N-Q 1 dnq.htm PRUDENTIAL INVESTMENT PORTFOLIOS, INC. 14 Prudential Investment Portfolios, Inc. 14

 

 

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
Registrant’s 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)

 

    

Moody’s
Ratings†

   

Interest
Rate

   

Maturity Date

   

Principal
Amount (000)#

   

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
(cost $23,695,762)

                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,
Sr. Sec’d. Notes

    Ba3    11.125%    11/15/17    200    232,000

Yonkers Racing Corp.,
Sec’d. Notes, 144A
(original cost $110,875; purchased 05/18/11)(d)(e)

    B1    11.375%    07/15/16    100   

110,125

              

342,125

Healthcare & Pharmaceutical — 0.4%

               

Apria Healthcare Group, Inc.,
Sr. Sec’d. Notes

    Ba3    11.250%    11/01/14    100   

105,625

Media & Entertainment — 3.8%

               

CW Media Holdings, Inc. (Canada),
Gtd. Notes, PIK, 144A

    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,
Gtd. Notes, 144A

    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.,
Sr. Unsec’d. Notes, Ser. H, MTN

    B3    5.375%    10/01/12    125    125,625

CIT Group, Inc., Sec’d. Notes

    B2    7.000%    05/01/17    150   

150,563

              

276,188

Paper — 1.4%

               

Graphic Packaging International, Inc.,
Gtd. Notes

    B3    9.500%    06/15/17    250    278,750

Verso Paper Holdings LLC / Verso Paper, Inc., Sr. Sec’d. Notes

    Ba2    11.500%    07/01/14    100   

108,500

              

387,250

Technology — 1.7%

               

NXP BV /NXP Funding LLC (Netherlands),
Sr. Sec’d. Notes, Ser. EXcH(a)

    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
(cost $3,509,384)

               

3,505,912

TOTAL LONG-TERM INVESTMENTS
(cost $27,205,146)

               

27,127,150

SHORT-TERM INVESTMENT — 8.8%

               

AFFILIATED MONEY MARKET MUTUAL FUND

         

Prudential Investment Portfolios 2 — Prudential Core Taxable Money Market Fund(f)
(cost $2,438,702)

    2,438,702   

2,438,702

TOTAL INVESTMENTS — 107.0%
(cost $29,643,848)(g)

                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:

144A—Security 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.

MTN—Medium Term Note

PIK—Payment 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 & Poor’s 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 Fund’s 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 Fund’s 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
Amount
(000)#

   

Description

   

Value

LONG-TERM INVESTMENTS 99.8%

   

Collateralized Mortgage Obligations 4.3%

   
$ 5,584   

Federal Home Loan Mortgage Corp.,
Ser. 2002-2496, Class PM,
5.500%, 09/15/17

    $     6,099,353
2,217   

Ser. 2002-2501, Class MC,
5.500%, 09/15/17

    2,403,398
6,650   

Ser. 2002-2513, Class HC,
5.000%, 10/15/17

    7,316,608
5,500   

Ser. 2002-2518, Class PV,
5.500%, 06/15/19

    5,686,194
3,556   

Federal National Mortgage Association,
Ser. 2002-18, Class PC,
5.500%, 04/25/17

    3,728,326
1,990   

Ser. 2002-57, Class ND,
5.500%, 09/25/17

    2,153,596
292   

MLCC Mortgage Investors, Inc.,
Ser. 2003-E, Class A1,
0.504%, 10/25/28 FRN

    266,069
969   

Structured Adjustable Rate Mortgage Loan Trust,
Ser. 2004-1, Class 4A3,
2.580%, 02/25/34 FRN

   

899,418

     

28,552,962

Commercial Mortgage-Backed Securities 12.0%

   
1,969   

Banc of America Commercial Mortgage, Inc.,
Ser. 2007-1, Class A2,
5.381%, 01/15/49

    1,991,343
10,800   

Bear Stearns Commercial Mortgage Securities,
Ser. 2004-T16, Class A5,
4.600%, 02/13/46

    11,179,974
4,000   

Ser. 2005-PW10, Class A4,
5.405%, 12/11/40 FRN

    4,410,478
3,300   

Credit Suisse First Boston Mortgage Securities Corp.,
Ser. 2005-C2, Class A4,
4.832%, 04/15/37

    3,537,496
3,100   

CWCapital Cobalt Ltd.,
Ser. 2007-C3, Class A3,
5.816%, 05/15/46 FRN

    3,321,377
4,400   

Federal Home Loan Mortgage Corp.,
Ser. 2010-K005, Class A2,
4.317%, 11/25/19

    4,584,253
6,400   

Ser. 2010-K007, Class A2,
4.224%, 03/25/20

    6,704,339
5,100   

Ser. 2010-K009, Class A2,
3.808%, 08/25/20

    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.,
Ser. 2007-GG9, Class A2,
5.381%, 03/10/39

