[FRONT COVER]
Oppenheimer Target Fund
Annual Report August 31, 1996
[PICTURE OF PETTING ZOO]
"We have some
important
financial goals,
so we want
our investment
to increase
in value
over time."
[LOGO] OppenheimerFunds(R)
<PAGE>
News
Outperformed Average
Cumulative Total Return for the
3-Year Period Ended 8/31/96:
Oppenheimer Target Fund
Class A (at net asset value)(1)
58.64%
Lipper Capital Appreciation
Funds Average(3)
41.36%
This Fund is for people who want the potential for
solid investment growth over the long-term.
How Your Fund Is Managed
Oppenheimer Target Fund seeks long-term growth by investing in the stocks of
"growth-type" companies, and cyclical industries that the Fund's investments
managers believe have opportunities for capital growth.
In today's stock market, the Fund's managers are targeting consumer and
industrial companies with strong earnings momentum, as well as companies that
have excellent growth prospects, especially in the technology sector, such as
computer software and net-working. The Fund also invests in U.S.-based companies
that are believed to have superior growth potential because their products or
services are in high demand abroad.
Performance
Total return at net asset value for the 12 months ended 8/31/96 was 18.31% for
Class A shares and 17.32% for Class C shares. Cumulative total return for Class
B shares since inception on 11/1/95 was 13.52%.(1)
Your Fund's average annual total returns at maximum offering price for
Class A shares for the 1-, 5- and 10-year periods ended 8/31/96 were 11.51%,
12.20% and 10.09%, respectively. For Class B shares, cumulative total return
since inception on 11/1/95 was 8.52%. For Class C shares, average annual total
returns for the 1-year period and since inception on 12/1/93 were 16.32% and
15.92%.(2)
Outlook
"In the fourth quarter, demand for technology is usually tremendous not only
because it's back to school time, but also because companies need to spend their
budgets before the end of the calendar year. We don't see that being any
different this year which leads us to believe technology stocks are a good place
to be right now."
Jane Putnam, Portfolio Manager
August 31, 1996
Total returns include change in share price and reinvestment of dividends and
capital gains distributions. 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. For more complete information, please review the
prospectus carefully before you invest.
1. Based on the change in net asset value per share for the period shown,
without deducting any sales charges. Such performance would have been lower if
sales charges were taken into account.
2. Class A returns show results of hypothetical investments on 8/31/95, 8/31/91
and 8/31/86, after deducting the current maximum initial sales charge of 5.75%.
Class A shares were first publicly offered on 1/22/81. The Fund's maximum sales
charge for Class A shares was higher during a portion of some of the periods
shown, so that actual investment results would have been less. Class B returns
show results of a hypothetical investment on 11/1/95 (inception of class), after
the deduction of the applicable 5% contingent deferred sales charge. Class C
returns show results of hypothetical investments on 8/31/95 and 12/1/93
(inception of class), after the deduction of the 1% contingent deferred sales
charge for the 1-year result. When such returns are calculated in the same
manner for the period ended 9/30/96, they are as follows: for Class A shares,
15.97%, 14.17% and 11.47% for the 1-, 5- and 10-year periods; for Class B
shares, cumulative total return since inception was 17.14%; and for Class C
shares, 21.05% and 18.46% for the 1-year period and since inception. An
explanation of the different performance calculations is in the Fund's
prospectus.
3. Source: Lipper Analytical Services, 8/31/96. The Lipper total
return average for the 3-year period was for 112 capital appreciation funds. The
average is shown for comparative purposes only. Oppenheimer Target Fund is
characterized by Lipper as a capital appreciation fund. Lipper performance does
not take sales charges into consideration.
2 Oppenheimer Target Fund
<PAGE>
[PHOTO-BRIDGET A. MACASKILL]
Bridget A. Macaskill
President
Oppenheimer
Target Fund
Dear Shareholder,
Over the past few months, the stock market has shown investors just how
unpredictable it can be. During this time, the market has experienced some
remarkable shifts, both up and down. Despite the recent volatility, we remain
optimistic and see this activity as "normal" movement in a bull market rather
than the onset of a bear market. Here's why.
