Fidelity Equity-Income Fund - Fidelity Investments

[Pages:6]QUARTERLY FUND REVIEW | AS OF SEPTEMBER 30, 2022

Fidelity? Equity-Income Fund

Investment Approach

? Fidelity? Equity-Income Fund is a diversified domestic equity strategy that seeks reasonable income. In pursuing this objective, the fund also will consider the potential for capital appreciation.

? The fund seeks a yield for its shareholders that exceeds the yield on the securities comprising the S&P 500? index.

? We believe in mean reversion, a value-driven philosophy and investment duration as a competitive advantage.

? In our bottom-up investment process, we focus on higher-quality firms, which helps minimize downside capture over time.

PERFORMANCE SUMMARY

Fidelity Equity-Income Fund Gross Expense Ratio: 0.57%2

Cumulative

3 Month

YTD

1 Year

Annualized

3 Year

5 Year

10 Year/ LOF1

-5.75% -15.73% -9.25% 6.37% 6.62% 8.94%

Russell 3000 Value Index Morningstar Fund Large Value % Rank in Morningstar Category (1% = Best) # of Funds in Morningstar Category

-5.56% -5.91%

---

-17.97% -11.79%

-16.64% -9.64%

--

47%

--

1,215

4.37% 5.27% 28% 1,153

5.11% 5.75% 32% 1,094

9.08% 8.98% 55%

800

1 Life of Fund (LOF) if performance is less than 10 years. Fund inception date: 05/16/1966. 2 This expense ratio is from the most recent prospectus and generally is based on amounts incurred during the

most recent fiscal year, or estimated amounts for the current fiscal year in the case of a newly launched fund. It does not include any fee waivers or reimbursements, which would be reflected in the fund's net expense ratio.

Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate; therefore, you may have a gain or loss when you sell your shares. Current performance may be higher or lower than the performance stated. Performance shown is that of the fund's Retail Class shares (if multiclass). You may own another share class of the fund with a different expense structure and, thus, have different returns. To learn more or to obtain the most recent month-end or other share-class performance, visit performance, institutional., or . Total returns are historical and include change in share value and reinvestment of dividends and capital gains, if any. Cumulative total returns are reported as of the period indicated.

For definitions and other important information, please see the Definitions and Important Information section of this Fund Review.

FUND INFORMATION

Manager(s): Ramona Persaud

Trading Symbol: FEQIX

Start Date: May 16, 1966

Size (in millions): $6,308.14

Morningstar Category: Fund Large Value Stock markets, especially foreign markets, are volatile and can decline significantly in response to adverse issuer, political, regulatory, market, or economic developments. Foreign securities are subject to interest rate, currency exchange rate, economic, and political risks. Fixed income investments entail interest rate risk (as interest rates rise bond prices usually fall), the risk of issuer default, issuer credit risk and inflation risk. Lower-quality bonds can be more volatile and have greater risk of default than higher-quality bonds. Value stocks can perform differently from the market as a whole. They can remain undervalued by the market for long periods of time.

Not FDIC Insured ? May Lose Value ? No Bank Guarantee

QUARTERLY FUND REVIEW: Fidelity? Equity-Income Fund | AS OF SEPTEMBER 30, 2022

Performance Review

For the quarter, the fund's Retail Class shares returned -5.75%, roughly in line with the -5.56% result of the benchmark, the Russell 3000? Value Index.

Asset prices around the world extended their synchronized downturn through September 30, as a multitude of crosscurrents continued to challenge the global economy and financial markets. Value stocks notably struggled, as persistently high inflation prompted the Federal Reserve to aggressively tighten monetary policy and pushed bond yields to their highest level in roughly a decade. The U.S. dollar surged, liquidity growth faded, and energyand food-supply shocks exacerbated by the ongoing Russia?Ukraine conflict added to global stagflationary pressure. Against this volatile backdrop, nearly all asset categories were firmly in the red for the three months.

The third quarter began on a bright note for the benchmark, after it returned -13.15% in the first half of 2022, during which the Fed raised its benchmark interest rate three times and announced plans to shrink its massive asset portfolio, a process known as quantitative tightening. The benchmark gained 6.81% in July, even though the central bank again raised its policy rate by 0.75%, before another leg down (-2.99%) in August. The downtrend deepened in September amid another 0.75% hike and growing certainty that the Fed would persist in raising interest rates to fight inflation, even at the expense of economic growth. The benchmark returned -8.86% in September, bringing its year-to-date result to -17.97%.

