Europe Equity Fund (Class Y)  (PEUYX)

Pursuing the growth potential of established companies in European markets


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Highlights

Objective

The fund seeks capital appreciation.

Strategy and process

  • European companies: The fund invests in established large and midsize companies across Europe that benefit from the region's economy and from operations in global markets.
  • A flexible strategy: Pursuing Putnam's blend strategy, the fund can own growth- or value-style stocks to participate when either style leads European markets.
  • A disciplined process: The fund manager combines fundamental research and quantitative tools to pursue multiple sources of return, supported by strong risk controls in portfolio construction.

Fund price

Yesterday’s close 52-week high 52-week low
Net asset value $27.13
-1.20% | $-0.33
$29.48
01/26/18
$26.07
06/30/17
Historical fund price

Fund facts as of 05/31/18

Total net assets
$204.59M
Turnover (fiscal year end)
47%
Dividend frequency
Annually
Number of holdings
58
Fiscal year-end
June
CUSIP / Fund code
746747609 / 1832
Inception date
10/04/05
Category
Blend
Open to new investors
Ticker
PEUYX

Management team

Co-Head of Equities
Portfolio Manager, Analyst


Literature


Are international stocks truly cheap?
On the surface, U.S. stocks appear more expensive than international stocks, but a quantitative comparison reveals the impact of sector valuations.
Just how cheap are European equities?
Our analysis finds that industry group weightings play a significant role in valuation discrepancies between U.S. and European equities.
Proceeding toward Brexit: The risks for investors
With the United Kingdom beginning to move forward with Brexit, we see risks to the economy, the pound, and the markets.

Performance

  • Total return (%) as of 03/31/18

  • Annual performance as of 03/31/18

Annualized Total return (%) as of 03/31/18

Annualized performance 1 yr. 3 yrs. 5 yrs. 10 yrs.
Before sales charge 11.20% 3.32% 6.80% 3.16%
After sales charge N/A N/A N/A N/A
MSCI Europe Index (ND) 14.49% 4.79% 6.37% 2.06%

Current performance may be lower or higher than the quoted past performance, which cannot guarantee future results. Share price, principal value, and return will vary, and you may have a gain or loss when you sell your shares. Performance assumes reinvestment of distributions and does not account for taxes. Returns before sales charge do not reflect the current maximum sales charges as indicated below. Had the sales charge been reflected, returns would be lower. Returns at public offering price (after sales charge) for class A and class M shares reflect the current maximum initial sales charges of 5.75% and 3.50% for equity funds and Putnam Multi-Asset Absolute Return Fund, and 4.00% and 3.25% for income funds (2.25% and 0.75% for Putnam Short Duration Bond Fund and 1.00% and 0.75% for Putnam Floating Rate Income Fund, Putnam Fixed Income Absolute Return Fund, and Putnam Short-Term Municipal Income Fund), respectively. Class B share returns reflect the applicable contingent deferred sales charge (CDSC), which is 5% in the first year, declining to 1% in the sixth year, and is eliminated thereafter (except for Putnam Floating Rate Income Fund, Putnam Short Duration Bond Fund, Putnam Fixed Income Absolute Return Fund, and Putnam Short-Term Municipal Income Fund, which is 1% in the first year, declining to 0.5% in the second year, and is eliminated thereafter). Class C shares reflect a 1% CDSC the first year that is eliminated thereafter. Performance for class B, C, M, R, and Y shares prior to their inception is derived from the historical performance of class A shares, adjusted for the applicable sales charge (or CDSC) and, except for class Y shares, the higher operating expenses for such shares (with the exception of Putnam Tax-Free High Yield Fund and Putnam AMT-Free Municipal Fund, which are based on the historical performance of class B shares). Class R5/R6 shares, available to qualified employee-benefit plans only, are sold without an initial sales charge and have no CDSC. Class Y shares are generally only available for corporate and institutional clients and have no initial sales charge. Performance for Class R5/R6 shares before their inception are derived from the historical performance of class Y shares, which have not been adjusted for the lower expenses; had they, returns would have been higher. For a portion of the period, some funds had expenses limitations or had been sold on a limited basis with limited assets and expenses, without which returns would be lower.

