UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

**FORM N-Q**

**QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED**

**MANAGEMENT INVESTMENT COMPANY**

**_______________________________**

Investment Company Act file number 811-5385

DWS Value Series, Inc.

(Exact name of registrant as specified in charter)

 

345 Park Avenue

New York, NY 10154

(Address of principal executive offices)             (Zip code)

 

Paul Schubert

345 Park Avenue

New York, NY 10154-0004

(Name and address of agent for service)

Registrant's telephone number, including area code: (212) 454-7190

Date of fiscal year end: 11/30

Date of reporting period:8/31/09

 

ITEM 1. SCHEDULE OF INVESTMENTS

| Investment Portfolio | **as of August 31, 2009 (Unaudited)** |
|----------------------|---------------------------------------|

 

 

**DWS Strategic Value Fund**

 

|                                      | **Shares**              |    | **Value ($)** |       |
|-------------------------------------------|-------------------------|---------|---------------|------------|
|                                           |
|                                      | **Common Stocks 99.1%** |    |
| **Consumer Discretionary 6.9%**           |                    |
| **Auto Components 1.2%**                  |                    |
| Goodyear Tire & Rubber Co.*           |                    | 350,000 |          | 5,771,500  |   |
| Johnson Controls, Inc. (a)                |                    | 900,000 |          | 22,293,000 |   |
|                                           |
|                                      | **28,064,500**          |    |
| **Hotels Restaurants & Leisure 1.5%** |                    |
| Burger King Holdings, Inc.                |                    | 650,000 |          | 11,654,500 |   |
| Carnival Corp. (Units) (a)                |                    | 800,000 |          | 23,400,000 |   |
|                                           |
|                                      | **35,054,500**          |    |
| **Media 2.1%**                            |                    |
| Time Warner, Inc. (a)                     |                    | 900,000 |          | 25,119,000 |   |
| Walt Disney Co. (a)                       |                    | 900,000 |          | 23,436,000 |   |
|                                           |
|                                      | **48,555,000**          |    |
|                                           |                         |         |               |            |  |  |  |

 

 

| **Specialty Retail 2.1%**                 |            |
|-------------------------------------------|-----------------|
| GameStop Corp. "A"* (a)                   |            | 950,000 |   | 22,610,000 |   |
| Lowe's Companies, Inc.                    |            | 1,150,000 |   | 24,725,000 |   |
|                                           |
|                                      | **47,335,000**  |   |
| **Consumer Staples 10.6%**                |            |
| **Beverages 1.7%**                        |            |
| PepsiCo, Inc.                             |            | 700,000 |   | **39,669,000** |   |
| **Food & Staples Retailing 2.9%**     |            |
| CVS Caremark Corp. (a)                    |            | 900,000 |   | 33,768,000 |   |
| Kroger Co. (a)                            |            | 1,500,000 |   | 32,385,000 |   |
|                                           |
|                                      | **66,153,000**  |   |
| **Food Products 1.1%**                    |            |
| Kraft Foods, Inc. "A"                     |            | 850,000 |   | **24,097,500** |   |
| **Tobacco 4.9%**                          |            |
| Altria Group, Inc. (a)                    |            | 3,500,000 |   | 63,980,000 |   |
| Philip Morris International, Inc. (a)     |            | 1,100,000 |   | 50,281,000 |   |
|                                           |
|                                      | **114,261,000** |   |
| **Energy 17.1%**                          |            |
| **Energy Equipment & Services 1.5%**  |            |
| Transocean Ltd.*                          |            | 450,000 |   | **34,128,000** |   |
| **Oil, Gas & Consumable Fuels 15.6%** |            |
| Anadarko Petroleum Corp. (a)              |            | 1,350,000 |   | 71,374,500 |   |
| Apache Corp. (a)                          |            | 550,000 |   | 46,722,500 |   |
| Chevron Corp. (a)                         |            | 1,000,000 |   | 69,940,000 |   |
| ConocoPhillips                            |            | 1,300,000 |   | 58,539,000 |   |
| Devon Energy Corp. (a)                    |            | 400,000 |   | 24,552,000 |   |
| EnCana Corp. (a)                          |            | 600,000 |   | 31,194,000 |   |
| Marathon Oil Corp.                        |            | 750,000 |   | 23,152,500 |   |
| Valero Energy Corp.                       |            | 1,411,800 |   | 26,457,132 |   |
| XTO Energy, Inc.                          |            | 250,000 |   | 9,650,000 |   |
|                                           |
|                                      | **361,581,632** |   |
| **Financials 16.2%**                      |            |
| **Capital Markets 2.5%**                  |            |
| Bank of New York Mellon Corp.             |            | 800,000 |   | 23,688,000 |   |
| The Goldman Sachs Group, Inc.             |            | 200,000 |   | 33,092,000 |   |
|                                           |
|                                      | **56,780,000**  |   |
| **Commercial Banks 1.7%**                 |            |
| KeyCorp (a)                               |            | 2,400,000 |   | 15,984,000 |   |
| SunTrust Banks, Inc. (a)                  |            | 1,000,000 |   | 23,370,000 |   |
|                                           |
|                                      | **39,354,000**  |   |
| **Consumer Finance 0.6%**                 |            |
| Capital One Financial Corp.               |            | 400,000 |   | **14,916,000** |   |
| **Diversified Financial Services 7.7%**   |            |
| Bank of America Corp. (a)                 |            | 5,400,000 |   | 94,986,000 |   |
| JPMorgan Chase & Co. (a)              |            | 1,500,000 |   | 65,190,000 |   |
| The NASDAQ OMX Group, Inc.*               |            | 800,000 |   | 17,560,000 |   |
|                                           |
|                                      | **177,736,000** |   |
| **Insurance 3.6%**                        |            |
| Allstate Corp. (a)                        |            | 1,300,000 |   | 38,207,000 |   |
| Fidelity National Financial, Inc. "A" (a) |            | 900,000 |   | 13,518,000 |   |

