T. Rowe Price Group, Inc. · NASDAQ:TROW
T. Rowe Price — Investor Presentation (September 2025)
54 slides from T. Rowe Price's investor presentation, September 2025
Slide 1: Small Cap Stocks in the Era of Uncertainty
U.S. Smaller Companies Small Cap Stocks in the Era of Uncertainty Matt Mahon, Portfolio Manager Michele Ward, CFA, U.S. Equity Portfolio Specialist September 2025 THIS MARKETING COMMUNICATION IS FOR INVESTMENT PROFESSIONALS ONLY. NOT FOR FURTHER DISTRIBUTION. T. R O W E P R I C E 1
Slide 2: About T. Rowe Price
About T. Rowe Price As of 30 June 2025 Independent investment Number of countries organization founded in with local presence 1937 16 Assets Under Management in USD1 $1.68 Trillion Small-cap Assets in USD1 Number of associates worldwide Launched New Horizons Fund in Pioneer in small-cap $80+ Billion
Slide 3: Small-cap stocks: Market backdrop in 2025
Small-cap stocks: Market backdrop in 2025 T. R O W E P R I C E 3
Slide 4: The "B" word
The “B” word As of 30 June 2025 S&P 500 Index: Shiller CAPE (Cyclically Adjusted Price/Earnings) Ratio 50x 45x 40x 35x 30x 25x 20x 15x 10x 5x 0x 1918 1925 1932 1939 1946 1953 1960 1967 1974 1981 1988 1995 2002 2009 2016 2023 Source: Robert J. Shiller. T. R O W E P R I C E 4
Slide 5: The reach for risk is not confined to large cap
The reach for risk is not confined to large cap 30 November 1985 – 31 July 2025 Russell 3000 Index: Rolling 3-Month Long/Short Beta Returns 90 80 70 60 Frequency 50 40 30 20 10 0 -54% -27% 0% 27% 54% L/S Beta Cap-Weighted 3M Returns Latest Data Point: -43.3 Past performance is not a guarantee or a r
Slide 6: Momentum driven investors accounted for 1/3 of equity trading volume in 1Q25
Momentum driven investors accounted for 1/3 of equity trading volume in 1Q25, nearly 3X their rate 15 years ago As of 31 March 2025 Equity Trading Volume Momentum Driven Investors Independent HFT Retail 8% Independent HFT 10% Retail 20% High Frequency Quant 2% 20% Low Frequency Quant 6% Long-Only 11
Slide 7: What has this meant in SMID?
What has this meant in SMID? As of 30 June 2025 Russell 2500 Index: 12-Month Performance by Beta Decile 70% D10 is not Nvidia or Meta in SMID. 60% >75% of the companies in 50% Decile 10 are non- earners. 40% >50% of 30% companies in Decile 9 are non- 20% earners. The multiyear hit- 10% rate for R250
Slide 8: Speculative factors drove second quarter returns in the Russell 2500
Speculative factors drove second quarter returns in the Russell 2500 30 August 2024 – 30 June 2025 Fed 50 bps Rumor Election Day Selloff Begins Selloff Ends 40% 20% 0% -20% Russell 2500 Index Highest Beta Most Speculative (10th Decile) -40% Sep-24 Oct-24 Nov-24 Dec-24 Jan-25 Feb-25 Mar-25 Apr-25 May
Slide 9: Fish where the fish are…
Fish where the fish are… 31 January 2001 - 31 December 2024 Russell 2500 Index: Forward 12-Month Median Hit Rates by Beta Decile 60% 55% 50% 45% 40% D1 D2 D3 D4 D5 D6 D7 D8 D9 D10 Past performance is not a guarantee or a reliable indicator of future results. D1 refers to the “lowest beta” decile, D1
Slide 10: This is unique even when considering post-recession periods
This is unique even when considering post-recession periods Calendar Year 2009 Russell 2500 Index: 12-Month Performance by Beta Decile 60% 50% 40% 30% 20% 10% 0% Russell D1 D2 D3 D4 D5 D6 D7 D8 D9 D10 2500 Past performance is not a guarantee or a reliable indicator of future results. D1 refers to th
Slide 11: We've seen something like this before…
We’ve seen something like this before…. 31 December 1997 – 9 March 2000 Russell 2000 Index: Performance by Beta Decile 350% 300% 250% 200% 150% 100% 50% 0% -50% Russell D1 D2 D3 D4 D5 D6 D7 D8 D9 D10 2000 Past performance is not a guarantee or a reliable indicator of future results. D1 refers to the
Slide 12: Large portions of the index were strongly positive in the sell-off
Large portions of the index were strongly positive in the sell-off 9 March 2000 – 31 December 2002 Russell 2000 Index: Performance by Beta Decile 60% 40% 20% 0% -20% -40% -60% -80% -100% Russell D1 D2 D3 D4 D5 D6 D7 D8 D9 D10 2000 Past performance is not a guarantee or a reliable indicator of future
Slide 13: Both small- and large-cap equities have had sustained periods of market leadership
Both small- and large-cap equities have had sustained periods of market leadership As of 31 July 2025 Small-cap Less Large-cap Forward Relative Returns 6 5 4 3 2 1 0 Small Cap Underperformance Relative Performance of Small vs. Large Past performance is not a guarantee or a reliable indicator of futu
Slide 14: Why invest in small-cap equities now?
