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Form N-CSR T. Rowe Price Equity For: Dec 31

February 22, 2024 10:08 AM EST

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act File Number: 811-04400

T. Rowe Price Equity Income Fund, Inc.

 

(Exact name of registrant as specified in charter)

100 East Pratt Street, Baltimore, MD 21202

 

(Address of principal executive offices)

David Oestreicher

100 East Pratt Street, Baltimore, MD 21202

 

(Name and address of agent for service)

Registrant’s telephone number, including area code: (410) 345-2000

Date of fiscal year end: December 31

Date of reporting period: December 31, 2023


Item 1. Reports to Shareholders

(a) Report pursuant to Rule 30e-1


Highlights
and
Market
Commentary
Management’s
Discussion
of
Fund
Performance
Performance
and
Expenses
Financial
Highlights
Portfolio
of
Investments
Financial
Statements
and
Notes
Additional
Fund
Information
December
31,
2023
Annual
Report
For
more
insights
from
T.
Rowe
Price
investment
professionals,
go
to
troweprice.com
.
T.
ROWE
PRICE
PRFDX
Equity
Income
Fund
.
PAFDX
Equity
Income
Fund–
.
Advisor  Class
RRFDX
Equity
Income
Fund–
.
R  Class
REIPX
Equity
Income
Fund–
.
I  Class
TRZQX
Equity
Income
Fund–
.
Z Class
T.
ROWE
PRICE
Equity
Income
Fund
HIGHLIGHTS
The
Equity
Income
Fund
underperformed
the
Russell
1000
Value
Index
and
its
Lipper
peer
group
for
the
12
months
ended
December
31,
2023.
For
most
of
the
year,
we
contended
with
a
narrow
market,
in
which
valuation
and
dividend
yield
were
not
in
favor.
Top
relative
detractors
were
focused
in
the
communication
services
and
materials
sectors,
where
some
of
our
holdings
underperformed
due
to
idiosyncratic
reasons.
Strong
contributors
were
found
in
industrials
and
energy.
Changes
in
sector
allocations
resulted
from
bottom-up
stock
selection.
Our
focus
on
valuation
and
a
willingness
to
invest
in
names
under
near-term
stress
benefited
the
portfolio’s
returns.
More
recently,
we
found
opportunities
in
defensive
names
given
the
strength
in
higher-beta
stocks.
Going
forward,
our
aim
is
to
maintain
a
portfolio
that
is
balanced
for
a
variety
of
market
settings,
while
also
investing
in
opportunities
that
have
particularly
attractive
risk/reward
characteristics.
As
always,
our
focus
is
on
investing
in
higher-quality
companies
that
offer
compelling
valuations,
attractive
long-term
fundamentals,
and
strong
dividend
yields.
Log
in
to
your
account
at
troweprice.com
for
more
information.
*
An
account
service
fee
will
be
charged
annually
for
each
T.
Rowe
Price
mutual
fund
account
unless
you
meet
criteria
for
a
fee
waiver.
Go
to
troweprice.com/personal-investing/help/fees-and-
minimums.html
to
learn
more
about
this
account
service
fee,
including
other
ways
to
waive
it.
T.
ROWE
PRICE
Equity
Income
Fund
Market
Commentary
1
Dear
Shareholder
Global
stock
and
bond
indexes
were
broadly
positive
during
2023
as
most
economies
managed
to
avoid
the
recession
that
was
widely
predicted
at
the
start
of
the
year.
Technology
companies
benefited
from
investor
enthusiasm
for
artificial
intelligence
developments
and
led
the
equity
rally,
while
fixed
income
benchmarks
rebounded
late
in
the
year
amid
