[COVER]
Oppenheimer Quest Value Fund, Inc.
Annual Report October 31, 1996
[PHOTO]Pool Party
"We have a lot of
IMPORTANT
goals, so we
need our money
to GROW solidly
over time."
[LOGO]OPPENHEIMERFUNDS/S/
<PAGE>
- ----
NEWS
- ----------------
BEAT THE AVERAGE
- ----------------
Cumulative Total Return for the
5-Year Period Ended 9/30/96:
Oppenheimer Quest Value
Fund, Inc.
Class A (at net asset value)(1)
- -------
124.23%
- -------
Lipper Capital Appreciation
Average for 80 Capital
Appreciation Funds for the
5-Year Period Ended 9/30/96(3)
- ------
99.46%
- ------
The Fund's Class A shares
are ranked **** among
1,684 (3-year), 1,014
(5-year) and 560 (10-year)
equity funds for the
combined 3-, 5- and 10-year
periods ended 9/30/96 by
MORNINGSTAR MUTUAL FUNDS.(4)
This Fund is for people who want their money
to GROW over time and feel most comfortable
investing in WELL-ESTABLISHED companies.
- ------------------------
HOW YOUR FUND IS MANAGED
- ------------------------
Oppenheimer Quest Value Fund, Inc. seeks growth by applying a value-oriented
philosophy to investing, looking for stocks that the portfolio manager believes
are undervalued. The manager employs a bottom-up process to select individual
stocks for the Fund. For a stock to be included in the portfolio, a rigorous
research process must be completed.
- -----------
PERFORMANCE
- -----------
Cumulative total returns for the 12 months ended 9/30/96 for Class A, B and C
shares were 22.09%, 21.49% and 21.46%, respectively, without deducting sales
charges.(1)
Your Fund's average annual total returns for Class A shares for the 1-, 5- and
10-year periods ended 9/30/96 were 15.07%, 16.14% and 12.99%, respectively. For
Class B shares, average annual total returns for the 1-year period ended 9/30/96
and since inception on 9/1/93 were 16.49% and 15.91%, respectively. For Class C
shares, average annual total returns for the 1-year period ended 9/30/96 and
since inception on 9/1/93 were 20.46% and 16.35%, respectively.(2)
- -------
OUTLOOK
- -------
"We remain confident that our portfolio contains solid companies that we believe
will thrive in virtually any type of economic environment. Of course, we'll
always be on the lookout to add new stocks at favorable prices that will
continue to benefit the Fund."
Eileen Rominger, Portfolio Manager
October 31, 1996
Total returns include change in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
IN REVIEWING PERFORMANCE AND RANKINGS, PLEASE REMEMBER THAT PAST PERFORMANCE
DOES NOT GUARANTEE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THE ORIGINAL COST. The Fund's
sub-adviser is OpCap Advisors (formerly Quest for Value Advisors, the Fund's
adviser until 11/22/95).
1. Includes change in net asset value per share without deducting any sales
charges. Such performance would have been lower if sales charges were taken into
account.
2. Class A returns include the current maximum initial sales charge of 5.75%.
Class A shares were first publicly offered on 4/30/80. The Fund's maximum sales
charge rate for Class A shares was lower prior to 11/22/95, so actual results
would have been greater. Class B returns include the applicable contingent
deferred sales charge of 5% (1-year) and 3% (since inception). Class C returns
include the 1% contingent deferred sales charge for the 1-year period. An
explanation of the different total returns is in the Fund's prospectus. Class B
and C shares are subject to an annual .75% asset-based sales charge and Class A
shares are subject to an annual .25% asset-based sales charge.
3. Source: Lipper Analytical Services, 9/30/96. The Lipper average is shown
for comparative purposes only. Funds included in the index may have different
investment policies and risks than the Fund. Oppenheimer Quest Value Fund, Inc.
is characterized by Lipper as a capital appreciation fund. Lipper performance
is based on total return and does not take sales charges into account.
4. Source: MORNINGSTAR MUTUAL FUNDS, 9/30/96. Morningstar rankings are based on
risk-adjusted investment return, after considering sales charges and expenses.
Investment return measures a fund's (or class's) 1-, 3-, 5- and 10-year
(depending on the inception of the class or fund) average annual total returns
in excess of 90-day U.S. Treasury bill returns. Risk measures the
underperformance of U.S. Treasury bill returns in those periods. Risk and
returns are combined to produce star rankings, reflecting performance relative
to the average fund in a fund's category. The top 10% of funds in each
investment class receive 5 stars; the next 22.5%, 4 stars; the middle 35%, 3
stars; the next 22.5%, 2 stars; and the bottom 10%, 1 star. The 4-star current
ranking is a weighted average of the 3-, 5- and 10-year rankings for the Fund's
Class A shares, which were 4, 4 and 3 stars, weighted 20%/30%/50%, respectively.
The 1-year star ranking is 3 stars, but is not included in Morningstar's overall
ranking calculations. There were 1,684 funds for the 1-year period. Rankings are
subject to change monthly. The Fund's Class A, B and C shares have the same
investment portfolio but different expenses.
2 Oppenheimer Quest Value Fund, Inc.
<PAGE>
[PHOTO]Bridget A. Macaskill
Bridget A. Macaskill
President
Oppenheimer
Quest Value Fund, Inc.
DEAR SHAREHOLDER,
Following a summer of uncertainty surrounding the economy and the stock
market, the arrival of fall brought renewed vigor to both. Most notable, the Dow
Jones Industrial Average broke out of its fluctuating pattern and burst through
the once-unimaginable 6,000 mark, sending many stock prices to all-time highs.
But as the Dow began accelerating faster than the economy, a debate erupted
about how long this bull run could last.
Looking back, the autumn rally was clearly a result of three main
factors: solid corporate profits, low inflation and stabilized interest rates,
all of which attracted investors to Wall Street. And though the stock market is
currently highly valued, there continue to be a number of positive economic
influences that may extend the market's uphill run.
We consider the leading catalyst to be the robust returns from corporate
America, where a strong economy boosted third-quarter earnings. To date, we're
still witnessing a cycle of events that could maintain the appeal of these
companies to investors. For example, corporate streamlining efforts, such as
spinoffs of non-core businesses, and consolidation within industries are helping
to increase the cash flow of many firms. In return, additional cash flows enable
these companies to add shareholder value by initiating stock repurchasing
programs. As corporations buy back record amounts of their own stocks, they are
reducing the supply and thereby raising the book value of their outstanding
shares, a move which further contributes to higher stock prices.