Why invest in small-cap equities now? T. R O W E P R I C E 14
Slide 15: Small-cap stocks provide opportunity for long-term investors
Small-cap stocks provide opportunity for long-term investors Access to breadth Elevated Deregulation and of US economy inflation domestic investment Account for 20% Similar to 1970s— market cap but c.70% multi-year out- Beneficiaries of Trump by number of performance policy; focus on companies indus
Slide 16: Past shifts in economic regime have led to changes in equity leadership
Past shifts in economic regime have led to changes in equity leadership As of 30 June 2025 Weight of Top 5 S&P 500 Stocks vs. Small-cap Relative Performance 35% 3.0 April 1973: AT&T, Eastman June 2025: Nvidia, Microsoft, 30% Kodak, Exxon, GM, IBM Apple, Amazon, Google 2.5 25% March 2000: Cisco, Exxo
Slide 17: Smaller companies benefit from more domestic focus
Smaller companies benefit from more domestic focus As of 30 June 2025 Magnificent 7 Average Beta: 1.42 Russell 2500 S&P 500* 2.9% 3.1% 2.4% 3.2% 2.0% 4.7% 6.7% 1.9% 12.0% 5.5% 5.0% 3.0% 3.8% 13.6% 3.7% 14.0% 45.2% 17.8% 9.3% 19.8% 11.5% 8.7% Communication Services Consumer Discretionary Consumer Sta
Slide 18: Durable small-cap outperformance does not require low rates and low inflation
Durable small-cap outperformance does not require low rates and low inflation As of 30 June 2025 15% 13.88% Median Fed Funds Median CPI Small vs. Large Rel. Return 10% 9.25% 8.40% 6.69% 5.94% 5% 3.10% 1.75% 2.40% 1.25% 2.21% 0% -5% -5.04% -5.90% -10% 1973–1983 1983–1999 1999–2014 2014–2025 Past perf
Slide 19: Why the Funds SICAV—U.S. Smaller Companies Equity Fund?
Why the T. Rowe Price Funds SICAV—U.S. Smaller Companies Equity Fund? T. R O W E P R I C E 19
Slide 20: Objective and Risks
Objective and Risks T. Rowe Price Funds SICAV―U.S. Smaller Companies Equity Fund Objective Risks – the following risks are materially relevant to the fund (refer to prospectus for further details): ▪ Small and mid-cap – Small and mid-size company stock prices can be more volatile than stock prices
Slide 21: Funds SICAV―U.S. Smaller Companies Equity Fund
T. Rowe Price Funds SICAV―U.S. Smaller Companies Equity Fund Consistent Process and Philosophy Best Ideas Portfolio ▪ SICAV Launched in 2001 Designed specifically for investors in Europe and Asia Large-cap Large-cap Large-cap ▪ Investable Universe: Value Core Growth North American companies up t
Slide 22: Why SMID and not just small? Better returns, lower risk
Why SMID and not just small? Better returns, lower risk Large-cap 31 December 1978 to 30 June 2025 Risk and Return Characteristics of Small and SMID Mid-cap Russell 2000 Russell 2500 Annualized Return 10.8% 12.1% Annualized Volatility 19.8% 18.5% Small-cap Return / Risk 0.55 0.65 Max Drawdown1 -53%
Slide 23: Analyst team can uncover hidden gems
In an inefficient segment of the equity market, our analyst team can uncover hidden gems Independent, fundamental research focusing on: Companies with durable That results in differentiated competitive advantages or growth, margins and returns those undergoing change vs. peers A broadly diversified
Slide 24: Time arbitrage: Molina Healthcare
Time arbitrage: Molina Healthcare Fifteen Years as of 31 July 2025 Figures shown in U.S. Dollars Molina Healthcare (MOH) Share Price Chart $500 $400 $300 $200 $100 $0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Past performance is not a guarantee or a reliable ind
Slide 25: Death, taxes, and the need for healthcare
Death, taxes, and the need for healthcare As of 30 June 2025 IL 2024 Including 100% Max MLR: overhead, the 96.3% *majority* of the 95% Medicaid industry is losing money today. MLR 90% Molina Healthcare is a low-cost 85% producer that will win from both rate catch-up and 80% market share gains. 75% C
Slide 26: Compounder: Teledyne Technologies
Compounder: Teledyne Technologies Fifteen Years as of 30 June 2025 Figures shown in U.S. Dollars Teledyne Technologies (TDY) Share Price Chart $600 $500 $400 $300 $200 $100 $0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Past performance is not a guarantee or a rel
Slide 27: Returns bottomed with FLIR
