seeks to measure the performance of U.S. Treasury bills available in the marketplace.

Russell 1000® Value Index is an unmanaged index of those companies in the large-cap Russell 1000® Index chosen for their value orientation.

S&P 500® Index is an unmanaged index of common stock performance.

Indexes assume reinvestment of all distributions and do not account for fees. Securities and performance of a fund and an index will differ. You cannot invest directly in an index.

BLOOMBERG®  is a trademark and service mark of Bloomberg Finance L.P. and its affiliates (collectively “Bloomberg”). Bloomberg or Bloomberg’s licensors own all proprietary rights in the Bloomberg Indices.

14 Large Cap Value Fund 

 


Neither Bloomberg nor Bloomberg’s licensors approve or endorse this material, or guarantee the accuracy or completeness of any information herein, or make any warranty, express or implied, as to the results to be obtained therefrom, and to the maximum extent allowed by law, neither shall have any liability or responsibility for injury or damages arising in connection therewith.

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.

ICE Data Indices, LLC (“ICE BofA”), used with permission. ICE BofA permits use of the ICE BofA indices and related data on an “as is” basis; makes no warranties regarding same; does not guarantee the suitability, quality, accuracy, timeliness, and/or completeness of the ICE BofA indices or any data included in, related to, or derived therefrom; assumes no liability in connection with the use of the foregoing; and does not sponsor, endorse, or recommend Putnam Investments, or any of its products or services.

Lipper, a Refinitiv company, is a third-party industry-ranking entity that ranks mutual funds. Its rankings do not reflect sales charges. Lipper rankings are based on total return at net asset value relative to other funds that have similar current investment styles or objectives as determined by Lipper. Lipper may change a fund’s category assignment at its discretion. Lipper category averages reflect performance trends for funds within a category.

Large Cap Value Fund 15 

 


Other information for shareholders

Important notice regarding delivery of shareholder documents

In accordance with Securities and Exchange Commission (SEC) regulations, Putnam sends a single notice of internet availability, or a single printed copy, of annual and semiannual shareholder reports, prospectuses, and proxy statements to Putnam shareholders who share the same address, unless a shareholder requests otherwise. If you prefer to receive your own copy of these documents, please call Putnam at 1-800-225-1581, and Putnam will begin sending individual copies within 30 days.

Proxy voting

Putnam is committed to managing our mutual funds in the best interests of our shareholders. The Putnam funds’ proxy voting guidelines and procedures, as well as information regarding how your fund voted proxies relating to portfolio securities during the 12-month period ended June 30, 2021, are available in the Individual Investors section of putnam.com and on the SEC’s website, www.sec.gov. If you have questions about finding forms on the SEC’s website, you may call the SEC at 1-800-SEC-0330. You may also obtain the Putnam funds’ proxy voting guidelines and procedures at no charge by calling Putnam’s Shareholder Services at 1-800-225-1581.

Fund portfolio holdings

The fund will file a complete schedule of its portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-PORT within 60 days of the end of such fiscal quarter. Shareholders may obtain the fund’s Form N-PORT on the SEC’s website at www.sec.gov.

Prior to its use of Form N-PORT, the fund filed its complete schedule of its portfolio holdings with the SEC on Form N-Q, which is available online at www.sec.gov.

Trustee and employee fund ownership

Putnam employees and members of the Board of Trustees place their faith, confidence, and, most importantly, investment dollars in Putnam mutual funds. As of April 30, 2022, Putnam employees had approximately $492,000,000 and the Trustees had approximately $72,000,000 invested in Putnam mutual funds. These amounts include investments by the Trustees’ and employees’ immediate family members as well as investments through retirement and deferred compensation plans.

Liquidity risk management program

Putnam, as the administrator of the fund’s liquidity risk management program (appointed by the Board of Trustees), presented the most recent annual report on the program to the Trustees in April 2022. The report covered the structure of the program, including the program documents and related policies and procedures adopted to comply with Rule 22e-4 under the Investment Company Act of 1940, and reviewed the operation of the program from January 2021 through December 2021. The report included a description of the annual liquidity assessment of the fund that Putnam performed in November 2021. The report noted that there were no material compliance exceptions identified under Rule 22e-4 during the period. The report included a review of the governance of the program and the methodology for classification of the fund’s investments. The report also included a discussion of liquidity monitoring during the period, including during the market liquidity challenges caused by the Covid-19 pandemic, and the impact those challenges had on the liquidity of the fund’s investments. Putnam concluded that the program has been operating effectively and adequately to ensure compliance with Rule 22e-4.

16 Large Cap Value Fund 

 


Financial statements

These sections of the report, as well as the accompanying Notes, constitute the fund’s financial statements.

The fund’s portfolio lists all the fund’s investments and their values as of the last day of the reporting period. Holdings are organized by asset type and industry sector, country, or state to show areas of concentration and diversification.

Statement of assets and liabilities shows how the fund’s net assets and share price are determined. All investment and non-investment assets are added together. Any unpaid expenses and other liabilities are subtracted from this total. The result is divided by the number of shares to determine the net asset value per share, which is calculated separately for each class of shares. (For funds with preferred shares, the amount subtracted from total assets includes the liquidation preference of preferred shares.)

Statement of operations shows the fund’s net investment gain or loss. This is done by first adding up all the fund’s earnings — from dividends and interest income — and subtracting its operating expenses to determine net investment income (or loss). Then, any net gain or loss the fund realized on the sales of its holdings — as well as any unrealized gains or losses over the period — is added to or subtracted from the net investment result to determine the fund’s net gain or loss for the fiscal period.

Statement of changes in net assets shows how the fund’s net assets were affected by the fund’s net investment gain or loss, by distributions to shareholders, and by changes in the number of the fund’s shares. It lists distributions and their sources (net investment income or realized capital gains) over the current reporting period and the most recent fiscal year-end. The distributions listed here may not match the sources listed in the Statement of operations because the distributions are determined on a tax basis and may be paid in a different period from the one in which they were earned. Dividend sources are estimated at the time of declaration. Actual results may vary. Any non-taxable return of capital cannot be determined until final tax calculations are completed after the end of the fund’s fiscal period.

Financial highlights provide an overview of the fund’s investment results, per-share distributions, expense ratios, net investment income ratios, and portfolio turnover in one summary table, reflecting the five most recent reporting periods. In a semiannual report, the highlights table also includes the current reporting period.

Large Cap Value Fund 17 

 


The fund’s portfolio 4/30/22 (Unaudited)
COMMON STOCKS (94.4%)* Shares Value
Aerospace and defense (4.5%)
Northrop Grumman Corp. 1,037,631 $455,935,061
Raytheon Technologies Corp. 3,404,696 323,139,697
779,074,758
Airlines (1.4%)
Southwest Airlines Co. † 5,446,370 254,454,406
254,454,406
Automobiles (1.3%)
General Motors Co. † 6,082,451 230,585,717
230,585,717
Banks (8.9%)
Bank of America Corp. 14,537,767 518,707,527
Citigroup, Inc. 6,948,858 335,004,444
JPMorgan Chase & Co. 3,573,230 426,500,733
KeyCorp 3,992,374 77,092,742
PNC Financial Services Group, Inc. (The) 1,339,172 222,436,469
1,579,741,915
Beverages (2.3%)
Keurig Dr Pepper, Inc. 5,613,842 209,957,691
PepsiCo, Inc. 1,176,261 201,975,776
411,933,467
Biotechnology (4.4%)
AbbVie, Inc. 2,692,024 395,404,485
Regeneron Pharmaceuticals, Inc. † 572,320 377,221,835
772,626,320
Building products (1.2%)
Johnson Controls International PLC 3,593,306 215,131,230
215,131,230
Capital markets (2.1%)
Goldman Sachs Group, Inc. (The) 909,387 277,808,635
State Street Corp. 1,423,650 95,341,841
373,150,476
Chemicals (3.6%)
Corteva, Inc. 4,607,118 265,784,637
Eastman Chemical Co. 1,683,660 172,861,372
PPG Industries, Inc. 1,198,352 153,377,072
Sherwin-Williams Co. (The) 131,826 36,246,877
628,269,958
Construction materials (0.9%)
CRH PLC (Ireland) 4,151,997 164,700,369
164,700,369
Consumer finance (0.7%)
Capital One Financial Corp. 977,620 121,831,004
121,831,004
Diversified financial services (0.7%)
Apollo Global Management, Inc. 2,396,138 119,231,827
119,231,827


18 Large Cap Value Fund


COMMON STOCKS (94.4%)* cont. Shares Value
Electric utilities (4.6%)
American Electric Power Co., Inc. 2,240,467 $222,052,684
Constellation Energy Corp. 1,718,857 101,773,523
Exelon Corp. 5,280,266 247,010,843
NRG Energy, Inc. 6,572,285 235,945,032
806,782,082
Electrical equipment (1.0%)
Eaton Corp. PLC 1,236,695 179,345,509
179,345,509
Electronic equipment, instruments, and components (0.6%)
Vontier Corp. 3,947,583 101,137,076
101,137,076
Equity real estate investment trusts (REITs) (3.0%)
American Tower Corp. 592,647 142,839,780
Boston Properties, Inc. 1,570,179 184,653,050
Gaming and Leisure Properties, Inc. 4,571,222 202,870,832
530,363,662
Food and staples retail (4.1%)
BJ’s Wholesale Club Holdings, Inc. † 3,158,915 203,276,180
Walmart, Inc. 3,438,371 526,036,379
729,312,559
Health-care providers and services (4.4%)
Anthem, Inc. 756,663 379,791,860
McKesson Corp. 1,264,286 391,435,588
771,227,448
Hotels, restaurants, and leisure (2.1%)
Aramark 4,292,662 155,608,998
Hilton Worldwide Holdings, Inc. † 1,395,275 216,672,255
372,281,253
Household durables (1.2%)
PulteGroup, Inc. 5,186,423 216,585,024
216,585,024
Household products (1.5%)
Procter & Gamble Co. (The) 1,674,593 268,855,906
268,855,906
Industrial conglomerates (1.5%)
General Electric Co. S 347,349 25,894,868
Honeywell International, Inc. 1,190,676 230,407,713
256,302,581
Insurance (3.2%)
American International Group, Inc. 3,517,864 205,830,223
Assured Guaranty, Ltd. Ω 4,003,414 220,788,282
AXA SA (France) 5,183,355 137,232,817
563,851,322
IT Services (1.0%)
Fidelity National Information Services, Inc. 1,851,293 183,555,701
183,555,701
Life sciences tools and services (2.4%)
Danaher Corp. 568,202 142,692,568
Thermo Fisher Scientific, Inc. 518,256 286,554,108
429,246,676