Additionally, the demand for stocks remains strong, largely because, as
many experts believe, investors are taking more responsibility for their
retirement investments. Indeed, as the country's baby boomers near retirement,
they are becoming increasingly aware of the need to secure their own financial
future, because they expect less and less from standard company pensions or
Social Security. As a result, equity mutual funds have become the fastest
growing means by which these investors are seeking to achieve their long-term
goals.
While these signs appear favorable for many well-managed companies,
stock valuations remain at historically high levels, causing us to become more
cautious about the market overall. We do not, however, expect to see a
significant market decline. In fact, we are confident that as long as corporate
earnings stay healthy, there will continue to be numerous investment
opportunities available to fill the demand for stocks. Nevertheless, it is
becoming more difficult to uncover true values and justify higher prices.
Therefore, we believe the correct approach to take at this point is to carefully
evaluate companies based on individual merits, such as strong management,
fundamental business policies and long-term prospects for the future.
Your portfolio manager discusses the outlook for your Fund in light of
these broad issues on the following pages. Thank you for your confidence in
OppenheimerFunds. We look forward to helping you reach your investment goals in
the future.
/s/Bridget A. Macaskill
Bridget A. Macaskill
November 21, 1996
3 Oppenheimer Quest Value Fund, Inc.
<PAGE>
Eileen Rominger
Portfolio Manager
Q + A
An interview with your Fund's managers.
HOW HAS THE FUND PERFORMED OVER THE PAST YEAR?
Oppenheimer Quest Value Fund, Inc. performed very well over the past year. In
fact, for the 1-year period ended 9/30/96, cumulative total return, without
deducting sales charges, for the Fund's Class A shares was 22.09%, compared to
17.61% for its benchmark, the S&P 500 Stock Index.(1) Moreover, this success
was accomplished without compromising the Fund's conservative strategy. The
result, for the 1-year period ended 9/30/96, was that the Fund ranked 46th out
of 175 capital appreciation funds ranked by Lipper Analytical Services.(2)
WHAT CHARACTERISTICS DO YOU LOOK FOR IN EVALUATING STOCKS?
We build our portfolio from the bottom up, choosing reasonably priced
individual stocks which we think will outperform the S&P 500 over the long term.
So, the companies we look for must display superior profitability
characteristics, such as historically maintaining strong cash flows and
generating high returns for shareholders. Based on these criteria, the
businesses we select tend to be leaders in their industries, which have
prospered due to an inherent competitive advantage.
WHAT INVESTMENTS MADE POSITIVE CONTRIBUTIONS TO PERFORMANCE?
While we are quite satisfied with our portfolio in general, we've had
outstanding performance from two of our larger positions, which are both in the
insurance industry. We selected these companies not only for their individual
merits, but also because theare in a business that is generally not affected by
short-term economic changes.
Another strong performer was our holding of shares in a national department
store chain that has had a history of generating a high return on shareholders'
equity. Besides its steady market share gains and otherwise strong operating
record, the company, during the past year, initiated elements of a financial
restructuring to enhance value. The company distributed to shareholders its
holding of a non-core specialty retail operation, strengthening the balance
sheet of the basic enterprise in the process. This enabled management to
commence a large share repurchase program.(3)
WERE THERE ANY INVESTMENTS THAT DIDN'T PERFORM AS WELL AS EXPECTED?
Across the portfolio, there were few investments that let us down. However,
two of our smaller positions were disappointing. Although these companies
originally appeared to have potential, due to poor decisions made by their
corporate management teams, our expectations were not met. In fact, these
holdings no longer fit our definition of strong companies with sound business
fundamentals, and consequently, we sold them.
WHAT IS YOUR OUTLOOK FOR THE FUND?
The Fund's impressive performance this year, in spite of apprehension
regarding the economy, underscores the importance of careful stock selection,
rather than chasing "hot picks". With that said, we remain confident that our
portfolio contains solid companies that we believe will thrive in virtually any
type of economic environment.//
1. The Fund's investments are not limited to securities in the S&P 500, which
cannot be purchased directly by investors.
2. Source: Lipper Analytical Services, 9/30/96. Oppenheimer Quest Value Fund,
Inc. was ranked 19th out of 80 funds in its category for the 5-year period ended
9/30/96 and 25th out of 54 funds in its category for the 10-year period ended
9/30/96. Oppenheimer Quest Value Fund, Inc. is characterized by Lipper as a
capital appreciation fund. Lipper performance is based on total return and does
not take sales charges into account.
