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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM N-Q

 

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

 

 

Investment Company Act file number: 811-5003

 

 

Blue Chip Value Fund, Inc.

 (Exact name of registrant as specified in charter)

 

 

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

 (Address of principal executive offices) (Zip code)

 

Michael P. Malloy

Drinker Biddle & Reath LLP

One Logan Square

18th & Cherry Streets

Philadelphia, Pennsylvania 19103-6996

 (Name and address of agent for service)

 

 

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

 

 

Date of fiscal year end: December 31

 

 

Date of reporting period: September 30, 2007

 

 

 

 


Item 1 – Schedule of Investments.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


BLUE CHIP VALUE FUND, INC.

STATEMENT OF INVESTMENTS

          

          

 

            

          

September 30, 2007 (Unaudited)

 

 

  

 

 

          

          

Shares

  

 Cost

Market Value

COMMON STOCKS

106.16%

          

 

            

          

BASIC MATERIALS

2.81%

          

 

            

          

Forestry & Paper

2.81%

          

 

            

          

Ball Corp.

          

88,040

 

 $

4,634,498 

 $

4,732,150 

          

          

          

 

            

          

TOTAL BASIC MATERIALS

          

          

 

4,634,498 

4,732,150 

          

          

          

 

            

          

CAPITAL GOODS

13.02%

           

  

            

          

Aerospace & Defense

5.20%

          

 

            

          

General Dynamics Corp.

          

55,000

 

2,948,776 

4,645,850 

Raytheon Co.

          

64,400

 

2,444,777 

4,110,008 

          

          

           

  

5,393,553 

8,755,858 

          

          

          

 

            

          

Farm Equipment

2.78%

          

 

            

          

CNH Global N.V. - ADS (Netherlands)

          

77,200

 

3,181,618 

4,689,128 

          

          

          

 

            

          

Industrial Products

5.04%

          

 

            

          

ITT Corp.

          

49,400

 

2,701,957 

3,355,742 

Parker Hannifin Corp.

          

45,900

 

3,261,524 

5,132,997 

          

          

           

  

5,963,481 

8,488,739 

          

          

          

 

            

          

TOTAL CAPITAL GOODS

          

          

 

14,538,652 

21,933,725 

          

          

          

 

            

          

COMMERCIAL SERVICES

2.30%

          

 

            

          

IT Services

1.13%

          

 

            

          

Computer Sciences Corp. **

          

33,950

 

1,606,368 

1,897,805 

          

          

          

 

            

          

Transaction Processing

1.17%

          

 

            

          

The Western Union Co.

          

94,100

 

1,738,127 

1,973,277 

          

          

          

 

            

          

TOTAL COMMERCIAL SERVICES

          

          

 

3,344,495 

3,871,082 

           

          

          

 

            

          

COMMUNICATIONS

7.68%

          

 

            

          

Networking

3.83%

          

 

            

          

Cisco Systems Inc. **

          

194,700

 

4,936,873 

6,446,517 

          

          

          

 

            

          

Telecomm Equipment & Solutions

3.85%

          

 

            

          

Nokia Corp. - ADR (Finland)

          

51,230

 

849,215 

1,943,154 

QUALCOMM Inc.

          

107,700

 

4,585,089 

4,551,402 

          

          

          

 

5,434,304 

6,494,556 

          

          

          

 

            

          

TOTAL COMMUNICATIONS

          

          

 

10,371,177 

12,941,073 

          

          

          

 

            

           

CONSUMER CYCLICAL

12.33%

          

 

            

          

Clothing & Accessories

3.19%

          

 

            

          

TJX Companies Inc.

          

184,900

 

4,512,232 

5,375,043 

          

          

          

 

            

           

Department Stores

2.60%

          

 

            

          

J.C. Penney Co. Inc.

          

69,000

 

4,508,048 

4,372,530 

          

          

          

 

            

          

Hotels & Gaming

2.56%

          

 

            

           

Starwood Hotels & Resorts Worldwide Inc.

          

71,100

 

3,032,156 

4,319,325 

          

          

          

 

            

          

Publishing & Media

2.08%

          

 

            

          

Walt Disney Co.

          

102,100

 

2,570,509 

3,511,219 

          

          

          

 

            

          

Restaurants

1.90%

          

 

            

          

Darden Restaurants Inc.

          

76,340

 

2,017,201 

3,195,592 

          

          

          

 

            

          

TOTAL CONSUMER CYCLICAL

          

          

 

16,640,146 

20,773,709 

 

 


 

CONSUMER STAPLES

7.28%

          

 

            

          

Consumer Products

2.54%

           

  

            

          

Colgate Palmolive Co.

          

60,000

 

3,410,589 

4,279,200 

          

          

          

 

            

          

Food & Agricultural Products

4.74%

          

 

            

          

Bunge Ltd.

           

41,200

 

1,927,317 

4,426,940 

Campbell Soup Co.

          

95,900

 

3,217,540 

3,548,300 

          

          

          

 

5,144,857 

7,975,240 

          

          

          

 

            

          

TOTAL CONSUMER STAPLES

           

          

 

8,555,446 

12,254,440 

          

          

          

 

            

          

ENERGY

10.22%

          

 

            

          

Exploration & Production

4.69%

          

 

            

          

Occidental Petroleum Corp.

