UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: | 811-03712 | |
Exact name of registrant as specified in charter: | Prudential Investment Portfolios, Inc. 14 | |
Address of principal executive offices: | Gateway Center 3, | |
100 Mulberry Street, | ||
Newark, New Jersey 07102 | ||
Name and address of agent for service: | Deborah A. Docs | |
Gateway Center 3, | ||
100 Mulberry Street, | ||
Newark, New Jersey 07102 | ||
Registrants telephone number, including area code: | 800-225-1852 | |
Date of fiscal year end: | 2/29/2012 | |
Date of reporting period: | 5/31/2011 |
Item 1. Schedule of Investments
Prudential Floating Rate Income Fund
Schedule of Investments
as of May 31, 2011 (Unaudited)
Moodys |
Interest |
Maturity Date |
Principal |
Value | ||||||
LONG-TERM INVESTMENTS 98.2% |
||||||||||
BANK LOANS(a) 85.5% |
||||||||||
Aerospace & Defense 2.3% |
||||||||||
Hawker Beechcraft, Inc. |
Caa1 | 0.207% | 03/26/14 | $ 15 | $ 12,777 | |||||
Hawker Beechcraft, Inc. |
Caa1 | 2.223% | 03/26/14 | 235 | 206,629 | |||||
Tasc, Inc. |
Ba2 | 4.500% | 12/18/15 | 100 | 100,023 | |||||
Wesco Aircraft Hardware Corp. |
Ba3 | 4.250% | 04/07/17 | 312 | 314,340 | |||||
633,769 | ||||||||||
Airlines 2.2% |
||||||||||
Delta Air Lines, Inc. |
Ba2 | 4.250% | 03/07/16 | 500 | 496,094 | |||||
Delta Air Lines, Inc. |
Ba2 | 5.500% | 04/20/17 | 100 | 98,938 | |||||
595,032 | ||||||||||
Automotive 1.8% |
||||||||||
Chrysler LLC |
Ba2 | 4.980% | 05/24/17 | 500 | 497,106 | |||||
Building Materials & Construction 1.9% |
||||||||||
Atrium Cos., Inc. |
B3 | 7.000% | 04/30/16 | 274 | 272,934 | |||||
Summit Materials Cos. I LLC |
B2 | 6.500% | 12/31/15 | 249 | 249,531 | |||||
522,465 | ||||||||||
Cable 0.5% |
||||||||||
Knology, Inc. |
B1 | 4.000% | 08/18/17 | 150 | 149,813 | |||||
Capital Goods 3.6% |
||||||||||
Aquilex Holdings, Inc. |
Ba3 | 6.000% | 04/01/16 | 250 | 249,063 | |||||
Belfor USA Group, Inc. |
Ba2 | 4.500% | 04/30/17 | 450 | 454,500 | |||||
Sensus USA, Inc. |
Ba3 | 4.750% | 05/09/17 | 300 | 301,125 | |||||
1,004,688 | ||||||||||
Chemicals 4.7% |
||||||||||
Houghton International, Inc. |
B1 | 6.750% | 01/31/16 | 500 | 502,813 | |||||
Nexeo Solutions LLC |
B1 | 5.000% | 09/08/17 | 300 | 299,906 | |||||
Nusil Tech |
B1 | 5.250% | 04/07/17 | 247 | 247,535 | |||||
Univar, Inc. |
B2 | 5.000% | 06/30/17 | 249 | 248,617 | |||||
1,298,871 | ||||||||||
Consumer 5.4% |
||||||||||
Acosta, Inc. |
Ba3 | 4.750% | 03/01/18 | 300 | 300,300 | |||||
Mood Media Corp. |
B1 | 7.000% | 05/04/18 | 75 | 74,625 | |||||
Realogy Corp. |
B1 | 4.540% | 10/10/16 | 229 | 212,397 | |||||
Realogy Corp. |
B1 | 4.540% | 10/10/16 | 21 | 19,919 | |||||
Revlon Consumer Products Corp. |
Ba3 | 4.750% | 11/19/17 | 225 | 225,281 | |||||
Travelport, Inc. |
Ba3 | 4.757% | 08/23/15 | 176 | 169,302 | |||||
Visant Corp. |
Ba3 | 5.250% | 12/22/16 | 500 | 500,125 | |||||
1,501,949 | ||||||||||
Electric 3.0% |
||||||||||
AES Corp. |
Ba1 | 0.000(b) | 05/31/18 | 450 | 449,578 | |||||
Calpine Corp. |
B1 | 4.500% | 04/01/18 | 250 | 250,500 | |||||
Texas Competitive Electric Holdings Co. LLC |
B2 | 4.738% | 10/10/17 | 144 | 113,781 | |||||
813,859 | ||||||||||
Energy Other 0.9% |
||||||||||
Frac Tech Services LLC |
B2 | 6.250% | 05/06/16 | 221 | 220,745 | |||||
Frac Tech Services LLC |
B2 | 6.250% | 05/06/16 | 29 | 29,433 | |||||
250,178 | ||||||||||
Foods 7.3% |
||||||||||
Del Monte Foods Co. |
Ba3 | 4.500% | 03/08/18 | 500 | 499,841 | |||||