By sector, energy rose 3% to lead the way, benefiting from consistently high oil prices. The economically sensitive consumer discretionary and financials sectors also outperformed, each returning about -3%. In contrast, notable laggards included communication services (-13%) and real estate (-11%). Information technology and consumer staples also underperformed, returning about -8% and -6%, respectively.

Against this volatile, dynamic backdrop, we continued to take a conservative approach to capital appreciation, focusing on minimizing downside capture. In managing the fund over a full market cycle, we aim to generate a favorable risk-adjusted return.

Given the conservatism of our strategy and our focus on minimizing downside capture, the fund underperformed the benchmark in July, when value stocks gained, and outperformed in August and September, when volatility picked up and value stocks lost ground.

Avoiding three sizable benchmark components that finished in the red notably contributed to relative performance the past three months: chipmaker Intel (-30%), drugmaker Pfizer (-16%) and Facebook parent Meta Platforms (-16%). We considered these stocks to be richly valued. Intel's lagging result reflected investors' concern about the cost of the company's ambitious expansion plan. As for Pfizer, investors appeared concerned that demand for its COVID treatments could be winding down and that its other drugs may not be able to sustain the company's growth. Meta Platforms delivered disappointing quarterly financial results, hampered by weak demand for advertising.

Elsewhere, it helped to overweight M&T Bank (+11%). The stock trended up in July after management reported quarterly financial results that were largely in line with Wall Street expectations. Although Q2 earnings reflected expenses stemming from M&T's April acquisition of People's United Financial, M&T achieved growth in net interest income, a key measure of profitability for banks.

In contrast, a non-benchmark position in drugmaker Sanofi (-24%) was the largest individual relative detractor. Shares of the French company fell sharply in August after management announced it would discontinue the development program for its breast cancer drug following multiple failed trials.

OpenText (-30%) was another out-of-benchmark stock that weighed on our relative result. Shares of the Canadian developer of enterprise management software sank in August following the firm's announcement that it intends to acquire U.K.-based Micro Focus, which had declining revenue. Investors were concerned about growing debt for OpenText, as well as its growth potential.

We'll also mention container maker Ball (-29%) as another notable relative detractor. The stock fell amid declining demand stemming from inflation and the company's exit from Russia.

LARGEST CONTRIBUTORS VS. BENCHMARK

Holding

Market Segment

Average Relative Relative Contribution Weight (basis points)*

Intel Corp.

Information Technology

-0.72%

20

Pfizer, Inc.

Health Care

-1.42%

16

M&T Bank Corp.

Financials

1.00%

16

Meta Platforms, Inc. Class Communication

A

Services

-1.50%

16

Walmart, Inc.

Consumer Staples 1.05%

13

* 1 basis point = 0.01%.

LARGEST DETRACTORS VS. BENCHMARK

Holding

Market Segment

Average Relative Relative Contribution Weight (basis points)*

Sanofi SA

Health Care

1.08%

-23

Open Text Corp.

Information Technology

0.64%

-18

Comcast Corp. Class A

Communication Services

0.65%

-14

Ball Corp.

Materials

0.48%

-13

Suncor Energy, Inc.

Energy

0.68%

-12

* 1 basis point = 0.01%.

2 | For definitions and other important information, please see Definitions and Important Information section of this Fund Review.

QUARTERLY FUND REVIEW: Fidelity? Equity-Income Fund | AS OF SEPTEMBER 30, 2022

Outlook and Positioning

As of the end of September, inflation is a persistent force for central banks to contend with, and interest rates have been on the rise in many parts of the world. Global demographic factors could offset this in the long term, though the market is steadfastly focused on short-to-medium-term damage from inflation and rising rates. Indeed, as of September 30 the market is concerned about stagflation and economic growth.

Since the global financial crisis, we have seen rate suppression accompanied by high correlation and low dispersion in stock prices, which has fueled stability in growth strategies at the expense of traditional value strategies. There is now a case for normalization in rates, which has driven improved value efficacy. We are keeping a close eye on structural factors like demographics-driven low global growth and accompanying lower rates, while maintaining flexibility when considering how to generate strong long-term returns through a value lens.

When valuations for value stocks are especially cheap, alpha odds tend to improve. In the past, when rates and economic growth were less distorted, value efficacy was less sensitive, broader and more sustainable. We think we could be on the verge of returning to an environment like that, which we believe would be positive for value investing.