          

64,680

 

1,862,346 

4,144,695 

XTO Energy Inc.

          

60,830

 

1,882,860 

3,761,727 

          

          

          

 

3,745,206 

7,906,422 

          

          

          

 

            

          

Integrated Oils

2.03%

          

 

            

          

Marathon Oil Corp.

          

60,000

 

1,245,020 

3,421,200 

          

          

          

 

            

          

Oil Services

3.50%

          

 

            

          

Transocean Inc. **

          

52,100

 

2,490,724 

5,889,905 

          

          

          

 

            

          

TOTAL ENERGY

          

          

 

7,480,950 

17,217,527 

          

          

          

 

            

          

INTEREST RATE SENSITIVE

18.99%

           

  

            

          

Integrated Financial Services

2.37%

          

 

            

          

Citigroup Inc.

          

85,600

 

3,791,519 

3,994,952 

          

          

          

 

            

          

Property Casualty Insurance

7.21%

          

 

            

          

ACE Ltd. (Cayman Islands)

          

60,300

 

3,335,901 

3,652,371 

American International Group Inc.

          

81,600

 

5,255,975 

5,520,240 

MBIA Inc.

          

48,590

 

2,855,134 

2,966,419 

          

          

          

 

11,447,010 

12,139,030 

          

          

          

 

            

          

Regional Banks

1.51%

          

 

            

          

Wachovia Corp.

          

50,600

 

2,575,760 

2,537,590 

           

          

          

 

            

          

Securities & Asset Management

4.58%

          

 

            

          

INVESCO PLC - ADR (Great Britain)

          

117,000

 

2,860,479 

3,194,100 

Merrill Lynch & Co. Inc.

          

24,300

 

1,336,651 

1,732,104 

State Street Corp.

          

41,000

 

2,715,421 

2,794,560 

          

          

          

 

6,912,551 

7,720,764 

          

          

          

 

            

          

Specialty Finance

2.01%

          

 

            

          

Freddie Mac

          

57,300

 

3,622,724 

3,381,273 

          

          

          

 

            

          

Thrifts

1.31%

          

 

            

          

Washington Mutual Inc.

          

62,300

 

2,460,354 

2,199,813 

          

          

          

 

            

          

TOTAL INTEREST RATE SENSITIVE

          

          

 

30,809,918 

31,973,422 

          

          

          

 

            

          

MEDICAL - HEALTHCARE

17.70%

           

  

            

          

Medical Technology

6.53%

          

 

            

          

Medtronic Inc.

          

98,000

 

4,837,379 

5,528,180 

Zimmer Holdings Inc. **

          

67,600

 

4,751,683 

5,474,924 

          

          

           

  

9,589,062 

11,003,104 

          

          

          

 

            

          

Pharmaceuticals

11.17%

          

 

            

          

Abbott Laboratories

          

128,000

 

5,474,045 

6,863,360 

Amgen Inc. **

          

68,200

 

4,016,687 

3,858,074 

Barr Pharmaceuticals Inc. **

          

34,100

 

1,589,798 

1,940,631 

Teva Pharmaceutical Industries Ltd. - ADR (Israel)

          

138,300

 

3,679,708 

6,150,201 

          

          

          

 

14,760,238 

18,812,266 

          

          

          

 

            

          

TOTAL MEDICAL - HEALTHCARE

          

          

 

24,349,300 

29,815,370 

          

          

          

 

            

          

 

 


 

TECHNOLOGY

10.14%

          

 

            

          

Computer Software

2.19%

          

 

            

          

Microsoft Corp.

          

124,900

 

3,327,879 

3,679,554 

          

          

          

 

            

          

PC's & Servers

3.52%

          

 

            

           

International Business Machines Corp.

          

50,300

 

4,074,509 

5,925,340 

          

          

          

 

            

          

Semiconductors

4.43%

          

 

            

          

Altera Corp.

          

109,700

 

2,100,294 

2,641,576 

Intel Corp.

          

186,500

 

3,681,180 

4,822,890 

          

          

          

 

5,781,474 

7,464,466 

          

          

          

 

            

          

TOTAL TECHNOLOGY

          

          

 

13,183,862 

17,069,360 

          

          

          

 

            

          

TRANSPORTATION

2.00%

          

 

            

          

Railroads

2.00%

          

 

            

          

Norfolk Southern Corp.

          

64,800

 

2,308,288 

3,363,768 

          

          

          

 

            

          

TOTAL TRANSPORTATION

          

          

 

2,308,288 

3,363,768 

          

          

          

 

            

          

UTILITIES

1.69%

          

 

            

          

Regulated Electric

1.69%

          

 

            

          

PPL Corp.