falling
interest
rates.
For
the
12-month
period,
the
technology-oriented
Nasdaq
Composite
Index
rose
about
43%,
reaching
a
record
high
and
producing
the
strongest
result
of
the
major
benchmarks.
Growth
stocks
outperformed
value
shares,
and
developed
market
stocks
generally
outpaced
their
emerging
markets
counterparts.
Currency
movements
were
mixed
over
the
period,
although
a
weaker
dollar
versus
major
European
currencies
was
beneficial
for
U.S.
investors
in
European
securities.
Within
the
S&P
500
Index,
which
finished
the
year
just
short
of
the
record
level
it
reached
in
early
2022,
the
information
technology,
communication
services,
and
consumer
discretionary
sectors
were
all
lifted
by
the
tech
rally
and
recorded
significant
gains.
A
small
group
of
tech-oriented
mega-cap
companies
helped
drive
much
of
the
market’s
advance.
Conversely,
the
defensive
utilities
sector
had
the
weakest
returns
in
the
growth-focused
environment,
and
the
energy
sector
also
lost
ground
amid
declining
oil
prices.
The
financials
sector
bounced
back
from
the
failure
of
three
large
regional
banks
in
the
spring
and
was
one
of
the
top-performing
segments
in
the
second
half
of
the
year.
The
U.S.
economy
was
the
strongest
among
the
major
markets
during
the
period,
with
gross
domestic
product
growth
coming
in
at
4.9%
in
the
third
quarter,
the
highest
since
the
end
of
2021.
Corporate
fundamentals
were
also
broadly
supportive.
Year-over-year
earnings
growth
contracted
in
the
first
and
second
quarters
of
2023,
but
results
were
better
than
expected,
and
earnings
growth
turned
positive
again
in
the
third
quarter.
Markets
remained
resilient
despite
a
debt
ceiling
standoff
in
the
U.S.,
the
outbreak
of
war
in
the
Middle
East,
the
continuing
conflict
between
Russia
and
Ukraine,
and
a
sluggish
economic
recovery
in
China.
Inflation
remained
a
concern,
but
investors
were
encouraged
by
the
slowing
pace
of
price
increases
as
well
as
the
possibility
that
the
Federal
Reserve
was
nearing
the
end
of
its
rate-hiking
cycle.
The
Fed
held
rates
steady
after
raising
its
short-term
lending
benchmark
rate
to
a
target
range
of
5.25%
to
5.50%
in
July,
the
highest
level
since
March
2001,
and
at
its
final
meeting
of
the
year
in
December,
the
central
bank
indicated
that
there
could
be
three
25-basis-point
rate
cuts
in
2024.
T.
ROWE
PRICE
Equity
Income
Fund
2
The
yield
of
the
benchmark
10-year
U.S.
Treasury
note
briefly
reached
5.00%
in
October
for
the
first
time
since
late
2007
before
falling
back
to
3.88%
by
period-end,
the
same
level
where
it
started
the
year,
amid
cooler-than-expected
inflation
readings
and
less-hawkish
Fed
rhetoric.
Fixed
income
benchmarks
were
lifted
late
in
the
year
by
falling
yields.
Investment-grade
and
high
yield
corporate
bonds
produced
solid
returns,
supported
by
the
higher
coupons
that
have
become
available
over
the
past
year,
as
well
as
increasing
hopes
that
the
economy
might
be
able
to
avoid
a
recession.
Global
economies
and
markets
showed
surprising
resilience
in
2023,
but
considerable
uncertainty
remains
as
we
look
ahead.
Geopolitical
events,
the
path
of
monetary
policy,
and
the
impact
of
the
Fed’s
rate
hikes
on
the
economy
all
raise
the
potential
for