Dunkin Brands, Inc. |
B2 | 4.250% | 11/23/17 | 499 | 499,062 | |||||
JBS USA LLC |
Ba3 | 4.250% | 05/25/18 | 275 | 274,828 | |||||
Pierre Foods, Inc. |
B1 | 7.000% | 09/30/16 | 249 | 250,724 | |||||
SUPERVALU |
Ba3 | 3.773% | 04/29/18 | 500 | 494,514 | |||||
2,018,969 | ||||||||||
Gaming 5.3% |
||||||||||
Ameristar Casinos, Inc. |
Ba3 | 4.000% | 04/13/18 | 250 | 251,070 | |||||
Harrahs Operating Co., Inc. |
B3 | 3.274% | 01/28/15 | 498 | 463,805 | |||||
Isle of Capri Casinos, Inc. |
Ba3 | 4.750% | 03/25/17 | 249 | 250,514 | |||||
Las Vegas Sands LLC |
Ba3 | 3.000% | 11/23/16 | 208 | 204,006 | |||||
Las Vegas Sands LLC |
Ba3 | 3.000% | 11/23/16 | 42 | 41,028 | |||||
Venetian Macau Ltd. |
Ba3 | 4.720% | 05/25/13 | 158 | 157,076 |
Venetian Macau Ltd. |
Ba3 | 4.720% | 05/25/12 | 91 | 90,900 | |||||
1,458,399 | ||||||||||
Healthcare & Pharmaceutical 10.9% |
||||||||||
Biomet, Inc. |
B2 | 3.276% | 03/25/15 | 399 | 396,521 | |||||
Community Health Systems, Inc. |
Ba3 | 3.754% | 01/25/17 | 499 | 486,044 | |||||
Drumm Investors LLC |
B1 | 4.023% | 05/04/18 | 250 | 246,000 | |||||
Emergency Medical Services |
B1 | 3.274% | 05/25/18 | 250 | 249,420 | |||||
Grifols SA |
Ba3 | 6.000% | 11/23/16 | 500 | 503,854 | |||||
HCR Healthcare LLC |
Ba3 | 5.000% | 04/06/18 | 500 | 492,620 | |||||
IASIS Healthcare Corp. |
Ba3 | 5.000% | 05/03/18 | 250 | 250,187 | |||||
PTS Acquisitions Corp. |
Ba3 | 2.441% | 04/10/14 | 150 | 145,838 | |||||
Skilled Healthcare Group, Inc. |
B1 | 5.250% | 04/08/16 | 249 | 248,123 | |||||
3,018,607 | ||||||||||
Insurance 0.9% |
||||||||||
Asurion LLC |
Ba3 | 5.500% | 05/24/18 | 250 | 247,603 | |||||
Media & Entertainment 6.3% |
||||||||||
Intelsat Jackson Holdings SA |
B1 | 5.250% | 04/02/18 | 500 | 502,847 | |||||
Nielsen Finance LLC |
Ba2 | 3.456% | 05/01/16 | 499 | 497,319 | |||||
SeaWorld Parks |
Ba2 | 4.000% | 02/17/16 | 241 | 242,315 | |||||
Univision Communications, Inc. |
B2 | 4.441% | 03/29/17 | 500 | 482,812 | |||||
1,725,293 | ||||||||||
Media (Non-Cable) 0.7% |
||||||||||
Hubbard Radio LLC |
Ba3 | 5.250% | 04/28/17 | 200 | 201,250 | |||||
Metals 1.8% |
||||||||||
Novelis, Inc. |
BB-(c) | 4.000% | 03/10/17 | 499 | 500,776 | |||||
Non-Captive Finance 2.7% |
||||||||||
International Lease Finance Corp. |
Ba2 | 6.750% | 03/17/15 | 250 | 250,580 | |||||
Springleaf Financial Funding Co. |
B2 | 5.500% | 05/10/17 | 500 | 499,219 | |||||
749,799 | ||||||||||
Packaging 5.6% |
||||||||||
Bway Holding Co. |
Ba3 | 4.500% | 02/23/18 | 458 | 458,844 | |||||
Bway Holding Co. |
Ba3 | 4.503% | 02/23/18 | 41 | 40,822 | |||||
Exopack LLC |
B1 | 6.500% | 05/31/17 | 250 | 249,375 | |||||
Pelican Products, Inc.(d) |
B1 | 5.000% | 03/07/17 | 299 | 299,250 | |||||
Reynolds Group Holdings, Inc. |
Ba3 | 4.250% | 02/09/18 | 500 | 499,688 | |||||
1,547,979 | ||||||||||
Real Estate Investment Trusts 1.6% |
||||||||||
CB Richard Ellis Services, Inc. |
Ba1 | 1.625% | 09/04/19 | 200 | 198,750 | |||||
CB Richard Ellis Services, Inc. |
Ba1 | 3.454% | 11/09/16 | 249 | 248,594 | |||||
447,344 | ||||||||||
Retailers 1.8% |
||||||||||
Nieman Marcus Group, Inc. |
B2 | 4.750% | 05/16/18 | 500 | 496,666 | |||||
Technology 11.3% |
||||||||||
Avaya, Inc. |
B1 | 4.766% | 10/26/17 | 299 | 291,199 | |||||
CDW LLC |
B2 | 4.500% | 07/15/17 | 500 | 498,125 | |||||
Dealer Computer Services, Inc. |
Ba2 | 3.750% | 04/21/18 | 500 | 501,250 | |||||
First Data Corp. |