3. The Fund's portfolio is subject to change.
4 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
=========================================
STATEMENT OF INVESTMENTS October 31, 1996
FACE MARKET VALUE
AMOUNT SEE NOTE 1
==================================================================================================================================
SHORT-TERM NOTES - 17.7%
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Beneficial Finance Corp., 5.24%, 11/25/96 (3) $20,000,000 $ 19,930,134
-----------------------------------------------------------------------------------------------------------------------
Deere (John) Capital Corp., 5.27%, 11/4/96 (3) 7,828,000 7,824,562
-----------------------------------------------------------------------------------------------------------------------
Household Finance Corp., 5.25%, 11/12/96 (3) 14,818,000 14,794,230
-----------------------------------------------------------------------------------------------------------------------
IBM Corp., 5.23%, 11/21/96 (3) 12,679,000 12,642,020
-----------------------------------------------------------------------------------------------------------------------
IBM Credit Corp., 5.23%, 11/21/96 (3) 20,934,000 20,873,112
-----------------------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc., 5.40%, 11/4/96 (3) 5,969,000 5,966,367
-----------------------------------------------------------------------------------------------------------------------
Prudential Funding Corp., 5.25%, 12/4/96 (3) 15,605,000 15,529,901
-------------
Total Short-Term Notes (Cost $97,560,326) 97,560,326
==================================================================================================================================
CONVERTIBLE CORPORATE BONDS AND NOTES - 0.4%
- ----------------------------------------------------------------------------------------------------------------------------------
Security Capital Realty, Inc., 12% Cv. Sub. Debs., 6/30/14 (1) 2,310,155 2,390,546
-----------------------------------------------------------------------------------------------------------------------
Security Capital Realty, Inc., 12% Cv. Sub. Debs. Interest Shares, (1)
6/30/14 73,836 73,836
-------------
Total Convertible Corporate Bonds and Notes (Cost $2,262,185) 2,464,382
SHARES
==================================================================================================================================
COMMON STOCKS - 81.6%
- ----------------------------------------------------------------------------------------------------------------------------------
BASIC MATERIALS - 5.9%
- ----------------------------------------------------------------------------------------------------------------------------------
CHEMICALS - 3.8%
-----------------------------------------------------------------------------------------------------------------------
Du Pont (E.I.) De Nemours & Co. 60,000 5,565,000
-----------------------------------------------------------------------------------------------------------------------
Hercules, Inc. 146,000 6,953,250
-----------------------------------------------------------------------------------------------------------------------
Monsanto Co. 215,000 8,519,375
--------------
21,037,625
- ----------------------------------------------------------------------------------------------------------------------------------
METALS - 1.6%
-----------------------------------------------------------------------------------------------------------------------
Freeport McMoRan, Inc. 66,333 2,114,364
-----------------------------------------------------------------------------------------------------------------------
Freeport-McMoRan Copper & Gold, Inc., Cl. B 229,290 6,964,684
--------------
9,079,048
- ----------------------------------------------------------------------------------------------------------------------------------
PAPER - 0.5%
-----------------------------------------------------------------------------------------------------------------------
Champion International Corp. 60,000 2,610,000
- ----------------------------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS - 7.6%
- ----------------------------------------------------------------------------------------------------------------------------------
AUTOS & HOUSING - 0.6%
-----------------------------------------------------------------------------------------------------------------------
Security Capital Realty, Inc. (1)(2) 3,049 3,301,006
- ----------------------------------------------------------------------------------------------------------------------------------
LEISURE & ENTERTAINMENT - 2.5%
-----------------------------------------------------------------------------------------------------------------------
AMR Corp. (2) 162,000 13,608,000
- ----------------------------------------------------------------------------------------------------------------------------------
MEDIA - 0.8%
-----------------------------------------------------------------------------------------------------------------------
Tele-Communications, Inc. (New), TCI Group, Series A (2) 340,000 4,228,750
- ----------------------------------------------------------------------------------------------------------------------------------
RETAIL: GENERAL - 3.7%
-----------------------------------------------------------------------------------------------------------------------
May Department Stores Co. 428,000 20,276,500
- ----------------------------------------------------------------------------------------------------------------------------------
CONSUMER NON-CYCLICALS - 7.7%
- ----------------------------------------------------------------------------------------------------------------------------------
HEALTHCARE/DRUGS - 0.9%
-----------------------------------------------------------------------------------------------------------------------
Warner-Lambert Co. 81,000 5,153,625
- ----------------------------------------------------------------------------------------------------------------------------------
HEALTHCARE/SUPPLIES & SERVICES - 5.5%
-----------------------------------------------------------------------------------------------------------------------
Becton, Dickinson & Co. 398,000 17,313,000
-----------------------------------------------------------------------------------------------------------------------
OrNda Healthcorp (2) 100,000 2,725,000
-----------------------------------------------------------------------------------------------------------------------
Tenet Healthcare Corp. (2) 500,000 10,437,500
--------------
30,475,500
- ----------------------------------------------------------------------------------------------------------------------------------
HOUSEHOLD GOODS - 1.3%
-----------------------------------------------------------------------------------------------------------------------
Avon Products, Inc. 135,600 7,356,300
- ----------------------------------------------------------------------------------------------------------------------------------
FINANCIAL - 36.8%
- ----------------------------------------------------------------------------------------------------------------------------------
BANKS - 7.3%
-----------------------------------------------------------------------------------------------------------------------
Citicorp 170,000 16,830,000
-----------------------------------------------------------------------------------------------------------------------
Wells Fargo & Co. 88,666 23,684,905
-------------
40,514,905
</TABLE>
5 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
====================================
STATEMENT OF INVESTMENTS (Continued)
MARKET VALUE
SHARES SEE NOTE 1
- ----------------------------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL - 8.1%
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
American Express Co. 80,000 $ 3,760,000
-----------------------------------------------------------------------------------------------------------------------
Countrywide Credit Industries, Inc. 620,000 17,670,000
-----------------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp. 158,000 15,958,000
-----------------------------------------------------------------------------------------------------------------------
Transamerica Corp. 101,000 7,663,375
-------------
45,051,375
- ----------------------------------------------------------------------------------------------------------------------------------
INSURANCE - 21.4%
-----------------------------------------------------------------------------------------------------------------------
ACE Ltd. 571,200 31,273,200
-----------------------------------------------------------------------------------------------------------------------
AFLAC, Inc. 329,050 13,203,131
-----------------------------------------------------------------------------------------------------------------------
American International Group, Inc. 89,000 9,667,625
-----------------------------------------------------------------------------------------------------------------------
Everest Reinsurance Holdings, Inc. 340,000 8,670,000
-----------------------------------------------------------------------------------------------------------------------
EXEL Ltd. 796,400 30,263,200
-----------------------------------------------------------------------------------------------------------------------
Mid Ocean Ltd. 294,900 13,860,300
-----------------------------------------------------------------------------------------------------------------------
Progressive Corp. 162,000 11,137,500
-------------
118,074,956
- ----------------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL - 12.9%
- ----------------------------------------------------------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT - 1.6%
-----------------------------------------------------------------------------------------------------------------------
General Electric Co. 90,200 8,726,850
- ----------------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL SERVICES - 2.1%
-----------------------------------------------------------------------------------------------------------------------
Donnelley (R.R.) & Sons Co. 380,000 11,542,500
- ----------------------------------------------------------------------------------------------------------------------------------
MANUFACTURING - 8.6%
-----------------------------------------------------------------------------------------------------------------------
AlliedSignal, Inc. 127,000 8,318,500
-----------------------------------------------------------------------------------------------------------------------
Caterpillar, Inc. 265,000 18,185,625
-----------------------------------------------------------------------------------------------------------------------
LucasVarity plc, ADR (2) 520,900 20,966,225
-------------
47,470,350
- ----------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 0.6%
-----------------------------------------------------------------------------------------------------------------------
Canadian Pacific Ltd. (New) 130,000 3,282,500
- ----------------------------------------------------------------------------------------------------------------------------------
TECHNOLOGY - 10.7%
- ----------------------------------------------------------------------------------------------------------------------------------
AEROSPACE/DEFENSE - 6.0%
-----------------------------------------------------------------------------------------------------------------------
Lockheed Martin Corp. 155,000 13,891,875
-----------------------------------------------------------------------------------------------------------------------
McDonnell Douglas Corp. 354,000 19,293,000
-------------
33,184,875
- ----------------------------------------------------------------------------------------------------------------------------------
COMPUTER HARDWARE - 1.1%
-----------------------------------------------------------------------------------------------------------------------
Adaptec, Inc. (2) 100,000 6,087,500
- ----------------------------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE - 0.7%
-----------------------------------------------------------------------------------------------------------------------
Electronic Arts, Inc. (2) 100,000 3,750,000
- ----------------------------------------------------------------------------------------------------------------------------------
ELECTRONICS - 1.1%
-----------------------------------------------------------------------------------------------------------------------
Arrow Electronics, Inc. (2) 129,500 6,167,438
- ----------------------------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS-TECHNOLOGY - 1.8%
-----------------------------------------------------------------------------------------------------------------------
Sprint Corp. 260,200 10,212,850
-------------
Total Common Stocks (Cost $309,631,476) 451,192,453
-----------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $409,453,987) 99.7% 551,217,161
-----------------------------------------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 0.3 1,415,480
------ -------------
NET ASSETS 100.0% $552,632,641
====== =============
</TABLE>
1. Identifies issues considered to be illiquid - See Note 5 of Notes
to Financial Statements.