We entered this period agreeing with many experts that the stock market was
probably due for some kind of a downturn. After all, we had not experienced any
real market correction in six years, making this the longest bull market of the
post-World War II era. Although the market did decline significantly in June and
July, we believe that long-term it will remain strong for the following three
reasons: strong corporate profits; low inflation; and stabilized interest rates.
First, because corporate profits of U.S. companies had advanced at a
double-digit rate between 1992 and 1995, investors had fully expected this
year's profit tallies to be flat. But instead, corporate America continued to
perform. Corporate profits were strong during the first part of the year due to
the fact that many companies reduced their operating expenses and frequently
applied their profits to their businesses.
Second, it is our belief that in today's world, faster economic growth may
not necessarily mean higher inflation. For example, despite reports of an
increase in hourly wages, inflation has remained low. In fact, our outlook is
that inflation will remain under control, primarily because of the Federal
Reserve's conservative monetary policy over the last few years as well as the
declining federal government deficit which should help the stock market to
remain strong.
Third, the strength of the stock market earlier this year is all the more
noteworthy because it came during a time when interest rates moved up
sharply--the yield on the benchmark 30-year U.S. Treasury bond rose from under
6% in January to about 7% today. Interest rates have been rising partly because
investors are concerned about whether the economy is growing fast enough to
generate higher inflation. And, while it's impossible to predict how interest
rates will fluctuate, we believe they will stabilize over the next few months.
Rest assured, however, that we will continue to monitor this situation very
closely and would become very cautious in anticipating the stock market's
performance if inflation were to flare up.
Taking these factors into account this year, our managers have worked hard
to strive to meet their Fund's objective--being careful not to abandon their
investment styles in response to short-term changes in the market. Additionally,
they understand that, historically, a diversified portfolio of stocks has
provided superior growth over the long term. With that in mind, it is critical
for investors to remain focused on long-term goals and put near-term
fluctuations in their proper perspective.
Your portfolio managers discuss 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
September 20, 1996
The Board of Trustees recently decided to change the fiscal year end of this
Fund from December 31 to August 31 in order to facilitate the auditing process.
Due to this change, the next shareholder report you receive will cover the
six-month period ended February 28, 1997.
3 Oppenheimer Target Fund
<PAGE>
[PHPOTO-FEMALE FUND MANAGER][PHOTO-MALE FUND MANAGER]
An interview with your Fund's managers.
Q + A
Q: How has
the Fund
performed?
How did the Fund perform over the period?
While the last few months have been volatile for many funds, Target performed
well. One reason for our good performance was that we avoided a lot of the
unseasoned areas that were strong during the first half of the year, only to
have been hit the hardest in the following two months. Also, we had a higher
percentage of cash than our peers, which hurt us in the first half but proved to
be a tremendous benefit for us during the recent decline when we were able to
put that cash to work at attractive prices. As a result of these two factors,
year-to-date the Fund is well into the first quartile of all aggressive funds
tracked by Lipper Analytical Services.(1)
[PHOTO-FUND MANAGER]
What investments made positive contributions to performance?
We're always looking for companies in fast growing markets that are grabbing
market share and for the most part, that's meant consumer cyclicals and
technology. For example, we've benefited from several large apparel companies as
well as retailers and communications technology companies. Our strategy was to
buy the stocks of companies that we felt were going to be gaining share in
markets that showed great growth.(2)
Did any investments negatively impact the portfolio?
We were a little disappointed that some of the brokerage and asset management
firms within the financial services sectors didn't perform as well as we thought
they would. We were positioned there believing there were good long- and
short-term reasons for continued strong performance, but short-term performance
has been flat. As far as individual stocks, basic materials was an area we
reduced. However, the sector weakened faster than we thought and consequently we
1. Source: Lipper Analytical Services, 8/31/96. Oppenheimer Target Fund Class A
shares for the year-to-date period ended 8/31/96 was ranked 36th out of 190
funds; and for the 1-year period ended 8/31/96, the Fund was ranked 43rd out of
171 funds in its category. Oppenheimer Target Fund is characterized by Lipper as
a capital appreciation fund. This comparison does not take sales charges into
consideration. Past performance is no guarantee of future results.