B1 | 4.307% | 03/24/18 | 469 | 437,726 | |||||
Freescale Semiconductor, Inc. |
B1 | 4.461% | 12/01/16 | 500 | 497,890 | |||||
Interactive Data Corp. |
Ba3 | 4.750% | 02/09/18 | 300 | 300,748 | |||||
Sensata Technologies, Inc. |
Ba3 | 4.000% | 05/12/18 | 350 | 350,510 | |||||
Trizetto Group |
B1 | 3.773% | 05/02/18 | 250 | 249,438 | |||||
3,126,886 | ||||||||||
Telecommunications 1.2% |
||||||||||
MetroPCS Wireless, Inc. |
Ba1 | 4.057% | 03/19/18 | 250 | 248,854 | |||||
Securus Technologies, Inc. |
B1 | 5.250% | 06/15/17 | 75 | 74,250 | |||||
323,104 | ||||||||||
Transportation 1.8% |
||||||||||
Hertz Corp. |
Ba1 | 3.750% | 03/12/18 | 500 | 490,833 | |||||
TOTAL BANK LOANS |
23,621,238 | |||||||||
CORPORATE BONDS 12.7% |
||||||||||
Cable 1.1% |
||||||||||
Echostar DBS Corp., Gtd. Notes |
Ba3 | 6.625% | 10/01/14 | 100 | 106,500 |
Videotron Ltee (Canada), Gtd. Notes |
Ba1 | 9.125% | 04/15/18 | 175 | 195,562 | |||||
302,062 | ||||||||||
Capital Goods 0.6% |
||||||||||
Case New Holland, Inc., Gtd. Notes |
Ba3 | 7.750% | 09/01/13 | 150 | 163,125 | |||||
Energy Other 0.8% |
||||||||||
Forest Oil Corp., Gtd. Notes |
B1 | 8.500% | 02/15/14 | 200 | 221,500 | |||||
Gaming 1.2% |
||||||||||
MGM Resorts International, |
Ba3 | 11.125% | 11/15/17 | 200 | 232,000 | |||||
Yonkers Racing Corp., |
B1 | 11.375% | 07/15/16 | 100 | 110,125 | |||||
342,125 | ||||||||||
Healthcare & Pharmaceutical 0.4% |
||||||||||
Apria Healthcare Group, Inc., |
Ba3 | 11.250% | 11/01/14 | 100 | 105,625 | |||||
Media & Entertainment 3.8% |
||||||||||
CW Media Holdings, Inc. (Canada), |
Ba2 | 13.500% | 08/15/15 | 380 | 416,037 | |||||
Lamar Media Corp., Gtd. Notes |
Ba3 | 9.750% | 04/01/14 | 200 | 232,500 | |||||
Nielsen Finance LLC / Nielsen Finance Co., Gtd. Notes |
B2 | 11.625% | 02/01/14 | 200 | 235,500 | |||||
Rainbow National Services LLC, |
B1 | 10.375% | 09/01/14 | 150 | 155,625 | |||||
1,039,662 | ||||||||||
Metals 0.7% |
||||||||||
Steel Dynamics, Inc., Gtd. Notes |
Ba2 | 6.750% | 04/01/15 | 200 | 206,000 | |||||
Non-Captive Finance 1.0% |
||||||||||
American General Finance Corp., |
B3 | 5.375% | 10/01/12 | 125 | 125,625 | |||||
CIT Group, Inc., Secd. Notes |
B2 | 7.000% | 05/01/17 | 150 | 150,563 | |||||
276,188 | ||||||||||
Paper 1.4% |
||||||||||
Graphic Packaging International, Inc., |
B3 | 9.500% | 06/15/17 | 250 | 278,750 | |||||
Verso Paper Holdings LLC / Verso Paper, Inc., Sr. Secd. Notes |
Ba2 | 11.500% | 07/01/14 | 100 | 108,500 | |||||
387,250 | ||||||||||
Technology 1.7% |
||||||||||
NXP BV /NXP Funding LLC (Netherlands), |
B3 | 3.028% | 10/15/13 | 300 | 298,500 | |||||
SunGard Data Systems, Inc., Gtd. Notes |
Caa1 | 10.625% | 05/15/15 | 150 | 163,875 | |||||
462,375 | ||||||||||
TOTAL CORPORATE BONDS |
3,505,912 | |||||||||
TOTAL LONG-TERM INVESTMENTS |
27,127,150 | |||||||||
SHORT-TERM INVESTMENT 8.8% |
||||||||||
AFFILIATED MONEY MARKET MUTUAL FUND |
||||||||||
Prudential Investment Portfolios 2 Prudential Core Taxable Money Market Fund(f) |
2,438,702 | 2,438,702 | ||||||||
TOTAL INVESTMENTS 107.0% |
29,565,852 | |||||||||
LIABILITIES IN EXCESS OF OTHER ASSETS (7.0)% |
(1,945,033) | |||||||||
NET ASSETS 100.0% |
$ 27,620,819 | |||||||||
The following abbreviations are used in portfolio descriptions:
144ASecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may not be resold subject to that rule except to qualified institutional buyers. Unless otherwise noted, 144A securities are deemed to be liquid.