2. Non-income producing security.
3. Short-term notes are generally traded on a discount basis; the
interest rate is the discount rate received by the Fund at the time
of purchase.
See accompanying Notes to Financial Statements.
6 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
====================================================
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 1996
===================================================================================================================================
<S> <C> <C>
ASSETS Investments, at value (cost $409,453,987) - see accompanying statement $551,217,161
-------------------------------------------------------------------------------------------------------
Receivables:
Shares of capital stock sold 4,419,152
Interest and dividends 452,440
-------------------------------------------------------------------------------------------------------
Other 32,085
-------------
Total assets 556,120,838
===================================================================================================================================
LIABILITIES Bank overdraft 512,979
-------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Shares of capital stock redeemed 2,672,405
Distribution and service plan fees 113,956
Transfer and shareholder servicing agent fees 19,923
Directors' fees 3,968
Other 164,966
-------------
Total liabilities 3,488,197
===================================================================================================================================
NET ASSETS $552,632,641
=============
===================================================================================================================================
COMPOSITION OF Par value of shares of capital stock $32,053,007
NET ASSETS -------------------------------------------------------------------------------------------------------
Additional paid-in capital 345,509,634
-------------------------------------------------------------------------------------------------------
Undistributed net investment income 1,919,807
-------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investment transactions 31,387,019
-------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments - Note 3 141,763,174
-------------
Net assets $552,632,641
=============
===================================================================================================================================
NET ASSET VALUE Class A Shares:
PER SHARE Net asset value and redemption price per share (based on
net assets of $412,246,475 and 23,831,339 shares of capital stock outstanding) $17.30
Maximum offering price per share (net asset value plus sales charge
of 5.75% of offering price) $18.36
-------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $111,130,226 and 6,507,830 shares of capital stock outstanding) $17.08
-------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $29,255,940 and 1,713,838 shares of capital stock outstanding) $17.07
</TABLE>
See accompanying Notes to Financial Statements.
7 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
===========================================================
STATEMENT OF OPERATIONS FOR THE YEAR ENDED OCTOBER 31, 1996
===================================================================================================================================
<S> <C> <C>
INVESTMENT INCOME Dividends $ 5,762,517
-------------------------------------------------------------------------------------------------------
Interest 3,979,691
-------------
Total income 9,742,208
===================================================================================================================================
EXPENSES Management fees - Note 4 4,200,099
-------------------------------------------------------------------------------------------------------
Distribution and service plan fees - Note 4:
Class A 1,688,380
Class B 673,147
Class C 177,281
-------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees - Note 4 430,241
-------------------------------------------------------------------------------------------------------
Shareholder reports 197,560
-------------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 118,001
Class B 42,286
Class C 11,018
-------------------------------------------------------------------------------------------------------
Custodian fees and expenses 56,155
-------------------------------------------------------------------------------------------------------
Legal and auditing fees 39,448
-------------------------------------------------------------------------------------------------------
Directors' fees and expenses 30,394
-------------------------------------------------------------------------------------------------------
Other 60,004
-------------
Total expenses 7,724,014
===================================================================================================================================
NET INVESTMENT INCOME 2,018,194
===================================================================================================================================
REALIZED AND Net realized gain on investments 31,502,109
UNREALIZED GAIN -------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments 69,588,617
-------------
Net realized and unrealized gain 101,090,726
===================================================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $103,108,920
=============
</TABLE>
See accompanying Notes to Financial Statements.
8 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
===================================
STATEMENTS OF CHANGES IN NET ASSETS
YEAR ENDED OCTOBER 31,
1996 1995
===================================================================================================================================
<S> <C> <C> <C>
OPERATIONS Net investment income $ 2,018,194 $ 2,439,300
-------------------------------------------------------------------------------------------------------
Net realized gain 31,502,109 22,321,532
-------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 69,588,617 39,322,642
----------------------------------
Net increase in net assets resulting
from operations 103,108,920 64,083,474
===================================================================================================================================
DIVIDENDS AND Dividends from net investment income:
DISTRIBUTIONS Class A (1,990,608) (1,649,576)
TO SHAREHOLDERS Class B (187,734) (108,497)
Class C (36,026) (29,366)
-------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (18,878,099) (15,501,438)
Class B (2,778,986) (1,014,005)
Class C (689,670) (255,884)
===================================================================================================================================
CAPITAL STOCK Net increase in net assets resulting from capital
TRANSACTIONS stock transactions - Note 2:
Class A 67,398,927 4,613,188
Class B 59,694,507 19,757,134
Class C 15,679,507 5,377,738
===================================================================================================================================
NET ASSETS Total increase 221,320,738 75,272,768
-------------------------------------------------------------------------------------------------------
Beginning of period 331,311,903 256,039,135
----------------------------------
End of period (including undistributed net investment
income of $1,919,807 and $2,115,981, respectively) $552,632,641 $331,311,903
==================================
</TABLE>
See accompanying Notes to Financial Statements.
