DREYFUS PREMIER GROWTH AND INCOME FUND
LETTER TO SHAREHOLDERS
Dear Shareholder:
Dreyfus Premier Growth and Income Fund completed the first half of its
current fiscal year on March 31, 1998. During the past six months,
large-capitalization growth stocks have continued to dominate the Standard &
Poor's 500 Composite Stock Price Index (the "S&P 500") . For example, an
analysis done by Lehman Brothers for the first quarter and latest 12 months
(ended .March 31, 1998) indicates that, on average, only stocks with market
capitalizations above $21 billion and/or relative price-earnings ratios (p/e)
of 120% or greater outperformed the S&P 500. In contrast, the Fund is
invested in low p/e stocks and had a bias toward small- to
medium-capitalization stocks.
Total returns for the various share classes during the six months (ended
March 31, 1998) are shown in the following table:
Total Return*
____________
Class A Shares 9.84%
Class B Shares 9.46%
Class C Shares 9.46%
Class R Shares 9.90%
During this time, the S&P 500 produced a total return of 17.21%.**
As you will recall from my last letter, my management of the Fund began
in July 1997. We spent the latter half of calendar year 1997 restructuring
the Fund to conform to my investment philosophy. Going forward, the Fund will
focus primarily on investments in mid- to large-capitalization companies with
above-average earnings growth prospects whose common stock is selling at a
below-average p/e ratio. Additionally, we will increase our focus on the
important area of stock selection, which will continue to be a strong factor
in superior investment results. Our process emphasizes strong fundamental
research.
Economic Review
A shift to a slower economy may have started this spring, ending nearly
two years of above-trend real growth. Slowing economic growth in the late
phase of this business cycle is not accompanied by accelerating price
inflation; rather, it is accompanied by rising cost pressures. This hot and
cold mix in the economy has kept Federal Reserve Board (the "Fed") policy
neutral in recent months, with equal concern over rising wage inflation and
slowing growth. In turn, stable short-term rates have thwarted the market's
attempts to reduce long-term rates. Meanwhile, a slowing economy without
pricing power threatened to curb corporate revenue growth this year. Rising
costs have already begun to squeeze corporate profit margins in some sectors.
The industrial sector is leading the economic slowdown, as evidenced by
weak orders for exports and capital goods and cutbacks in automobile
production. Manufacturers are bearing the brunt of Asia's economic turmoil,
the strong dollar, and pricing constraints due to import competition. The
household sector, which benefits from these factors, has enjoyed strong
purchasing power that has fueled a boom in housing demand and consumer
spending. This mix has kept the labor market quite tight, exerting upward
pressure on wages, especially in the service economy.
The Fed abandoned its bias towards tighter monetary policy earlier this
year. However, by keeping short-term interest rates stable, the Fed has
effectively created a floor for longer-term rates. Demand for U.S. Treasury
bonds has periodically increased this year as investors sought refuge in
higher-quality instruments. And the shift to a Federal budget surplus has
curtailed the new supply of bonds. The Fed's neutral stance has had the
effect of forcing a higher range of interest rates than the market might
otherwise bear.
As for corporate profits, a very mixed picture has begun to emerge. The
risk to this year's overall profit growth, and hence to the total economy, is
that slower economic growth may coexist for some time with rising cost
pressures.
Market Overview
The stock market continued to exhibit impressive strength in recent
months, after bouncing back from the "Asian flu" attack of last fall.
To be sure, the rising tide of stock market prices did not lift all boats
equally. Smaller stocks, as represented by the Russell 2000 Index, did not
gain as much as the broader market averages. Yet for the half-year, many
investors had reason to be pleased.
The Fed, in addition to holding its monetary policy steady through March,
may also have encouraged the market bulls when Fed Chairman Alan Greenspan,
on April 2, 1998, told a gathering of newspaper editors that stock prices had
been going up on the basis of a "continuous upward revision" in expected
future corporate earnings. That was quite a contrast from Mr. Greenspan's
attitude in December 1996, when he complained of "irrational exuberance" in
the stock market.
How stock prices will behave in the coming months depends to a great
extent on the outlook for corporate profits. There are no guarantees that the
continuous upward revision referred to by the Fed Chairman will, in fact,
continue. First-quarter reports for some corporations, particularly some
technology companies, have been disappointing. In the Far East, while the
crisis in Southeast Asia appears to have eased, Japan is still in deep
difficulties. This is forcing downward revision of expectations by some
American global companies that have large stakes in the Far East. A great
deal is riding on whether second-quarter profits for major corporations will
be weaker than the first-quarter returns.