Large Cap Value Fund 19



COMMON STOCKS (94.4%)* cont. Shares Value
Media (1.9%)
Charter Communications, Inc. Class A † 399,889 $171,348,438
Comcast Corp. Class A 4,234,416 168,360,380
339,708,818
Metals and mining (1.9%)
Freeport-McMoRan, Inc. (Indonesia) 8,080,415 327,660,828
327,660,828
Multi-utilities (0.7%)
Ameren Corp. 1,304,108 121,151,633
121,151,633
Multiline retail (1.5%)
Target Corp. 1,132,041 258,841,175
258,841,175
Oil, gas, and consumable fuels (8.4%)
ConocoPhillips 4,399,140 420,205,853
Enterprise Products Partners LP 4,787,666 124,048,426
EOG Resources, Inc. 698,933 81,607,417
Exxon Mobil Corp. 2,879,168 245,449,072
Shell PLC (Euronext Amsterdan Exchange) (United Kingdom) 10,173,343 275,024,330
Valero Energy Corp. 3,040,747 338,982,476
1,485,317,574
Pharmaceuticals (6.4%)
AstraZeneca PLC ADR (United Kingdom) S 4,610,201 306,117,346
Johnson & Johnson 1,923,427 347,101,636
Merck & Co., Inc. 3,540,568 314,012,976
Sanofi (France) 1,582,493 166,559,063
1,133,791,021
Road and rail (1.4%)
Union Pacific Corp. 1,069,810 250,645,785
250,645,785
Semiconductors and semiconductor equipment (2.7%)
NXP Semiconductors NV 594,500 101,600,050
Qualcomm, Inc. 1,816,395 253,732,218
Texas Instruments, Inc. 675,277 114,965,909
470,298,177
Software (4.2%)
Microsoft Corp. 2,023,687 561,613,616
Oracle Corp. 2,362,823 173,431,208
735,044,824
Specialty retail (1.1%)
O’Reilly Automotive, Inc. † 327,407 198,588,716
198,588,716
Trading companies and distributors (0.9%)
United Rentals, Inc. † 505,499 160,000,543
160,000,543
Wireless telecommunication services (0.7%)
T-Mobile US, Inc. † 1,041,676 128,271,986
128,271,986
Total common stocks (cost $10,703,210,201) $16,668,899,326


20 Large Cap Value Fund



CONVERTIBLE PREFERRED STOCKS (1.3%)* Shares Value
Danaher Corp. 5.00% cv. pfd. S 73,835 $100,784,775
T-Mobile US, Inc. 144A 5.25% cv. pfd. † 117,845 127,594,317
Total convertible preferred stocks (cost $197,113,186) $228,379,092

U.S. TREASURY OBLIGATIONS (0.1%)* Principal
amount		 Value
U.S. Treasury Bonds 3.00%, 8/15/48 i $1,199,000 $1,186,087
U.S. Treasury Notes    
2.625%, 2/28/23 i 269,000 271,655
2.375%, 2/29/24 i 122,000 121,823
2.25%, 8/15/27 i 2,159,000 2,093,021
2.125%, 2/29/24 i 112,000 111,294
1.75%, 11/15/29 i 1,613,000 1,499,638
1.75%, 12/31/24 i 177,000 172,924
1.75%, 9/30/22 i 1,432,000 1,436,668
1.625%, 8/15/29 i 2,028,000 1,862,637
1.625%, 9/30/26 i 618,000 584,900
1.625%, 5/15/26 i 1,826,000 1,747,391
1.50%, 2/15/30 i 214,000 193,698
1.50%, 8/15/26 i 1,140,000 1,076,297
1.375%, 1/31/25 i 249,000 239,944
1.125%, 2/28/27 i 1,425,000 1,311,371
1.125%, 2/28/25 i 48,000 45,821
0.50%, 3/31/25 i 163,000 152,253
0.50%, 11/30/23 i 126,000 122,190
0.375%, 4/30/25 i 533,000 495,663
0.25%, 6/30/25 i 191,000 175,842
0.25%, 5/31/25 i 2,276,000 2,100,634
0.125%, 6/30/23 i 240,000 234,125
0.125%, 5/31/22 i 111,000 111,025
Total U.S. treasury obligations (cost $17,346,901) $17,346,901

WARRANTS (—%)* † Expiration
date		 Strike
price		 Warrants Value
Occidental Petroleum Corp. 8/3/27 $22.00 62,783 $2,118,298
Total warrants (cost $310,780) $2,118,298

SHORT-TERM INVESTMENTS (5.8%)* Principal amount/
shares		 Value
Atlantic Asset Securitization, LLC asset backed commercial paper 0.670%, 5/26/22 $33,000,000 $32,981,784
Atlantic Asset Securitization, LLC asset backed commercial paper 0.630%, 5/18/22 62,750,000 62,728,639
Bedford Row Funding Corp. asset backed commercial paper 0.691%, 6/1/22 29,175,000 29,150,556
BPCE SA commercial paper 0.350%, 5/2/22 (France) 21,350,000 21,349,304
CRC Funding, LLC asset backed commercial paper 0.650%, 5/16/22 50,000,000 49,985,291


Large Cap Value Fund 21



SHORT-TERM INVESTMENTS (5.8%)* cont. Principal amount/
shares		 Value
Interest in $223,802,000 joint tri-party repurchase agreement dated 4/29/2022 with Royal Bank of Canada due 5/2/2022 — maturity value of $82,404,060 for an effective yield of 0.300% (collateralized by Agency Mortgage-Backed Securities and U.S. Treasuries (including strips) with coupon rates ranging from 0.625% to 4.500% and due dates ranging from 4/15/2023 to 11/15/2050, valued at $228,283,747) $82,402,000 $82,402,000
Matchpoint Finance PLC asset backed commercial paper 0.751%, 6/2/22 (Ireland) 10,000,000 9,992,454
Matchpoint Finance PLC asset backed commercial paper 0.751%, 5/27/22 (Ireland) 10,315,000 10,309,007
MetLife Short Term Funding, LLC asset backed commercial paper 0.600%, 5/12/22 30,000,000 29,994,313
MetLife Short Term Funding, LLC asset backed commercial paper 0.450%, 5/17/22 21,545,000 21,538,493
Mitsubishi UFJ Trust & Banking Corp./Singapore commercial paper 0.430%, 5/4/22 (Singapore) 25,000,000 24,998,590
Nationwide Building Society commercial paper 0.390%, 5/4/22 (United Kingdom) 27,000,000 26,998,451
Nationwide Building Society commercial paper 0.357%, 5/3/22 (United Kingdom) 75,000,000 74,996,717
Prudential PLC commercial paper 0.370%, 5/5/22 (United Kingdom) 50,000,000 49,996,575
Putnam Cash Collateral Pool, LLC 0.45% d Shares 65,944,910 65,944,910
Putnam Short Term Investment Fund Class P 0.43% L Shares 194,682,536 194,682,536
Skandinaviska Enskilda Banken AB commercial paper 0.350%, 5/4/22 (Sweden) $25,000,000 24,998,677
State Street Institutional U.S. Government Money Market Fund, Premier Class 0.29% P Shares 34,355,000 34,355,000
Sumitomo Mitsui Trust Bank, Ltd./Singapore commercial paper 0.430%, 5/4/22 (Singapore) $45,000,000 44,997,619
Swedbank AB commercial paper 0.320%, 5/2/22 (Sweden) 50,000,000 49,998,621
TotalEnergies Capital Canada, Ltd. commercial paper 0.400%, 5/6/22 (Canada) 50,000,000 49,995,625
U.S. Treasury Bills zero%, 7/14/22 i 111,000 110,845
U.S. Treasury Bills zero%, 6/16/22 i 1,147,000 1,146,312
U.S. Treasury Bills zero%, 6/2/22 i 1,609,000 1,608,517
U.S. Treasury Bills 0.145%, 5/3/22 ∆ 9,400,000 9,399,977
U.S. Treasury Bills 0.097%, 5/19/22 # ∆ 8,300,000 8,299,138
U.S. Treasury Bills zero%, 6/30/22 i 3,319,000 3,315,681
U.S. Treasury Bills zero%, 12/29/22 i 2,742,000 2,713,209
Total short-term investments (cost $1,019,015,493) $1,018,988,841

TOTAL INVESTMENTS
Total investments (cost $11,936,996,561) $17,935,732,458

Key to holding’s abbreviations
ADR American Depository Receipts: Represents ownership of foreign securities on deposit with a custodian bank.


22 Large Cap Value Fund



Notes to the fund’s portfolio
Unless noted otherwise, the notes to the fund’s portfolio are for the close of the fund’s reporting period, which ran from November 1, 2021 through April 30, 2022 (the reporting period). Within the following notes to the portfolio, references to “Putnam Management” represent Putnam Investment Management, LLC, the fund’s manager, an indirect wholly-owned subsidiary of Putnam Investments, LLC and references to “ASC 820” represent Accounting Standards Codification 820 Fair Value Measurements and Disclosures.
* Percentages indicated are based on net assets of $17,664,273,202.
† This security is non-income-producing.
Ω Affiliated company (Note 5).
# This security, in part or in entirety, was pledged and segregated with the broker to cover margin requirements for futures contracts at the close of the reporting period. Collateral at period end totaled $441,912 and is included in Investments in securities on the Statement of assets and liabilities (Notes 1 and 8).
∆ This security, in part or in entirety, was pledged and segregated with the custodian for collateral on certain derivative contracts at the close of the reporting period. Collateral at period end totaled $795,859 and is included in Investments in securities on the Statement of assets and liabilities (Notes 1 and 8).
d Affiliated company. See Notes 1 and 5 to the financial statements regarding securities lending. The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period.
i This security was pledged, or purchased with cash that was pledged, to the fund for collateral on certain derivative contracts (Note 1).
L Affiliated company (Note 5). The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period.
P This security was pledged, or purchased with cash that was pledged, to the fund for collateral on certain derivative contracts. The rate quoted in the security description is the annualized 7-day yield of the fund at the close of the reporting period.
S Security on loan, in part or in entirety, at the close of the reporting period (Note 1).
At the close of the reporting period, the fund maintained liquid assets totaling $722,222 to cover certain derivative contracts.
Unless otherwise noted, the rates quoted in Short-term investments security descriptions represent the weighted average yield to maturity.
144A after the name of an issuer represents securities exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers.
The dates shown on debt obligations are the original maturity dates.

FORWARD CURRENCY CONTRACTS at 4/30/22 (aggregate face value $1,087,024,054) (Unaudited)
Counterparty Currency Contract
type*		 Delivery
date		 Value Aggregate
face value		 Unrealized
appreciation/
(depreciation)
Bank of America N.A.
Euro Sell 6/15/22 $18,800,282 $19,798,130 $997,848
Barclays Bank PLC
British Pound Sell 6/15/22 181,023,622 192,629,837 11,606,215
Citibank, N.A.
Euro Buy 6/15/22 21,591,678 22,313,944 (722,266)
Goldman Sachs International
British Pound Sell 6/15/22 152,964,664 162,772,262 9,807,598
Euro Sell 6/15/22 47,959,534 50,474,420 2,514,886
HSBC Bank USA, National Association
British Pound Sell 6/15/22 6,580,715 7,002,739 422,024
Euro Sell 6/15/22 57,944,105 61,015,778 3,071,673


Large Cap Value Fund 23



FORWARD CURRENCY CONTRACTS at 4/30/22 (aggregate face value $1,087,024,054) (Unaudited) cont.
Counterparty Currency Contract
type*		 Delivery
date		 Value Aggregate
face value		 Unrealized
appreciation/
(depreciation)
Morgan Stanley & Co. International PLC
British Pound Sell 6/15/22 $23,753,299 $24,737,853 $984,554
Euro Sell 6/15/22 147,157,816 154,941,949 7,784,133
NatWest Markets PLC
British Pound Sell 6/15/22 30,587,274 32,550,134 1,962,860
State Street Bank and Trust Co.
British Pound Sell 6/15/22 61,644,725 65,593,263 3,948,538
Euro Sell 6/15/22 120,483,000 127,080,925 6,597,925
UBS AG
Euro Sell 6/15/22 86,297,057 91,123,173 4,826,116
WestPac Banking Corp.
British Pound Sell 6/15/22 70,972,938 74,989,647 4,016,709
Unrealized appreciation 58,541,079
Unrealized (depreciation) (722,266)
Total $57,818,813
* The exchange currency for all contracts listed is the United States Dollar.