MTNMedium Term Note
PIKPayment in Kind
| The ratings reflected are as of May 31, 2011. Ratings of certain bonds may have changed subsequent to that date. |
# | Principal amount is shown in U.S. dollars unless otherwise stated. |
(a) | Variable rate instrument. The interest rate shown reflects the rate in effect at May 31, 2011. |
(b) | Rate shown reflects the effective yield at May 31, 2011. Rate will increase to 4.250% upon closing of loan trade. |
(c) | Standard & Poors Rating. |
(d) | Indicates a security that has been deemed illiquid. |
(e) | Indicates a restricted security; the aggregate original cost of such securities is $110,875. The aggregate value of $110,125 is approximately 0.4% of net assets. |
(f) | Prudential Investments LLC, the manager of the Portfolio, also serves as manager of the Prudential Investment Portfolios 2 Prudential Core Taxable Money Market Fund. |
(g) | The United States federal income tax basis of the Funds investments and the net unrealized depreciation as of May 31, 2011 were as follows: |
Tax Basis of Investments |
Appreciation | Depreciation | Net Unrealized Depreciation |
|||||||||||
$ | 29,652,016 | $ | 43,481 | $ | (129,645 | ) | $ | (86,164 | ) |
The difference between book basis and tax basis was primarily attributable to difference in the treatment of accreting market discount and premium amortization for book and tax purposes.
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in the three broad levels listed below.
Level 1 - quoted prices generally for stocks, exchange traded funds, options and futures traded in active markets for identical securities, and mutual funds which trade at daily net asset value.
Level 2 - other significant observable inputs (including, but not limited to, quoted prices for similar securities, interest rates, prepayment speeds, foreign currency exchange rates, and amortized cost) generally for debt securities, swaps, forward foreign currency contracts and for foreign stocks priced using vendor modeling tools.
Level 3 - significant unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of May 31, 2011 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities |
||||||||||||
Bank Loans |
$ | | $ | 22,876,541 | $ | 744,697 | ||||||
Corporate Bonds |
| 3,505,912 | | |||||||||
Affiliated Money Market Mutual Fund |
2,438,702 | | | |||||||||
|
|
|
|
|
|
|||||||
Total |
$ | 2,438,702 | $ | 26,382,453 | $ | 744,697 | ||||||
|
|
|
|
|
|
The following is a reconciliation of assets in which significant unobservable inputs (Level 3) were used in determining fair value:
Bank Loans | ||||
Balance as of 03/30/11 (commencement of Fund) |
$ | | ||
Realized gain (loss) |
| |||
Change in unrealized appreciation (depreciation)* |
7,222 | |||
Purchases |
737,475 | |||
Sales |
| |||
Accrued discount/premium |
| |||
Transfers into Level 3 |
| |||
Transfers out of Level 3 |
| |||
|
|
|||
Balance as of 05/31/11 |
$ | 744,697 | ||
|
|
* | Of which, $7,222 was included in Net Assets relating to securities held at the reporting period end. |
Prudential Government Income Fund
Schedule of Investments
as of May 31, 2011 (Unaudited)
Principal |
Description |
Value | ||
LONG-TERM INVESTMENTS 99.8% |
||||
Collateralized Mortgage Obligations 4.3% |
||||
$ 5,584 | Federal Home Loan Mortgage Corp., |
$ 6,099,353 | ||
2,217 | Ser. 2002-2501, Class MC, |
2,403,398 | ||
6,650 | Ser. 2002-2513, Class HC, |
7,316,608 | ||
5,500 | Ser. 2002-2518, Class PV, |
5,686,194 | ||
3,556 | Federal National Mortgage Association, |
3,728,326 | ||
1,990 | Ser. 2002-57, Class ND, |
2,153,596 | ||
292 | MLCC Mortgage Investors, Inc., |
266,069 | ||
969 | Structured Adjustable Rate Mortgage Loan Trust, |
899,418 | ||
28,552,962 | ||||
Commercial Mortgage-Backed Securities 12.0% |
||||
1,969 | Banc of America Commercial Mortgage, Inc., |
1,991,343 | ||
10,800 | Bear Stearns Commercial Mortgage Securities, |
11,179,974 | ||
4,000 | Ser. 2005-PW10, Class A4, |
4,410,478 | ||
3,300 | Credit Suisse First Boston Mortgage Securities Corp., |
3,537,496 | ||
3,100 | CWCapital Cobalt Ltd., |
3,321,377 | ||
4,400 | Federal Home Loan Mortgage Corp., |
4,584,253 | ||