2. The Fund's portfolio is subject to change.
4 Oppenheimer Target Fund
<PAGE>
Facing page
Top left: Jane Putnam, Portfolio
Manager
Top right: Michael Levine, Member
of Equity Investments Team
Bottom: Jay Tracey, Member
of Equity Investments Team
This page
Top: John Doney, Member of
Equity Investments Team
Bottom: Robert Doll, Executive VP,
Director of Equity Investments
and Richard Rubinstein, Member
of Equity Investments Team
A: The
Fund has
outperformed
many of
its peers.
were not able to reduce that area as much as we would have liked.
What changes have you made to the portfolio in light of the market's recent
volatility?
We've done some trimming to our financial holdings because we think this is an
area that has become almost fully valued. We've taken money out of this area so
that we could add to leading names in areas like HMOs that took a hit during the
decline but we feel are now a good buy. We've also added to some energy as well
as industrial stocks.
During the last two months we were pleased that we had some extra cash in
the portfolio because, with the NASDAQ down at one point nearly 20 percent,
there were many stocks that became available at reasonable prices. We took that
as a buying opportunity and used it to make some excellent purchases. These new
additions have helped to build the portfolio's equity position while, at the
same time, they reduced our cash level significantly.
What areas do you expect to do especially well in the future?
We're comfortable with our overweight in technology stocks. We're starting to
see positive signs, as new software is being introduced and people are upgrading
their computers, both in the office and at home. In the fourth quarter, demand
for technology is usually strong not only because it's back to school time, but
also because companies need to spend their budgets before the end of the
calendar year. We don't see that being any different this year, especially given
the strong new product cycle, which leads us to believe technology stocks are a
good place to be right now.
[PHOTO-ROBERT DOLL AND RICHARD RUBINSTEIN]
[PHOTO-JOHN DONEY]
What adjustments are you making to the portfolio in view of the upcoming
Presidential election?
Over the last few Presidential election years, the areas that seem to have
suffered the most have generally been related to healthcare. That's because the
candidates are likely to begin discussing the Medicare issue and consequently,
drug and healthcare service companies do not perform as well as they normally
would. While we still have a significant position in pharmaceuticals, we've
trimmed the position and sold some of the names that we've already seen
outperform. We're watching this area carefully. []
5 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Statement of Investments August 31, 1996
Face Market Value
Amount See Note 1
===================================================================================================================================
<S> <C> <C> <C>
Convertible Corporate Bonds and Notes--0.3%
- -----------------------------------------------------------------------------------------------------------------------------------
Danka Business Systems PLC, 6.75% Cv. Sub. Nts., 4/1/02 (Cost $1,723,750) $1,700,000 $ 1,980,500
Shares
===================================================================================================================================
Common Stocks--87.4%
- -----------------------------------------------------------------------------------------------------------------------------------
Basic Materials--3.9%
- -----------------------------------------------------------------------------------------------------------------------------------
Chemicals--3.2%
FMC Corp.(1) 13,600 870,400
---------------------------------------------------------------------------------------------------------------
IMC Global, Inc. 115,000 4,945,000
---------------------------------------------------------------------------------------------------------------
Morton International, Inc. 80,000 2,970,000
---------------------------------------------------------------------------------------------------------------
Praxair, Inc. 210,400 8,652,700
---------------------------------------------------------------------------------------------------------------
Terra Industries, Inc. 270,100 3,578,825
---------------------------------------------------------------------------------------------------------------
Union Carbide Corp. 110,000 4,757,500
-----------
25,774,425
- -----------------------------------------------------------------------------------------------------------------------------------
Paper--0.7%
Boise Cascade Corp. 55,000 1,856,250
---------------------------------------------------------------------------------------------------------------
Bowater, Inc. 110,000 3,960,000
-----------
5,816,250
- -----------------------------------------------------------------------------------------------------------------------------------
Consumer Cyclicals--14.2%
- -----------------------------------------------------------------------------------------------------------------------------------
Autos & Housing--1.4%
AutoZone, Inc.(1) 120,000 3,270,000
---------------------------------------------------------------------------------------------------------------
Pulte Corp. 150,000 3,731,250
---------------------------------------------------------------------------------------------------------------
Toll Brothers, Inc.(1) 240,000 4,170,000
-----------
11,171,250
- -----------------------------------------------------------------------------------------------------------------------------------
Leisure & Entertainment--2.5%
Alaska Air Group, Inc.(1) 150,000 3,168,750