FUTURES CONTRACTS OUTSTANDING at 4/30/22 (Unaudited)
Number of
contracts		 Notional
amount		 Value Expiration
date		 Unrealized
appreciation/
(depreciation)
S&P 500 Index E-Mini (Long) 37 $7,644,071 $7,635,875 Jun-22 $(96,280)
Unrealized appreciation —
Unrealized (depreciation) (96,280)
Total $(96,280)


24 Large Cap Value Fund


ASC 820 establishes a three-level hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of the fund’s investments. The three levels are defined as follows:

Level 1: Valuations based on quoted prices for identical securities in active markets.

Level 2: Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3: Valuations based on inputs that are unobservable and significant to the fair value measurement.

The following is a summary of the inputs used to value the fund’s net assets as of the close of the reporting period:

Valuation inputs
Investments in securities: Level 1 Level 2 Level 3
Common stocks*:
Communication services $467,980,804 $— $—
Consumer discretionary 1,276,881,885 — —
Consumer staples 1,410,101,932 — —
Energy 1,210,293,244 275,024,330 —
Financials 2,620,573,727 137,232,817 —
Health care 2,940,332,402 166,559,063 —
Industrials 2,094,954,812 — —
Information technology 1,490,035,778 — —
Materials 955,930,786 164,700,369 —
Real Estate 530,363,662 — —
Utilities 927,933,715 — —
Total common stocks 15,925,382,747 743,516,579 —
Convertible preferred stocks — 228,379,092 —
U.S. treasury obligations — 17,346,901 —
Warrants 2,118,298 — —
Short-term investments 34,355,000 984,633,841 —
Totals by level $15,961,856,045 $1,973,876,413 $—
Valuation inputs
Other financial instruments: Level 1 Level 2 Level 3
Forward currency contracts $— $57,818,813 $—
Futures contracts (96,280) — —
Totals by level $(96,280) $57,818,813 $—
* Common stock classifications are presented at the sector level, which may differ from the fund’s portfolio presentation.


The accompanying notes are an integral part of these financial statements.


Large Cap Value Fund 25


Statement of assets and liabilities 4/30/22 (Unaudited)

ASSETS   
Investment in securities, at value, including $63,663,070 of securities on loan (Notes 1 and 8):   
Unaffiliated issuers (identified cost $11,563,260,715)  $17,454,316,730 
Affiliated issuers (identified cost $373,735,846) (Notes 1 and 5)  481,415,728 
Dividends, interest and other receivables  26,876,635 
Receivable for shares of the fund sold  36,552,843 
Receivable for investments sold  1,191,144 
Unrealized appreciation on forward currency contracts (Note 1)  58,541,079 
Prepaid assets  197,642 
Total assets  18,059,091,801 
 
LIABILITIES   
Payable to custodian  35,774 
Payable for investments purchased  198,477,093 
Payable for shares of the fund repurchased  51,193,814 
Payable for compensation of Manager (Note 2)  6,996,138 
Payable for custodian fees (Note 2)  54,626 
Payable for investor servicing fees (Note 2)  3,928,314 
Payable for Trustee compensation and expenses (Note 2)  2,530,124 
Payable for administrative services (Note 2)  51,539 
Payable for distribution fees (Note 2)  2,351,658 
Unrealized depreciation on forward currency contracts (Note 1)  722,266 
Payable for variation margin on futures contracts (Note 1)  288,600 
Collateral on securities loaned, at value (Note 1)  65,944,910 
Collateral on certain derivative contracts, at value (Notes 1 and 8)  60,596,465 
Other accrued expenses  1,647,278 
Total liabilities  394,818,599 
 
Net assets  $17,664,273,202 
 
REPRESENTED BY   
Paid-in capital (Unlimited shares authorized) (Notes 1 and 4)  $11,380,587,315 
Total distributable earnings (Note 1)  6,283,685,887 
Total — Representing net assets applicable to capital shares outstanding  $17,664,273,202 

 

(Continued on next page)

26 Large Cap Value Fund 

 


Statement of assets and liabilities cont.

COMPUTATION OF NET ASSET VALUE AND OFFERING PRICE   
Net asset value and redemption price per class A share   
($9,448,391,861 divided by 317,900,080 shares)  $29.72 
Offering price per class A share (100/94.25 of $29.72)*  $31.53 
Net asset value and offering price per class B share   
($49,496,008 divided by 1,688,904 shares)**  $29.31 
Net asset value and offering price per class C share   
($298,223,838 divided by 10,188,061 shares)**  $29.27 
Net asset value, offering price and redemption price per class R share   
($74,397,632 divided by 2,527,297 shares)  $29.44 
Net asset value, offering price and redemption price per class R5 share   
($39,936,523 divided by 1,342,693 shares)  $29.74 
Net asset value, offering price and redemption price per class R6 share   
($2,342,432,365 divided by 78,757,226 shares)  $29.74 
Net asset value, offering price and redemption price per class Y share   
($5,411,394,975 divided by 182,009,913 shares)  $29.73 

 

*On single retail sales of less than $50,000. On sales of $50,000 or more the offering price is reduced.

**Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge.

The accompanying notes are an integral part of these financial statements.

Large Cap Value Fund 27 

 


Statement of operations Six months ended 4/30/22 (Unaudited)

INVESTMENT INCOME   
Dividends (net of foreign tax of $696,903) (including dividend income of $1,974,537   
from investments in affiliated issuers)  $174,335,420 
Interest (including interest income of $188,657 from investments in affiliated issuers) (Note 5)  564,976 
Securities lending (net of expenses) (Notes 1 and 5)  61,034 
Total investment income  174,961,430 
 
EXPENSES   
Compensation of Manager (Note 2)  40,697,217 
Investor servicing fees (Note 2)  11,556,543 
Custodian fees (Note 2)  86,634 
Trustee compensation and expenses (Note 2)  330,020 
Distribution fees (Note 2)  14,182,227 
Administrative services (Note 2)  295,996 
Other  2,132,753 
Total expenses  69,281,390 
Expense reduction (Note 2)  (276) 
Net expenses  69,281,114 
 
Net investment income  105,680,316 
 
REALIZED AND UNREALIZED GAIN (LOSS)   
Net realized gain (loss) on:   
Securities from unaffiliated issuers (Notes 1 and 3)  184,179,306 
Securities from affiliated issuers (Notes 1 and 5)  2,823,682 
Foreign currency transactions (Note 1)  (109,442) 
Forward currency contracts (Note 1)  48,045,263 
Futures contracts (Note 1)  (1,977,313) 
Total net realized gain  232,961,496 
Change in net unrealized appreciation (depreciation) on:   
Securities from unaffiliated issuers  (912,542,779) 
Securities from affiliated issuers (Note 5)  (3,947,320) 
Assets and liabilities in foreign currencies  (306,447) 
Forward currency contracts  41,420,300 
Futures contracts  (96,280) 
Total change in net unrealized depreciation  (875,472,526) 
 
Net loss on investments  (642,511,030) 
 
Net decrease in net assets resulting from operations  $(536,830,714) 

 

The accompanying notes are an integral part of these financial statements.

28 Large Cap Value Fund 

 


Statement of changes in net assets

  Six months  Eleven months  Year ended 
INCREASE (DECREASE) IN NET ASSETS  ended 4/30/22*  ended 10/31/21**  11/30/20 
Operations       
Net investment income  $105,680,316  $175,392,090  $217,228,106 
Net realized gain on investments       
and foreign currency transactions  232,961,496  999,292,415  556,045,582 
Change in net unrealized appreciation (depreciation)       
of investments and assets and liabilities       
in foreign currencies  (875,472,526)  2,722,101,488  (108,825,756) 
Net increase (decrease) in net assets resulting       
from operations  (536,830,714)  3,896,785,993  664,447,932 
Distributions to shareholders (Note 1):       
From ordinary income       
Net investment income       
Class A  (50,894,085)  (114,280,295)  (126,450,131) 
Class B  (70,561)  (414,056)  (742,214) 
Class C  (496,390)  (1,779,696)  (2,908,863) 
Class R  (275,989)  (706,584)  (960,224) 
Class R5  (488,434)  (898,519)  (866,934) 
Class R6  (15,628,378)  (28,234,502)  (25,023,289) 
Class Y  (32,713,853)  (60,548,960)  (51,097,032) 
Net realized short-term gain on investments       
Class A  (14,121,644)  (1,734,141)  — 
Class B  (90,827)  (16,495)  — 
Class C  (468,931)  (66,830)  — 
Class R  (100,145)  (14,396)  — 
Class R5  (110,061)  (10,006)  — 
Class R6  (3,225,294)  (313,332)  — 
Class Y  (7,073,604)  (688,113)  — 
From net realized long-term gain on investments       
Class A  (540,227,998)  (355,001,681)  (208,888,897) 
Class B  (3,474,634)  (3,373,610)  (2,599,535) 
Class C  (17,939,095)  (13,669,842)  (9,443,691) 
Class R  (3,831,069)  (2,946,874)  (1,994,539) 
Class R5  (4,210,403)  (2,040,926)  (1,645,635) 
Class R6  (123,384,669)  (65,854,110)  (32,414,627) 
Class Y  (270,602,970)  (140,825,742)  (72,375,886) 
Increase (decrease) from capital share       
transactions (Note 4)  1,849,626,288  1,040,025,921  (273,227,093) 
Total increase (decrease) in net assets  223,366,540  4,143,393,204  (146,190,658) 
 
NET ASSETS       
Beginning of period  17,440,906,662  13,297,513,458  13,443,704,116 
End of period  $17,664,273,202  $17,440,906,662  $13,297,513,458 

 

*Unaudited.

**The fund changed its fiscal year end from November 30 to October 31.

The accompanying notes are an integral part of these financial statements.