Performance snapshot

  Before sales charge After sales charge
1 mt. as of 05/31/18 -0.69 % -
YTD as of 06/19/18 -1.42 % -

Risk-adjusted performance as of 05/31/18

Alpha (3 yrs.) -1.33
Sharpe ratio (3 yrs.) 0.10
Treynor ratio (3 yrs.) 1.35
Information ratio (3 yrs.) -0.48

Volatility as of 05/31/18

Standard deviation (3 yrs.) 11.96%
Beta 0.91
R-squared 0.93

Capture ratio as of 05/31/18

Up-market (3 yrs.) 86.69
Down-market (3 yrs.) 93.98

Lipper rankings as of 05/31/18

European Region Funds Percentile ranking Rank/Funds in category
1 yr. 69% 107/156
3 yrs. 75% 97/129
5 yrs. 50% 48/96
10 yrs. 33% 22/66

Morningstar ratings as of 05/31/18

Europe Stock Rating Funds in category
Overall (107)
3 yrs. (107)
5 yrs. (76)
10 yrs. (55)

Distributions

Record/Ex dividend date 12/21/17
Payable date 12/28/17
Income $0.2
Extra income --
Short-term cap. gain --
Long-term cap. gain --

Lipper rankings are based on total return without sales charge relative to all share classes of funds with similar objectives as determined by Lipper. Past performance is not indicative of future results.

The Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

The up-market capture ratio is used to evaluate how well an investment manager performed relative to an index during periods when that index has risen. The ratio is calculated by dividing the manager’s returns by the returns of the index during the up-market, and multiplying that factor by 100. The down-market capture ratio is used to evaluate how well an investment manager performed relative to an index during periods when that index has dropped. The ratio is calculated by dividing the manager’s returns by the returns of the index during the down-market and multiplying that factor by 100.


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Holdings

Top 10 holdings as of 05/31/18

Total 3.85%
Novartis Ag 3.65%
Unilever Nv 3.05%
Siemens Ag 2.95%
Rio Tinto 2.85%
Bayer Ag 2.74%
Prudential 2.59%
Airbus 2.50%
Koninklijke Ahold Delhaize Nv 2.37%
Ing Groep Nv 2.28%
Top 10 holdings, percent of portfolio 28.83%

Full portfolio holdings as of 03/31/18

NOVARTIS AG-REG 3.88%
TOTAL SA 3.49%
UNILEVER NV-CVA 3.02%
SIEMENS AG 2.91%
PRUDENTIAL PLC 2.72%
RIO TINTO PLC 2.66%
ING GROEP NV-CVA 2.58%
BAYER AG-REG 2.52%
AIRBUS SE 2.46%
KONINKLIJKE AHOLD DELHAIZE N 2.35%
SOCIETE GENERALE SA 2.26%
DANSKE BANK A/S 2.20%
RHEINMETALL AG 2.15%
ASTRAZENECA PLC 2.10%
VEOLIA ENVIRONNEMENT 2.04%
ASML HOLDING NV 2.03%
BASF SE 2.01%
NATIXIS 2.01%
STMICROELECTRONICS NV 1.92%
ENI SPA 1.91%
DIAGEO PLC 1.87%
ADIDAS AG 1.86%
HEINEKEN NV 1.86%
EURAZEO SA 1.84%
UNIPER SE 1.79%
ASSOCIATED BRITISH FOODS PLC 1.77%
PARTNERS GROUP HOLDING AG 1.74%
COMPASS GROUP PLC 1.69%
CRH PLC 1.62%
MAGNA INTERNATIONAL INC 1.61%
CANADIAN DOLLAR ACCOUNT 1.58%
EVONIK INDUSTRIES AG 1.55%
FERGUSON PLC 1.53%
KION GROUP AG 1.50%
KERRY GROUP PLC-A 1.45%
AENA SME SA 1.42%
KKR & CO LP 1.39%
PIRELLI & C SPA 1.34%
ASSA ABLOY AB-B 1.31%
FORTUM OYJ 1.26%
DIXONS CARPHONE PLC 1.14%
ADECCO GROUP AG-REG 1.11%
ST JAMES'S PLACE PLC 1.10%
BANK OF IRELAND GROUP PLC 1.08%
CAIXABANK S.A 1.07%
BAE SYSTEMS PLC 1.05%
BERKELEY GROUP HOLDINGS/THE 0.99%
CAIRN ENERGY PLC 0.99%
ORION ENGINEERED CARBONS SA 0.98%
CLINIGEN GROUP PLC 0.93%
DELIVERY HERO AG 0.93%
CELLNEX TELECOM SAU 0.92%
BURFORD CAPITAL LTD 0.91%
VIRGIN MONEY HOLDINGS UK 0.90%
AMAZON.COM INC 0.83%
ALPHABET INC-CL C 0.80%
ORBOTECH LTD 0.77%
X 5 RETAIL GROUP NV-REGS GDR 0.74%
WIZZ AIR HLDG PLC 0.73%
CHF/USD 06/20/2018 JPMCB 0.04%
CAD/USD 04/18/2018 BANKAM 0.00%
CHF/USD 06/20/2018 BCAP-FX 0.00%
DKK/USD 06/20/2018 CITI 0.00%
EUR/USD 06/20/2018 BANKAM 0.00%
EUR/USD 06/20/2018 BCAP-FX 0.00%
EUR/USD 06/20/2018 GSFX 0.00%
EUR/USD 06/20/2018 HSBCB 0.00%
EUR/USD 06/20/2018 JPMCB 0.00%
EUR/USD 06/20/2018 SSBT 0.00%
GBP/USD 06/20/2018 BANKAM 0.00%
GBP/USD 06/20/2018 CITI 0.00%
GBP/USD 06/20/2018 GSFX 0.00%
GBP/USD 06/20/2018 JPMCB 0.00%
GBP/USD 06/20/2018 SSBT 0.00%
NOK/USD 06/20/2018 JPMCB 0.00%
POUND STERLING CALL ACCOUNT 0.00%
SEK/USD 06/20/2018 CSI-FX 0.00%
SEK/USD 06/20/2018 RBSF 0.00%
EUR/USD 06/20/2018 CITI -0.03%
NORWEGIAN KRONE CALL ACCOUNT -0.60%
THE EURO EUR CALL ACCOUNT -0.74%