Returns bottomed with FLIR Fifteen Years as of 30 June 2025 Teledyne Technologies (TDY) TTM Return on Assets 10% 8% 6% 4% 2% 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source: FactSet. The specific securities identified and described do not represent all of th
Slide 28: Management change: International Paper
Management change: International Paper Since First Trading Record as of 30 June 2025 Figures shown in U.S. Dollars International Paper (IP) Share Price Chart $70 $60 $50 $40 $30 $20 $10 $0 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 2012 2016 2020 2024 Past performance is not a guarantee or a
Slide 29: International Paper update
International Paper update 31 December 2000 – 30 June 2025 Industry Demand: Trailing 12-Month Total Box Shipments (bsf) 450 400 350 300 2000 2004 2008 2012 2016 2020 2024 Sources: RBC, Fibre Box Association. The specific securities identified and described do not represent all of the securities purc
Slide 30: International Paper update
International Paper update As of 30 June 2025 Industry Supply Source: Jefferies. The specific securities identified and described do not represent all of the securities purchased, sold, or recommended for the portfolio, and no assumptions should be made that the securities identified and discussed w
Slide 31: Disruptive technologies: Aurora Innovation
Disruptive technologies: Aurora Innovation Since First Trading Record as of 30 June 2025 Figures shown in U.S. Dollars Aurora Innovation (AUR) Share Price Chart $20 $15 $10 $5 $0 2021 2022 2023 2024 2025 Past performance is not a guarantee or a reliable indicator of future results. Source: FactSet.
Slide 32: Portfolio snapshot: Diversification, balance, quality
Portfolio snapshot: Diversification, balance, quality As of 30 June 2025 Top 10 Holdings Sector Diversification Portfolio Characteristics Company % of SICAV 30% T. Rowe Price Funds SICAV—US Smaller Companies Equity Fund T. Rowe Price Funds SICAV— Russell 2500 Russell 2500 Net 30% Index U.S. Smaller
Slide 33: Taking full advantage of the broad opportunity set
Taking full advantage of the broad opportunity set As of 30 June 2025 Morningstar holdings-based style analysis of the T. Rowe Price Funds SICAV—U.S. Smaller Companies Equity Fund DEEP- CORE- CORE- HIGH- VALUE VALUE CORE GROWTH GROWTH GIANT LARGE MID SMALL MICRO BROAD EXPOSURE TO BROAD EXPOSURE TO V
Slide 34: Value added is primarily the result of stock selection
Value added is primarily the result of stock selection Ten years ended 30 June 2025 Long-term Performance Attribution of T. Rowe Price Funds SICAV— U.S. Smaller Companies Fund vs. Russell 2500 Index1 4% Total Value Added Sector Allocation 3% Security Selection 2% 1% 0% -1% Total Information Real Est
Slide 35: Average Annual Return (%)
Performance 10 Years Ended 30 June 2025 Figures are Calculated in U.S. Dollars T. Rowe Price Funds—US Smaller Companies Equity Fund Class I2 Risk/Return Characteristics T. Rowe Price Funds—US Smaller Companies 10 Years Equity Fund Class I Stepped Out3 T. Rowe Price Funds SICAV—US Smaller Russell 250
Slide 36: Multi-dimensional risk management is integral to our process
Multi-dimensional risk management is integral to our process T. Rowe Price Funds SICAV—U.S. Smaller Companies Equity Fund As of 30 June 2025 Company Portfolio Specifics Construction Valuation framework and knowledge of fundamentals and ESG factors help Position size and sector weights offer balance
Slide 37: Fund has delivered positive alpha in most market environments
T. Rowe Price Funds SICAV – U.S. Smaller Companies Equity Fund has delivered positive alpha in most market environments Rolling 1-Year Periods Since Inception as of 30 June 2025 Average Outperformance of T. Rowe Price Funds SICAV – U.S. Smaller Companies Equity Fund Class I (Stepped Out) vs. Russell
Slide 38: Q&A
O&A T. ROWE PRICE INVEST WITH CONFIDENCE* | 38
Slide 39: Please share your feedback
Please share your feedback For every survey completed, £10 will go to Ocean Generation Charity Scan QR code T. R O W E P R I C E 39
Slide 40: Appendix
T. ROWE PRICE INVEST WITH CONFIDENCE* | 40
Slide 41: Fund profile
Fund profile As of 30 June 2025 T. Rowe Price Funds SICAV—U.S. Smaller Companies Equity Fund The fund is actively managed and invests mainly in a widely diversified portfolio of shares from smaller capitalization companies in the Fund Goal United States, with the goal of increasing the value of its