Large Cap Value Fund 29 

 


Financial highlights
(For a common share outstanding throughout the period)

  INVESTMENT OPERATIONS LESS DISTRIBUTIONS RATIOS AND SUPPLEMENTAL DATA
                        Ratio of  Ratio of net   
  Net asset    Net realized      From net            expenses  investment   
  value,    and unrealized  Total from  From net  realized    Non-recurring  Net asset  Total return  Net assets,  to average  income (loss)  Portfolio 
  beginning  Net investment  gain (loss) on  investment  investment  gain on  Total  reimburse-­  value, end  at net asset  end of period  net assets  to average  turnover 
Period ended­  of period­  income (loss)a  investments­  operations­  income­  investments­  distributions  ments­  of period­  value (%)b  (in thousands)  (%)c  net assets (%)  (%) 
Class A                             
April 30, 2022**   $32.65­  .17­  (1.09)  (.92)  (.16)  (1.85)  (2.01)  —­  $29.72­  (2.96)*  $9,448,392­  .44*  .55*  4* 
October 31,2021 †­  26.76­  .31­  7.13­  7.44­  (.37)  (1.18)  (1.55)  —­  32.65­  29.16*  9,873,796­  .81*  1.04*  15* 
November 30, 2020­  26.37­  .41­  1.03­  1.44­  (.40)  (.65)  (1.05)  —­  26.76­  5.75­  8,114,686­  .90­  1.71­  21­ 
November 30, 2019  24.48­  .40­  2.85­  3.25­  (.47)  (.89)  (1.36)  —­  26.37­  14.64­  8,568,585­  .91­  1.66­  12­ 
November 30, 2018  24.51­  .37­  .28­  .65­  (.27)  (.41)  (.68)  —­  24.48­  2.65­  8,050,928­  .91­  1.51­  16­ 
November 30, 2017  21.09­  .30­  3.69­  3.99­  (.36)  (.21)  (.57)  —­d,e  24.51­  19.28­  8,466,321­  .92­f  1.30­  11­ 
November 30, 2016  20.69­  .33­  1.22­  1.55­  (.30)  (.85)  (1.15)  —­  21.09­  8.01­  3,316,513­  .97­g  1.66­g  15­ 
Class B                             
April 30, 2022**   $32.21­  .05­  (1.06)  (1.01)  (.04)  (1.85)  (1.89)  —­  $29.31­  (3.31)*  $49,496­  .81*  .17*  4* 
October 31,2021 †­  26.41­  .11­  7.03­  7.14­  (.16)  (1.18)  (1.34)  —­  32.21­  28.26*  66,647­  1.50*  .36*  15* 
November 30, 2020­  26.02­  .23­  1.02­  1.25­  (.21)  (.65)  (.86)  —­  26.41­  4.95­  77,385­  1.65­  .87­  21­ 
November 30, 2019  24.17­  .22­  2.80­  3.02­  (.28)  (.89)  (1.17)  —­  26.02­  13.75­  106,864­  1.66­  .92­  12­ 
November 30, 2018  24.19­  .18­  .29­  .47­  (.08)  (.41)  (.49)  —­  24.17­  1.93­  124,574­  1.66­  .75­  16­ 
November 30, 2017  20.84­  .13­  3.63­  3.76­  (.20)  (.21)  (.41)  —­d,e  24.19­  18.33­  158,052­  1.67­f  .57­  11­ 
November 30, 2016  20.44­  .18­  1.22­  1.40­  (.15)  (.85)  (1.00)  —­  20.84­  7.29­  105,267­  1.72­g  .92­g  15­ 
Class C                             
April 30, 2022**   $32.19­  .05­  (1.07)  (1.02)  (.05)  (1.85)  (1.90)  —­  $29.27­  (3.34)*  $298,224­  .81*  .17*  4* 
October 31,2021 †­  26.39­  .10­  7.04­  7.14­  (.16)  (1.18)  (1.34)  —­  32.19­  28.31*  325,902­  1.50*  .36*  15* 
November 30, 2020­  26.01­  .23­  1.01­  1.24­  (.21)  (.65)  (.86)  —­  26.39­  4.94­  310,953­  1.65­  .97­  21­ 
November 30, 2019  24.17­  .22­  2.80­  3.02­  (.29)  (.89)  (1.18)  —­  26.01­  13.73­  381,827­  1.66­  .91­  12­ 
November 30, 2018  24.20­  .18­  .28­  .46­  (.08)  (.41)  (.49)  —­  24.17­  1.91­  379,587­  1.66­  .74­  16­ 
November 30, 2017  20.83­  .13­  3.65­  3.78­  (.20)  (.21)  (.41)  —­d,e  24.20­  18.40­  440,477­  1.67­f  .58­  11­ 
November 30, 2016  20.45­  .18­  1.21­  1.39­  (.16)  (.85)  (1.01)  —­  20.83­  7.20­  370,527­  1.72­g  .91­g  15­ 
Class R                             
April 30, 2022**   $32.36­  .13­  (1.07)  (.94)  (.13)  (1.85)  (1.98)  —­  $29.44­  (3.07)*  $74,398­  .56*  .42*  4* 
October 31,2021 †­  26.53­  .24­  7.07­  7.31­  (.30)  (1.18)  (1.48)  —­  32.36­  28.87*  69,251­  1.04*  .82*  15* 
November 30, 2020­  26.15­  .35­  1.01­  1.36­  (.33)  (.65)  (.98)  —­  26.53­  5.47­  68,849­  1.15­  1.47­  21­ 
November 30, 2019  24.29­  .34­  2.82­  3.16­  (.41)  (.89)  (1.30)  —­  26.15­  14.33­  81,830­  1.16­  1.42­  12­ 
November 30, 2018  24.31­  .31­  .28­  .59­  (.20)  (.41)  (.61)  —­  24.29­  2.45­  96,822­  1.16­  1.25­  16­ 
November 30, 2017  20.93­  .24­  3.65­  3.89­  (.30)  (.21)  (.51)  —­d,e  24.31­  18.90­  113,504­  1.17­f  1.09­  11­ 
November 30, 2016  20.53­  .28­  1.22­  1.50­  (.25)  (.85)  (1.10)  —­  20.93­  7.80­  118,848­  1.22­g  1.41­g  15­ 

 

See notes to financial highlights at the end of this section.

The accompanying notes are an integral part of these financial statements.

30 Large Cap Value Fund  Large Cap Value Fund 31 

 


Financial highlights cont.

  INVESTMENT OPERATIONS LESS DISTRIBUTIONS RATIOS AND SUPPLEMENTAL DATA
                        Ratio of  Ratio of net   
  Net asset    Net realized      From net            expenses  investment   
  value,    and unrealized  Total from  From net  realized    Non-recurring  Net asset  Total return  Net assets,  to average  income (loss)  Portfolio 
  beginning  Net investment  gain (loss) on  investment  investment  gain on  Total  reimburse-­  value, end  at net asset  end of period  net assets  to average  turnover 
Period ended­  of period­  income (loss)a  investments­  operations­  income­  investments­  distributions  ments­  of period­  value (%)b  (in thousands)  (%)c  net assets (%)  (%) 
Class R5                             
April 30, 2022**   $32.68­  .21­  (1.10)  (.89)  (.20)  (1.85)  (2.05)  —­  $29.74­  (2.86)*  $39,937­  .32*  .67*  4* 
October 31,2021 †­  26.78­  .38­  7.14­  7.52­  (.44)  (1.18)  (1.62)  —­  32.68­  29.48*  76,300­  .58*  1.25*  15* 
November 30, 2020­  26.39­  .47­  1.03­  1.50­  (.46)  (.65)  (1.11)  —­  26.78­  6.03­  46,663­  .65­  1.95­  21­ 
November 30, 2019  24.51­  .46­  2.85­  3.31­  (.54)  (.89)  (1.43)  —­  26.39­  14.91­  67,476­  .65­  1.88­  12­ 
November 30, 2018  24.53­  .42­  .30­  .72­  (.33)  (.41)  (.74)  —­  24.51­  2.95­  32,219­  .65­  1.67­  16­ 
November 30, 2017  21.10­  .37­  3.68­  4.05­  (.41)  (.21)  (.62)  —­d,e  24.53­  19.57­  67,389­  .66­f  1.67­  11­ 
November 30, 2016  20.70­  .39­  1.22­  1.61­  (.36)  (.85)  (1.21)  —­  21.10­  8.35­  120,507­  .66­g  1.97­g  15­ 
Class R6                             
April 30, 2022**   $32.68­  .22­  (1.09)  (.87)  (.22)  (1.85)  (2.07)  —­  $29.74­  (2.81)*  $2,342,432­  .27*  .72*  4* 
October 31,2021 †­  26.78­  .40­  7.15­  7.55­  (.47)  (1.18)  (1.65)  —­  32.68­  29.59*  2,161,747­  .49*  1.35*  15* 
November 30, 2020­  26.39­  .50­  1.02­  1.52­  (.48)  (.65)  (1.13)  —­  26.78­  6.14­  1,452,740­  .55­  2.07­  21­ 
November 30, 2019  24.51­  .49­  2.84­  3.33­  (.56)  (.89)  (1.45)  —­  26.39­  15.00­  1,287,321­  .55­  2.02­  12­ 
November 30, 2018  24.53­  .47­  .27­  .74­  (.35)  (.41)  (.76)  —­  24.51­  3.06­  1,117,896­  .55­  1.87­  16­ 
November 30, 2017  21.11­  .38­  3.69­  4.07­  (.44)  (.21)  (.65)  —­d,e  24.53­  19.68­  965,235­  .56­f  1.68­  11­ 
November 30, 2016  20.70­  .41­  1.23­  1.64­  (.38)  (.85)  (1.23)  —­  21.11­  8.52­  616,651­  .56­g  2.07­g  15­ 
Class Y                             
April 30, 2022**   $32.67­  .21­  (1.10)  (.89)  (.20)  (1.85)  (2.05)  —­  $29.73­  (2.86)*  $5,411,395­  .32*  .67*  4* 
October 31,2021 †­  26.77­  .38­  7.14­  7.52­  (.44)  (1.18)  (1.62)  —­  32.67­  29.49*  4,867,264­  .58*  1.26*  15* 
November 30, 2020­  26.39­  .47­  1.02­  1.49­  (.46)  (.65)  (1.11)  —­  26.77­  5.98­  3,226,237­  .65­  1.96­  21­ 
November 30, 2019  24.50­  .46­  2.85­  3.31­  (.53)  (.89)  (1.42)  —­  26.39­  14.93­  2,949,801­  .66­  1.91­  12­ 
November 30, 2018  24.52­  .44­  .28­  .72­  (.33)  (.41)  (.74)  —­  24.50­  2.95­  2,412,784­  .66­  1.77­  16­ 
November 30, 2017  21.10­  .36­  3.68­  4.04­  (.41)  (.21)  (.62)  —­d,e  24.52­  19.54­  2,035,965­  .67­f  1.58­  11­ 
November 30, 2016  20.69­  .38­  1.23­  1.61­  (.35)  (.85)  (1.20)  —­  21.10­  8.33­  1,544,573­  .72­g  1.92­g  15­ 

 

* Not annualized.

** Unaudited.

† For the eleven months ended October 31, 2021. The fund changed its fiscal year end from November 30 to October 31.

a Per share net investment income (loss) has been determined on the basis of the weighted average number of shares outstanding during the period.

b Total return assumes dividend reinvestment and does not reflect the effect of sales charges.

c Includes amounts paid through expense offset and/or brokerage/service arrangements, if any (Note 2). Also excludes acquired fund fees and expenses, if any.

d Reflects a non-recurring reimbursement pursuant to a settlement between the Securities and Exchange Commission (the SEC) and JPMorgan Chase which amounted to less than $0.01 per share outstanding on September 29, 2017.

e Reflects a non-recurring reimbursement pursuant to a settlement between the Securities and Exchange Commission (the SEC) and Countrywide Financial which amounted to less than $0.01 per share outstanding on November 29, 2017.

f Includes one time merger costs of 0.01%.

g Reflects a voluntary waiver of certain fund expenses in effect during the period. As a result of such waivers, the expenses of each class reflect a reduction of less than 0.01% as a percentage of net assets.

The accompanying notes are an integral part of these financial statements.

32 Large Cap Value Fund  Large Cap Value Fund 33 

 


Notes to financial statements 4/30/22 (Unaudited)

Within the following Notes to financial statements, references to “State Street” represent State Street Bank and Trust Company, references to “the SEC” represent the Securities and Exchange Commission, references to “Putnam Management” represent Putnam Investment Management, LLC, the fund’s manager, an indirect wholly-owned subsidiary of Putnam Investments, LLC and references to “OTC”, if any, represent over-the-counter. Unless otherwise noted, the “reporting period” represents the period from November 1, 2021 through April 30, 2022.