9 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
====================
FINANCIAL HIGHLIGHTS
CLASS A
----------------------------------------------------------------------
YEAR ENDED OCTOBER 31,
1996(2) 1995 1994 1993 1992
====================================================================================================================
PER SHARE OPERATING DATA:
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period $14.51 $12.59 $12.51 $11.71 $10.61
- --------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .08 .12(3) .09(3) .05(3) .04(3)
Net realized and unrealized gain (loss) 3.79 2.71 .50 1.34 1.77
- --------------------------------------------------------------------------------------------------------------------
Total income (loss) from investment
operations 3.87 2.83 .59 1.39 1.81
- --------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income (.10) (.08) (.04) (.05) (.07)
Distributions from net realized gain (.98) (.83) (.47) (.54) (.64)
- --------------------------------------------------------------------------------------------------------------------
Total dividends and distributions
to shareholders (1.08) (.91) (.51) (.59) (.71)
- --------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $17.30 $14.51 $12.59 $12.51 $11.71
======================================================================
====================================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(4) 28.39% 24.74% 5.01% 12.27% 18.45%
====================================================================================================================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $412,246 $282,615 $238,085 $245,320 $142,939
- --------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $338,429 $257,240 $237,923 $205,074 $122,319
- --------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) 0.58% 0.90% 0.72% 0.40% 0.53%
Expenses 1.71% 1.68% 1.71% 1.75% 1.75%
- --------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(6) 36.0% 36.0% 49.0% 27.0% 41.0%
Average brokerage commission rate(7) $0.0559 -- -- -- --
</TABLE>
1. For the period from September 1, 1993 (inception of offering) to
October 31, 1993.
2. On November 22, 1995, OppenheimerFunds, Inc. became the investment adviser
to the Fund.
3. Based on average shares outstanding for the period.
4. Assumes a hypothetical initial investment on the business day before the
first day of the fiscal period (or inception of offering), with all dividends
and distributions reinvested in additional shares on the reinvestment date, and
redemption at the net asset value calculated on the last business day of the
fiscal period. Sales charges are not reflected in the total returns. Total
returns are not annualized for periods of less than one full year.
10 Oppenheimer Quest Value Fund, Inc.
<PAGE>
<TABLE>
<CAPTION>
====================
FINANCIAL HIGHLIGHTS
CLASS B CLASS C
-------------------------------------------- --------------
YEAR ENDED OCTOBER 31, YEAR ENDED OCTOBER 31,
1996(2) 1995 1994 1993(1) 1996(2) 1995 1994 1993(1)
====================================================================================================================================
PER SHARE OPERATING DATA:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period $14.37 $12.53 $12.51 $12.66 $14.35 $12.52 $12.50 $12.66
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .05 .05(3) .02(3) (.01)(3) .04 .04(3) .01(3) (.01)(3)
Net realized and unrealized gain (loss) 3.71 2.69 .50 (.14) 3.71 2.70 .51 (.15)
- ------------------------------------------------------------------------------------------------------------------------------------
Total income (loss) from investment
operations 3.76 2.74 .52 (.15) 3.75 2.74 .52 (.16)
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions to
shareholders:
Dividends from net investment income (.07) (.07) (.03) -- (.05) (.08) (.03) --
Distributions from net realized gain (.98) (.83) (.47) -- (.98) (.83) (.47) --
- ------------------------------------------------------------------------------------------------------------------------------------
Total dividends and distributions
to shareholders (1.05) (.90) (.50) -- (1.03) (.91) (.50) --
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $17.08 $14.37 $12.53 $12.51 $17.07 $14.35 $12.52 $12.50
======================================================================================
====================================================================================================================================
TOTAL RETURN, AT NET ASSET VALUE(4) 27.76% 24.08% 4.43% (1.19)% 27.73% 24.10% 4.45% (1.26)%
====================================================================================================================================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands) $111,130 $38,557 $14,373 $2,015 $29,256 $10,140 $3,581 $221
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 68,175 $25,393 $ 8,341 $1,136 $18,099 $ 6,711 $1,725 $169
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) 0.06% 0.36% 0.14% (1.19)%(5) 0.06% 0.31% 0.09% (0.90)%(5)
Expenses 2.26% 2.21% 2.24% 2.27%(5) 2.20% 2.26% 2.28% 2.27%(5)
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(6) 36.0% 36.0% 49.0% 27.0% 36.0% 36.0% 49.0% 27.0%
Average brokerage commission rate(7) $0.0559 -- -- -- $0.0559 -- -- --
</TABLE>
5. Annualized.
6. The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities (excluding short-term securities) for the period
ended October 31, 1996 were $215,220,520 and $127,851,243, respectively.
7. Total brokerage commissions paid on applicable purchases and sales of
portfolio securities for the period, divided by the total number of related
shares purchased and sold.
See accompanying Notes to Financial Statements.
11 Oppenheimer Quest Value Fund, Inc.
<PAGE>
=============================
NOTES TO FINANCIAL STATEMENTS
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Quest Value Fund, Inc. (the Fund), formerly named Quest for
Value Fund, Inc., is registered under the Investment Company Act of 1940,
as amended, as a diversified, open-end management investment company. The
Fund's investment objective is to seek capital appreciation, primarily
through investment in equity securities. On November 22, 1995, OCC
Distributors (previously Quest for Value Distributors), OpCap Advisors
(previously Quest for Value Advisors) and their parent Oppenheimer Capital
consummated a transaction with OppenheimerFunds, Inc. (the Manager), which
resulted in the sale to the Manager of certain mutual fund assets of OCC
Distributors and OpCap Advisors, including the transfer of Quest for Value
Funds and the use of the name "Quest for Value." As part of the
transaction, the Fund entered into an investment advisory agreement with
the Manager and the Manager entered into a sub-advisory agreement with
OpCap Advisors (the former Manager). The Fund offers Class A, Class B and
Class C shares. Class A shares are sold with a front-end sales charge.
Class B and Class C shares may be subject to a contingent deferred sales
charge. All three classes of shares have identical rights to earnings,
assets and voting privileges, except that each class has its own
distribution and/or service plan, expenses directly attributable to a
particular class and exclusive voting rights with respect to matters
affecting a single class. Class B shares will automatically convert to
Class A shares six years after the date of purchase. The following is a
summary of significant accounting policies consistently followed by the
Fund.