Offsetting that, to some extent, is the continuing wave of spectacular
corporate mergers, as exemplified by the combination of Travelers Group and
Citicorp in early April. It wasn't lost on stock market followers that the
value of the merger increased from $70 billion to $83 billion on the day of
the merger announcement, due to a jump in the prices of both stocks. Similar
appreciation, though on a smaller scale, has occurred in other mergers this
past year and seems likely to continue in the months ahead.
Stock prices have been unusually sensitive both to good and to bad news
in recent months. There is no sign that this volatility will subside in the
near future. Yet investors' money continues to flow into the market at a pace
likely to continue for the foreseeable future.
Portfolio Focus
In the stock markets, large-capitalization growth stocks have continued
to lead the markets higher. As a result, our mid- to large-capitalization
value process has not kept pace with the broad market averages like the S&P
500. As we speak, this situation is reversing and "value" stocks are starting
to outperform their growth counterparts. The one constant feature appears to
be capitalization. Large-capitalization value stocks are now leading the
parade. While we may witness a seesaw battle between these two basic
investment styles and capitalization this year, we remain convinced that our
value process will produce above-average long-term results. We continue to
actively seek investments in companies whose earnings growth potential is
greater, and projected price-earnings (p/e) ratio is less, than the S&P 500.
Equity investment results during the first six months were positively
impacted by two primary factors-financials and manufacturing companies. The
greatest impact once again came from the financial holdings, with Fannie Mae,
Freddie Mac, Fleet Financial, BankBoston, and Travelers Group producing
outstanding results. In manufacturing, Xerox, Armstrong World Industries,
Masco, Pentair, and Tyco International were strong performers. Tyco
International has been sold from the portfolio, as its p/e ratio became too
high to justify retention based on our low p/e approach.
On the other side of the ledger, issue selection and a mid-cap bias hurt
results. Although technology stocks, such as Adaptec and 3COM, were the
hardest hit, an assortment of stocks from varied industries (Georgia-Pacific,
Money Store, Pacificare Health Systems Cl. B, Pennzoil, and Telebras, the
Brazilian telephone company) also registered negative results.
In the current equity environment, favoring large-capitalization growth
stocks, issue selection should be the key factor determining investment
success. We continue to find stocks with what we believe to be good long-term
earnings growth potential that are attractively priced relative to the broad
market average. Examples of recently purchased stocks meeting our investment
criteria include Leggett & Platt, a maker of components and related products
for bedding, furniture and various other furnishings, and Masco, a maker of
building and home improvement products (e.g., Delta faucets, Thermador
cooking appliances). Purchased in September 1997 at a 12% and 20% p/e
discount to the S&P 500, respectively, each company is expected to grow its
earnings at a 15% to 20% rate over the next two years and 14% longer term,
more than double the market's projected growth.
Year-to-date, the Fund's relative performance is moving in the right
direction, and we remain convinced our process will produce satisfying
results over time. We are grateful for the opportunity to invest your capital
and will be working diligently on your behalf.
Sincerely,
[Douglas D. Ramos, CFA signature logo]
Douglas D. Ramos, CFA
Portfolio Manager
April 21, 1998
New York, N.Y.
* Total return includes reinvestment of dividends and any capital gains
paid, and does not take into consideration the maximum initial sales charge
in the case of Class A shares or the contingent deferred sales charge imposed
on redemptions in the case of Class B and Class C shares.
**SOURCE: LIPPER ANALYTICAL SERVICES, INC.-Reflects the reinvestment of
income dividends and, where applicable, capital gain distributions. The
Standard & Poor's 500 Composite Stock Price Index is a widely accepted
unmanaged index of U.S. stock market performance.