Putnam Large Cap Value Fund (the fund) is a Massachusetts business trust, which is registered under the Investment Company Act of 1940, as amended, as a diversified open-end management investment company. The goal of the fund is to seek capital growth and current income. The fund invests mainly in common stocks of U.S. companies, with a focus on value stocks that offer the potential for capital growth, current income, or both. Under normal circumstances, Putnam Management invests at least 80% of the fund’s net assets in large-cap companies, which for purposes of this policy, are of a size similar to those in the Russell 1000 Value Index. This policy may be changed only after 60 days’ notice to shareholders. As of January 31, 2022, the index was composed of companies having market capitalizations of between approximately $720.6 million to $1.8 trillion. The fund may also invest in midsize companies. Value stocks are issued by companies that Putnam Management believes are currently undervalued by the market. If Putnam Management is correct and other investors ultimately recognize the value of the company, the price of its stock may rise. Putnam Management may consider, among other factors, a company’s valuation, financial strength, growth potential, competitive position in its industry, projected future earnings, cash flows and dividends when deciding whether to buy or sell investments.

The fund offers class A, class B, class C, class R, class R5, class R6 and class Y shares. Purchases of class B shares are closed to new and existing investors except by exchange from class B shares of another Putnam fund or through dividend and/or capital gains reinvestment. Class A shares are sold with a maximum front-end sales charge of 5.75%. Class A shares generally are not subject to a contingent deferred sales charge, and class R, class R5, class R6 and class Y shares are not subject to a contingent deferred sales charge. Class B shares, which convert to class A shares after approximately eight years, are not subject to a front-end sales charge and are subject to a contingent deferred sales charge if those shares are redeemed within six years of purchase. Class C shares are subject to a one-year 1.00% contingent deferred sales charge and generally convert to class A shares after approximately eight years. Class R shares, which are not available to all investors, are sold at net asset value. The expenses for class A, class B, class C and class R shares may differ based on the distribution fee of each class, which is identified in Note 2. Class R5, class R6 and class Y shares, which are sold at net asset value, are generally subject to the same expenses as class A, class B, class C and class R shares, but do not bear a distribution fee, and in the case of class R5 and class R6 shares, bear a lower investor servicing fee, which is identified in Note 2. Class R5, class R6 and class Y shares are not available to all investors.

In the normal course of business, the fund enters into contracts that may include agreements to indemnify another party under given circumstances. The fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be, but have not yet been, made against the fund. However, the fund’s management team expects the risk of material loss to be remote.

The fund has entered into contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent and custodian, who each provide services to the fund. Unless expressly stated otherwise, shareholders are not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek any remedy under them against the service providers, either directly or on behalf of the fund.

Under the fund’s Amended and Restated Agreement and Declaration of Trust, any claims asserted against or on behalf of the Putnam Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of Massachusetts.

Note 1: Significant accounting policies

The following is a summary of significant accounting policies consistently followed by the fund in the preparation of its financial statements. The preparation of financial statements is in conformity with accounting principles generally accepted in the United States of America and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and the reported amounts of increases and decreases in net assets from operations. Actual results could differ from those estimates. Subsequent events after the Statement of assets and liabilities date through the date that the financial statements were issued have been evaluated in the preparation of the financial statements.

34 Large Cap Value Fund 

 


Investment income, realized and unrealized gains and losses and expenses of the fund are borne pro-rata based on the relative net assets of each class to the total net assets of the fund, except that each class bears expenses unique to that class (including the distribution fees applicable to such classes). Each class votes as a class only with respect to its own distribution plan or other matters on which a class vote is required by law or determined by the Trustees. If the fund were liquidated, shares of each class would receive their pro-rata share of the net assets of the fund. In addition, the Trustees declare separate dividends on each class of shares.

Security valuation Portfolio securities and other investments are valued using policies and procedures adopted by the Board of Trustees. The Trustees have formed a Pricing Committee to oversee the implementation of these procedures and have delegated responsibility for valuing the fund’s assets in accordance with these procedures to Putnam Management. Putnam Management has established an internal Valuation Committee that is responsible for making fair value determinations, evaluating the effectiveness of the pricing policies of the fund and reporting to the Pricing Committee.

Investments for which market quotations are readily available are valued at the last reported sales price on their principal exchange, or official closing price for certain markets, and are classified as Level 1 securities under Accounting Standards Codification 820 Fair Value Measurements and Disclosures (ASC 820). If no sales are reported, as in the case of some securities that are traded OTC, a security is valued at its last reported bid price and is generally categorized as a Level 2 security.

Investments in open-end investment companies (excluding exchange-traded funds), if any, which can be classified as Level 1 or Level 2 securities, are valued based on their net asset value. The net asset value of such investment companies equals the total value of their assets less their liabilities and divided by the number of their outstanding shares.

Market quotations are not considered to be readily available for certain debt obligations (including short-term investments with remaining maturities of 60 days or less) and other investments; such investments are valued on the basis of valuations furnished by an independent pricing service approved by the Trustees or dealers selected by Putnam Management. Such services or dealers determine valuations for normal institutional-size trading units of such securities using methods based on market transactions for comparable securities and various relationships, generally recognized by institutional traders, between securities (which consider such factors as security prices, yields, maturities and ratings). These securities will generally be categorized as Level 2.

Many securities markets and exchanges outside the U.S. close prior to the scheduled close of the New York Stock Exchange and therefore the closing prices for securities in such markets or on such exchanges may not fully reflect events that occur after such close but before the scheduled close of the New York Stock Exchange. Accordingly, on certain days, the fund will fair value certain foreign equity securities taking into account multiple factors including movements in the U.S. securities markets, currency valuations and comparisons to the valuation of American Depository Receipts, exchange-traded funds and futures contracts. The foreign equity securities, which would generally be classified as Level 1 securities, will be transferred to Level 2 of the fair value hierarchy when they are valued at fair value. The number of days on which fair value prices will be used will depend on market activity and it is possible that fair value prices will be used by the fund to a significant extent. At the close of the reporting period, fair value pricing was used for certain foreign securities in the portfolio. Securities quoted in foreign currencies, if any, are translated into U.S. dollars at the current exchange rate.

To the extent a pricing service or dealer is unable to value a security or provides a valuation that Putnam Management does not believe accurately reflects the security’s fair value, the security will be valued at fair value by Putnam Management in accordance with policies and procedures approved by the Trustees. Certain investments, including certain restricted and illiquid securities and derivatives, are also valued at fair value following procedures approved by the Trustees. These valuations consider such factors as significant market or specific security events such as interest rate or credit quality changes, various relationships with other securities, discount rates, U.S. Treasury, U.S. swap and credit yields, index levels, convexity exposures, recovery rates, sales and other multiples and resale restrictions. These securities are classified as Level 2 or as Level 3 depending on the priority of the significant inputs.

To assess the continuing appropriateness of fair valuations, the Valuation Committee reviews and affirms the reasonableness of such valuations on a regular basis after considering all relevant information that is reasonably available. Such valuations and procedures are reviewed periodically by the Trustees. The fair value of securities is generally determined as the amount that the fund could reasonably expect to realize from an orderly disposition of such securities over a reasonable period of time. By its nature, a fair value price is a good faith estimate of the value of a security in a current sale and does not reflect an actual market price, which may be different by a material amount.

Large Cap Value Fund 35 

 


Joint trading account Pursuant to an exemptive order from the SEC, the fund may transfer uninvested cash balances into a joint trading account along with the cash of other registered investment companies and certain other accounts managed by Putnam Management. These balances may be invested in issues of short-term investments having maturities of up to 90 days.

Repurchase agreements The fund, or any joint trading account, through its custodian, receives delivery of the underlying securities, the fair value of which at the time of purchase is required to be in an amount at least equal to the resale price, including accrued interest. Collateral for certain tri-party repurchase agreements, which totaled $84,052,141 at the end of the reporting period, is held at the counterparty’s custodian in a segregated account for the benefit of the fund and the counterparty. Putnam Management is responsible for determining that the value of these underlying securities is at all times at least equal to the resale price, including accrued interest. In the event of default or bankruptcy by the other party to the agreement, retention of the collateral may be subject to legal proceedings.

Security transactions and related investment income Security transactions are recorded on the trade date (the date the order to buy or sell is executed). Gains or losses on securities sold are determined on the identified cost basis.

Interest income, net of any applicable withholding taxes, if any, and including amortization and accretion of premiums and discounts on debt securities, is recorded on the accrual basis. Dividend income, net of any applicable withholding taxes, is recognized on the ex-dividend date except that certain dividends from foreign securities, if any, are recognized as soon as the fund is informed of the ex-dividend date. Non-cash dividends, if any, are recorded at the fair value of the securities received. Dividends representing a return of capital or capital gains, if any, are reflected as a reduction of cost and/or as a realized gain.

Foreign currency translation The accounting records of the fund are maintained in U.S. dollars. The fair value of foreign securities, currency holdings, and other assets and liabilities is recorded in the books and records of the fund after translation to U.S. dollars based on the exchange rates on that day. The cost of each security is determined using historical exchange rates. Income and withholding taxes are translated at prevailing exchange rates when earned or incurred. The fund does not isolate that portion of realized or unrealized gains or losses resulting from changes in the foreign exchange rate on investments from fluctuations arising from changes in the market prices of the securities. Such gains and losses are included with the net realized and unrealized gain or loss on investments. Net realized gains and losses on foreign currency transactions represent net realized exchange gains or losses on disposition of foreign currencies, currency gains and losses realized between the trade and settlement dates on securities transactions and the difference between the amount of investment income and foreign withholding taxes recorded on the fund’s books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized appreciation and depreciation of assets and liabilities in foreign currencies arise from changes in the value of assets and liabilities other than investments at the period end, resulting from changes in the exchange rate.

Futures contracts The fund uses futures contracts to equitize cash.

The potential risk to the fund is that the change in value of futures contracts may not correspond to the change in value of the hedged instruments. In addition, losses may arise from changes in the value of the underlying instruments, if there is an illiquid secondary market for the contracts, if interest or exchange rates move unexpectedly or if the counterparty to the contract is unable to perform. With futures, there is minimal counterparty credit risk to the fund since futures are exchange traded and the exchange’s clearinghouse, as counterparty to all exchange traded futures, guarantees the futures against default. Risks may exceed amounts recognized on the Statement of assets and liabilities. When the contract is closed, the fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.

Futures contracts are valued at the quoted daily settlement prices established by the exchange on which they trade. The fund and the broker agree to exchange an amount of cash equal to the daily fluctuation in the value of the futures contract. Such receipts or payments are known as “variation margin.”

Futures contracts outstanding at period end, if any, are listed after the fund’s portfolio.

Forward currency contracts The fund buys and sells forward currency contracts, which are agreements between two parties to buy and sell currencies at a set price on a future date. These contracts are used to hedge foreign exchange risk.

36 Large Cap Value Fund 

 


The U.S. dollar value of forward currency contracts is determined using current forward currency exchange rates supplied by a quotation service. The fair value of the contract will fluctuate with changes in currency exchange rates. The contract is marked to market daily and the change in fair value is recorded as an unrealized gain or loss. The fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed when the contract matures or by delivery of the currency. The fund could be exposed to risk if the value of the currency changes unfavorably, if the counterparties to the contracts are unable to meet the terms of their contracts or if the fund is unable to enter into a closing position. Risks may exceed amounts recognized on the Statement of assets and liabilities.

Forward currency contracts outstanding at period end, if any, are listed after the fund’s portfolio.

Master agreements The fund is a party to ISDA (International Swaps and Derivatives Association, Inc.) Master Agreements (Master Agreements) with certain counterparties that govern OTC derivative and foreign exchange contracts entered into from time to time. The Master Agreements may contain provisions regarding, among other things, the parties’ general obligations, representations, agreements, collateral requirements, events of default and early termination. With respect to certain counterparties, in accordance with the terms of the Master Agreements, collateral pledged to the fund is held in a segregated account by the fund’s custodian and, with respect to those amounts which can be sold or repledged, is presented in the fund’s portfolio.