---------------------------------------------------------------------------
INVESTMENT VALUATION. Portfolio securities are valued at the close of the
New York Stock Exchange on each trading day. Listed and unlisted securities
for which such information is regularly reported are valued at the last
sale price of the day or, in the absence of sales, at values based on the
closing bid or the last sale price on the prior trading day. Long-term and
short-term "non-money market" debt securities are valued by a portfolio
pricing service approved by the Board of Directors. Such securities which
cannot be valued by the approved portfolio pricing service are valued using
dealer-supplied valuations provided the Manager is satisfied that the firm
rendering the quotes is reliable and that the quotes reflect current market
value, or are valued under consistently applied procedures established by
the Board of Directors to determine fair value in good faith. Short-term
"money market type" debt securities having a remaining maturity of 60 days
or less are valued at cost (or last determined market value) adjusted for
amortization to maturity of any premium or discount.
---------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, AND GAINS AND LOSSES. Income, expenses
(other than those attributable to a specific class) and gains and losses
are allocated daily to each class of shares based upon the relative
proportion of net assets represented by such class. Operating expenses
directly attributable to a specific class are charged against the
operations of that class.
---------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to continue to comply with provisions of
the Internal Revenue Code applicable to regulated investment companies and
to distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
---------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to shareholders
are recorded on the ex-dividend date.
12 Oppenheimer Quest Value Fund, Inc.
<PAGE>
=============================
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
================================================================================
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS. Net investment income
(loss) and net realized gain (loss) may differ for financial statement and
tax purposes. The character of the distributions made during the year from
net investment income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. Also, due to timing of
dividend distributions, the fiscal year in which amounts are distributed
may differ from the year that the income or realized gain (loss) was
recorded by the Fund.
During the year ended October 31, 1996, the Fund adjusted the
classification of net investment income and capital gain (loss) to reflect
the differences between financial statement amounts and distributions
determined in accordance with income tax regulations. Accordingly, during
the year ended October 31, 1996, amounts have been reclassified to reflect
a decrease in paid-in capital of $17,129. Accumulated net realized gain on
investments was increased by the same amount.
---------------------------------------------------------------------------
OTHER. Investment transactions are accounted for on the date the
investments are purchased or sold (trade date) and dividend income is
recorded on the ex-dividend date. Realized gains and losses on investments
and unrealized appreciation and depreciation are determined on an
identified cost basis, which is the same basis used for federal income tax
purposes.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses during
the reporting period. Actual results could differ from those estimates.
================================================================================
2. CAPITAL STOCK
The Fund has authorized 35,000,000 shares of $1.00 par value capital stock.
Transactions in shares of capital stock were as follows:
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31, 1996 YEAR ENDED OCTOBER 31, 1995
----------------------------- -----------------------------
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
Class A:
<S> <C> <C> <C> <C>
Sold 6,823,030 $109,212,436 4,045,256 $ 53,027,793
Dividends and distributions
reinvested 1,381,459 19,409,592 1,440,961 16,047,556
Redeemed (3,849,611) (61,223,101) (4,924,606) (64,462,161)
----------- ------------- ----------- -------------
Net increase 4,354,878 $ 67,398,927 561,611 $ 4,613,188
=========== ============= =========== =============
-------------------------------------------------------------------------------------------------------------
Class B:
Sold 4,315,316 $ 67,660,385 1,718,575 $ 22,392,431
Dividends and distributions
reinvested 196,585 2,738,062 94,418 1,045,812
Redeemed (686,922) (10,703,940) (277,524) (3,681,109)
----------- ------------- ----------- -------------
Net increase 3,824,979 $ 59,694,507 1,535,469 $ 19,757,134
=========== ============= =========== =============
-------------------------------------------------------------------------------------------------------------
Class C:
Sold 1,267,566 $ 20,075,574 523,083 $ 6,835,837
Dividends and distributions
reinvested 51,443 716,599 25,381 280,898
Redeemed (311,646) (5,112,666) (127,913) (1,738,997)
----------- ------------- ----------- -------------
Net increase 1,007,363 $ 15,679,507 420,551 $ 5,377,738
=========== ============= =========== =============
</TABLE>
================================================================================
3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS
At October 31, 1996, net unrealized appreciation on investments of
$141,763,174 was composed of gross appreciation of $146,132,768, and gross
depreciation of $4,369,594.
13 Oppenheimer Quest Value Fund, Inc.
<PAGE>
=========================================
NOTES TO FINANCIAL STATEMENTS (Continued)
================================================================================
4. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Fund which provides for a fee of 1.00% of the
first $400 million of average annual net assets, 0.90% of the next $400
million and 0.85% of net assets in excess of $800 million. Prior to November
22, 1995, management fees were paid to the former Manager at an annual rate
of 1.00% of the Fund's average net assets. The Manager has agreed to
reimburse the Fund if aggregate expenses (with specified exceptions) exceed
the most stringent applicable regulatory limit on Fund expenses. The Manager
acts as the accounting agent for the Fund at an annual fee of $55,000, plus
out-of-pocket costs and expenses reasonably incurred. Prior to November 22,
1995, accounting service fees were paid monthly to the former Manager.
Effective November 22, 1995, the Manager pays OpCap Advisors (the
Sub-Adviser) a monthly fee based on the fee schedule set forth in the
Prospectus. For the period ended October 31, 1996, the Manager paid
$1,524,058 to the Sub-Adviser.
For the year ended October 31, 1996, commissions (sales charges paid by
investors) on sales of Class A shares totaled $1,572,574, of which $584,527
was retained by OppenheimerFunds Distributor, Inc. (OFDI), a subsidiary of
the Manager, as general distributor, and by affiliated broker/dealers. Sales
charges advanced to broker/dealers by OFDI on sales of the Fund's Class B
and Class C shares totaled $2,244,538 and $183,698, of which $90,556 and
$1,937, respectively, were paid to an affiliated broker/dealer. During the
year ended October 31, 1996, OFDI received contingent deferred sales charges
of $166,112 and $7,700, respectively, upon redemption of Class B and Class C
shares as reimbursement for sales commissions advanced by OFDI at the time
of sale of such shares.
OppenheimerFunds Services (OFS), a division of the Manager, is the transfer
and shareholder servicing agent for the Fund and for other registered
investment companies. The Fund pays OFS an annual maintenance fee for each
Fund shareholder account and reimburses OFS for its out-of-pocket expenses.
During the period ended October 31, 1996, the Fund paid OFS $376,090.