<TABLE>
DREYFUS PREMIER GROWTH AND INCOME FUND
STATEMENT OF INVESTMENTS MARCH 31, 1998 (UNAUDITED)
Common Stocks-95.7% Shares Value
______________ ______________
<S> <C> <C>
Consumer Durables-2.1% Leggett & Platt 51,000 $ 2,623,313
_____________
Consumer Non-Durables-8.1% Kimberly-Clark 49,000 2,456,125
Philip Morris Cos........................ 61,000 2,542,937
RJR Nabisco Holdings..................... 69,100 2,163,694
Warnaco Group,Cl. A..................... 76,000 2,983,000
_____________
10,145,756
_____________
Consumer Services-1.3% Carnival, Cl. A 23,500 1,639,125
_____________
Electronic Technology-10.0% Adaptec 31,000 (a) 608,375
Digital Equipment........................ 600 (a) 31,387
Gateway 2000............................. 25,100 (a) 1,178,131
Lexmark International Group, Cl. A....... 20,300 916,038
Lockheed Martin.......................... 24,000 2,700,000
Micron Technology........................ 19,000 (a) 552,187
Sundstrand............................... 51,000 3,085,500
Texas Instruments........................ 10,000 541,250
United Technologies...................... 31,000 2,861,687
_____________
12,474,555
_____________
Energy Minerals-8.0% Mobil 37,000 2,835,125
Santa Fe International................... 45,800 (a) 1,737,537
Texaco................................... 45,000 (a) 2,711,250
Tosco.................................... 79,000 2,784,750
_____________
10,068,662
_____________
Finance-19.0% BankBoston 27,000 2,976,750
Chase Manhattan.......................... 17,000 2,292,875
Chubb.................................... 32,000 2,508,000
Federal Home Loan........................ 52,000 2,466,750
Federal National Mortgage Association.... 42,000 2,656,500
First Union.............................. 49,500 2,809,125
Fleet Financial Group.................... 35,000 2,977,188
Travelers Group.......................... 48,000 2,880,000
Washington Mutual........................ 31,000 2,223,281
_____________
23,790,469
_____________
Health Services-2.1% Beverly Enterprises 200,000 (a) 2,662,500
_____________
Health Technology-3.3% Biogen............. 59,000 2,843,063
Genzyme-General Division................. 39,000 1,248,000
_____________
4,091,063
_____________
DREYFUS PREMIER GROWTH AND INCOME FUND
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1998 (UNAUDITED)
Common Stocks (continued) Shares Value
______________ ______________
Non-Energy Minerals-1.0% ISPATInternational, Cl. A 45,700 (a) $ 1,302,450
_____________
Process Industries-8.2% Archer-Daniels-Midland 95,000 2,084,063
duPont (E.I.) de Nemours................. 29,000 1,972,000
Great Lakes Chemical..................... 56,000 3,024,000
Praxair.................................. 61,600 3,168,550
_____________
10,248,613
_____________
Producer Manufacturing-12.1% AlliedSignal 67,000 2,814,000
Armstrong World Industries............... 36,000 3,116,250
Masco.................................... 46,200 2,748,900
Pentair.................................. 66,000 2,953,500
Xerox.................................... 33,000 3,512,437
_____________
15,145,087
_____________
Retail Trade-2.1% American Stores 103,000 (a) 2,678,000
_____________
Transportation-2.9% CNF Transportation 26,500 (a) 952,344
Wisconsin Central Transportation......... 95,000 2,674,844
_____________
3,627,188
_____________
Utilities-15.5% AT&T 41,000 2,690,625
Bell Atlantic............................ 27,000 2,767,500
Coastal.................................. 45,000 2,930,625
Dominion Resources....................... 64,000 2,688,000
..................... GTE................. 49,000 2,933,875
Telefonos De Mexico, Cl. L, A.D.S........ 49,000 2,762,375
Texas Utilities.......................... 40,000 1,572,500
UGI...................................... 40,000 1,130,000
_____________
..................... 19,475,500
_____________
TOTAL COMMON STOCKS
(cost $107,168,921)............... $119,972,281
=============
Convertible Preferred Stocks-1.9%
Financial; Sanwa International Finance, Cum., 1.25% (Units)
(cost $2,627,179).................... 110 (b) $ 2,430,113
=============
Principal
Convertible Corporate Bonds-2.2% Amount
______________________________________________________________________________
_____________
Financial; Sumitomo Bank Treasury, Bonds
9.40%, 12/29/2049
(cost $2,634,500).................... $ 2,600,000 (b) $ 2,702,827
_____________
_____________
DREYFUS PREMIER GROWTH AND INCOME FUND
STATEMENT OF INVESTMENTS (CONTINUED) MARCH 31, 1998 (UNAUDITED)
Principal
Short-Term Investments-1.8% Amount Value
______________________________________________________________________________ _____________ _____________
U.S. Treasury Bills; 5.04%, 5/28/1998
(cost $2,200,300).................... $ 2,218,000 $ 2,200,212
_____________
_____________
TOTAL INVESTMENTS (cost $114,630,900).................................... 101.6% $127,305,433
======= =============
LIABILITIES, LESSCASH AND RECEIVABLES.................................... (1.6%) $ (1,961,350)
======= =============
NETASSETS................................................................ 100.0% $125,344,083
======= =============
Notes to Statement of Investments:
(a) Non-income producing.