Prior top 10 holdings

Top 10 holdings as of 05/31/18
Total
Novartis Ag
Unilever Nv
Siemens Ag
Rio Tinto
Bayer Ag
Prudential
Airbus
Koninklijke Ahold Delhaize Nv
Ing Groep Nv
Holdings represent 28.83% of portfolio
Top 10 holdings as of 04/30/18
Total
Novartis Ag
Unilever Nv
Siemens Ag
Rio Tinto
Prudential
Bayer Ag
Ing Groep Nv
Airbus
Koninklijke Ahold Delhaize Nv
Holdings represent 29.46% of portfolio
Top 10 holdings as of 03/31/18
Novartis Ag
Total
Unilever Nv
Siemens Ag
Prudential
Rio Tinto
Ing Groep Nv
Bayer Ag
Airbus
Koninklijke Ahold Delhaize Nv
Holdings represent 28.59% of portfolio
Top 10 holdings as of 02/28/18
Novartis Ag
Total
Bayer Ag
Siemens Ag
Unilever Nv
Prudential
Ing Groep Nv
Airbus
Rio Tinto
Societe Generale
Holdings represent 28.76% of portfolio

Portfolio composition as of 05/31/18

Common stock 98.46%
Cash and net other assets 1.54%

Equity statistics as of 05/31/18

Median market cap $23.30B
Weighted average market cap $65.42B
Price to book 2.12
Price to earnings 14.85

Fund characteristics will vary over time.

Due to rounding, percentages may not equal 100%.

Consider these risks before investing: International investing involves currency, economic, and political risks. Emerging-market securities carry illiquidity and volatility risks. Investments in small and/or midsize companies increase the risk of greater price fluctuations. Investments in a single region may be affected by common economic forces and other factors. In addition, events in any one country within the region may impact the other countries or the region as a whole. Growth stocks may be more susceptible to earnings disappointments, and value stocks may fail to rebound. Risks associated with derivatives include increased investment exposure, which may be considered leverage, or, in the case of over-the-counter instruments, the potential inability to terminate or sell derivatives positions and the potential failure of the other party to the instrument to meet its obligations. Stock prices may fall or fail to rise over time for a variety of reasons, including general financial market conditions and factors related to a specific issuer or industry. You can lose money by investing in the fund.