 

 

| The Travelers Companies, Inc. (a)             |            | 650,000    |   | 32,773,000     |   |
|-----------------------------------------------|-----------------|------------|--------|----------------|--------|
|                                               |
|                                          | **84,498,000**  |       |
| **Thrifts & Mortgage Finance 0.1%**       |            |
| Washington Mutual, Inc.*                      |            | 12,654,430 |   | **2,341,069**  |   |
| **Health Care 12.4%**                         |            |
| **Health Care Equipment & Supplies 1.2%** |            |
| Baxter International, Inc.                    |            | 500,000    |   | **28,460,000** |   |
| **Health Care Providers & Services 3.1%** |            |
| Aetna, Inc. (a)                               |            | 1,250,000  |   | 35,625,000     |   |
| UnitedHealth Group, Inc.                      |            | 1,250,000  |   | 35,000,000     |   |
|                                               |
|                                          | **70,625,000**  |       |
| **Pharmaceuticals 8.1%**                      |            |
| Merck & Co., Inc. (a)                     |            | 1,750,000  |   | 56,752,500     |   |
| Mylan, Inc.* (a)                              |            | 2,150,000  |   | 31,540,500     |   |
| Novartis AG (ADR)                             |            | 800,000    |   | 37,176,000     |   |
| Pfizer, Inc. (a)                              |            | 3,700,000  |   | 61,790,000     |   |
|                                               |
|                                          | **187,259,000** |       |
| **Industrials 13.5%**                         |            |
| **Aerospace & Defense 7.5%**              |            |
| Honeywell International, Inc. (a)             |            | 1,500,000  |   | 55,140,000     |   |
| ITT Corp. (a)                                 |            | 700,000    |   | 35,056,000     |   |
| Northrop Grumman Corp. (a)                    |            | 500,000    |   | 24,405,000     |   |
| United Technologies Corp. (a)                 |            | 1,000,000  |   | 59,360,000     |   |
|                                               |
|                                          | **173,961,000** |       |
| **Air Freight & Logistics 2.2%**          |            |
| FedEx Corp. (a)                               |            | 750,000    |   | **51,532,500** |   |
| **Industrial Conglomerates 2.8%**             |            |
| General Electric Co. (a)                      |            | 2,000,000  |   | 27,800,000     |   |
| Tyco International Ltd.                       |            | 1,150,000  |   | 36,443,500     |   |
|                                               |
|                                          | **64,243,500**  |       |
| **Machinery 1.0%**                            |            |
| Dover Corp.                                   |            | 686,501    |   | **23,746,070** |   |
| **Information Technology 11.3%**              |            |
| **Communications Equipment 1.2%**             |            |
| Cisco Systems, Inc.*                          |            | 1,250,000  |   | **27,000,000** |   |
| **Computers & Peripherals 5.9%**          |            |
| Dell, Inc.* (a)                               |            | 2,500,000  |   | 39,575,000     |   |
| Hewlett-Packard Co. (a)                       |            | 1,000,000  |   | 44,890,000     |   |
| International Business Machines Corp. (a)     |            | 350,000    |   | 41,317,500     |   |
| Lexmark International, Inc. "A"* (a)          |            | 600,000    |   | 11,304,000     |   |
|                                               |
|                                          | **137,086,500** |       |
| **IT Services 1.0%**                          |            |
| Accenture Ltd. "A" (a)                        |            | 700,000    |   | **23,100,000** |   |
| **Software 3.2%**                             |            |
| Microsoft Corp. (a)                           |            | 2,000,000  |   | 49,300,000     |   |
| Symantec Corp.*                               |            | 1,650,000  |   | 24,948,000     |   |
|                                               |
|                                          | **74,248,000**  |       |
| **Materials 2.4%**                            |            |
| **Metals & Mining**                       |            |
| BHP Billiton Ltd. (ADR) (a)                   |            | 900,000    |   | **56,070,000** |   |