additional
volatility.
We
believe
this
environment
makes
skilled
active
management
a
critical
tool
for
identifying
risks
and
opportunities,
and
our
investment
teams
will
continue
to
use
fundamental
research
to
help
identify
securities
that
can
add
value
to
your
portfolio
over
the
long
term.
Thank
you
for
your
continued
confidence
in
T.
Rowe
Price.
Sincerely, 
Robert
Sharps
CEO
and
President
T.
ROWE
PRICE
Equity
Income
Fund
Management’s
Discussion
of
Fund
Performance
3
INVESTMENT
OBJECTIVE 
The
fund
seeks
a
high
level
of
dividend
income
and
long-term
capital
growth
primarily
through
investments
in
stocks.
FUND
COMMENTARY
How
did
the
fund
perform
in
the
past 12
months?
The
Equity
Income
Fund
returned
9.65%
for
the
12-month
period
ended
December
31,
2023.
The
fund
underperformed
its
benchmark,
the
Russell
1000
Value
Index,
and
its
peer
group,
the
Lipper
Equity
Income
Funds
Index.
(Returns
for
the
Advisor,
R,
I,
and
Z
Class
shares
varied
slightly,
reflecting
their
different
fee
structures.
Past
performance
cannot
guarantee
future
results.
)
What
factors
influenced
the
fund’s
performance?
U.S.
equities
produced
strong
gains
in
2023,
driven
by
generally
favorable
corporate
earnings,
a
resilient
economy,
and
increased
investor
interest
in
artificial
intelligence.
Within
the
portfolio,
sector
allocation
drove
relative
underperformance,
while
our
favorable
stock
picks
tempered
losses.
Our
underweight
exposure
to
the
communication
services
sector
detracted
from
relative
results,
as
did
select
names
within
the
sector.
In
the
interactive
media
and
services
space,
our
underweight
to
Meta
Platforms,
which
was
removed
from
the
Russell
1000
Value
Index
in
June,
was
a
notable
headwind
over
the
first
half
of
2023
as
the
stock
advanced
significantly
following
a
shift
to
a
cost
focus.
The
company
continued
to
perform
well
as
it
experienced
a
rebound
in
digital
ad
spending
and
improved
monetization
trends.
Walt
Disney
PERFORMANCE
COMPARISON
Total
Return
Periods
Ended
12/31/23
6
Months
12
Months
Equity
Income
Fund
.
6.92‌%
9.65‌%
Equity
Income
Fund–
.
Advisor  Class
6.76‌
9.34‌
Equity
Income
Fund–
.
R  Class
6.64‌
9.06‌
Equity
Income
Fund–
.
I  Class
6.99‌
9.75‌
Equity
Income
Fund–
.
Z  Class
7.32‌
10.39‌
Russell
1000
Value
Index
6.03‌
11.46‌
S&P
500
Index
8.04‌
26.29‌
Lipper
Equity
Income
Funds
Index
5.68‌
10.12‌
T.
ROWE
PRICE
Equity
Income
Fund
4
shares
also
hindered
relative
results
as
the
company
struggled
with
weak
Disney+
subscriber
growth,
a
slowdown
in
park
attendance,
and
a
weakening
in
linear
TV
profits
and
revenues.
(Please
refer
to
the
portfolio
of
investments
for
a
complete
list
of
holdings
and
the
amount
each
represents
in
the
portfolio.)
After
a
strong
performance
the
previous
year,
CF
Industries
in
the
materials
sector
underperformed
amid
a
volatile
backdrop
for
fertilizer
demand
and
pricing.
Early
in
2023,
weak
fertilizer
demand
pressured
shares,
although
the
hydrogen
and
nitrogen
products
manufacturer
benefited
from
improved
sentiment
around
the
fertilizer
cycle
midyear.
However,
weak
nitrogen
pricing
late
in
the
year
again
weighed
on
the
stock.
We
continue
to
own
a
significant
position
in
CF
Industries
as
we
believe
that
