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
18
th
& Cherry Streets
Philadelphia, Pennsylvania 19103-6996
(Name and address of agent for service)
Registrants Telephone Number, including Area Code:
(800)
624-4190
Date of fiscal year end:
December 31
Date of reporting period:
March 31, 2008
Item 1 Schedule of
Investments.
Blue Chip Value Fund, Inc.
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STATEMENT OF
INVESTMENTS
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March 31, 2008
(Unaudited)
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COMMON STOCKS
- 108.79%
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BASIC MATERIALS
-
2.88%
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Forestry
& Paper - 2.88%
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Ball Corp.
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88,940
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4,675,085
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$4,085,904
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TOTAL BASIC
MATERIALS
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4,675,085
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4,085,904
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CAPITAL GOODS
-
11.78%
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Aerospace
& Defense - 4.36%
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General Dynamics
Corp.
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37,500
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1,934,073
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3,126,375
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Raytheon Co.
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47,500
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1,716,962
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3,068,975
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Farm Equipment
- 2.21%
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CNH Global N.V.
- ADS (Netherlands)
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60,300
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2,346,522
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3,137,409
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Industrial
Products - 5.21%
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ITT Corp.
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49,900
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2,730,482
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2,585,319
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Parker Hannifin
Corp.
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69,550
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3,307,807
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4,817,729
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TOTAL CAPITAL
GOODS
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12,035,846
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16,735,807
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COMMERCIAL SERVICES
-
4.33%
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Business
Products & Services - 1.92%
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Quanta Services
Inc.**
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117,500
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3,597,235
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2,722,475
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IT Services -
0.99%
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Computer
Sciences Corp.**
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34,350
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1,624,404
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1,401,137
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Transaction
Processing - 1.42%
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The Western
Union Co.
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95,100
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1,759,527
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2,022,777
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TOTAL COMMERCIAL
SERVICES
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6,981,166
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6,146,389
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COMMUNICATIONS
-
8.80%
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Networking -
4.50%
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Cisco Systems
Inc.**
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265,200
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6,590,884
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6,388,668
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Telecomm
Equipment & Solutions - 4.30%
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Nokia Corp. -
ADR (Finland)
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51,730
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867,230
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1,646,566
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QUALCOMM Inc.
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108,800
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4,631,344
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4,460,800
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TOTAL
COMMUNICATIONS
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12,089,458
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12,496,034
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CONSUMER CYCLICAL
-
14.34%
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Apparel &
Footwear Manufacturers - 2.66%
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Nike Inc.
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55,550
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3,488,246
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3,777,400
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Clothing
& Accessories - 2.69%
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TJX Companies
Inc.**
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115,400
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2,682,938
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3,816,278
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Hotels &
Gaming - 2.62%
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Starwood Hotels
& Resorts Worldwide Inc.
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71,900
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3,070,596
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3,720,825
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Internet -
1.48%
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Expedia Inc.**
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96,400
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2,718,632
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2,110,196
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Publishing
& Media - 2.28%
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Walt Disney Co.
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103,200
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2,606,191
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3,238,416
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Restaurants -
2.61%
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Darden
Restaurants Inc.
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114,040
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3,189,084
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3,712,002
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TOTAL CONSUMER
CYCLICAL
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17,755,687
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20,375,117
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CONSUMER STAPLES
-
9.11%
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Consumer
Products - 3.32%
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Colgate
Palmolive Co.
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60,600
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3,455,613
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4,721,346
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Food &
Agricultural Products - 5.79%
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Bunge Ltd.
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19,100
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838,526
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1,659,408
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Campbell Soup
Co.
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74,700
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2,439,376
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2,536,065
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Unilever N.V.
(Netherlands)
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119,400
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4,225,012
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4,027,362
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TOTAL CONSUMER
STAPLES
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10,958,527
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12,944,181
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ENERGY
-
13.69%
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Exploration
& Production - 6.71%
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Occidental
Petroleum Corp.
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65,380
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1,914,909
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4,783,854
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XTO Energy Inc.
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76,837
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1,928,996
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4,753,137
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Integrated
Oils - 2.82%
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Marathon Oil
Corp.
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87,700
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2,629,531
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3,999,120
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Oil Services
- 4.16%
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Transocean Inc. **
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43,749
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2,675,694
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5,914,865
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TOTAL ENERGY
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9,149,130
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19,450,976
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INTEREST RATE SENSITIVE
-
13.29%
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Insurance -
1.07%
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The Travelers
Cos. Inc.
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31,900
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1,676,644
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1,526,415
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Integrated
Financial Services - 1.83%
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JPMorgan Chase
& Co.
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60,500
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2,608,804
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2,598,475
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Money Center
Banks - 1.20%
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Bank of America
Corp.