(b) Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At March 31, 1998,
these securities amounted to $5,132,940 or approximately 4.1% of
net assets.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER GROWTH AND INCOME FUND
STATEMENT OF ASSETS AND LIABILITIES MARCH 31, 1998 (UNAUDITED)
Cost Value
_____________ _____________
<S> <C> <C>
ASSETS: Investments in securities-See Statement of Investments $114,630,900 $127,305,433
Cash....................................... 183,014
Receivable for investment securities sold.. 897,248
Dividends and interest receivable.......... 257,285
Receivable for shares of Common Stock subscribed 93,562
Net unrealized appreciation on forward
....... currency exchange contracts-Note 4(a) 99,739
Prepaid expenses........................... 28,469
_____________
128,864,750
_____________
LIABILITIES: Due to The Dreyfus Corporation and affiliates 95,221
Due to Distributor......................... 77,969
Payable for investment securities purchased 2,746,679
Payable for shares of Common Stock redeemed 570,354
Accrued expenses........................... 30,444
_____________
3,520,667
_____________
NET ASSETS.................................................................. $125,344,083
=============
REPRESENTED BY: Paid-in capital............................ $107,431,883
Accumulated distributions in excess of investment
income-net.................................. (66,008)
Accumulated net realized gain (loss) on investments 5,203,936
Accumulated net unrealized appreciation (depreciation)
on investments and forward currency exchange
contracts-Note 4(b)......................... 12,774,272
_____________
NET ASSETS.................................................................. $125,344,083
=============
NET ASSET VALUE PER SHARE
--------------------------
Class A Class B Class C Class R
_____________ __________ ________ ________
Net Assets................................. $43,363,310 $76,610,146 $5,070,587 $300,040
Shares Outstanding......................... 2,111,268 3,752,703 248,189 14,512
NET ASSET VALUE PER SHARE.................. $20.54 $20.41 $20.43 $20.68
======= ======= ======= =======
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS PREMIER GROWTH AND INCOME FUND
STATEMENT OF OPERATIONS SIX MONTHS ENDED MARCH 31, 1998 (UNAUDITED)
INVESTMENT INCOME
INCOME: Cash dividends (net of $5,785 foreign taxes
<S> <C> <C>
withheld at source).............. $ 985,109
Interest............................. 67,141
_________
Total Income................... $ 1,052,250
EXPENSES: Management fee-Note 3(a)............. 435,321
Distribution fees-Note 3(b).......... 280,711
Shareholder servicing costs-Note 3(c) 217,164
Registration fees.................... 38,099
Professional fees.................... 12,470
Directors' fees and expenses-Note 3(d) 9,720
Prospectus and shareholders' reports. 6,871
Custodian fees-Note 3(c)............. 2,046
Loan commitment fees-Note 2.......... 322
Miscellaneous........................ 2,390
_________
Total Expenses................. 1,005,114
Less-reduction in management fee due to
undertaking-Note 3(a)................. (15,082)
_________
Net Expenses................... 990,032
____________
INVESTMENT INCOME-NET................................................. 62,218
____________
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS-Note 4:
Net realized gain (loss) on investments:
Long transactions................ $7,321,146
Short sale transactions.......... 12,540
_________
Net Realized Gain (Loss)....... 7,333,686
Net unrealized appreciation (depreciation) on
investments and forward currency exchange
contracts........................ 3,653,141
____________
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS................ 10,986,827
____________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................. $11,049,045
============
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER GROWTH AND INCOME FUND
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
March 31, 1998 Year Ended
(Unaudited) September 30, 1997
_________________ __________________
<S> <C> <C>
OPERATIONS:
Investment income-net....................................... $ 62,218 $ 786,252
Net realized gain (loss) on investments..................... 7,333,686 12,333,304
Net unrealized appreciation (depreciation) on investments... 3,653,141 6,103,441
_____________ _______________
Net Increase (Decrease) in Net Assets Resulting from Operations 11,049,045 19,222,997
_____________ ______________
DIVIDENDSTOSHAREHOLDERSFROM:
Investment income-net:
Class A shares............................................ (103,354) (489,113)
Class B shares............................................ - (312,112)
Class C shares............................................ - (28,180)
Class R shares............................................ (1,288) (3,378)
Net realized gain on investments:
Class A shares............................................ (4,256,479) (1,625,160)
Class B shares............................................ (7,237,792) (2,153,920)
Class C shares............................................ (521,235) (196,847)
Class R shares............................................ (27,101) (11,381)
_____________ _______________
Total Dividends....................................... (12,147,249) (4,820,091)
_____________ _______________
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold:
Class A shares............................................ 3,053,739 20,228,297
Class B shares............................................ 6,884,942 35,546,757