6,400 | Ser. 2010-K007, Class A2, |
6,704,339 | ||
5,100 | Ser. 2010-K009, Class A2, |
5,159,147 | ||
6,600 | Ser. 2011-K013, Class A2, 3.974%, 01/25/21 FRN |
6,724,444 |
1,876 | Greenwich Capital Commercial Funding Corp., |
1,910,582 | ||
3,284 | GS Mortgage Securities Corp. II, |
3,360,610 | ||
1,600 | JPMorgan Chase Commercial Mortgage Securities Corp., |
1,704,332 | ||
5,000 | Merrill Lynch Mortgage Trust, |
5,307,150 | ||
4,529 | Merrill Lynch/Countrywide Commercial Mortgage Trust, |
4,668,684 | ||
3,000 | Morgan Stanley Capital I, |
3,268,781 | ||
3,000 | NCUA Guaranteed Notes, |
3,018,348 | ||
4,000 | Wachovia Bank Commercial Mortgage Trust, |
4,448,824 | ||
4,212 | Ser. 2006-C27, Class A2, 5.624%, 07/15/45 |
4,225,790 | ||
79,525,952 | ||||
Corporate Bonds 1.3% |
||||
800 | Credit Suisse AG (Switzerland), Covered Notes, 144A, |
803,041 | ||
2,960 | Depfa ACS Bank (Ireland), Covered Notes, 144A, |
2,079,169 | ||
5,280 | DNB NOR Boligkreditt (Norway), Covered Notes, 144A, |
5,390,241 | ||
8,272,451 | ||||
Mortgage-Backed Securities 48.8% |
||||
2,105 | Federal Home Loan Mortgage Corp., |
2,212,680 | ||
2,047 | 4.000%, 12/01/40 |
2,062,318 | ||
6,000(a) | 4.000%, TBA 30 YR |
6,035,628 | ||
6,000(a) | 4.500%, TBA 30 YR |
6,201,564 | ||
19,035 | 5.000%, 06/01/33 - 05/01/34 |
20,381,863 | ||
3,772 | 5.500%, 05/01/37 - 01/01/38 |
4,094,982 | ||
1,268 | 6.000%, 08/01/32 - 09/01/34 |
1,408,411 | ||
742 | 6.500%, 01/01/12 - 09/01/32 |
838,327 | ||
173 | 7.000%, 09/01/32 |
200,382 | ||
122 | 8.000%, 03/01/22 - 08/01/22 |
142,779 | ||
92 | 8.500%, 01/01/17 - 09/01/19 |
102,922 | ||
66 | 9.000%, 01/01/20 |
69,286 | ||
58 | 11.500%, 10/01/19 |
61,437 |
763 | Federal National Mortgage Association, |
796,019 | ||
6,174 | 2.471%, 07/01/33 FRN |
6,437,730 | ||
1,465 | 2.518%, 04/01/34 FRN |
1,539,913 | ||
1,750 | 2.555%, 06/01/34 FRN |
1,843,150 | ||
1,974 | 3.500%, 06/01/39 |
1,911,526 | ||
7,500 | 3.500%, TBA 15 YR |
7,623,045 | ||
7,000(a) | 3.500%, TBA 15 YR |
7,133,438 | ||
1,000(a) | 4.000%, TBA 15 YR |
1,038,750 | ||
9,000 | 4.000%, TBA 30 YR |
9,063,279 | ||
629 | 4.500%, 01/01/20 |
673,106 | ||
2,500(a) | 4.500%, TBA 15 YR |
2,642,577 | ||
69,000(a) | 4.500%, TBA 30 YR |
71,673,750 | ||
15,500 | 4.500%, TBA 30 YR |
16,043,711 | ||
15,152 | 5.000%, 07/01/18 - 05/01/36 |
16,285,269 | ||
24,000(a) | 5.000%, TBA 30 YR |
25,545,000 | ||
39,937 | 5.500%, 08/01/15 - 11/01/36 |
43,579,924 | ||
5,500(a) | 5.500%, TBA 30 YR |
5,946,017 | ||
15,182 | 6.000%, 11/01/14 - 05/01/36 |
16,783,368 | ||
10,515 | 6.500%, 10/01/11 - 10/01/37 |
11,916,159 | ||
3,868 | 7.000%, 07/01/11 - 02/01/36 |
4,408,470 | ||
43 | 7.500%, 10/01/11 - 10/01/26 |
45,123 | ||
5 | 8.500%, 06/01/17 - 03/01/25 |
4,720 | ||
82 | 9.000%, 04/01/25 |
97,095 | ||
26 | 9.500%, 01/01/25 - 02/01/25 |
31,193 | ||
Government National Mortgage Association, |
||||
8,000 (a) | 4.500%, TBA 30 YR |
8,403,752 | ||
6,849 | 5.000%, 07/15/33 - 04/15/34 |
7,466,022 | ||
3,948 | 5.500%, 02/15/34 - 02/15/36 |
4,401,217 | ||
4,417 | 7.000%, 03/15/22 - 02/15/29 |
5,108,319 | ||
557 | 7.500%, 01/15/23 - 07/15/24 |
649,612 | ||
469 | 8.500%, 04/15/25 |
561,658 | ||
282 | 9.500%, 09/15/16 - 08/20/21 |
318,254 | ||
323,783,745 | ||||
Municipal Bond 0.2% |
||||
1,170 | Utah St. Build America Bonds, Ser. D, GO, |
1,245,325 | ||
Small Business Administration Agencies 1.4% |
||||
611 | Small Business Administration Participation Certificates, |
624,488 | ||
2,027 | Ser. 1995-20L, Class 1, |
2,165,009 | ||
2,211 | Ser. 1996-20H, Class 1, |
2,365,602 | ||
1,407 | Ser. 1996-20K, Class 1, |
1,503,062 | ||
453 | Ser. 1997-20A, Class 1, |
502,737 | ||
1,858 | Ser. 1998-20I, Class 1, |
2,030,308 | ||
9,191,206 |
U.S. Government Agency Securities 4.2% |
||||
6,510 | Ally Financial, Inc., FDIC Gtd. Notes, |
6,638,814 | ||
1,310 | Federal Home Loan Mortgage Corp., |
1,517,474 | ||
2,220 | Federal National Mortgage Association, |
2,230,505 | ||
10,000(b) | Financing Corp. FICO STRIPS, Ser. 1P, |
8,230,670 | ||
1,240 | Tennessee Valley Authority, |
1,354,447 | ||
1,080 | 5.500%, 06/15/38 |
1,216,999 | ||
6,345 | Western Corporate Federal Credit Union, NCUA Gtd. Notes, |