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45,000
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1,804,727
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1,705,950
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Property
Casualty Insurance - 2.55%
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ACE Ltd. (Cayman
Islands)
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26,300
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1,454,450
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1,448,078
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American
International Group Inc.
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50,200
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3,158,987
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2,171,150
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Regional
Banks - 0.80%
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Wachovia Corp.
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42,200
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2,095,473
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1,139,400
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Securities
& Asset Management - 5.47%
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Invesco Ltd.
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118,200
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2,890,549
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2,879,352
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Lehman Brothers
Holdings Inc.
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20,500
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1,095,063
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771,620
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Morgan Stanley
& Co.
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25,000
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1,161,450
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1,142,500
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State Street
Corp.
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37,600
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2,487,597
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2,970,400
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Thrifts -
0.37%
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Washington
Mutual Inc.
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50,900
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787,524
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524,270
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TOTAL INTEREST
RATE SENSITIVE
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21,221,268
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18,877,610
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MEDICAL & HEALTHCARE
-
14.36%
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Medical
Technology - 3.74%
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Zimmer Holdings
Inc.**
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68,300
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4,805,463
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5,317,838
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Pharmaceuticals
- 10.62%
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Abbott
Laboratories
|
129,400
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5,552,038
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7,136,409
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Amgen Inc.**
|
59,300
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3,400,349
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2,477,554
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Teva
Pharmaceutical Industries Ltd. - ADR (Israel)
|
118,300
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3,020,278
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5,464,277
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TOTAL MEDICAL
& HEALTHCARE
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16,778,128
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20,396,078
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TECHNOLOGY
-
11.19%
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Computer
Software - 2.52%
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Microsoft Corp.
|
126,200
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3,364,604
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3,581,556
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PC's &
Servers - 4.12%
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International
Business Machines Corp.
|
50,800
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4,127,044
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5,849,112
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Semiconductors
- 4.55%
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Altera Corp.
|
134,000
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2,537,590
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2,469,620
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Intel Corp.
|
188,500
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3,721,840
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3,992,430
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TOTAL TECHNOLOGY
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13,751,078
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15,892,718
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TRANSPORTATION
-
2.50%
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Railroads -
2.50%
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Norfolk Southern
Corp.
|
65,500
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2,345,472
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3,557,960
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TOTAL
TRANSPORTATION
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2,345,472
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3,557,960
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UTILITIES
-
2.52%
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Regulated
Electric - 2.52%
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PPL Corp.
|
78,050
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3,663,705
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3,584,056
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TOTAL UTILITIES
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3,663,705
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3,584,056
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TOTAL COMMON
STOCKS
|
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131,404,550
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154,542,830
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SHORT TERM
INVESTMENTS - 0.22%
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Goldman Sachs
Financial Square Prime Obligations Fund - FST Shares
|
310,517
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|
310,517
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|
310,517
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TOTAL SHORT TERM
INVESTMENTS
|
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|
310,517
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310,517
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TOTAL
INVESTMENTS
|
109.01%
|
|
$131,715,067
|
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$154,853,347
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Liabilities in
Excess of Other Assets
|
(9.01)%
|
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(12,792,865)
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NET ASSETS
|
100.00%
|
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$142,060,482
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**
Non-income producing security
ADR - American
Depositary Receipt
ADS - American
Depositary Share
See
accompanying notes to Statement of Investments.
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COUNTRY
BREAKDOWN
|
As of March 31,
2008
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Market
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Country
|
Value
|
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%
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United States
|
$136,250,303
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95.91%
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Netherlands
|
7,164,771
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5.04%
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Israel
|
5,464,277
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3.85%
|
United Kingdom
|
2,879,352
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|
2.03%
|
Finland
|
1,646,566
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|
1.16%
|
Cayman Islands
|
1,448,078
|
|
|
|
1.02%
|
Total
Investments
|
$154,853,347
|
|
|
|
109.01%
|
Liabilities in
Excess of Other Assets
|
(12,792,865)
|
|
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|
(9.01%)
|
Net Assets
|
$142,060,482
|
|
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|
100.00%
|
|
|
Please note
the country classification is based on the company headquarters. All of the
Fund's investments are traded on U.S. exchanges.
|
|
See
accompanying notes to Statement of Investments.
|
BLUE CHIP VALUE FUND
NOTES TO STATEMENT OF INVESTMENTS
March 31, 2008 (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 investments 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. FAS 157 MEASUREMENTS
The
Fund adopted Financial Accounting Standards Board Statement of Financial Accounting
Standards No. 157, Fair Value Measurements (FAS 157), effective January
1, 2008. FAS 157 defines fair value, establishes a three-tier hierarchy to measure
fair value based on the extent of use of observable inputs as compared to unobservable
inputs for disclosure purposes and requires additional disclosures about
these valuations measurements. Inputs refer broadly to the assumptions that market
participants would use in pricing a security. Observable inputs are inputs that reflect
the assumptions market participants would use in pricing the security developed based
on market data obtained from sources independent of the reporting entity. Unobservable
inputs are inputs that reflect the reporting entitys own assumptions about
the assumptions market participants would use in pricing the security developed based
on the best information available in the circumstances.