Class C shares............................................ 619,563 4,748,666
Class R shares............................................ 22,783 161,295
Dividends reinvested:
Class A shares............................................ 4,018,006 1,937,255
Class B shares............................................ 6,502,012 2,129,131
Class C shares............................................ 326,646 128,219
Class R shares............................................ 28,398 14,759
Cost of shares redeemed:
Class A shares............................................ (5,581,688) (15,559,198)
Class B shares............................................ (5,523,024) (14,190,548)
Class C shares............................................ (1,138,078) (2,874,632)
Class R shares............................................ (9,315) (114,833)
_____________ _______________
Increase (Decrease) in Net Assets from Capital Stock Transactions 9,203,984 32,155,168
_____________ _______________
Total Increase (Decrease) in Net Assets............. 8,105,780 46,558,074
NET ASSETS:
Beginning of Period......................................... 117,238,303 70,680,229
_____________ _______________
End of Period............................................... $125,344,083 $ 117,238,303
============= ===============
Distribution in excess of investment income-net................. $ (66,008) $ (23,584)
_____________ _______________
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER GROWTH AND INCOME FUND
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Shares
___________________________________
Six Months Ended
March 31, 1998 Year Ended
(Unaudited) September 30, 1997
_____________ _______________
<S> <C> <C>
CAPITAL SHARE TRANSACTIONS:
Class A
________
Shares sold............................................................ 155,795 1,096,093
Shares issued for dividends reinvested................................. 218,338 108,196
Shares redeemed........................................................ (282,873) (828,597)
_________ _________
Net Increase (Decrease) in Shares Outstanding 91,260 375,692
========= =========
Class B
________
Shares sold............................................................ 351,965 1,921,817
Shares issued for dividends reinvested................................. 355,882 120,246
Shares redeemed........................................................ (279,887) (760,602)
_________ _________
Net Increase (Decrease) in Shares Outstanding 427,960 1,281,461
========= =========
Class C
________
Shares sold............................................................ 33,070 256,807
Shares issued for dividends reinvested................................. 17,869 7,233
Shares redeemed........................................................ (58,663) (151,697)
_________ _________
Net Increase (Decrease) in Shares Outstanding (7,724) 112,343
========= =========
Class R
________
Shares sold............................................................ 1,186 8,448
Shares issued for dividends reinvested................................. 1,531 824
Shares redeemed........................................................ (480) (6,434)
_________ _________
Net Increase (Decrease) in Shares Outstanding 2,237 2,838
========= =========
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER GROWTH AND INCOME FUND
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements.
Class A Class B
____________________________________ ____________________________________
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 1998 September 30, March 31, 1998 September 30,
____________________ _________________
PER SHARE DATA: (Unaudited) 1997 1996(1) (Unaudited) 1997 1996(1)
__________ _______ _______ __________ _______ _______
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $20.94 $18.45 $12.50 $20.85 $18.37 $12.50
______ ______ ______ ______ ______ ______
Investment Operations:
Investment income-net............... .06 .24 .10 (.01) .10 .03
Net realized and unrealized gain (loss)
on investments.................... 1.75 3.39 5.94 1.73 3.38 5.87
______ ______ ______ ______ ______ ______
Total from Investment Operations.... 1.81 3.63 6.04 1.72 3.48 5.90
______ ______ ______ ______ ______ ______
Distributions:
Dividends from investment income-net (.05) (.25) (.09) - (.11) (.03)
Dividends from net realized gain
on investments (2.16) (.89) - (2.16) (.89) -
______ ______ ______ ______ ______ ______
Total Distributions................. (2.21) (1.14) (.09) (2.16) (1.00) (.03)
______ ______ ______ ______ ______ ______
Net asset value, end of period...... $20.54 $20.94 $18.45 $20.41 $20.85 $18.37
====== ====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN(2).............. 9.84%(3) 20.90% 48.24%(3) 9.46%(3) 20.08% 47.14%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average
net assets........................ .61%(3) 1.24% .94%(3) .98%(3) 2.00% 1.52%(3)
Ratio of net investment income to
average net assets................ .29%(3) 1.27% .92%(3) (.08%)(3) .50% .34%(3)
Decrease reflected in above expense ratios
due to undertakings by the Manager....... .01%(3) .11% .30%(3) .01%(3) .11% .30%(3)
Portfolio Turnover Rate............. 68.58%(3) 265.33% 205.64%(3) 68.58%(3) 265.33% 205.64%(3)
Average commission rate paid(4)..... $.0510 $.0572 $.0585(5) $.0510 $.0572 $.0585(5)
Net Assets, end of period (000's Omitted) $43,363 $42,309 $30,330 $76,610 $69,330 $37,534
(1) From December 29, 1995 (commencement of operations) to September 30,
1996.