Collateral pledged by the fund is segregated by the fund’s custodian and identified in the fund’s portfolio. Collateral can be in the form of cash or debt securities issued by the U.S. Government or related agencies or other securities as agreed to by the fund and the applicable counterparty. Collateral requirements are determined based on the fund’s net position with each counterparty.

Termination events applicable to the fund may occur upon a decline in the fund’s net assets below a specified threshold over a certain period of time. Termination events applicable to counterparties may occur upon a decline in the counterparty’s long-term and short-term credit ratings below a specified level. In each case, upon occurrence, the other party may elect to terminate early and cause settlement of all derivative and foreign exchange contracts outstanding, including the payment of any losses and costs resulting from such early termination, as reasonably determined by the terminating party. Any decision by one or more of the fund’s counterparties to elect early termination could impact the fund’s future derivative activity.

At the close of the reporting period, the fund had a net liability position of $722,266 on open derivative contracts subject to the Master Agreements. Collateral pledged by the fund at period end for these agreements totaled $795,859 and may include amounts related to unsettled agreements.

Securities lending The fund may lend securities, through its agent, to qualified borrowers in order to earn additional income. The loans are collateralized by cash in an amount at least equal to the fair value of the securities loaned. The fair value of securities loaned is determined daily and any additional required collateral is allocated to the fund on the next business day. The remaining maturities of the securities lending transactions are considered overnight and continuous. The risk of borrower default will be borne by the fund’s agent; the fund will bear the risk of loss with respect to the investment of the cash collateral. Income from securities lending, net of expenses, is included in investment income on the Statement of operations. Cash collateral is invested in Putnam Cash Collateral Pool, LLC, a limited liability company managed by an affiliate of Putnam Management. Investments in Putnam Cash Collateral Pool, LLC are valued at its closing net asset value each business day. There are no management fees charged to Putnam Cash Collateral Pool, LLC. At the close of the reporting period, the fund received cash collateral of $65,944,910 and the value of securities loaned amounted to $63,663,070.

Interfund lending The fund, along with other Putnam funds, may participate in an interfund lending program pursuant to an exemptive order issued by the SEC. This program allows the fund to borrow from or lend to other Putnam funds that permit such transactions. Interfund lending transactions are subject to each fund’s investment policies and borrowing and lending limits. Interest earned or paid on the interfund lending transaction will be based on the average of certain current market rates. During the reporting period, the fund did not utilize the program.

Lines of credit The fund participates, along with other Putnam funds, in a $317.5 million unsecured committed line of credit and a $235.5 million unsecured uncommitted line of credit, both provided by State Street. Borrowings may be made for temporary or emergency purposes, including the funding of shareholder redemption requests and trade settlements. Interest is charged to the fund based on the fund’s borrowing at a rate equal to 1.25% plus the higher of (1) the Federal Funds rate and (2) the Overnight Bank Funding Rate for the committed

Large Cap Value Fund 37 

 


line of credit and 1.30% plus the higher of (1) the Federal Funds rate and (2) the Overnight Bank Funding Rate for the uncommitted line of credit. A closing fee equal to 0.04% of the committed line of credit and 0.04% of the uncommitted line of credit has been paid by the participating funds. In addition, a commitment fee of 0.21% per annum on any unutilized portion of the committed line of credit is allocated to the participating funds based on their relative net assets and paid quarterly. During the reporting period, the fund had no borrowings against these arrangements.

Federal taxes It is the policy of the fund to distribute all of its taxable income within the prescribed time period and otherwise comply with the provisions of the Internal Revenue Code of 1986, as amended (the Code), applicable to regulated investment companies. It is also the intention of the fund to distribute an amount sufficient to avoid imposition of any excise tax under Section 4982 of the Code.

The fund is subject to the provisions of Accounting Standards Codification 740 Income Taxes (ASC 740). ASC 740 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The fund did not have a liability to record for any unrecognized tax benefits in the accompanying financial statements. No provision has been made for federal taxes on income, capital gains or unrealized appreciation on securities held nor for excise tax on income and capital gains. Each of the fund’s federal tax returns for the prior three fiscal years remains subject to examination by the Internal Revenue Service.

The fund may also be subject to taxes imposed by governments of countries in which it invests. Such taxes are generally based on either income or gains earned or repatriated. The fund accrues and applies such taxes to net investment income, net realized gains and net unrealized gains as income and/or capital gains are earned. In some cases, the fund may be entitled to reclaim all or a portion of such taxes, and such reclaim amounts, if any, are reflected as an asset on the fund’s books. In many cases, however, the fund may not receive such amounts for an extended period of time, depending on the country of investment.

Tax cost of investments includes adjustments to net unrealized appreciation (depreciation) which may not necessarily be final tax cost basis adjustments, but closely approximate the tax basis unrealized gains and losses that may be realized and distributed to shareholders. The aggregate identified cost on a tax basis is $11,942,506,461, resulting in gross unrealized appreciation and depreciation of $6,215,794,182 and $164,845,652, respectively, or net unrealized appreciation of $6,050,948,530.

Distributions to shareholders Distributions to shareholders from net investment income are recorded by the fund on the ex-dividend date. Distributions from capital gains, if any, are recorded on the ex-dividend date and paid at least annually. The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles. Dividend sources are estimated at the time of declaration. Actual results may vary. Any non-taxable return of capital cannot be determined until final tax calculations are completed after the end of the fund’s fiscal year. Reclassifications are made to the fund’s capital accounts to reflect income and gains available for distribution (or available capital loss carryovers) under income tax regulations.

Note 2: Management fee, administrative services and other transactions

The fund pays Putnam Management a management fee (based on the fund’s average net assets and computed and paid monthly) at annual rates that may vary based on the average of the aggregate net assets of all open-end mutual funds sponsored by Putnam Management (excluding net assets of funds that are invested in, or that are invested in by, other Putnam funds to the extent necessary to avoid “double counting” of those assets). Such annual rates may vary as follows:

0.630%  of the first $5 billion,  0.430%  of the next $50 billion, 
0.580%  of the next $5 billion,  0.410%  of the next $50 billion, 
0.530%  of the next $10 billion,  0.400%  of the next $100 billion and 
0.480%  of the next $10 billion,  0.395%  of any excess thereafter. 

 

For the reporting period, the management fee represented an effective rate (excluding the impact from any expense waivers in effect) of 0.229% of the fund’s average net assets.

Putnam Management has contractually agreed, through March 30, 2023, to waive fees and/or reimburse the fund’s expenses to the extent necessary to limit the cumulative expenses of the fund, exclusive of brokerage, interest, taxes, investment-related expenses, extraordinary expenses, acquired fund fees and expenses and payments under the fund’s investor servicing contract, investment management contract and distribution

38 Large Cap Value Fund 

 


plans, on a fiscal year-to-date basis to an annual rate of 0.20% of the fund’s average net assets over such fiscal year-to-date period. During the reporting period, the fund’s expenses were not reduced as a result of this limit.

Putnam Investments Limited (PIL), an affiliate of Putnam Management, is authorized by the Trustees to manage a separate portion of the assets of the fund as determined by Putnam Management from time to time. PIL did not manage any portion of the assets of the fund during the reporting period. If Putnam Management were to engage the services of PIL, Putnam Management would pay a quarterly sub-management fee to PIL for its services at an annual rate of 0.35% of the average net assets of the portion of the fund managed by PIL.

The fund reimburses Putnam Management an allocated amount for the compensation and related expenses of certain officers of the fund and their staff who provide administrative services to the fund. The aggregate amount of all such reimbursements is determined annually by the Trustees.

Custodial functions for the fund’s assets are provided by State Street. Custody fees are based on the fund’s asset level, the number of its security holdings and transaction volumes.

Putnam Investor Services, Inc., an affiliate of Putnam Management, provides investor servicing agent functions to the fund. Putnam Investor Services, Inc. received fees for investor servicing for class A, class B, class C, class R and class Y shares that included (1) a per account fee for each direct and underlying non-defined contribution account (retail account) of the fund; (2) a specified rate of the fund’s assets attributable to defined contribution plan accounts; and (3) a specified rate based on the average net assets in retail accounts. Putnam Investor Services, Inc. has agreed that the aggregate investor servicing fees for each fund’s retail and defined contribution accounts for these share classes will not exceed an annual rate of 0.25% of the fund’s average assets attributable to such accounts.

Class R5 shares paid a monthly fee based on the average net assets of class R5 shares at an annual rate of 0.15%.

Class R6 shares paid a monthly fee based on the average net assets of class R6 shares at an annual rate of 0.05%.

During the reporting period, the expenses for each class of shares related to investor servicing fees were as follows:

Class A  $6,959,687  Class R5  57,090 
Class B  41,383  Class R6  566,287 
Class C  224,120  Class Y  3,657,908 
Class R  50,068  Total  $11,556,543 

 

The fund has entered into expense offset arrangements with Putnam Investor Services, Inc. and State Street whereby Putnam Investor Services, Inc.’s and State Street’s fees are reduced by credits allowed on cash balances. For the reporting period, the fund’s expenses were reduced by $276 under the expense offset arrangements.

Each Independent Trustee of the fund receives an annual Trustee fee, of which $13,590, as a quarterly retainer, has been allocated to the fund, and an additional fee for each Trustees meeting attended. Trustees also are reimbursed for expenses they incur relating to their services as Trustees.

The fund has adopted a Trustee Fee Deferral Plan (the Deferral Plan) which allows the Trustees to defer the receipt of all or a portion of Trustees fees payable on or after July 1, 1995. The deferred fees remain invested in certain Putnam funds until distribution in accordance with the Deferral Plan.

The fund has adopted an unfunded noncontributory defined benefit pension plan (the Pension Plan) covering all Trustees of the fund who have served as a Trustee for at least five years and were first elected prior to 2004. Benefits under the Pension Plan are equal to 50% of the Trustee’s average annual attendance and retainer fees for the three years ended December 31, 2005. The retirement benefit is payable during a Trustee’s lifetime, beginning the year following retirement, for the number of years of service through December 31, 2006. Pension expense for the fund is included in Trustee compensation and expenses in the Statement of operations. Accrued pension liability is included in Payable for Trustee compensation and expenses in the Statement of assets and liabilities. The Trustees have terminated the Pension Plan with respect to any Trustee first elected after 2003.

The fund has adopted distribution plans (the Plans) with respect to the following share classes pursuant to Rule 12b–1 under the Investment Company Act of 1940. The purpose of the Plans is to compensate Putnam Retail Management Limited Partnership, an indirect wholly-owned subsidiary of Putnam Investments, LLC, for services provided and expenses incurred in distributing shares of the fund. The Plans provide payments by the fund to Putnam Retail Management Limited Partnership at an annual rate of up to the following amounts (Maximum %)

Large Cap Value Fund 39 

 


of the average net assets attributable to each class. The Trustees have approved payment by the fund at the following annual rate (Approved %) of the average net assets attributable to each class. During the reporting period, the class-specific expenses related to distribution fees were as follows:

  Maximum %  Approved %  Amount 
Class A  0.35%  0.25%  $12,152,072 
Class B  1.00%  1.00%  289,224 
Class C  1.00%  1.00%  1,565,748 
Class R  1.00%  0.50%  175,183 
Total      $14,182,227 

 

For the reporting period, Putnam Retail Management Limited Partnership, acting as underwriter, received net commissions of $290,540 from the sale of class A shares and received $909 and $768 in contingent deferred sales charges from redemptions of class B and class C shares, respectively.