          

61,450

 

2,830,425 

2,845,135 

          

          

          

 

            

          

TOTAL UTILITIES

          

          

 

2,830,425 

2,845,135 

TOTAL COMMON STOCKS

          

          

 

139,047,157 

178,790,761 

          

          

          

 

            

          

SHORT TERM INVESTMENTS

2.02%

          

 

            

          

Goldman Sachs Financial Square Prime Obligations Fund - FST Shares

          

3,404,116

 

3,404,116 

3,404,116 

 

 

  

 

 

          

          

          

 

            

          

TOTAL SHORT TERM INVESTMENTS

          

          

 

3,404,116 

3,404,116 

          

          

          

 

            

           

TOTAL INVESTMENTS

108.18%

 

  

 $

142,451,273 

 $

182,194,877 

Liabilities in Excess of Other Assets

(8.18%)

 

  

            

(13,783,296)

NET ASSETS

100.00%

 

  

            

 $

168,411,581 

          

          

          

 

            

           

          

          

          

 

            

          

 

          

          

 

            

          

** Non Income Producing Security.

          

          

 

            

          

ADR - American Depositary Receipt.

           

          

 

            

          

ADS - American Depositary Share.

 

 

  

 

 

 

 

 

  

 

 

See accompanying notes to Statement of Investments.

          

          

 

            

          

 

 


 

BLUE CHIP VALUE FUND, INC.

 

 

 

 

COUNTRY BREAKDOWN

As of September 30, 2007 (Unaudited)

 

 

 

 

Market

 

 

Country

Value

 

%

United States 

 $

159,161,807 

 

94.51%

Israel 

6,150,201 

 

3.65%

Netherlands 

4,689,128 

 

2.78%

Cayman Islands 

3,652,371 

 

2.17%

Great Britain 

3,194,100 

 

1.90%

Finland 

1,943,154 

 

1.15%

Short Term Investments

3,404,116 

 

2.02%

Total Investments

182,194,877 

 

108.18%

Liabilities in Excess of Other Assets

(13,783,296)

 

-8.18%

Net Assets

 $

168,411,581 

 

100.00%

 

 

 

 

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

 

 

 


 

BLUE CHIP VALUE FUND

NOTES TO STATEMENT OF INVESTMENTS

September 30, 2007 (Unaudited)

 

1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

 

 


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

 

As of September 30, 2007:

 

 

Gross appreciation (excess of value over tax cost)

 $  40,109,951

Gross depreciation (excess of tax cost over value)

      (1,203,798)

Net unrealized appreciation

 $  38,906,153

Cost of investments for income tax purposes

 $143,288,724

 

 

3. LOAN OUTSTANDING

 

The Fund has a line of credit The Bank of New York (“BONY”) in which the Fund  may borrow up to the lesser of $15,000,000 or the maximum amount the Fund is permitted to borrow under the Investment Company Act of 1940. The interest rate resets daily at overnight Federal Funds Rate plus 0.825%.

 

The borrowings under the BONY loan are secured by a perfected security interest on all of the Funds’ assets.

 

 

Details of the loan outstanding are as follows:

 

                                                                                                                            

  

 

     Average for the

 

  As of   Nine Months Ended

 

 September 30,   September 30,

 

  2007   2007

Loan outstanding

 $10,525,000   $11,320,192

Interest rate

 5.76%*   6.04%

% of Fund's total assets

  5.77%   6.21%

Amount of debt per share outstanding

$ 0.37   $ 0.40

Number of shares outstanding (in thousands)

 28,333   28,220**

 

*Annualized

**Weighted average

 

 

 

 

 


4. NEW ACCOUNTING PRONOUNCEMENTS

 

Effective January 2, 2007, the Fund adopted FASB Interpretation No. 48 (“FIN 48”) “Accounting for Uncertainty in Income Taxes,” which requires that the financial statement effects of a tax position taken or expected to be taken in a tax return be recognized in the financial statements when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. Management has concluded that the Fund has taken no uncertain tax positions that require adjustment to the financial statements to comply with the provisions of FIN 48. The Fund files income tax returns in the U.S. federal jurisdiction and the State of Colorado. For the years ended December 31, 2002 through December 31, 2006, the Fund’s federal and Colorado returns are still open to examination by the appropriate taxing authority. However, to our knowledge there are currently no federal or Colorado income tax returns under examination.

 

In September 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards No. 157, “Fair Value Measurements” (“SFAS No. 157”). SFAS No. 157 defines fair value for securities in the Fund’s portfolio, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosure about fair value measurement. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. Management is currently evaluating the impact adoption of SFAS No. 157 will have on the Fund’s financial statement disclosures.

 

 

 

 

 

 


 

 

Item 2 - Controls and Procedures.

 

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

 

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

 

Item 3 – Exhibits.

 

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

 

 

 

 


 

 

 

 

 

 

SIGNATURES

 

            Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

BLUE CHIP VALUE FUND, INC.

  

By:       /s/ Todger Anderson

            Todger Anderson

            President / Principal   Executive Officer

  

Date:    November 29, 2007

 

 

            Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. 

           

By:       /s/ Todger Anderson

            Todger Anderson

            President / Principal   Executive Officer

  

Date:    November 29, 2007

 

  

By:       /s/ Jasper R. Frontz

            Jasper R. Frontz

            Treasurer / Principal Financial Officer

  

Date:    November 29, 2007