fundamentals
for
the
company
will
improve
in
2024.
Our
stock
choices
in
the
consumer
staples
sector
was
also
a
hindrance,
notably
Conagra
Brands.
The
packaged
food
company’s
shares
declined
due
to
challenges
from
higher
inflation
and
weaker
volume
trends
caused
by
supply
chain
disruptions
from
its
largest
frozen
food
supplier.
Increased
competition
from
other
food
companies
and
persistent
sales
growth
concerns
also
negatively
impacted
shares.
More
broadly,
accelerated
demand
for
weight
loss
drugs
raised
concerns
about
the
long-term
effect
on
food
and
beverage
stocks,
which
also
pulled
back
performance.
On
a
positive
note,
our
industrials
and
business
services
sector
holdings
added
the
most
to
relative
results.
Specifically,
GE
recorded
a
double-digit
return
as
the
diversified
conglomerate’s
shares
advanced
significantly
on
a
better-than-
expected
recovery
in
the
aviation
industry,
improvement
in
its
renewables
segment,
and
positive
sentiment
following
the
spinoff
of
its
health
care
business
early
in
2023.
In
energy,
TotalEnergies
helped
relative
performance
as
its
shares
outpaced
the
sector
with
a
double-digit
return
as
the
French
oil
and
gas
major
benefited
from
continued
low-cost
production
growth
and
shareholder-friendly
capital
allocation
policies.
TotalEnergies
is
a
long-term
holding,
and
we
continue
to
value
the
company’s
ability
to
execute
in
uncertain
environments,
its
focus
on
returning
cash
to
shareholders,
and
its
attractive
dividend
yield.
T.
ROWE
PRICE
Equity
Income
Fund
5
How
is
the
fund
positioned?
The
Equity
Income
Fund
seeks
to
buy
well-established,
large-cap
companies
that
have
a
strong
record
of
paying
dividends
and
appear
to
be
undervalued
by
the
market.
The
fund’s
holdings
tend
to
be
solid,
higher-quality
companies
going
through
a
period
of
controversy
or
stress,
reflecting
our
dual
focus
on
valuation
and
dividend
yield.
Each
position
is
the
product
of
careful
stock
picking
based
on
the
fundamental
research
generated
by
T.
Rowe
Price’s
equity
analyst
team,
as
opposed
to
broader
market
or
macroeconomic
trends.
Top
purchases
covered
varied
sectors
of
the
market.
In
financials,
we
leaned
heavily
into
wealth
platform
Charles
Schwab
over
the
second
half
of
the
year,
as
we
believe
the
market
underappreciates
how
quickly
net
interest
margins
are
likely
to
improve.
We
also
value
the
company’s
competitive
positioning
in
fast-growing
wealth
channels
and
the
strength
of
its
platform
and
the
markets
it
serves.
We
also
added
to
our
position
in
U.S.
Bancorp,
one
of
the
largest
U.S.
banks,
for
its
defensive
credit
profile
and
attractive
valuation.
In
industrials
and
business
services,
we
initiated
a
position
in
Norfolk
Southern,
a
railroad
company
that
primarily
operates
in
the
eastern
U.S.
and
services
a
diverse
set
of
end
markets,
including
agricultural,
metals,
and
chemicals.
In
our
view,
the
company
should
benefit
from
a
strong
industry
backdrop,
margin
improvements,
optionality
around
growth,
and
continued
capital
return.
We
also
found
compelling
opportunities
in
consumer
staples.
We
started
positions
in
(1)
Kenvue,
a
consumer
health
company
that
we
believe
has
room
for
operational
improvement,
margin
expansion,