A deferred sales charge of up to 1.00% is assessed on certain redemptions of class A shares. For the reporting period, Putnam Retail Management Limited Partnership, acting as underwriter, received $459 on class A redemptions.

Note 3: Purchases and sales of securities

During the reporting period, the cost of purchases and the proceeds from sales, excluding short-term investments, were as follows:

  Cost of purchases  Proceeds from sales 
Investments in securities (Long-term)  $1,053,858,834  $604,761,424 
U.S. government securities (Long-term)  —  — 
Total  $1,053,858,834  $604,761,424 

 

The fund may purchase or sell investments from or to other Putnam funds in the ordinary course of business, which can reduce the fund’s transaction costs, at prices determined in accordance with SEC requirements and policies approved by the Trustees. During the reporting period, purchases or sales of long-term securities from or to other Putnam funds, if any, did not represent more than 5% of the fund’s total cost of purchases and/or total proceeds from sales.

Note 4: Capital shares

At the close of the reporting period, there were an unlimited number of shares of beneficial interest authorized. In certain circumstances shares may be purchased or redeemed through the delivery to the fund or receipt by the shareholders, respectively, of securities, the fair value of which is used to determine the number of shares issued or redeemed Transactions, including, if applicable, direct exchanges pursuant to share conversions, in capital shares were as follows:

  SIX MONTHS ENDED 4/30/22  ELEVEN MONTHS ENDED 10/31/21  YEAR ENDED 11/30/20 
Class A  Shares  Amount  Shares  Amount  Shares  Amount 
Shares sold  14,209,932  $442,589,591  14,559,260  $430,134,612  18,050,189  $430,672,025 
Shares issued in             
connection with             
reinvestment of             
distributions  18,606,522  566,827,729  16,386,830  438,980,932  12,497,648  313,510,879 
  32,816,454  1,009,417,320  30,946,090  869,115,544  30,547,837  744,182,904 
Shares             
repurchased  (17,284,531)  (536,014,492)  (31,801,553)  (940,751,802)  (52,233,371)  (1,253,293,270) 
Net increase             
(decrease)  15,531,923  $473,402,828  (855,463)  $(71,636,258)  (21,685,534)  $(509,110,366) 

 

40 Large Cap Value Fund 

 


  SIX MONTHS ENDED 4/30/22  ELEVEN MONTHS ENDED 10/31/21  YEAR ENDED 11/30/20 
Class B  Shares  Amount  Shares  Amount  Shares  Amount 
Shares sold  16,964  $509,761  36,511  $1,043,072  44,993  $1,072,871 
Shares issued in             
connection with             
reinvestment of             
distributions  113,152  3,406,609  135,618  3,529,348  123,045  3,117,955 
  130,116  3,916,370  172,129  4,572,420  168,038  4,190,826 
Shares             
repurchased  (510,208)  (15,698,155)  (1,033,443)  (30,242,248)  (1,344,458)  (31,925,951) 
Net decrease  (380,092)  $(11,781,785)  (861,314)  $(25,669,828)  (1,176,420)  $(27,735,125) 
 
  SIX MONTHS ENDED 4/30/22  ELEVEN MONTHS ENDED 10/31/21  YEAR ENDED 11/30/20 
Class C  Shares  Amount  Shares  Amount  Shares  Amount 
Shares sold  1,082,096  $33,078,285  1,935,259  $56,943,610  1,723,864  $41,386,801 
Shares issued in             
connection with             
reinvestment of             
distributions  598,402  17,995,156  574,286  14,949,074  446,461  11,280,305 
  1,680,498  51,073,441  2,509,545  71,892,684  2,170,325  52,667,106 
Shares             
repurchased  (1,617,408)  (49,336,109)  (4,166,008)  (120,233,785)  (5,066,828)  (118,556,062) 
Net increase             
(decrease)  63,090  $1,737,332  (1,656,463)  $(48,341,101)  (2,896,503)  $(65,888,956) 
 
  SIX MONTHS ENDED 4/30/22  ELEVEN MONTHS ENDED 10/31/21  YEAR ENDED 11/30/20 
Class R  Shares  Amount  Shares  Amount  Shares  Amount 
Shares sold  713,057  $21,377,336  286,505  $8,474,714  421,879  $9,940,439 
Shares issued in             
connection with             
reinvestment of             
distributions  138,938  4,195,336  138,222  3,647,940  113,725  2,847,580 
  851,995  25,572,672  424,727  12,122,654  535,604  12,788,019 
Shares             
repurchased  (464,603)  (14,255,603)  (879,857)  (25,415,810)  (1,069,912)  (25,165,835) 
Net increase             
(decrease)  387,392  $11,317,069  (455,130)  $(13,293,156)  (534,308)  $(12,377,816) 
 
  SIX MONTHS ENDED 4/30/22  ELEVEN MONTHS ENDED 10/31/21  YEAR ENDED 11/30/20 
Class R5  Shares  Amount  Shares  Amount  Shares  Amount 
Shares sold  265,143  $8,258,211  1,203,804  $35,817,477  355,512  $8,361,339 
Shares issued in             
connection with             
reinvestment of             
distributions  157,862  4,808,884  109,030  2,949,447  99,106  2,512,569 
  423,005  13,067,095  1,312,834  38,766,924  454,618  10,873,908 
Shares             
repurchased  (1,415,239)  (42,540,070)  (720,366)  (21,097,118)  (1,268,668)  (32,547,026) 
Net increase             
(decrease)  (992,234)  $(29,472,975)  592,468  $17,669,806  (814,050)  $(21,673,118) 

 

Large Cap Value Fund 41 

 


  SIX MONTHS ENDED 4/30/22  ELEVEN MONTHS ENDED 10/31/21  YEAR ENDED 11/30/20 
Class R6  Shares  Amount  Shares  Amount  Shares  Amount 
Shares sold  20,066,015  $621,580,885  22,773,846  $681,192,497  20,606,318  $495,662,992 
Shares issued in             
connection with             
reinvestment of             
distributions  4,503,099  137,145,789  3,419,512  92,344,819  2,263,092  56,276,450 
  24,569,114  758,726,674  26,193,358  773,537,316  22,869,410  551,939,442 
Shares             
repurchased  (11,964,198)  (373,140,242)  (14,287,619)  (425,009,741)  (7,394,571)  (418,659,931) 
Net increase  12,604,916  $385,586,432  11,905,739  $348,527,575  5,474,839  $133,279,511 
 
  SIX MONTHS ENDED 4/30/22  ELEVEN MONTHS ENDED 10/31/21  YEAR ENDED 11/30/20 
Class Y  Shares  Amount  Shares  Amount  Shares  Amount 
Shares sold  44,718,859  $1,386,325,681  56,463,465  $1,681,024,375  46,759,559  $1,115,167,876 
Shares issued in             
connection with             
reinvestment of             
distributions  9,453,196  287,824,281  6,793,762  183,602,084  4,464,370  111,358,631 
  54,172,055  1,674,149,962  63,257,227  1,864,626,459  51,223,929  1,226,526,507 
Shares             
repurchased  (21,162,773)  (655,312,575)  (34,765,608)  (1,031,857,576)  (41,693,816)  (976,952,338) 
Redemption in kind  —  —  —  —  (816,909)  (19,295,392) 
Net increase  33,009,282  $1,018,837,387  28,491,619  $832,768,883  8,713,204  $230,278,777 

 

Note 5: Affiliated transactions

Transactions during the reporting period with any company which is under common ownership or control, or involving securities of companies in which the fund owned at least 5% of the outstanding voting securities, were as follows:

              Change in     
              unrealized  Shares   
  Fair value as      Investment  Capital gain  Realized  appreciation  outstanding as  Fair value as 
Name of affiliate  of 10/31/21  Purchase cost  Sale proceeds  Income  distributions  gain (loss)  (depreciation)  of 4/30/22  of 4/30/22 
Short-term investments                   
Putnam Cash Collateral Pool, LLC*  $96,760,375  $312,938,872  $343,754,337  $35,487  $—  $—  $—  65,944,910  $65,944,910 
Putnam Short Term Investment Fund**  235,153,634  607,600,596  648,071,694  188,657  —  —  —  194,682,536  194,682,536 
Total Short-term investments  331,914,009  920,539,468  991,826,031  224,144  —  —  —    260,627,446 
Common stocks†                   
Financials                   
Assured Guaranty, Ltd.  230,557,734  5,844,107  14,489,921  1,974,537  —  2,823,682  (3,947,320)  4,003,414  220,788,282 
Total Common stocks  230,557,734  5,844,107  14,489,921  1,974,537  —  2,823,682  (3,947,320)    220,788,282 
Totals  $562,471,743  $926,383,575  $1,006,315,952  $2,198,681  $—  $2,823,682  $(3,947,320)    $481,415,728 

 

* No management fees are charged to Putnam Cash Collateral Pool, LLC (Note 1).Investment income shown is included in securities lending income on the Statement of operations. There were no realized or unrealized gains or losses during the period.

** Management fees charged to Putnam Short Term Investment Fund have been waived by Putnam Management. There were no realized or unrealized gains or losses during the period.

† Common stock classifications are presented at the sector level, which may differ from the fund’s portfolio presentation.

42 Large Cap Value Fund  Large Cap Value Fund 43 

 


Note 6: Market, credit and other risks

In the normal course of business, the fund trades financial instruments and enters into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the contracting party to the transaction to perform (credit risk). The fund may be exposed to additional credit risk that an institution or other entity with which the fund has unsettled or open transactions will default. Investments in foreign securities involve certain risks, including those related to economic instability, unfavorable political developments, and currency fluctuations.

Beginning in January 2020, global financial markets have experienced, and may continue to experience, significant volatility resulting from the spread of a virus known as Covid–19. The outbreak of Covid–19 has resulted in travel and border restrictions, quarantines, supply chain disruptions, lower consumer demand, and general market uncertainty. The effects of Covid–19 have adversely affected, and may continue to adversely affect, the global economy, the economies of certain nations, and individual issuers, all of which may negatively impact the fund’s performance.

Note 7: Summary of derivative activity

The volume of activity for the reporting period for any derivative type that was held during the period is listed below and was based on an average of the holdings at the end of each fiscal quarter:

Futures contracts (number of contracts)  20 
Forward currency contracts (contract amount)  $1,101,000,000 
Warrants (number of warrants)  63,000 

 

The following is a summary of the fair value of derivative instruments as of the close of the reporting period:

Fair value of derivative instruments as of the close of the reporting period   
  ASSET DERIVATIVES LIABILITY DERIVATIVES
Derivatives not         
accounted for as  Statement of    Statement of   
hedging instruments  assets and    assets and   
under ASC 815  liabilities location  Fair value  liabilities location  Fair value 
Foreign exchange         
contracts  Receivables  $58,541,079  Payables  $722,266 
      Payables, Net assets —   
Equity contracts  Investments  2,118,298  Unrealized depreciation  96,280* 
Total    $60,659,377    $818,546 

 

* Includes cumulative appreciation/depreciation of futures contracts as reported in the fund’s portfolio. Only current day’s variation margin is reported within the Statement of assets and liabilities.