The other long-term trend we are considering is globalization. Globalization of the past several decades created distinct winners and losers. Recent policies, such as trade and tax, seem to focus on a reversal of globalization. The COVID-19 pandemic revealed vulnerability in global supply chains, seemingly strengthening the argument for de-globalization.

Transitions such as these could result in increased market uncertainty in the final quarter of 2022, creating a significant role for active investing, which historically has successfully differentiated long-term value from short-term swings in price.

At quarter end, we're pursuing a balanced approach to fund positioning, with a defensive tilt. The fund remains overweight in energy stocks, as valuation and fundamentals are constructive. Our top holding is Exxon Mobil.

An overweight in health care is based on the sector's consistent combination of value, quality and income. Health care is the fund's largest sector weighting at quarter end, representing 19% of assets. We own a combination of attractively valued pharmaceuticals names (Johnson & Johnson and Bristol-Myers Squibb), life sciences stocks (Danaher) and managed care names (UnitedHealth Group and Cigna). All are top-15 holdings as of September 30.

Consumer staples was our third-largest sector allocation, at 11% of assets as of quarter end. This was the fund's largest sector overweighting, given reasonable valuations for quality defensive names at this point in the economic cycle. This quarter we established a modest non-benchmark position in Alimentation Couche-Tard, a Canadian operator of convenience stores. Stocks in the consumer staples sector typically perform well in a recession. Importantly, these companies also tend to pay high, sustainable dividends ? a characteristic we look for in our investments.

Conversely, some of the fund's largest sector underweights were in some economically sensitive sectors, including financials, real estate, consumer discretionary and industrials.

MARKET-SEGMENT DIVERSIFICATION

Market Segment Health Care Financials Consumer Staples Energy Communication Services Information Technology Industrials Utilities Materials Consumer Discretionary Real Estate Other

Portfolio Weight 19.17% 15.59% 10.81% 9.54%

Index Weight 16.99% 20.51% 6.97% 7.69%

Relative Weight

Relative Change From Prior Quarter

2.18%

1.11%

-4.92%

1.22%

3.84%

0.47%

1.85% -0.69%

9.18%

7.73% 1.45%

0.31%

9.05% 7.81% 6.68% 4.59%

8.58% 10.17% 5.93% 4.08%

0.47% -2.36% 0.75% 0.51%

0.22% 0.56% 0.07% -0.11%

3.58% 2.04% 0.00%

6.20% 5.16% 0.00%

-2.62% -3.12% 0.00%

0.14% 0.27% 0.00%

CHARACTERISTICS

Portfolio

Valuation

Price/Earnings Trailing

14.7x

Price/Earnings (IBES 1-Year Forecast)

12.1x

Price/Book

2.6x

Price/Cash Flow

10.1x

Return on Equity (5-Year Trailing)

14.3%

Growth

Sales/Share Growth 1-Year (Trailing)

16.2%

Earnings/Share Growth 1-Year (Trailing)

34.4%

Earnings/Share Growth 1-Year (IBES Forecast)

11.3%

Earnings/Share Growth 5-Year (Trailing)

12.1%

Size

Weighted Average Market Cap ($ Billions) 183.1

Weighted Median Market Cap ($ Billions) 129.4

Median Market Cap ($ Billions)

53.1

Index

14.4x 12.5x 2.1x 10.3x 12.2%

18.9% 23.2% 6.2% 13.6%

120.6 59.9 1.8

3 | For definitions and other important information, please see Definitions and Important Information section of this Fund Review.

QUARTERLY FUND REVIEW: Fidelity? Equity-Income Fund | AS OF SEPTEMBER 30, 2022

LARGEST OVERWEIGHTS BY HOLDING

Holding

Roche Holding AG (participation certificate) UnitedHealth Group, Inc. Danaher Corp. Eli Lilly & Co. T-Mobile U.S., Inc.

Market Segment

Health Care

Health Care Health Care Health Care Communication Services

Relative Weight

1.54%

1.46% 1.45% 1.36% 1.30%

LARGEST UNDERWEIGHTS BY HOLDING

Holding

Market Segment

Berkshire Hathaway, Inc. Class B

Financials

Chevron Corp.

Energy

Pfizer, Inc.