 

 

| **Telecommunication Services 5.6%**                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Diversified Telecommunication Services 4.2%**                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| AT&T, Inc.                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 1,850,000 |   | 48,192,500 |   |
| Verizon Communications, Inc. (a)                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 1,550,000 |   | 48,112,000 |   |
|                                                                                                                                                                                                               |
|                                                                                                                                                                                                          | **96,304,500**                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |
| **Wireless Telecommunication Services 1.4%**                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Vodafone Group PLC (ADR) (a)                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 1,500,000 |   | **32,580,000** |   |
| **Utilities 3.1%**                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| **Electric Utilities**                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| American Electric Power Co., Inc.                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 600,000 |   | 18,858,000 |   |
| Duke Energy Corp. (a)                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 800,000 |   | 12,392,000 |   |
| Exelon Corp. (a)                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 450,000 |   | 22,509,000 |   |
| Southern Co.                                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 600,000 |   | 18,720,000 |   |
|                                                                                                                                                                                                               |
|                                                                                                                                                                                                          | **72,479,000**                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |
|                                                                                                                                                                                                               |
| **Total Common Stocks**(Cost $2,223,077,282)                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | **2,293,219,271** |   |
|                                                                                                                                                                                                          | **Securities Lending Collateral 41.1%**                                                                                                                                                                                                                                                                                                                                                                                                                                              |   |
| Daily Assets Fund Institutional, 0.29% (b) (c)(Cost $951,140,449)                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | 951,140,449 |   | **951,140,449** |   |
|                                                                                                                                                                                                          | **Cash Equivalents 3.5%**                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |
| Cash Management QP Trust, 0.22% (b)(Cost $82,081,948)                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | 82,081,948 |   | **82,081,948** |   |
|                                                                                                                                                                                                          | **% of****Net Assets**                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | **Value ($)** |   |
|                                                                                                                                                                                                               |
| **Total Investments Portfolio**(Cost $3,256,299,679) †                                                                                                                                                 | 143.7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | **3,326,441,668** |   |
| **Other Assets and Liabilities, Net**                                                                                                                                                                         | (43.7)                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   | **(1,012,117,374)** |   |
|                                                                                                                                                                                                               |
| **Net Assets**                                                                                                                                                                                                | 100.0                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   | **2,314,324,294** |   |
| *For information on the Fund's policies regarding the valuation of investments and other significant accounting policies, please refer to the Fund's most recent semi-annual or annual financial statements.* |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| ***                                                                                                                                                                                                           | *Non-income producing security.*                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |
| *†*                                                                                                                                                                                                    | *The cost for federal income tax purposes was $3,267,867,329. At August 31, 2009, net unrealized appreciation for all securities based on tax cost was $58,574,339. This consisted of aggregate gross unrealized appreciation for all securities in which there was an excess of value over tax cost of $391,483,826 and aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over value of                            $332,909,487.* |   |
| *(a)*                                                                                                                                                                                                         | *All or a portion of these securities were on loan. The value of all securities loaned at August 31, 2009 amounted to $919,582,086 which is 39.7% of net assets.*                                                                                                                                                                                                                                                                                                                    |   |
| *(b)*                                                                                                                                                                                                         | *Affiliated fund managed by Deutsche Investment Management Americas Inc. The rate shown is the annualized seven-day yield at period end.*                                                                                                                                                                                                                                                                                                                                            |   |
| *(c)*                                                                                                                                                                                                         | *Represents collateral held in connection with securities lending. Income earned by the Fund is net of borrower rebates.*                                                                                                                                                                                                                                                                                                                                                            |   |
| *ADR: American Depositary Receipt*                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |  |  |  |  |  |  |  |  |  |