6,459,914 | ||
27,648,823 | ||||
U.S. Government Treasury Obligations 27.6% |
||||
14,575(c) | United States Treasury Bonds, |
15,911,804 | ||
2,265(c) | 5.250%, 11/15/28 |
2,670,576 | ||
10,660 | 7.500%, 11/15/16 |
13,818,025 | ||
7,420 | 7.500%, 11/15/24 |
10,619,875 | ||
2,475 | United States Treasury Notes, |
2,476,740 | ||
3,895(c) | 0.625%, 04/30/13 |
3,908,983 | ||
720(d) | 1.125%, 12/15/11 |
723,853 | ||
3,540 | 1.750%, 05/31/16 |
3,550,514 | ||
6,075(c) | 2.000%, 04/30/16 |
6,175,116 | ||
9,850 | 2.625%, 02/29/16 |
10,327,114 | ||
14,910 | 3.125%, 08/31/13 |
15,773,155 | ||
3,745(c) | 3.125%, 05/15/21 |
3,769,006 | ||
14,205(c) | 3.625%, 02/15/21 |
14,938,560 | ||
14,000(e) | United States Treasury STRIPS, I/O, |
8,973,608 | ||
12,000(e) | 3.900%, 05/15/24 |
7,277,280 | ||
16,500(d)(e) | 3.930%, 08/15/24 |
9,865,334 | ||
3,080(e) | 3.930%, 11/15/24 |
1,815,521 | ||
9,500(e) | 4.030%, 08/15/25 |
5,362,807 | ||
9,900(e) | 4.170%, 02/15/22 |
6,810,398 | ||
5,530(e) | 4.350%, 08/15/22 |
3,700,228 | ||
8,570(e) | 4.440%, 11/15/22 |
5,651,932 | ||
7,300(c)(e) | 4.780%, 11/15/23 |
4,550,952 | ||
12,000(e) | 4.850%, 02/15/24 |
7,381,824 | ||
17,700(d)(e) | 5.270%, 05/15/25 |
10,134,312 | ||
3,950(e) | 5.650%, 08/15/26 |
2,110,149 | ||
9,570(c)(e) | 5.860%, 05/15/27 |
4,909,735 | ||
183,207,401 | ||||
TOTAL LONG-TERM INVESTMENTS |
661,427,865 |
SHORT-TERM INVESTMENTS 28.0% |
||||
Shares |
||||
Affiliated Mutual Funds |
||||
12,384,619 | Prudential Investment Portfolios 2 Prudential Core Short- Term Bond Fund |
111,585,422 | ||
74,169,717 | Prudential Investment Portfolios 2 Prudential Core Taxable Money Market Fund |
74,169,717 | ||
TOTAL SHORT-TERM INVESTMENTS |
185,755,139 | |||
TOTAL INVESTMENTS 127.8% |
847,183,004 | |||
LIABILITIES IN EXCESS OF OTHER ASSETS(i) (27.8%) |
(184,110,966) | |||
NET ASSETS 100.0% |
$663,072,038 |
The following abbreviations are used in the portfolio descriptions:
144ASecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may not be resold subject to that rule except to qualified institutional buyers. Unless otherwise noted, 144A securities are deemed to be liquid.
FDICFederal Deposit Insurance Corp.
FICOFinancing Corp.
FRNFloating Rate Note
GOGeneral Obligation
I/OInterest Only
NCUANational Credit Union Administration
STRIPSSeparate Trading of Registered Interest and Principal of Securities
TBATo Be Announced
# | Principal amount is shown in U.S. dollars unless otherwise stated. |
(a) | All or partial principal amount of $129,000,000 represents to-be announced (TBA) securities acquired under mortgage dollar roll agreement. |
(b) | Represents a zero coupon bond. Rate shown reflects the effective yield at May 31, 2011. |
(c) | All or a portion of security is on loan. The aggregate market value of such securities, including those sold and pending settlement, is $30,564,500; cash collateral of $31,163,455 (included in liabilities) was received with which the Fund purchased highly liquid short-term investments. |
(d) | Represents security, or a portion thereof, segregated as collateral for futures contracts. |
(e) | Variable rate instrument. The interest rate shown reflects the rate in effect at May 31, 2011. |
(f) | Prudential Investments LLC, the manager of the Fund, also serves as manager of the Prudential Investment Portfolios 2 Prudential Core Taxable Money Market Fund and the Prudential Investment Portfolios 2 Prudential Core Short-Term Bond Fund. |
(g) | Represents security, or a portion thereof, purchased with cash collateral received for securities on loan. |
(h) | The United States federal income tax basis of the Funds investments and the net unrealized appreciation as of May 31, 2011 were as follows: |
Tax Basis of Investments |
Appreciation | Depreciation | Net Unrealized Appreciation |
|||||||||||
$ | 830,988,257 | $ | 28,381,350 | $ | (12,186,603 | ) | $ | 16,194,747 |
The difference between book basis and tax basis was primarily attributable to deferred losses on wash sales and difference in the treatment of accreting market discount and premium amortization for book and tax purposes as of the most recent fiscal year end.