The Fund has adopted a Distribution and Service Plan for Class A shares to
compensate OFDI for a portion of its costs incurred in connection with the
personal service and maintenance of accounts that hold Class A shares. Under
the Plan, the Fund pays an annual asset-based sales charge to OFDI of 0.25%
per year on Class A shares. The Fund also pays a service fee to OFDI of
0.25% per year. Both fees are computed on the average annual net assets of
Class A shares of the Fund, determined as of the close of each regular
business day. OFDI uses all of the service fee and a portion of the
asset-based sales charge to compensate brokers, dealers, banks and other
financial institutions quarterly for providing personal service and
maintenance of accounts of their customers that hold Class A shares. OFDI
retains the balance of the asset-based sales charge to reimburse itself for
its other expenditures under the Plan. During the year ended October 31,
1996, OFDI paid $7,893 to an affiliated broker/dealer as compensation for
Class A personal service and maintenance expenses.
The Fund has adopted compensation type Distribution and Service Plans for
Class B and Class C shares to compensate OFDI for its services and costs in
distributing Class B and Class C shares and servicing accounts. Under the
Plans, the Fund pays OFDI an annual asset-based sales charge of 0.75% per
year on Class B and Class C shares, as compensation for sales commissions
paid from its own resources at the time of sale and associated financing
costs. OFDI also receives a service fee of 0.25% per year as compensation
for costs incurred in connection with the personal service and maintenance
of accounts that hold shares of the Fund, including amounts paid to brokers,
dealers, banks and other financial institutions. Both fees are computed on
the average annual net assets of Class B and Class C shares, determined as
of the close of each regular business day. During the year ended October 31,
1996, OFDI retained $576,105 and $118,643, respectively, as compensation for
Class B and Class C sales commissions and service fee advances, as well as
financing costs. If the Plans are terminated by the Fund, the Board of
Directors may allow the Fund to continue payments of the asset-based sales
charge to OFDI for certain expenses it incurred before the Plans were
terminated. At October 31, 1996, OFDI had incurred unreimbursed expenses of
$1,827,648 for Class B and $191,798 for Class C.
14 Oppenheimer Quest Value Fund, Inc.
<PAGE>
=========================================
NOTES TO FINANCIAL STATEMENTS (Continued)
================================================================================
5. ILLIQUID AND RESTRICTED SECURITIES
At October 31, 1996, investments in securities included issues that are
illiquid or restricted. Restricted securities are often purchased in private
placement transactions, are not registered under the Securities Act of 1933,
may have contractual restrictions on resale, and are valued under methods
approved by the Board of Directors as reflecting fair value. A security may
be considered illiquid if it lacks a readily available market or if its
valuation has not changed for a certain period of time. The Fund intends to
invest no more than 10% of its net assets (determined at the time of
purchase and reviewed from time to time) in illiquid or restricted
securities. Certain restricted securities, eligible for resale to qualified
institutional investors, are not subject to that limit. The aggregate value
of illiquid or restricted securities subject to this limitation at October
31, 1996 was $5,765,388, which represents 1.04% of the Fund's net assets.
Information concerning restricted securities is as follows:
<TABLE>
<CAPTION>
VALUATION PER UNIT
SECURITY ACQUISITION DATES COST PER UNIT AS OF OCT. 31, 1996
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Security Capital Realty, Inc. 9/15/94-4/17/95 $925.50 $1,082.40
----------------------------------------------------------------------------------------------------------
Security Capital Realty, Inc., 12% Cv.
Sub. Debs., 6/30/14 9/15/94-10/11/95 94.25 103.48
----------------------------------------------------------------------------------------------------------
Security Capital Realty, Inc., 12% Cv.
Sub. Debs. Interest Shares, 6/30/14 1/1/95-6/30/96 100.00 100.00
</TABLE>
15 Oppenheimer Quest Value Fund, Inc.
<PAGE>
=================================
REPORT OF INDEPENDENT ACCOUNTANTS
================================================================================
To the Board of Directors and Shareholders of
Oppenheimer Quest Value Fund, Inc.
In our opinion, the accompanying statement of assets and liabilities,
including the statement of investments, and the related statements of
operations and of changes in net assets and the financial highlights
present fairly, in all material respects, the financial position of
Oppenheimer Quest Value Fund, Inc., formerly Quest for Value Fund, Inc.
(the Fund) at October 31, 1996, the results of its operations, the changes
in its net assets and the financial highlights for the year then ended, in
conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as financial
statements) are the responsibility of the Fund's management; our
responsibility is to express an opinion on these financial statements based
on our audit. We conducted our audit of these financial statements in
accordance with generally accepted auditing standards which require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audit, which included
confirmation of securities at October 31, 1996 by correspondence with the
custodian, provides a reasonable basis for the opinion expressed above. The
financial statments of the Fund for the year ended October 31, 1995 were
audited by other independent accountants whose report dated December 20,
1995 expressed an unqualified opinion on those statements.
Price Waterhouse LLP
Denver, Colorado
November 21, 1996
16 Oppenheimer Quest Value Fund, Inc.
<PAGE>
==========================================
FEDERAL INCOME TAX INFORMATION (Unaudited)
================================================================================
In early 1997 shareholders will receive information regarding all dividends
and distributions paid to them by the Fund during calendar year 1996.
Regulations of the U.S. Treasury Department require the Fund to report this
information to the Internal Revenue Service.
Distributions of $1.0802, $1.0432 and $1.0282 per share were paid to Class
A, Class B and Class C shareholders, respectively, on December 21, 1995, of
which, for each class of shares, $0.8176 was designated as a "capital gain
distribution" for federal income tax purposes. Whether received in stock or
in cash, the capital gain distribution should be treated by shareholders as
a gain from the sale of capital assets held for more than one year
(long-term capital gains).
Dividends paid by the Fund during the fiscal year ended October 31, 1996
which are not designated as capital gain distributions should be multiplied
by 100% to arrive at the net amount eligible for the corporate
dividend-received deduction.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service.
Because of the complexity of the federal regulations which may affect your
individual tax return and the many variations in state and local tax
regulations, we recommend that you consult your tax adviser for specific
guidance.
17 Oppenheimer Quest Value Fund, Inc.
<PAGE>
==================================
OPPENHEIMER QUEST VALUE FUND, INC.
================================================================================
OFFICERS AND DIRECTORS Bridget A. Macaskill, Chairman of the
Board of Directors and President
Paul Y. Clinton, Director
Thomas W. Courtney, Director
Lacy B. Herrmann, Director
George Loft, Director
Robert C. Doll, Jr., Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
===========================================================================
INVESTMENT ADVISER OppenheimerFunds, Inc.