and
free
SECTOR
DIVERSIFICATION
Percent
of
Net
Assets
6/30/23
12/31/23
Financials  
20.7‌%
22.8‌%
Health
Care  
17.5‌
15.6‌
Industrials
and
Business
Services  
11.8‌
12.8‌
Information
Technology  
8.0‌
8.9‌
Energy  
8.1‌
8.6‌
Consumer
Staples  
7.7‌
8.2‌
Utilities  
7.3‌
6.4‌
Communication
Services  
4.6‌
4.7‌
Real
Estate  
4.2‌
4.2‌
Consumer
Discretionary  
5.0‌
3.8‌
Materials  
3.5‌
3.1‌
Other
and
Reserves  
1.6‌
0.9‌
Total
100.0‌%
100.0‌%
Historical
weightings
reflect
current
industry/sector
classifications.
T.
ROWE
PRICE
Equity
Income
Fund
6
cash
flow
conversion,
and
(2)
Colgate-Palmolive,
a
household
and
consumer
products
company
with
leading
market
share
in
several
key
categories
whose
efforts
to
stabilize
market
share
through
premium
product
innovation
and
increased
ad
spend
could
positively
impact
shares.
Turning
to
sales,
our
largest
sale
was
reducing
our
position
in
GE,
of
which
we
sold
shares
to
manage
our
position
size.
We
continue
to
have
a
significant
overweight
in
the
diversified
conglomerate
and
remain
confident
that
the
company
will
continue
to
benefit
from
a
recovery
in
the
aerospace
business
and
further
streamlining
of
its
portfolio
of
assets.
In
utilities,
we
reduced
our
position
in
Sempra,
although
we
continue
to
find
value
in
its
Texas
and
California
utilities
and
the
liquefied
natural
gas
projects
in
its
infrastructure
business.
In
financials,
we
sold
shares
of
investment
bank
Goldman
Sachs
to
moderate
our
capital
markets
industry
exposure.
What
is
portfolio
management’s
outlook?
The
market
was
data-point-driven
throughout
2023,
and
the
fourth
quarter
was
no
exception,
as
the
market
rallied
sharply
on
favorable
inflation
and
employment
news.
While
all
eyes
remain
on
the
direction
of
monetary
policy,
we
believe
that
the
Federal
Reserve
will
also
be
heavily
influenced
by
new
data.
We
therefore
expect
the
market
will
continue
to
be
volatile,
switching
between
optimism
and
pessimism
depending
on
the
next
data
point.
This
backdrop
creates
a
wide
range
of
potential
outcomes,
and
the
likelihood
of
a
recession
versus
a
“soft
landing”
is
largely
unknown.
We
believe
that
our
portfolio
has
a
careful
balance
of
both
offensive
holdings,
which
should
do
well
if
the
market
moves
higher,
and
defensive
holdings,
which
should
perform
well
if
the
market
moves
lower.
Going
forward,
our
focus
will
remain
on
taking
advantage
of
compelling
opportunities
as
they
arise.
Ultimately,
we
believe
that
individual
stock
picking
will
be
critical
and
that
our
understanding
of
the
company
fundamentals
of
portfolio
holdings
as
well
as
our
valuation
discipline
and
long-term
investment
horizon
will
help
serve
shareholders
well
over
time.
The
views
expressed
reflect
the
opinions
of
T.
Rowe
Price
as
of
the
date
of
this
report
and
are
subject
to
change
based
on
changes
in
market,
economic,
or
other
conditions.
These
views
are
not
intended
to
be
a
forecast
of
future
events
and
are
no
guarantee
of
future
results.
T.
ROWE
PRICE
Equity
Income
Fund
7
RISKS
OF
INVESTING
IN
THE
FUND
DIVIDEND-PAYING
STOCKS
The
fund’s
emphasis
on
dividend-paying
stocks
could
cause
the
fund
to
underperform
similar
funds
that
invest
without
consideration
of
a