(i) | Liabilities in excess of other assets include net unrealized appreciation (depreciation) on the following derivative contracts held at reporting period end: |
Open futures contracts outstanding at May 31, 2011:
Number of |
Type |
Expiration |
Value at May 31, 2011 |
Value at Trade Date |
Unrealized Appreciation/ (Depreciation)(a) |
|||||||||||||
Long Positions: |
||||||||||||||||||
128 | 2 Year U.S. Treasury Notes |
Sep. 2011 | $ | 28,056,000 | $ | 28,039,345 | $ | 16,655 | ||||||||||
1,455 | 5 Year U.S. Treasury Notes |
Sep. 2011 | 173,349,610 | 172,551,222 | 798,388 | |||||||||||||
3 | U.S. Ultra Bonds |
Jun. 2011 | 391,687 | 365,347 | 26,340 | |||||||||||||
84 | U.S. Ultra Bonds |
Sep. 2011 | 10,841,250 | 10,735,262 | 105,988 | |||||||||||||
Short Positions: |
||||||||||||||||||
800 | 10 Year U.S. Treasury Notes |
Sep. 2011 | 98,087,500 | 97,148,656 | (938,844 | ) | ||||||||||||
829 | U.S. Long Bonds |
Sep. 2011 | 103,495,469 | 102,654,691 | (840,778 | ) | ||||||||||||
$ | (832,251 | ) | ||||||||||||||||
|
|
|||||||||||||||||
|
|
(a) | The amount represents fair value of derivative instruments subject to interest rate contracts risk exposure as of May 31, 2011. |
Interest rate swap agreements outstanding at May 31, 2011:
Counterparty |
Termination Date |
Notional Amount (000)# |
Fixed Rate |
Floating Rate |
Fair Value |
Upfront Premiums Paid/(Received) |
Unrealized Appreciation/ (Depreciation)(c) |
|||||||||||||||||
Citibank NA(a) |
03/15/16 | $ | 7,065 | 2.555% | 3 month LIBOR | $ | (269,081 | ) | $ | | $ | (269,081 | ) | |||||||||||
Citibank NA(a) |
05/26/16 | 2,215 | 2.008% | 3 month LIBOR | (10,902 | ) | (10,902 | ) | ||||||||||||||||
Citibank NA(b) |
03/15/16 | 4,705 | 2.404% | 3 month LIBOR | 140,445 | | 140,445 | |||||||||||||||||
Citibank NA(b) |
03/23/16 | 2,360 | 2.251% | 3 month LIBOR | 53,292 | | 53,292 | |||||||||||||||||
Citibank NA(b) |
05/31/16 | 1,415 | 1.941% | 3 month LIBOR | 1,773 | | 1,773 | |||||||||||||||||
Citibank NA(b) |
08/15/26 | 5,835 | 3.694% | 3 month LIBOR | 16,576 | | 16,576 | |||||||||||||||||
Citibank NA(b) |
08/15/26 | 3,075 | 3.842% | 3 month LIBOR | 63,545 | | 63,545 | |||||||||||||||||
Citibank NA(b) |
08/15/26 | 2,805 | 3.717% | 3 month LIBOR | 15,720 | | 15,720 | |||||||||||||||||
Morgan Stanley Capital Services(a) |
02/16/16 | 9,020 | 2.555% | 3 month LIBOR | (373,476 | ) | | (373,476 | ) | |||||||||||||||
Morgan Stanley Capital Services(b) |
03/08/16 | 9,020 | 2.387% | 3 month LIBOR | 275,884 | | 275,884 | |||||||||||||||||
Morgan Stanley Capital Services(b) |
05/26/41 | 5,600 | 4.740% | 3 month LIBOR | 38,066 | | 38,066 | |||||||||||||||||
$ | (48,158 | ) | $ | | $ | (48,158 | ) | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||||
|
|
|
|
|
|
LIBORLondon Interbank Offered Rate
(a) | The Fund pays the fixed rate and receives the floating rate. |
(b) | The Fund pays the floating rate and receives the fixed rate. |
(c) | The amount represents fair value of derivative instruments subject to interest rate contracts risk exposure as of May 31, 2011. |
# | Notional amount is shown in U.S. dollars unless otherwise stated. |
Various inputs are used in determining the value of the Funds investments. These inputs are summarized in the three broad levels listed below.
Level 1 - quoted prices generally for stocks, exchange traded funds, options and futures traded in active markets for identical securities, and mutual funds which trade at daily net asset value.
Level 2 - other significant observable inputs (including, but not limited to, quoted prices for similar securities, interest rates, prepayment speeds, foreign currency exchange rates, and amortized cost) generally for debt securities, swaps, forward foreign currency contracts and for foreign stocks priced using vendor modeling tools.
Level 3 - significant unobservable inputs for securities valued in accordance with Board approved fair valuation procedures.