Health Care

Meta Platforms, Inc. Class A Communication Services

Thermo Fisher Scientific, Inc. Health Care

Relative Weight

-2.74%

-1.61% -1.41% -1.39% -0.99%

10 LARGEST HOLDINGS

Holding Exxon Mobil Corp. JPMorgan Chase & Co. Bank of America Corp. Johnson & Johnson Danaher Corp. Walmart, Inc. Bristol-Myers Squibb Co. Wells Fargo & Co. Linde PLC T-Mobile U.S., Inc. 10 Largest Holdings as a % of Net Assets Total Number of Holdings

Market Segment Energy Financials Financials Health Care Health Care Consumer Staples Health Care Financials Materials Communication Services

22.91%

121

The 10 largest holdings are as of the end of the reporting period, and may not be representative of the fund's current or future investments. Holdings do not include money market investments.

ASSET ALLOCATION

Asset Class

Portfolio Weight

Index Weight

Relative Weight

Relative Change From Prior Quarter

Domestic Equities

87.38% 99.77% -12.39% 5.10%

International Equities

10.68% 0.23% 10.45% -1.47%

Developed Markets

8.99%

0.18%

8.81%

-1.33%

Emerging Markets

1.69%

0.04%

1.65%

-0.14%

Tax-Advantaged Domiciles

0.00%

0.01%

-0.01%

0.00%

Bonds

0.00%

0.00%

0.00%

0.00%

Cash & Net Other Assets 1.94%

0.00%

1.94%

-3.63%

Net Other Assets can include fund receivables, fund payables, and offsets to other derivative positions, as well as certain assets that do not fall into any of the portfolio composition categories. Depending on the extent to which the fund invests in derivatives and the number of positions that are held for future settlement, Net Other Assets can be a negative number.

"Tax-Advantaged Domiciles" represent countries whose tax policies may be favorable for company incorporation.

3-YEAR RISK/RETURN STATISTICS

Beta Standard Deviation Sharpe Ratio Tracking Error Information Ratio R-Squared

Portfolio 0.85

17.83% 0.33 4.02% 0.50 0.98

Index 1.00 20.74% 0.18

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4 | For definitions and other important information, please see Definitions and Important Information section of this Fund Review.

QUARTERLY FUND REVIEW: Fidelity? Equity-Income Fund | AS OF SEPTEMBER 30, 2022

Definitions and Important Information

Information provided in this document is for informational and educational purposes only. To the extent any investment information in this material is deemed to be a recommendation, it is not meant to be impartial investment advice or advice in a fiduciary capacity and is not intended to be used as a primary basis for you or your client's investment decisions. Fidelity, and its representatives may have a conflict of interest in the products or services mentioned in this material because they have a financial interest in, and receive compensation, directly or indirectly, in connection with the management, distribution and/or servicing of these products or services including Fidelity funds, certain third-party funds and products, and certain investment services.

CHARACTERISTICS Earnings-Per-Share Growth measures the growth in reported earnings per share over the specified past time period.

Median Market Cap identifies the median market capitalization of the portfolio or benchmark as determined by the underlying security market caps.

Price-to-Book (P/B) Ratio is the ratio of a company's current share price to reported accumulated profits and capital.

Price/Cash Flow is the ratio of a company's current share price to its trailing 12-months cash flow per share.

Price-to-Earnings (P/E) Ratio (IBES 1-Year Forecast) is the ratio of a company's current share price to Wall Street analysts' estimates of earnings.

Price-to-Earnings (P/E) Ratio Trailing is the ratio of a company's current share price to its trailing 12-months earnings per share.

Return on Equity (ROE) 5-Year Trailing is the ratio of a company's last five years historical profitability to its shareholders' equity. Preferred stock is included as part of each company's net worth.

Sales-Per-Share Growth measures the growth in reported sales over the specified past time period.

Weighted Average Market Cap identifies the market capitalization of the average equity holding as determined by the dollars invested in the portfolio or benchmark.

Weighted Median Market Cap identifies the market capitalization of the median equity holding as determined by the dollars invested in the portfolio or benchmark.

IMPORTANT FUND INFORMATION Relative positioning data presented in this commentary is based on the fund's primary benchmark (index) unless a secondary benchmark is provided to assess performance.

INDICES It is not possible to invest directly in an index. All indices represented are unmanaged. All indices include reinvestment of dividends and interest income unless otherwise noted.