The
three-tier hierarchy is summarized as follows:
Level
1 quoted prices in active markets for identical investments.
Level
2 other significant observable inputs (including quoted prices for similar investments,
interest rates, prepayment speeds, credit risk, etc.).
Level
3 significant unobservable inputs (including the Funds own assumptions in determining the
fair value of investments).
The
following is a summary of the inputs used as of March 31, 2008 in valuing the Funds
assets:
Valuation Inputs
|
Investments in
Securities at
Value
|
Other Financial
Instruments* -
Unrealized
Appreciation (Depreciation)
|
Level 1 -
Quoted Prices
|
$ 154,853,347
|
$
-
|
Level 2 -
Other Significant Observable Inputs
|
$
-
|
$
-
|
Level 3 -
Significant Unobservable Inputs
|
$
-
|
$
-
|
Total
|
$ 154,853,347
|
$
-
|
|
|
|
*Other financial instruments include futures, forwards and
swap contracts.
All
securities of the Fund were valued using Level 1 inputs during the three months
ended March 31, 2008. Thus, a reconciliation of assets in which significant unobservable
inputs (Level 3) were used in determining fair value is not applicable.
The
inputs or methodology used for valuing securities are not necessarily an
indication of the risk
associated with investing in those securities.
3. UNREALIZED APPRECIATION AND DEPRECIATION OF
INVESTMENTS (TAX BASIS)
As of March 31, 2008:
Gross appreciation (excess of value over tax cost)
|
$ 29,895,493
|
Gross depreciation (excess of tax cost over value)
|
(7,475,176)
|
Net unrealized appreciation
|
$
22,420,317
|
Cost of investments for income tax purposes
|
$132,433,030
|
4. LOAN OUTSTANDING
The Fund has a line of credit
with The Bank of New York Mellon (BONY)
in which the Fund may borrow up to the lesser of $15,000,000 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
|
Quarter Ended
|
|
March 31,
|
March 31,
|
|
2008
|
2008
|
Loan outstanding
|
$12,755,000
|
$12,741,813
|
Interest rate
|
2.09%*
|
3.19%
|
% of Fund's total assets
|
8.23%
|
8.22%
|
Amount of debt per share outstanding
|
$
.45
|
$
.45
|
Number of shares outstanding (in thousands)
|
28,435
|
28,435**
|
*Annualized
**Weighted average
5. NEW ACCOUNTING PRONOUNCEMENTS
Effective January 2, 2007, the Fund adopted Financial
Accounting Standards Board (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, 2004 through December 31, 2006, the Funds federal and Colorado returns
are still open to examination by the appropriate taxing authority. However, to
managements knowledge there are currently no federal or Colorado income tax returns
under examination.
In March 2008, the FASB issued Statement of Financial
Accounting Standards No. 161, Disclosures about Derivative Instruments and
Hedging Activities (SFAS 161). SFAS 161 is effective for fiscal years and interim
periods beginning after November 15, 2008. SFAS 161 requires enhanced disclosures
about Funds derivative and hedging activities. Management of the Fund currently
believes that SFAS 161 will have no impact on the Funds financial statements.
Item 2 - Controls and
Procedures.
(a) The registrant's Principal Executive
Officer and Principal Financial Officer have evaluated the registrant's
disclosure controls and procedures (as defined in Rule 30a-3(c) under the
Investment Company Act of 1940) within 90 days of the filing date of this
report and have concluded that the registrant's disclosure controls and
procedures were effective, as of that date.
(b) There was no change in the registrant's
internal control over financial reporting (as defined in Rule 30a-3(d) under
the Investment Company Act of 1940) that occurred during registrant's last
fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting.
Item 3 Exhibits.
Separate
certifications for the registrant's Principal Executive Officer and Principal
Financial Officer, as required by Rule 30a-2(a) under the Investment Company
Act of 1940, are attached as Ex99.CERT.
SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934 and the Investment Company
Act of 1940, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
BLUE
CHIP VALUE FUND, INC.
By:
/s/
Todger Anderson
Todger
Anderson
President
/ Principal Executive Officer
Date: May
30, 2008
Pursuant to the
requirements of the Securities Exchange Act of 1934 and the Investment Company
Act of 1940, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates indicated.
By:
/s/
Todger Anderson
Todger
Anderson
President
/ Principal Executive Officer
Date: May
30, 2008
By:
/s/
Jasper R. Frontz
Jasper
R. Frontz
Treasurer
/ Principal Financial Officer
Date: May
30, 2008
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