 

***Fair Value Measurements***

 

*Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, “Fair Value Measurements,” as amended, establishes a three-tier hierarchy for measuring fair value and requires additional disclosure about the classification of fair value measurements.*

 

*Various inputs are used in determining the value of the Fund's investments. These inputs are summarized in three broad levels. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, and credit risk). Level 3 includes significant unobservable            inputs (including the Fund's own assumptions in determining the fair value of investments). The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.*

*The following is a summary of the inputs used as of August 31, 2009 in valuing the Fund's investments:*

 

| **Assets**                                      | **Level 1**                                                         | **Level 2**      | **Level 3**  | **Total**           |   |
|-------------------------------------------------|---------------------------------------------------------------------|------------------|--------------|---------------------|--------|
| Common Stock and/or Other Equity Investments(d) | $ 2,293,219,271                                                     | $ —        | $ —    | $ 2,293,219,271     |   |
| Short-Term Investments(d)                       | 951,140,449                                                         | 82,081,948       | —      | 1,033,222,397       |   |
| **Total**                                       | **$ 3,244,359,720**                                                 | **$ 82,081,948** | **$**— | **$ 3,326,441,668** |   |
|                                            |                                                                |             |         |                |   |
| *(d)*                                           | *See Investment Portfolio for additional detailed categorizations.* |
|                                                 |                                                                     |                  |              |                     |        |  |

 

 

| **ITEM 2.** | **CONTROLS AND PROCEDURES**                                                                                                                                                                                                                                                                                                                                                                  |
|-------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |                                                                                                                                                                                                                                                                                                                                                                                         |
|        | (a)          The Chief Executive and Financial Officers concluded that the Registrant’s Disclosure Controls and Procedures are effective based on the evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.                                                                 |
|        |                                                                                                                                                                                                                                                                                                                                                                                         |
|        | (b)         There have been no changes in the registrant’s internal control over financial reporting that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal controls over financial                            reporting. |
|        |                                                                                                                                                                                                                                                                                                                                                                                         |
| **ITEM 3.** | **EXHIBITS**                                                                                                                                                                                                                                                                                                                                                                                 |
|        |                                                                                                                                                                                                                                                                                                                                                                                         |
|        | Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.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.

 

| Registrant: | DWS Strategic Value Fund, a series of DWS Value Series, Inc. |
|-------------|--------------------------------------------------------------|
|        |                                                         |
| By:         | /s/Michael G. Clark

Michael G. Clark

President             |
|        |                                                         |
| Date:       | October 21, 2009                                             |

 

 

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.

 

| Registrant: | DWS Strategic Value Fund, a series of DWS Value Series, Inc.           |
|-------------|------------------------------------------------------------------------|
|        |                                                                   |
| By:         | /s/Michael G. Clark

Michael G. Clark

President                       |
|        |                                                                   |
| Date:       | October 21, 2009                                                       |
|        |                                                                   |
|        |                                                                   |
|        |                                                                   |
| By:         | /s/Paul Schubert

Paul Schubert

Chief Financial Officer and Treasurer |
|        |                                                                   |
| Date:       | October 21, 2009                                                       |