(2) Exclusive of sales load.
(3) Not annualized.
(4) The Fund is required to disclose its average commission rate paid per
share for purchases and sales of investment securities.
(5) Restated to reflect current years presentation.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS PREMIER GROWTH AND INCOME FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements.
Class C Class R
______________________________________ ______________________________________
Six Months Ended Year Ended Six Months Ended Year Ended
March 31, 1998 September 30, March 31, 1998 September 30,
____________________ ____________________
PER SHARE DATA: (Unaudited) 1997 1996(1) (Unaudited) 1997 1996(1)
__________ _______ _______ __________ _______ _______
Net asset value, beginning of period $20.87 $18.40 $12.50 $21.11 $18.42 $12.50
______ ______ ______ ______ ______ ______
Investment Operations:
Investment income-net............... (.02) .09 .03 .04 .20 .43
Net realized and unrealized gain (loss)
on investments.................... 1.74 3.38 5.88 1.79 3.67 5.61
______ ______ ______ ______ ______ ______
Total from Investment Operations.... 1.72 3.47 5.91 1.83 3.87 6.04
______ ______ ______ ______ ______ ______
Distributions:
Dividends from investment income-net - (.11) (.01) (.10) (.29) (.12)
Dividends from net realized gain on investments (2.16) (.89) - (2.16) (.89) -
______ ______ ______ ______ ______ ______
Total Distributions................. (2.16) (1.00) (.01) (2.26) (1.18) (.12)
______ ______ ______ ______ ______ ______
Net asset value, end of period...... $20.43 $20.87 $18.40 $20.68 $21.11 $18.42
====== ====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN................. 9.46%(2,3) 19.89%(2) 47.27%(2,3) 9.90%(3) 22.25% 48.38%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average
net assets........................ .97%(3) 2.00% 1.52%(3) .57%(3) .99% .79%(3)
Ratio of net investment income
to average net assets............. (.07%)(3) .52% .30%(3) .34%(3) 1.50% 1.01%(3)
Decrease reflected in above expense ratios due to
undertakings by the Manager....... .01%(3) .11% .30%(3) .01%(3) .12% .30%(3)
Portfolio Turnover Rate............. 68.58%(3) 265.33% 205.64%(3) 68.58%(3) 265.33% 205.64%(3)
Average commission rate paid(4)..... $.0510 $.0572 $.0585(5) $.0510 $.0572 $.0585(5)
Net Assets, end of period (000's Omitted) $5,071 $5,340 $2,642 $300 $259 $174
(1) From December 29, 1995 (commencement of operations) to September 30,
1996.
(2) Exclusive of sales load.
(3) Not annualized.
(4) The Fund is required to disclose its average commission rate paid per
share for purchases and sales of investment securities.
(5) Restated to reflect current years presentation.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
DREYFUS PREMIER GROWTH AND INCOME FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus Dreyfus Premier Growth and Income Fund (the "Fund") is a series
of Dreyfus Premier Equity Funds, Inc. (the "Company") which is registered
under the Investment Company Act of 1940 ("Act") as a non-diversified
open-end management investment company and operates as a series company
currently offering three series, including the Fund. The Fund's investment
objective is long-term capital growth, current income and growth of income,
consistent with reasonable investment risk. The Dreyfus Corporation ("Manager"
) serves as the Fund's investment adviser. The Manager is a direct subsidiary
of Mellon Bank, N.A. ("Mellon").
Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor
of the Fund's shares. The Fund is authorized to issue 200 million shares of
$1.00 par value Common Stock in each of the following classes of shares:
Class A, Class B, Class C and Class R shares. Class A shares are subject to a
sales charge imposed at the time of purchase, Class B shares are subject to a
contingent deferred sales charge ("CDSC") imposed on Class B share
redemptions made within six years of purchase, Class C shares are subject to
a CDSC imposed on Class C shares redeemed within one year of purchase and
Class R shares are sold at net asset value per share only to institutional
investors. Other differences between the classes include the services offered
to and the expenses borne by each class and certain voting rights.
The Company accounts separately for the assets, liabilities and
operations of each fund. Expenses directly attributable to each fund are
charged to that fund's operations; expenses which are applicable to all funds
are allocated among them on a pro rata basis.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management
estimates and assumptions. Actual results could differ from those estimates.
(a) Portfolio valuation: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities
exchange on which such securities are primarily traded or at the last sales
price on the national securities market. Securities not listed on an exchange
or the national securities market, or securities for which there were no
transactions, are valued at the average of the most recent bid and asked
prices, except for open short positions, where the asked price is used for
valuation purposes. Bid price is used when no asked price is available.
Investments denominated in foreign currencies are translated to U.S. dollars
at the prevailing rates of exchange. Forward currency exchange contracts are
valued at the forward rate.
(b) Foreign currency transactions: The Fund does not isolate that portion
of the results of operations resulting from changes in foreign exchange rates
on investments from the fluctuations arising from changes in market prices of
securities held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.
Net realized foreign exchange gains or losses arise from sales and
maturities of short-term securities, sales of foreign currencies, currency
gains or losses realized on securities transactions and the difference
between the amounts of dividends, interest, and foreign withholding taxes
recorded on the Fund's books and the U.S. dollar equivalent of the amounts
actually received or paid. Net unrealized foreign exchange gains or losses
arise from changes in the value of assets and liabilities other than investmen
ts in securities, resulting from changes in exchange rates. Such gains and
losses are included with net realized and unrealized gain or loss on
investments.
(c) Securities transactions and investment income: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Dividend
income is recognized on the ex-dividend date and interest income, including,
where applicable, amortization of discount on investments, is recognized on
the accrual basis.
(d) Dividends to shareholders: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net are declared and paid on a
quarterly basis. Dividends from net realized capital gain are normally
declared and paid
DREYFUS PREMIER GROWTH AND INCOME FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
annually, but the Fund may make distributions on a more frequent basis to
comply with the distribution requirements of the Internal Revenue Code. To
the extent that net realized capital gain can be offset by capital loss
carryovers, if any, it is the policy of the Fund not to distribute such gain.
(e) Federal income taxes: It is the policy of the Fund to continue to
qualify as a regulated investment company, if such qualification is in the
best interests of its shareholders, by complying with the applicable
provisions of the Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
NOTE 2-BANK LINE OF CREDIT:
The Fund participates with other Dreyfus-managed funds in a $600 million
redemption credit facility ("Facility") primarily to be utilized for
temporary or emergency purposes, including the financing of redemptions. In
connection therewith, the Fund has agreed to pay commitment fees on its pro
rata portion of the Facility. Interest is charged to the Fund at rates based
on prevailing market rates in effect at the time of borrowings. During the
period ended March 31, 1998, the Fund did not borrow under the Facility.
NOTE 3-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(a) Pursuant to a management agreement with the Manager, the management
fee is computed at the annual rate of .75 of 1% of the value of the Fund's
average daily net assets and is payable monthly. The Manager had undertaken
from October 1, 1997 through December 31, 1997 to reduce the management fee
paid by the Fund, to the extent that the Fund's aggregate expenses, excluding
12b-1 distribution fees, taxes, brokerage, interest on borrowings (which, in
the view of Stroock & Stroock & Lavan LLP, counsel to the Fund, also
contemplates commitment fees and dividends and interest accrued on securities
sold short) and extraordinary expenses, exceeded an annual rate of 1.25% of
the value of the Fund's average daily net assets. The reduction in management
fee, pursuant to the undertaking, amounted to $15,082 during the period ended
March 31, 1998.
Dreyfus Service Corporation, a wholly owned subsidiary of the Manager,
retained $4,032 during the period ended March 31, 1998 from commissions
earned on sales of Fund shares.
(b) Under the Distribution Plan (the "Plan") adopted pursuant to Rule
12b-1 under the Act, the Fund pays the Distributor for distributing the
Fund's Class B and Class C shares at an annual rate of .75 of 1% of the value
of the average daily net assets of Class B and Class C shares, respectively.