44 Large Cap Value Fund 

 


The following is a summary of realized and change in unrealized gains or losses of derivative instruments in the Statement of operations for the reporting period (Note 1):

Amount of realized gain or (loss) on derivatives recognized in net gain or (loss) on investments 
Derivatives not accounted for as hedging    Forward currency   
instruments under ASC 815  Futures  contracts  Total 
Foreign exchange contracts  $—  $48,045,263  $48,045,263 
Equity contracts    (1,977,313)  —  $(1,977,313) 
Total  $(1,977,313)  $48,045,263  $46,067,950 

 

Change in unrealized appreciation or (depreciation) on derivatives recognized in net gain or (loss) 
on investments         
Derivatives not         
accounted for as      Forward   
hedging instruments      currency   
under ASC 815  Warrants  Futures  contracts  Total 
Foreign exchange         
contracts  $—  $—  $41,420,300  $41,420,300 
Equity contracts  1,174,042  (96,280)  —  $1,077,762 
Total  $1,174,042  $(96,280)  $41,420,300  $42,498,062 

 

Large Cap Value Fund 45 

 


Note 8: Offsetting of financial and derivative assets and liabilities

The following table summarizes any derivatives, repurchase agreements and reverse repurchase agreements, at the end of the reporting period, that are subject to an enforceable master netting agreement or similar agreement. For securities lending transactions or borrowing transactions associated with securities sold short, if any, see Note 1. For financial reporting purposes, the fund does not offset financial assets and financial liabilities that are subject to the master netting agreements in the Statement of assets and liabilities.

  Bank of
America N.A.		 Barclays Bank
PLC		 BofA
Securities,
Inc.		 Citibank, N.A. Goldman
Sachs
International		 HSBC Bank
USA, National Association		 Morgan
Stanley & Co. International
PLC		 NatWest
Markets PLC		 Royal Bank
of Canada		 State Street
Bank and
Trust Co.		 UBS AG WestPac
Banking Corp.		 Total
Assets:                           
Futures contracts§  $—  $—  $—  $—  $—  $—  $—  $—  $—  $—  $—  $—  $— 
Forward currency contracts#  997,848  11,606,215  —  —  12,322,484  3,493,697  8,768,687  1,962,860  —  10,546,463  4,826,116  4,016,709  58,541,079 
Repurchase agreements **  —  —  —  —  —  —  —  —  82,402,000  —  —  —  82,402,000 
Total Assets  $997,848  $11,606,215  $—  $—  $12,322,484  $3,493,697  $8,768,687  $1,962,860  $82,402,000  $10,546,463  $4,826,116  $4,016,709  $140,943,079 
Liabilities:                           
Futures contracts§  —  —  288,600  —  —  —  —  —  —  —  —  —  288,600 
Forward currency contracts#  —  —  —  722,266  —  —  —  —  —  —  —  —  722,266 
Total Liabilities  $—  $—  $288,600  $722,266  $—  $—  $—  $—  $—  $—  $—  $—  $1,010,866 
Total Financial and Derivative Net Assets  $997,848  $11,606,215  $(288,600)  $(722,266)  $12,322,484  $3,493,697  $8,768,687  $1,962,860  $82,402,000  $10,546,463  $4,826,116  $4,016,709  $139,932,213 
Total collateral received (pledged)†##  $994,817  $11,606,215  $—  $(722,266)  $12,322,484  $3,493,697  $8,768,687  $1,962,860  $82,402,000  $10,546,463  $4,826,116  $—   
Net amount  $3,031  $—  $(288,600)  $—  $—  $—  $—  $—  $—  $—  $—  $4,016,709   
Controlled collateral received (including                           
TBA commitments)**  $994,817  $13,410,779  $—  $—  $13,890,000  $3,750,000  $9,365,000  $2,250,000  $—  $11,835,869  $5,100,000  $—  $60,596,465 
Uncontrolled collateral received  $—  $—  $—  $—  $—  $—  $—  $—  $84,052,141  $—  $—  $—  $84,052,141 
Collateral (pledged) (including                           
TBA commitments)**  $—  $—  $—  $(795,859)  $—  $—  $—  $—  $—  $—  $—  $—  $(795,859) 

 

** Included with Investments in securities on the Statement of assets and liabilities.

† Additional collateral may be required from certain brokers based on individual agreements.

# Covered by master netting agreement (Note 1).

##Any over-collateralization of total financial and derivative net assets is not shown. Collateral may include amounts related to unsettled agreements.

§ Includes current day’s variation margin only as reported on the Statement of assets and liabilities, which is not collateralized. Cumulative appreciation/(depreciation) for futures contracts is represented in the tables listed after the fund’s portfolio. Collateral pledged for initial margin on futures contracts, which is not included in the table above, amounted to $441,912.

46 Large Cap Value Fund  Large Cap Value Fund 47 

 


Services for shareholders

Investor services

Systematic investment plan Tell us how much you wish to invest regularly — weekly, semimonthly, or monthly — and the amount you choose will be transferred automatically from your checking or savings account. There’s no additional fee for this service, and you can suspend it at any time. This plan may be a great way to save for college expenses or to plan for your retirement.

Please note that regular investing does not guarantee a profit or protect against loss in a declining market. Before arranging a systematic investment plan, consider your financial ability to continue making purchases in periods when prices are low.

Systematic exchange You can make regular transfers from one Putnam fund to another Putnam fund. There are no additional fees for this service, and you can cancel or change your options at any time.

Dividends PLUS You can choose to have the dividend distributions from one of your Putnam funds automatically reinvested in another Putnam fund at no additional charge.

Free exchange privilege You can exchange money between Putnam funds free of charge, as long as they are the same class of shares. A signature guarantee is required if you are exchanging more than $500,000. The fund reserves the right to revise or terminate the exchange privilege.

Reinstatement privilege If you’ve sold Putnam shares or received a check for a dividend or capital gain, you may reinvest the proceeds with Putnam within 90 days of the transaction and they will be reinvested at the fund’s current net asset value — with no sales charge. However, reinstatement of class B shares may have special tax consequences. Ask your financial or tax representative for details.

Check-writing service You have ready access to many Putnam accounts. It’s as simple as writing a check, and there are no special fees or service charges. For more information about the check-writing service, call Putnam or visit our website.

Dollar cost averaging When you’re investing for long-term goals, it’s time, not timing, that counts. Investing on a systematic basis is a better strategy than trying to figure out when the markets will go up or down. This means investing the same amount of money regularly over a long period. This method of investing is called dollar cost averaging. When a fund’s share price declines, your investment dollars buy more shares at lower prices. When it increases, they buy fewer shares. Over time, you will pay a lower average price per share.

For more information

Visit the Individual Investors section at putnam.com A secure section of our website contains complete information on your account, including balances and transactions, updated daily. You may also conduct transactions, such as exchanges, additional investments, and address changes. Log on today to get your password.

Call us toll free at 1-800-225-1581 Ask a helpful Putnam representative or your financial advisor for details about any of these or other services, or see your prospectus.

48 Large Cap Value Fund 

 


Fund information

Founded over 80 years ago, Putnam Investments was built around the concept that a balance between risk and reward is the hallmark of a well-rounded financial program. We manage funds across income, value, blend, growth, sustainable, asset allocation, absolute return, and global sector categories.

Investment Manager  Trustees  Richard T. Kircher 
Putnam Investment  Kenneth R. Leibler, Chair  Vice President and 
Management, LLC  Liaquat Ahamed  BSA Compliance Officer 
100 Federal Street  Ravi Akhoury   
Boston, MA 02110  Barbara M. Baumann  Martin Lemaire 
  Katinka Domotorffy  Vice President and 
Investment Sub-Advisor  Catharine Bond Hill  Derivatives Risk Manager 
Putnam Investments Limited  Paul L. Joskow 
16 St James’s Street  George Putnam, III  Susan G. Malloy 
London, England SW1A 1ER  Robert L. Reynolds  Vice President and 
Manoj P. Singh  Assistant Treasurer 
Marketing Services  Mona K. Sutphen 
Putnam Retail Management    Alan G. McCormack 
Limited Partnership  Officers  Vice President and 
100 Federal Street  Robert L. Reynolds  Derivatives Risk Manager 
Boston, MA 02110  President 
    Denere P. Poulack 
Custodian  James F. Clark  Assistant Vice President, 
State Street Bank  Vice President, Chief Compliance  Assistant Clerk, and 
and Trust Company  Officer, and Chief Risk Officer  Assistant Treasurer 
   
Legal Counsel  Nancy E. Florek  Janet C. Smith 
Ropes & Gray LLP  Vice President, Director of  Vice President, 
  Proxy Voting and Corporate  Principal Financial Officer, 
  Governance, Assistant Clerk,  Principal Accounting Officer, 
  and Assistant Treasurer  and Assistant Treasurer 
   
  Michael J. Higgins  Stephen J. Tate 
  Vice President, Treasurer,  Vice President and 
  and Clerk  Chief Legal Officer 
   
  Jonathan S. Horwitz  Mark C. Trenchard 
  Executive Vice President,  Vice President 
Principal Executive Officer,   
  and Compliance Liaison   

 

This report is for the information of shareholders of Putnam Large Cap Value Fund. It may also be used as sales literature when preceded or accompanied by the current prospectus, the most recent copy of Putnam’s Quarterly Performance Summary, and Putnam’s Quarterly Ranking Summary. For more recent performance, please visit putnam.com. Investors should carefully consider the investment objectives, risks, charges, and expenses of a fund, which are described in its prospectus. For this and other information or to request a prospectus or summary prospectus, call 1-800-225-1581 toll free. Please read the prospectus carefully before investing. The fund’s Statement of Additional Information contains additional information about the fund’s Trustees and is available without charge upon request by calling 1-800-225-1581.



Item 2. Code of Ethics:
Not applicable

Item 3. Audit Committee Financial Expert:
Not applicable

Item 4. Principal Accountant Fees and Services:
Not applicable

Item 5. Audit Committee of Listed Registrants
Not applicable

Item 6. Schedule of Investments:
The registrant’s schedule of investments in unaffiliated issuers is included in the report to shareholders in Item 1 above.

Item 7. Disclosure of Proxy Voting Policies and Procedures For Closed-End Management Investment Companies:
Not applicable

Item 8. Portfolio Managers of Closed-End Investment Companies
Not Applicable

Item 9. Purchases of Equity Securities by Closed-End Management Investment Companies and Affiliated Purchasers:
Not applicable

Item 10. Submission of Matters to a Vote of Security Holders:
Not applicable

Item 11. Controls and Procedures:
(a) The registrant’s principal executive officer and principal financial officer have concluded, based on their evaluation of the effectiveness of the design and operation of the registrant’s disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the design and operation of such procedures are generally effective to provide reasonable assurance that information required to be disclosed by the registrant in this report is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms.

(b) Changes in internal control over financial reporting: Not applicable

Item 12. Disclosures of Securities Lending Activities for Closed-End Investment Companies:
Not Applicable

Item 13. Exhibits:
(a)(1) Not applicable

(a)(2) Separate certifications for the principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940, as amended, are filed herewith.

(b) The certifications required by Rule 30a-2(b) under the Investment Company Act of 1940, as amended, are filed herewith.

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.

Putnam Large Cap Value Fund
By (Signature and Title):
/s/ Janet C. Smith
Janet C. Smith
Principal Accounting Officer

Date: June 28, 2022
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 (Signature and Title):
/s/ Jonathan S. Horwitz
Jonathan S. Horwitz
Principal Executive Officer

Date: June 28, 2022
By (Signature and Title):
/s/ Janet C. Smith
Janet C. Smith
Principal Financial Officer

Date: June 28, 2022