Top Industry Sectors as of 05/31/18

Financials 20.85%
Industrials 15.91%
Consumer staples 13.26%
Health care 9.45%
Materials 9.41%
Consumer discretionary 8.72%
Information technology 7.68%
Energy 6.93%
Utilities 5.35%
 
Other
2.44%
Cash and net other assets 1.54%
Telecommunication services 0.90%

The unclassified sector (where applicable) includes exchange traded funds and other securities not able to be classified by sector.

Sectors will vary over time.

Country Allocation as of 05/31/18

United Kingdom 26.25%
Germany 17.00%
France 15.66%
Netherlands 11.71%
Switzerland 5.38%
United States 5.24%
Ireland 4.31%
Spain 3.27%
Denmark 2.01%
 
Other
9.17%
Canada 1.89%
Cash and net other assets 1.54%
Finland 1.42%
Sweden 1.33%
Italy 1.18%
Luxembourg 1.07%
Poland 0.74%

Expenses

Expense ratio

Class A Class B Class C Class M Class R Class R6 Class Y
Total expense ratio 1.29% 2.04% 2.04% 1.79% 1.54% 0.88% 1.04%
What you pay 1.29% 2.04% 2.04% 1.79% 1.54% 0.88% 1.04%

Sales charge/Dealer allowance

 Breakpoint Class A Class B Class C Class M Class R Class R6 Class Y
$0-$49,999 5.75% / 5.00% 0.00% / 4.00% 0.00% / 1.00% 3.50% / 3.00% -- -- --
$50,000-$99,999 4.50% / 3.75% 0.00% / 4.00% 0.00% / 1.00% 2.50% / 2.00% -- -- --
$100,000-$249,999 3.50% / 2.75% -- 0.00% / 1.00% 1.50% / 1.00% -- -- --
$250,000-$499,999 2.50% / 2.00% -- 0.00% / 1.00% 1.00% / 1.00% -- -- --
$500,000-$999,999 2.00% / 1.75% -- 0.00% / 1.00% 1.00% / 1.00% -- -- --
$1M-$4M 0.00% / 1.00% -- -- -- -- -- --
$4M-$50M 0.00% / 0.50% -- -- -- -- -- --
$50M+ 0.00% / 0.25% -- -- -- -- -- --

CDSC

  Class A (sales for $1,000,000+) Class B Class C Class M Class R Class R6 Class Y
0 to 9 mts. 1.00% 5.00% 1.00% -- -- -- --
9 to 12 mts. 1.00% 5.00% 1.00% -- -- -- --
2 yrs. 0.00% 4.00% 0.00% -- -- -- --
3 yrs. 0.00% 3.00% 0.00% -- -- -- --
4 yrs. 0.00% 3.00% 0.00% -- -- -- --
5 yrs. 0.00% 2.00% 0.00% -- -- -- --
6 yrs. 0.00% 1.00% 0.00% -- -- -- --
7+ yrs. 0.00% 0.00% 0.00% -- -- -- --

Trail commissions

  Class A Class B Class C Class M Class R Class R6 Class Y
  0.25% 0.25% 1.00% 0.65% 0.50% 0.00% 0.00%
  NA NA NA NA NA NA NA
  NA NA NA NA NA NA NA

For sales and trail commission information on purchases over $1 million and participant-directed qualified retirement plans, see a Putnam fund prospectus and the statement of additional information.

MSCI Europe Index is an unmanaged index of Western European equity securities. You cannot invest directly in an index.

Consider these risks before investing: International investing involves currency, economic, and political risks. Emerging-market securities carry illiquidity and volatility risks. Investments in small and/or midsize companies increase the risk of greater price fluctuations. Investments in a single region may be affected by common economic forces and other factors. In addition, events in any one country within the region may impact the other countries or the region as a whole. Growth stocks may be more susceptible to earnings disappointments, and value stocks may fail to rebound. Risks associated with derivatives include increased investment exposure, which may be considered leverage, or, in the case of over-the-counter instruments, the potential inability to terminate or sell derivatives positions and the potential failure of the other party to the instrument to meet its obligations. Stock prices may fall or fail to rise over time for a variety of reasons, including general financial market conditions and factors related to a specific issuer or industry. You can lose money by investing in the fund.