Slide 42: Consistent approach and strong long-term performance
Consistent approach and strong long-term performance As of 30 June 2025 BETTER RETURNS LOWER VOLATILITY T. Rowe Price Funds SICAV—U.S. 10.22% 17.37% Smaller Companies Equity Fund 1st Quartile 10-year returns 10-year annualized 4-STAR annualized vs. standard deviation vs. performance for 10-years1 Ov
Slide 43: "Quality" has many dimensions
“Quality” has many dimensions As of 30 June 2025 Negative Earners as Percent of Total Fund Investment Weighted Median Long-term Debt to Capital Rolling Quarterly—LTM EPS 50% T. Rowe Price Funds SICAV—U.S. Smaller Companies Equity Fund 45% T. Rowe Price Funds SICAV—U.S. Smaller Companies Equity Fund
Slide 44: Fund has delivered strong results over the long term
T. Rowe Price Funds SICAV – U.S. Smaller Companies Equity Fund has delivered strong results over the long term As of 30 June 2025 Batting Average and Excess Returns of T. Rowe Price Funds SICAV – U.S. Smaller Companies Equity Fund Class I (Stepped Out) vs. Russell 2500 Net 30% Index 1 Year 3 Years 5
Slide 45: Performance
Performance Periods Ended 30 June 2025 Figures are Calculated in U.S. Dollars T. Rowe Price Funds SICAV—US Smaller Companies Equity Fund Annualised Three Year-to- One Three Five Ten Fifteen Twenty Months Date Year Years Years Years Years Years T. Rowe Price Funds SICAV—US Smaller Companies 7.11% -1.
Slide 46: Attribution analysis (USD)—major impacts
Attribution analysis (USD)—major impacts One Year Ended 30 June 2025 T. Rowe Price Funds SICAV—U.S. Smaller Companies Equity Fund vs. Russell 2500 Index1 By Sector 1.0 Value Added—Percentage 0.0 ■ Total Value Added -1.0 ■ Value Added From Sector Weight -2.0 ■ Value Added From -3.0 Stock Selection -4
Slide 47: Favorable risk adjusted returns
Favorable risk adjusted returns As of 30 June 2025 Well-balanced portfolio. Seeking higher returns with lower risk. Well balanced portfolio with that added 10-year results: Higher-than-benchmark 1-, 3-, 5-, and 10-year results: Lower-than- value in both up and down markets1 returns benchmark risk 30
Slide 48: Returns, risk, and performance attribution
Returns, risk, and performance attribution T. Rowe Price Funds SICAV—U.S. Smaller Companies Equity Fund As of 30 June 2025 Consistency under different portfolio managers Greg McCrickard Dave Wagner Frank Alonso Ryan Burgess Curt Organt Jun. 2001–Jan. 2008 Jan. 2008–Sep. 2013 Oct. 2013–Sep. 2016 Oct.
Slide 49: Investment Management Research Team
T. Rowe Price Investment Management Research Team As of 30 June 2025 BAL Baltimore NYC New York City PHL Philadelphia SFO San Francisco DC Washington DC HEAD OF TRPIM HEAD OF ESG DIRECTORS OF RESEARCH Stephon Jackson, CFA BAL Chris Whitehouse DC Steven Krichbaum, CFA BAL Thomas Watson, CFA BAL EQUIT
Slide 50: ESG: Integrated, collaborative, material
ESG: Integrated, collaborative, material Sustainable 1 ESG Integration 2 Responsible Exclusions 3 Investing Criteria SFDR classification: Article 8 4 Principal Adverse Impact (PAI) indicators2 ESG integration supports the T. Rowe Price Responsible exclusion list 10% minimum Sustainable Investments1
Slide 51: Market capitalization range
Market capitalization range As of 30 June 2025 40% T. Rowe Price Funds SICAV—US Smaller Companies Equity Fund Russell 2500 Index 30% 20% 10% 0% 0-1,000 1,000-4,000 4,000-8,000 8,000-12,000 12,000-20,000 20,000+ Equity holdings only. Source: Frank Russell Company “LSE” and MSCI/S&P GICS do not accept
Slide 52: Additional disclosures
Additional disclosures T. Rowe Price uses the current MSCI/S&P Global Industry Classification Standard (GICS) for sector and industry reporting. Effective 17 March 2023, the GICS structure changed. Sector/industry diversification data prior to that date have not been restated. The Global Industry Cl
Slide 53: Important information
Important information The Funds are sub-funds of the T. Rowe Price Funds SICAV, a Luxembourg investment company with variable capital which is registered with Commission de Surveillance du Secteur Financier and which qualifies as an undertaking for collective investment in transferable securities (“
Slide 54: Thank You
D4 T.RowePrice Thank You
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