===========================================================================
SUB-ADVISER OpCap Advisors
===========================================================================
DISTRIBUTOR OppenheimerFunds Distributor, Inc.
===========================================================================
TRANSFER AND OppenheimerFunds Services
SHAREHOLDER SERVICING
AGENT
===========================================================================
CUSTODIAN OF PORTFOLIO State Street Bank and Trust Company
SECURITIES
===========================================================================
INDEPENDENT ACCOUNTANTS Price Waterhouse LLP
===========================================================================
LEGAL COUNSEL Gordon Altman Butowsky Weitzen Shalov & Wein
This is a copy of a report to shareholders of Oppenheimer Quest Value Fund,
Inc. This report must be preceded or accompanied by a Prospectus of
Oppenheimer Quest Value Fund, Inc. For material information concerning the
Fund, see the Prospectus.
Shares of Oppenheimer funds are not deposits or obligations of any bank,
are not guaranteed by any bank, and are not insured by the FDIC or any
other agency, and involve investment risks, including possible loss of the
principal amount invested.
18 Oppenheimer Quest Value Fund, Inc.
<PAGE>
- -----------------------
OPPENHEIMERFUNDS FAMILY
- -----------------------
================================================================================
OppenheimerFunds offers over 50 funds designed to fit virtually
every investment goal. Whether you're investing for retirement,
your children's education or tax-free income, we have the funds
to help you seek your objective.
When you invest with OppenheimerFunds, you can feel comfor-
table knowing that you are investing with a respected financial
institution with over 35 years of experience in helping people
just like you reach their financial goals. And you're investing
with a leader in global, growth stock and flexible fixed-income
investments--with over 3 million shareholder accounts and more
than $55 billion under OppenheimerFunds' management and that of
our affiliates.
At OppenheimerFunds, we don't charge a fee to exchange
shares. And you can exchange shares easily by mail or by tele-
phone.(1) For more information on Oppenheimer funds, please con-
tact your financial adviser or call us at 1-800-525-7048 for a
prospectus. You may also write us at the address shown on the
back cover. As always, please read the prospectus carefully
before you invest.
================================================================================
STOCK FUNDS Developing Markets Fund Growth Fund
Global Emerging Growth Fund Global Fund
Enterprise Fund(2) Quest Global Value Fund
International Growth Fund Disciplined Value Fund
Discovery Fund Oppenheimer Fund
Quest Small Cap Value Fund Value Stock Fund
Gold & Special Minerals Fund Quest Value Fund
Target Fund
================================================================================
STOCK & BOND Main Street Income & Growth Fund Equity Income Fund
FUNDS Quest Opportunity Value Fund Disciplined Allocation Fund
Total Return Fund Asset Allocation Fund
Quest Growth & Income Value Fund Strategic Income & Growth Fund
Global Growth & Income Fund Bond Fund for Growth
================================================================================
BOND FUNDS International Bond Fund Bond Fund
High Yield Fund U.S. Government Trust
Champion Income Fund Limited-Term Government Fund
Strategic Income Fund
================================================================================
MUNICIPAL California Municipal Fund(3) Insured Municipal Fund
FUNDS Florida Municipal Fund(3) Intermediate Municipal Fund
New Jersey Municipal Fund(3)
New York Municipal Fund(3) Rochester Division
Pennsylvania Municipal Fund(3) Rochester Fund Municipals
Municipal Bond Fund Limited Term New York
Municipal Fund
================================================================================
MONEY MARKET Money Market Fund Cash Reserves
FUNDS(4)
================================================================================
LIFESPAN Growth Fund Income Fund
Balanced Fund
1. Exchange privileges are subject to change or termination.
Shares may be exchanged only for shares of the same class of
eligible funds.
2. Effective 4/1/96, the Fund is closed to new investors.
3. Available only to investors in certain states.
4. An investment in money market funds is neither insured nor
guaranteed by the U.S. government and there can be no assurance
that a money market fund will be able to maintain a stable net
asset value of $1.00 per share.
Oppenheimer funds are distributed by OppenheimerFunds
Distributor, Inc., Two World Trade Center, New York, NY
10048-0203.
-c-Copyright 1996 OppenheimerFunds, Inc. All rights reserved.
19 Oppenheimer Quest Value Fund, Inc.
<PAGE>
[BACK COVER}
INFORMATION
GENERAL INFORMATION
Monday-Friday 8:30 a.m.-9 p.m. ET
Saturday 10 a.m.-2 p.m. ET
- --------------
1-800-525-7048
- --------------
TELEPHONE TRANSACTIONS
Monday-Friday 8:30 a.m.-8 p.m. ET
- --------------
1-800-852-8457
- --------------
PHONELINK
24 hours a day, automated
information and transactions
- --------------
1-800-533-3310
- --------------
TELECOMMUNICATIONS DEVICE
FOR THE DEAF (TDD)
Monday-Friday 8:30 a.m.-8 p.m. ET
- --------------
1-800-843-4461
- --------------
OPPENHEIMERFUNDS
INFORMATION HOTLINE
24 hours a day, timely and insightful
messages on the economy and
issues that affect your investments
- --------------
1-800-835-3104
- --------------
RA0225.001.1096 December 31, 1996
- ------------------------------------------------------------------------------
"HOW MAY I HELP YOU?" [PHOTO]Customer Service Representative
Customer Service Representative
OppenheimerFunds Services
As an Oppenheimer funds shareholder, you have some special privileges. Whether
it's automatic investment plans, informative newsletters and hotlines, or ready
account access, you can benefit from services designed to make investing simple.
And when you need help, our Customer Service Representatives are only a
toll-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling our
toll-free Telephone Transactions number. And, by enrolling in AccountLink, a
convenient service that "links" your Oppenheimer funds accounts and your bank
checking or savings account, you can use the Telephone Transactions number to
make investments.
For added convenience, you can get automated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the Oppenheimer funds' transfer agent,
OppenheimerFunds Services, with their Award of Excellence in 1993.
So call us today--we're here to help.
- ------------------------------------------------------------------------------
[LOGO] OPPENHEIMERFUNDS-R- --------------
OppenheimerFunds Distributor, Inc. Bulk Rate
P.O. Box 5270 U.S. Postage
Denver, CO 80217-5270 PAID
Permit No. 130
Torrington, CT
-----------