company’s
track
record
of
paying
dividends.
There
is
no
guarantee
that
the
issuers
of
the
stocks
held
by
the
fund
will
declare
dividends
in
the
future
or
that,
if
dividends
are
declared,
they
will
remain
at
their
current
levels
or
increase
over
time.
For
example,
a
sharp
rise
in
interest
rates
or
an
economic
downturn
could
cause
a
company
to
unexpectedly
reduce
or
eliminate
its
dividend.
In
addition,
stocks
of
companies
with
a
history
of
paying
dividends
may
not
benefit
from
a
broad
market
advance
to
the
same
degree
as
the
overall
stock
market.
STOCK
INVESTING
The
fund’s
share
price
can
fall
because
of
weakness
in
the
overall
stock
markets,
a
particular
industry,
or
specific
holdings.
Stock
markets
as
a
whole
can
be
volatile
and
decline
for
many
reasons,
such
as
adverse
local,
political,
regulatory,
or
economic
developments;
changes
in
investor
psychology;
or
heavy
institutional
selling
at
the
same
time
by
major
institutional
investors
in
the
market,
such
as
mutual
funds,
pension
funds,
and
banks.
The
prospects
for
an
industry
or
company
may
deteriorate
because
of
a
variety
of
factors,
including
disappointing
earnings
or
changes
in
the
competitive
environment.
In
addition,
the
advisor’s
assessment
of
companies
whose
stocks
are
held
by
the
fund
may
prove
incorrect,
resulting
in
losses
or
poor
performance,
even
in
rising
markets.
In
the
event
an
issuer
is
liquidated
or
declares
bankruptcy,
the
claims
of
owners
of
the
issuer’s
bonds
and
preferred
stock
take
precedence
over
the
claims
of
those
who
own
common
stock.
For
a
more
thorough
discussion
of
risks,
please
see
the
fund’s
prospectus.
BENCHMARK
INFORMATION
Note:
London
Stock
Exchange
Group
plc
and
its
group
undertakings
(collectively,
the
“LSE
Group”).
©
LSE
Group
2024.
FTSE
Russell
is
a
trading
name
of
certain
of
the
LSE
Group
companies.  “Russell
®
” is/are
a
trademark(s)
of
the
relevant
LSE
Group
companies
and
is/are
used
by
any
other
LSE
Group
company
under
license.
All
rights
in
the
FTSE
Russell
indexes
or
data
vest
in
the
relevant
LSE
Group
company
which
owns
the
index
or
the
data.
Neither
LSE
Group
nor
its
licensors
accept
any
liability
for
any
errors
or
omissions
in
T.
ROWE
PRICE
Equity
Income
Fund
8
the
indexes
or
data
and
no
party
may
rely
on
any
indexes
or
data
contained
in
this
communication.
No
further
distribution
of
data
from
the
LSE
Group
is
permitted
without
the
relevant
LSE
Group
company’s
express
written
consent.
The
LSE
Group
does
not
promote,
sponsor
or
endorse
the
content
of
this
communication.
The
LSE
Group
is
not
responsible
for
the
formatting
or
configuration
of
this
material
or
for
any
inaccuracy
in
T.
Rowe
Price’s
presentation
thereof.
Note:
Portions
of
the
mutual
fund
information
contained
in
this
report
was
supplied
by
Lipper,
a
Refinitiv
Company,
subject
to
the
following:
Copyright
2024
©
Refinitiv.
All
rights
reserved.
Any
copying,
republication
or
redistribution
of
Lipper
content
is
expressly
prohibited
without
the
prior
written
consent
of
Lipper.
Lipper
shall
not
be
liable
for
any
errors
or
delays
in
the
content,
or
for
any
actions
taken
in
reliance
thereon.
Note:
The
S&P
500
Index
is
a
product
of
S&P
Dow
Jones
Indices
LLC,
a
division
of
S&P