During the period ended March 31, 1998, Class B and Class C shares were
charged $261,849 and $18,862, respectively, pursuant to the Plan.
(c) Under the Shareholder Services Plan the Fund pays the Distributor for
the provision of certain services to Fund shareholders at the annual rate of
.25 of 1% of the value of the average daily net assets of Class A, Class B
and Class C shares, respectively. The services provided may include personal
services relating to shareholder accounts, such as answering shareholder
inquiries regarding the Fund and providing reports and other information, and
services related to the maintenance of shareholder accounts. The Distributor
may make payments to Service Agents (a securities dealer, financial
institution or other industry professional) in respect of these services. The
Distributor determines the amounts to be paid to Service Agents. During the
period ended March 31, 1998, Class A, Class B and Class C shares were charged
$51,200, $87,283 and $6,288, respectively, pursuant to the Shareholder
Services Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. During the
period ended March 31, 1998, the Fund was charged $51,709 pursuant to the
transfer agency agreement.
DREYFUS PREMIER GROWTH AND INCOME FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
The Fund compensates Mellon under a custody agreement to provide custodial
services for the Fund. During the period ended
March 31, 1998, the Fund was charged $2,046 pursuant to the custody
agreement.
(d) Each director who is not an "affiliated person" as defined in the Act
receives from the Company an annual fee of $4,500 and an attendance fee of
$500 per meeting. The Chairman of the Board receives an additional 25% of
such compensation.
NOTE 4-SECURITIES TRANSACTIONS:
(a) The following summarizes the aggregate amount of purchases and sales
of investment securities and securities sold short, excluding short-term
securities and forward currency exchange contracts, during the period ended
March 31, 1998:
<TABLE>
Purchases Sales
_____________ _____________
<S> <C> <C>
Long transactions......................................... $80,811,169 $79,973,652
Short sale transactions................................... 101,475 114,015
_____________ _____________
Total................................................. $80,912,644 $80,087,667
============= =============
</TABLE>
The Fund is engaged in short-selling which obligates the Fund to replace
the security borrowed by purchasing the security at
current market value. The Fund would incur a loss if the price of the
security increases between the date of the short sale and the date on which
the Fund replaces the borrowed security. The Fund would realize a gain if the
price of the security declines between those dates. Until the Fund replaces
the borrowed security, the Fund will maintain daily, a segregated account
with a broker and custodian, of cash and/or U.S. Government securities
sufficient to cover its short position. At March 31, 1998, there were no
securities sold short outstanding.
The following summarizes open forward currency exchange contracts at
March 31, 1998:
<TABLE>
Forward Currency Exchange Contracts
__________________________________
Foreign
Currency Unrealized
Sales: Amount Proceeds Value Appreciation
_____ _____________ ___________ __________ ____________
<S> <C> <C> <C> <C>
Japanese Yen, expiring 5/18/1998........... 330,000,000 $2,593,218 $2,493,479 $99,739
=======
</TABLE>
The Fund enters into forward currency exchange contracts in order to hedge
its exposure to changes in foreign currency exchange rates on its foreign
portfolio holdings. When executing forward currency exchange contracts, the
Fund is obligated to buy or sell a foreign currency at a specified rate on a
certain date in the future. With respect to sales of forward currency exchange
contracts, the Fund would incur a loss ifthe value of the contract increases
between the date the forward contract is opened and the date the forward
contract is closed. The Fund realizes a gain if the value of the contract
decreases between those dates. With respect to purchases of forward currency
exchange contracts, the Fund would incur a loss if the value of the contract
decreases between the date the forward contract is opened and the date the
forward contract is closed. The Fund realizes a gain if the value of the
contract increases between those dates. The Fund is also exposed to credit risk
associated with counter party nonperformance on these forward currency exchange
contracts which is typically limited to the unrealized gain on each open
contract. At March 31, 1998, there were no open forward currency exchange
contracts.
(b) At March 31, 1998, accumulated net unrealized appreciation on
investments was $12,774,272, consisting of $14,803,798 gross unrealized
appreciation and $2,029,526, gross unrealized depreciation.
At March 31, 1998, the cost of investments for federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS PREMIER GROWTH
AND INCOME FUND
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, PA 15258
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 320SA983
Semi-Annual Report
Dreyfus Premier
Growth and Income
Fund
March 31, 1998
Registration Mark
[Dreyfus lion/2hres logo]