    1,910,582
3,284   

GS Mortgage Securities Corp. II,
Ser. 2007-GG10, Class A2,
5.778%, 08/10/45 FRN

    3,360,610
1,600   

JPMorgan Chase Commercial Mortgage Securities Corp.,
Ser. 2007-LD11, Class A3,
5.817%, 06/15/49 FRN

    1,704,332
5,000   

Merrill Lynch Mortgage Trust,
Ser. 2006-C1, Class ASB,
5.667%, 05/12/39 FRN

    5,307,150
4,529   

Merrill Lynch/Countrywide Commercial Mortgage Trust,
Ser. 2007-9, Class A2,
5.590%, 09/12/49

    4,668,684
3,000   

Morgan Stanley Capital I,
Ser. 2006-IQ12, Class A4,
5.332%, 12/15/43

    3,268,781
3,000   

NCUA Guaranteed Notes,
Ser. 2010-C1, Class A2,
2.900%, 10/29/20

    3,018,348
4,000   

Wachovia Bank Commercial Mortgage Trust,
Ser. 2006-C25, Class A4,
5.737%, 05/15/43 FRN

    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,
2.600%, 05/27/16

    803,041
2,960   

Depfa ACS Bank (Ireland), Covered Notes, 144A,
5.125%, 03/16/37

    2,079,169
5,280   

DNB NOR Boligkreditt (Norway), Covered Notes, 144A,
2.900%, 03/29/16

   

5,390,241

     

8,272,451

Mortgage-Backed Securities 48.8%

   
2,105   

Federal Home Loan Mortgage Corp.,
2.491%, 05/01/34 FRN

    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,
2.291%, 04/01/34 FRN

    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,
4.554%, 07/01/24

   

1,245,325

Small Business Administration Agencies 1.4%

   
611   

Small Business Administration Participation Certificates,
Ser. 1995-20B, Class 1,
8.150%, 02/01/15

    624,488
2,027   

Ser. 1995-20L, Class 1,
6.450%, 12/01/15

    2,165,009
2,211   

Ser. 1996-20H, Class 1,
7.250%, 08/01/16

    2,365,602
1,407   

Ser. 1996-20K, Class 1,
6.950%, 11/01/16

    1,503,062
453   

Ser. 1997-20A, Class 1,
7.150%, 01/01/17

    502,737
1,858   

Ser. 1998-20I, Class 1,
6.000%, 09/01/18

   

2,030,308

     

9,191,206

U.S. Government Agency Securities 4.2%

   
6,510   

Ally Financial, Inc., FDIC Gtd. Notes,
1.750%, 10/30/12

    6,638,814
1,310   

Federal Home Loan Mortgage Corp.,
5.125%, 11/17/17

    1,517,474
2,220   

Federal National Mortgage Association,
1.125%, 06/27/14

    2,230,505
10,000(b)   

Financing Corp. FICO STRIPS, Ser. 1P,
2.840%, 05/11/18

    8,230,670
1,240   

Tennessee Valley Authority,
5.250%, 09/15/39

    1,354,447
1,080   

5.500%, 06/15/38

    1,216,999
6,345   

Western Corporate Federal Credit Union, NCUA Gtd. Notes,
1.750%, 11/02/12

   

6,459,914

     

27,648,823

U.S. Government Treasury Obligations 27.6%

   
14,575(c)   

United States Treasury Bonds,
4.750%, 02/15/41

    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,
0.500%, 05/31/13

    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,
3.750%, 05/15/23

    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
(cost $633,415,410)

   

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
(cost $121,882,917)(f)

    111,585,422
74,169,717   

Prudential Investment Portfolios 2 — Prudential Core Taxable Money Market Fund
(cost $74,169,717; includes $31,163,455 of cash collateral received for securities on loan)(f)(g)

   

 

74,169,717

  

TOTAL SHORT-TERM INVESTMENTS
(cost $196,052,634)

   

185,755,139

  

TOTAL INVESTMENTS 127.8%
(cost $829,468,044)(h)

    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:

144A—Security 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.

FDIC—Federal Deposit Insurance Corp.

FICO—Financing Corp.

FRN—Floating Rate Note

GO—General Obligation

I/O—Interest Only

NCUA—National Credit Union Administration

STRIPS—Separate Trading of Registered Interest and Principal of Securities

TBA—To 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 Fund’s 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
Contracts

     

Type

   

Expiration
Date

    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 ) 
              

 

 

    

 

 

     

 

 

  
              

 

 

    

 

 

     

 

 

  

 

LIBOR—London 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 Fund’s 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 security’s foreign market and before the fund’s normal pricing time, are valued at fair value in accordance with the Board of Director’s 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 issuer’s 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 security’s 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 Commission’s website (www.sec.gov).

Item 2. Controls and Procedures

 

  (a) It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s 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 Commission’s rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrant’s 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 registrant’s 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.