Global,
or
its
affiliates
(“SPDJI”)
and
has
been
licensed
for
use
by
T.
Rowe
Price.
Standard
&  Poor’s
®
and
S&P
®
 are
registered
trademarks of
Standard
&
Poor’s
Financial
Services
LLC,
a
division
of
S&P
Global (“S&P”);
Dow
Jones
®
is
a
registered
trademark
of
Dow
Jones
Trademark
Holdings
LLC
(“Dow
Jones”);
T.
Rowe
Price
is
not
sponsored,
endorsed,
sold
or
promoted
by
SPDJI,
Dow
Jones,
S&P,
or
their
respective
affiliates,
and
none
of
such
parties
make
any
representation
regarding
the
advisability
of
investing
in
such
product(s)
nor
do
they
have
any
liability
for
any
errors,
omissions,
or
interruptions
of
the
S&P
500
Index.
BENCHMARK
INFORMATION
(continued)
T.
ROWE
PRICE
Equity
Income
Fund
9
PORTFOLIO
HIGHLIGHTS
TWENTY-FIVE
LARGEST
HOLDINGS
Percent
of
Net
Assets
12/31/23
Wells
Fargo
3.0‌%
TotalEnergies
3.0‌ 
QUALCOMM
2.9‌ 
Southern
2.6‌ 
American
International
Group
2.5‌ 
General
Electric
2.3‌
Elevance
Health
2.3‌
News
2.3‌
Chubb
2.2‌
L3Harris
Technologies
1.8‌
CF
Industries
Holdings
1.8‌
Becton
Dickinson
&
Company
1.8‌
Boeing
1.7‌
Weyerhaeuser
1.7‌
Philip
Morris
International
1.7‌
Equitable
Holdings
1.7‌
Microsoft
1.7‌
Charles
Schwab
1.6‌
MetLife
1.5‌
Equity
Residential
1.4‌
Zimmer
Biomet
Holdings
1.4‌
Exxon
Mobil
1.3‌
U.S.
Bancorp
1.3‌
Dominion
Energy
1.3‌
Fifth
Third
Bancorp
1.3‌
Total
48.1‌%
Note:
The
information
shown
does
not
reflect
any
exchange-traded
funds
(ETFs),
cash
reserves,
or
collateral
for
securities
lending
that
may
be
held
in
the
portfolio.
T.
ROWE
PRICE
Equity
Income
Fund
10
GROWTH
OF
$10,000 
This
chart
shows
the
value
of
a
hypothetical
$10,000
investment
in
the
fund
over
the
past
10
fiscal
year
periods
or
since
inception
(for funds
lacking
10-year
records).
The
result
is
compared
with
benchmarks,
which
include
a
broad-based
market
index
and
may
also
include
a
peer
group
average
or
index.
Market
indexes
do
not
include
expenses,
which
are
deducted
from
fund
returns
as
well
as
mutual fund
averages
and
indexes.
EQUITY
INCOME
FUND 
Note:
Performance
for
the
Advisor,
R,
I,
and
Z
Class
shares
will
vary
due
to
their
differing
fee
structures.
See
the
Average
Annual
Compound
Total
Return
table
on
the
next
page. 
T.
ROWE
PRICE
Equity
Income
Fund
11
AVERAGE
ANNUAL
COMPOUND
TOTAL
RETURN
EXPENSE
RATIO
Periods
Ended
12/31/23
1
Year
5
Years
10
Years
Since
Inception
Inception
Date
Equity
Income
Fund
.
9.65‌%
11.32‌%
7.98‌%
–‌
Equity
Income
Fund–
.
Advisor  Class
9.34‌
10.98‌
7.66‌
–‌
Equity
Income
Fund–
.
R  Class
9.06‌
10.69‌
7.38‌
–‌
Equity
Income
Fund–
.
I  Class
9.75‌
11.44‌
–‌
10.19‌%
12/17/15
Equity
Income
Fund–
.
Z  Class
10.39‌
–‌
–‌
8.47‌
2/22/21
The
fund’s
performance
information
represents
only
past
performance
and
is
not
necessarily
an
indication
of
future
results.
Current
performance
may
be
lower
or
higher
than
the
performance
data
cited.
Share
price,
principal
value,
and
return
will
vary,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
For
the
most
recent
month-end
performance,
please
visit
our
website
(troweprice.com)
or
contact
a
T.
Rowe
Price
representative
at
1
-
800
-
225
-
5132
or,
for
0.02
Advisor,
0.03
R,
0.04
I
,
and
0.05
Z
Class
shares,
1-800-638-8790.
This
table
shows
how
the
fund
would