Russell 3000 Value Index is a market-capitalization-weighted index designed to measure the performance of the broad value segment of the U.S. equity market. It includes those Russell 3000 Index

companies with lower price-to-book ratios and lower forecasted growth rates.

S&P 500 is a market-capitalization-weighted index of 500 common stocks chosen for market size, liquidity, and industry group representation to represent U.S. equity performance.

MARKET-SEGMENT WEIGHTS Market-segment weights illustrate examples of sectors or industries in which the fund may invest, and may not be representative of the fund's current or future investments. They should not be construed or used as a recommendation for any sector or industry.

RANKING INFORMATION ? 2022 Morningstar, Inc. All rights reserved. The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or redistributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Fidelity does not review the Morningstar data and, for mutual fund performance, you should check the fund's current prospectus for the most up-to-date information concerning applicable loads, fees and expenses.

% Rank in Morningstar Category is the fund's total-return percentile rank relative to all funds that have the same Morningstar Category. The highest (or most favorable) percentile rank is 1 and the lowest (or least favorable) percentile rank is 100. The topperforming fund in a category will always receive a rank of 1%. % Rank in Morningstar Category is based on total returns which include reinvested dividends and capital gains, if any, and exclude sales charges. Multiple share classes of a fund have a common portfolio but impose different expense structures.

RELATIVE WEIGHTS Relative weights represents the % of fund assets in a particular market segment, asset class or credit quality relative to the benchmark. A positive number represents an overweight, and a negative number is an underweight. The fund's benchmark is listed immediately under the fund name in the Performance Summary.

5 |

3-YEAR RISK/RETURN STATISTICS

Beta is a measure of the volatility of a fund relative to its benchmark index. A beta greater (less) than 1 is more (less) volatile than the index.

Information Ratio measures a fund's active return (fund's average monthly return minus the benchmark's average monthly return) in relation to the volatility of its active returns.

R-Squared measures how a fund's performance correlates with a benchmark index's performance and shows what portion of it can be explained by the performance of the overall market/index. RSquared ranges from 0, meaning no correlation, to 1, meaning perfect correlation. An R-Squared value of less than 0.5 indicates that annualized alpha and beta are not reliable performance statistics.

Sharpe Ratio is a measure of historical risk-adjusted performance. It is calculated by dividing the fund's excess returns (the fund's average annual return for the period minus the 3-month "risk free" return rate) and dividing it by the standard deviation of the fund's returns. The higher the ratio, the better the fund's return per unit of risk. The three month "risk free" rate used is the 90-day Treasury Bill rate.

Standard Deviation is a statistical measurement of the dispersion of a fund's return over a specified time period. Fidelity calculates standard deviations by comparing a fund's monthly returns to its average monthly return over a 36-month period, and then annualizes the number. Investors may examine historical standard deviation in conjunction with historical returns to decide whether a fund's volatility would have been acceptable given the returns it would have produced. A higher standard deviation indicates a wider dispersion of past returns and thus greater historical volatility. Standard deviation does not indicate how the fund actually performed, but merely indicates the volatility of its returns over time.

Tracking Error is the divergence between the price behavior of a position or a portfolio and the price behavior of a benchmark, creating an unexpected profit or loss.

Before investing in any mutual fund, please carefully consider the investment objectives, risks, charges, and expenses. For this and other information, call or write Fidelity for a free prospectus or, if available, a summary prospectus. Read it carefully before you invest.

Past performance is no guarantee of future results.

Views expressed are through the end of the period stated and do not necessarily represent the views of Fidelity. Views are subject to change at any time based upon market or other conditions and Fidelity disclaims any responsibility to update such views. These views may not be relied on as investment advice and, because investment decisions for a Fidelity fund are based on numerous factors, may not be relied on as an indication of trading intent on behalf of any Fidelity fund. The securities mentioned are not necessarily holdings invested in by the portfolio manager(s) or FMR LLC. References to specific company securities should not be construed as recommendations or investment advice.

Diversification does not ensure a profit or guarantee against a loss.

S&P 500 is a registered service mark of Standard & Poor's Financial Services LLC.

Other third-party marks appearing herein are the property of their respective owners.

All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company.

Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917.

Fidelity Distributors Company LLC, 500 Salem Street, Smithfield, RI 02917.

? 2022 FMR LLC. All rights reserved.

Not NCUA or NCUSIF insured. May lose value. No credit union guarantee.

656701.37.0

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