The following is a summary of the inputs used as of May 31, 2011 in valuing such portfolio securities:
Level 1 | Level 2 | Level 3 | ||||||||||
Investments in Securities |
||||||||||||
Collateralized Mortgage Obligations |
$ | | $ | 28,552,962 | $ | | ||||||
Commercial Mortgage-Backed Securities |
| 79,525,952 | | |||||||||
Corporate Bonds |
| 8,272,451 | | |||||||||
Mortgage-Backed Securities |
| 323,783,745 | | |||||||||
Municipal Bond |
| 1,245,325 | | |||||||||
Small Business Administration Agencies |
| 9,191,206 | | |||||||||
U.S. Government Agency Securities |
| 27,648,823 | | |||||||||
U.S. Government Treasury Obligations |
| 183,207,401 | | |||||||||
Affiliated Mutual Funds |
185,755,139 | | | |||||||||
Other Financial Instruments* |
||||||||||||
Futures Contracts |
(832,251 | ) | | | ||||||||
Interest Rate Swaps |
| (48,158 | ) | | ||||||||
Total |
$ | 184,922,888 | $ | 661,379,707 | $ | | ||||||
* | Other financial instruments are derivative instruments not reflected in the Schedule of Investments, such as futures, forwards and swap contracts, which are valued at the unrealized appreciation/depreciation on the instrument. |
Notes to Schedule of Investments (Unaudited)
Securities Valuation: Securities listed on a securities exchange (other than options on securities and indices) are valued at the last sale price on such exchange on the day of valuation or, if there was no sale on such day, at the mean between the last reported bid and asked prices, or at the last bid price on such day in the absence of an asked price. Securities traded via NASDAQ are valued at the NASDAQ official closing price (NOCP) on the day of valuation, or if there was no NOCP, at the last sale price. Securities that are actively traded in the over-the-counter market, including listed securities for which the primary market is believed by Prudential Investments LLC (PI or Manager), in consultation with the subadvisor; to be over-the-counter, are valued at market value using prices provided by an independent pricing agent or principal market maker.
Corporate bonds (other than convertible debt securities) and U.S. government securities that are actively traded in the over-the-counter market, including listed securities for which the primary market is believed by an Advisor in consultation with the Manager to be over-the-counter, are valued by an independent pricing agent or more than one principal market maker (if available, otherwise by a principal market maker or a primary market dealer). Convertible debt securities that are actively traded in the over-the-counter market, including listed securities for which the primary market is believed by an Advisor in consultation with the Manager to be over-the-counter, are valued by an independent pricing agent or at the mean between the last reported bid and asked prices (or at the last bid price in the absence of an asked price) provided by more than one principal market maker (if available, otherwise by a principal market maker or a primary market dealer).
Futures contracts and options thereon traded on a commodities exchange or board of trade are valued at the last sale price at the close of trading on such exchange or board of trade or, if there was no sale on the applicable commodities exchange or board of trade on such day, at the mean between the most recently quoted bid and asked prices on such exchange or board of trade or at the last bid price in the absence of an asked price.
Securities for which market quotations are not readily available, or whose values have been effected by events occurring after the close of the securitys foreign market and before the funds normal pricing time, are valued at fair value in accordance with the Board of Directors approved fair valuation procedures. When determining the fair valuation of securities some of the factors influencing the valuation include, the nature of any restrictions on disposition of the securities; assessment of the general liquidity of the securities; the issuers financial condition and the markets in which it does business; the cost of the investment; the size of the holding and the capitalization of issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the investment advisor regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a securitys most recent closing price and from the price used by other mutual funds to calculate their net asset values.
Swaps are valued by marking-to-market the unrealized gains and losses daily.
Market values of investments traded in a foreign currency are translated into U.S. dollars at the current rates of exchange.
Investments in open end, non exchange-traded mutual funds are valued at the net asset value as of the close of the New York Stock Exchange on the date of valuation.
Short-term debt securities of sufficient credit quality, which mature in sixty days or less, are valued at amortized cost, which approximates fair value. The amortized cost method involves valuing a security at its cost on the date of purchase and thereafter assuming a constant amortization to maturity of the difference between the principal amount due at maturity and cost. Short-term debt securities which mature in more than sixty days are valued at fair value.
Certain Funds invest in the Prudential Core Short-Term Bond Fund, pursuant to an exemptive order received from the Securities and Exchange Commission, and in the Prudential Core Taxable Money Market Fund, each a portfolio of the Prudential Investment Portfolios 2 registered under the Investment Company Act of 1940, as amended, and managed by PI.
Other information regarding the Funds is available in the Funds most recent Report to Shareholders. This information is available on the Securities and Exchange Commissions website (www.sec.gov).
Item 2. Controls and Procedures
(a) | It is the conclusion of the registrants principal executive officer and principal financial officer that the effectiveness of the registrants current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant has been recorded, processed, summarized and reported within the time period specified in the Commissions rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrants principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure. |
(b) | There have been no significant changes in the registrants internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. |
Item 3. Exhibits
Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 Attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Prudential Investment Portfolios, Inc. 14
By (Signature and Title)* |
/s/ Deborah A. Docs | |
Deborah A. Docs | ||
Secretary of the Fund | ||
Date July 20, 2011 |
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/ Judy A. Rice | |
Judy A. Rice | ||
President and Principal Executive Officer | ||
Date July 20, 2011 |
By (Signature and Title)* |
/s/ Grace C. Torres | |
Grace C. Torres | ||
Treasurer and Principal Financial Officer | ||
Date July 20, 2011 |
* | Print the name and title of each signing officer under his or her signature. |
CERTIFICATIONS
I, Judy A. Rice, certify that:
1. | I have reviewed this report on Form N-Q of Prudential Investment Portfolios, Inc. 14; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and |
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: July 20, 2011 |
/s/ Judy A. Rice | |||||
Judy A. Rice | ||||||
President and Principal Executive Officer |
CERTIFICATIONS
I, Grace C. Torres, certify that:
1. | I have reviewed this report on Form N-Q of Prudential Investment Portfolios, Inc. 14; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the schedules of investments included in this report fairly present in all material respects the investments of the registrant as of the end of the fiscal quarter for which the report is filed; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and |
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: July 20, 2011 |
/s/ Grace C. Torres | |||||
Grace C. Torres | ||||||
Treasurer and Principal Financial Officer |