have
performed
each
year
if
its
actual
(or
cumulative)
returns
had
been
earned
at
a
constant
rate.
Average
annual
total
return
figures
include
changes
in
principal
value,
reinvested
dividends,
and
capital
gain
distributions.
Returns
do
not
reflect
taxes
that
the
shareholder
may
pay
on
fund
distributions
or
the
redemption
of
fund
shares.
When
assessing
performance,
investors
should
consider
both
short-
and
long-term
returns.
Equity
Income
Fund
0.67‌%
Equity
Income
Fund–Advisor
Class
1.00‌ 
Equity
Income
Fund–R
Class
1.23‌ 
Equity
Income
Fund–I
Class
0.56‌ 
Equity
Income
Fund–Z
Class
0.54‌ 
The
expense
ratio
shown
is
as
of
the
fund’s
most
recent
prospectus.
This
number
may
vary
from
the
expense
ratio
shown
elsewhere
in
this
report
because
it
is
based
on
a
different
time
period
and,
if
applicable,
includes
acquired
fund
fees
and
expenses
but
does
not
include
fee
or
expense
waivers.
T.
ROWE
PRICE
Equity
Income
Fund
12
FUND
EXPENSE
EXAMPLE
As
a
mutual
fund
shareholder,
you
may
incur
two
types
of
costs:
(1)
transaction
costs,
such
as
redemption
fees
or
sales
loads,
and
(2)
ongoing
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
fund
expenses.
The
following
example
is
intended
to
help
you
understand
your
ongoing
costs
(in
dollars)
of
investing
in
the
fund
and
to
compare
these
costs
with
the
ongoing
costs
of
investing
in
other
mutual
funds.
The
example
is
based
on
an
investment
of
$1,000
invested
at
the
beginning
of
the
most
recent
six-month
period
and
held
for
the
entire
period.
Please
note
that
the
fund
has
five
share
classes:
The
original
share
class
(Investor
Class)
charges
no
distribution
and
service
(12b-1)
fee,
Advisor
Class
shares
are
offered
only
through
unaffiliated
brokers
and
other
financial
intermediaries
and
charge
a
0.25%
12b-1
fee,
R
Class
shares
are
available
to
retirement
plans
serviced
by
intermediaries
and
charge
a
0.50%
12b-1
fee,
I
Class
shares
are
available
to
institutionally
oriented
clients
and
impose
no
12b-1
or
administrative
fee
payment,
and
Z
Class
shares
are
offered
only
to
funds
advised
by
T.
Rowe
Price
and
other
advisory
clients
of
T.
Rowe
Price
or
its
affiliates
that
are
subject
to
a
contractual
fee
for
investment
management
services
and
impose
no
12b-1
fee
or
administrative
fee
payment.
Each
share
class
is
presented
separately
in
the
table.
Actual
Expenses
The
first
line
of
the
following
table
(Actual)
provides
information
about
actual
account
values
and
expenses
based
on
the
fund’s
actual
returns.
You
may
use
the
information
on
this
line,
together
with
your
account
balance,
to
estimate
the
expenses
that
you
paid
over
the
period.
Simply
divide
your
account
value
by
$1,000
(for
example,
an
$8,600
account
value
divided
by
$1,000
=
8.6),
then
multiply
the
result
by
the
number
on
the
first
line
under
the
heading
"Expenses
Paid
During
Period"
to
estimate
the
expenses
you
paid
on
your
account
during
this
period. 
Hypothetical
Example
for
Comparison
Purposes
The
information
on
the
second
line
of
the
table
(Hypothetical)
is
based
on
hypothetical
account
values
and
expenses
derived
from
the
fund’s
actual
expense
ratio
and
an
assumed
5%
per
year
rate
of
return
before
expenses
(not
the
fund’s
actual