---------------------------------------------------------------------------------------------------------------
AMR Corp.(1) 30,000 2,460,000
---------------------------------------------------------------------------------------------------------------
Callaway Golf Co. 31,800 1,049,400
---------------------------------------------------------------------------------------------------------------
Disney (Walt) Co. 125,000 7,125,000
---------------------------------------------------------------------------------------------------------------
Outback Steakhouse, Inc.(1) 45,000 1,271,250
---------------------------------------------------------------------------------------------------------------
Wendy's International, Inc. 252,800 5,119,200
-----------
20,193,600
- -----------------------------------------------------------------------------------------------------------------------------------
Media--0.7%
Evergreen Media Corp., Cl. A(1) 105,000 3,307,500
---------------------------------------------------------------------------------------------------------------
Viacom, Inc., Cl. B(1) 75,768 2,386,692
-----------
5,694,192
- -----------------------------------------------------------------------------------------------------------------------------------
Retail: General--5.1%
Donna Karan International, Inc.(1) 269,600 6,605,200
---------------------------------------------------------------------------------------------------------------
Eckerd Corp.(1) 271,500 6,651,750
---------------------------------------------------------------------------------------------------------------
Jones Apparel Group, Inc.(1) 100,600 5,570,725
---------------------------------------------------------------------------------------------------------------
Liz Claiborne, Inc. 65,000 2,258,750
---------------------------------------------------------------------------------------------------------------
Nautica Enterprises, Inc.(1) 100,000 2,650,000
---------------------------------------------------------------------------------------------------------------
Tommy Hilfiger Corp.(1) 199,000 9,974,875
---------------------------------------------------------------------------------------------------------------
Wal-Mart Stores, Inc. 265,000 7,022,500
-----------
40,733,800
</TABLE>
6 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Retail: Specialty--4.5%
American Pad & Paper Co.(1) 221,000 $ 3,674,125
---------------------------------------------------------------------------------------------------------------
Bed Bath & Beyond, Inc.(1) 200,000 4,525,000
---------------------------------------------------------------------------------------------------------------
CUC International, Inc.(1) 75,000 2,578,125
---------------------------------------------------------------------------------------------------------------
Gap, Inc. (The) 180,000 6,300,000
---------------------------------------------------------------------------------------------------------------
General Nutrition Cos., Inc.(1) 180,100 2,656,475
---------------------------------------------------------------------------------------------------------------
Home Depot, Inc. 65,000 3,453,125
---------------------------------------------------------------------------------------------------------------
Lands' End, Inc.(1) 95,000 1,995,000
---------------------------------------------------------------------------------------------------------------
Nike, Inc., Cl. B 100,000 10,800,000
-----------
35,981,850
- -----------------------------------------------------------------------------------------------------------------------------------
Consumer Non-Cyclicals--16.0%
- -----------------------------------------------------------------------------------------------------------------------------------
Beverages--1.1%
Coca-Cola Co. (The) 140,000 7,000,000
---------------------------------------------------------------------------------------------------------------
Cott Corp. 200,000 1,562,500
-----------
8,562,500
- -----------------------------------------------------------------------------------------------------------------------------------
Food--3.1%
American Stores Co. 100,000 4,112,500
---------------------------------------------------------------------------------------------------------------
JP Foodservice, Inc.(1) 94,900 2,230,150
---------------------------------------------------------------------------------------------------------------
Kroger Co.(1) 125,000 5,296,875
---------------------------------------------------------------------------------------------------------------
Richfood Holdings, Inc. 125,000 4,750,000
---------------------------------------------------------------------------------------------------------------
Safeway, Inc.(1) 240,000 8,700,000
-----------
25,089,525
- -----------------------------------------------------------------------------------------------------------------------------------
Healthcare/Drugs--4.4%
Amgen, Inc.(1) 50,000 2,912,500
---------------------------------------------------------------------------------------------------------------
Bristol-Myers Squibb Co. 60,000 5,265,000
---------------------------------------------------------------------------------------------------------------
Johnson & Johnson 74,526 3,670,405
---------------------------------------------------------------------------------------------------------------
Pfizer, Inc. 150,000 10,650,000
---------------------------------------------------------------------------------------------------------------
Schering-Plough Corp. 150,000 8,381,250
---------------------------------------------------------------------------------------------------------------
Warner-Lambert Co. 80,000 4,760,000
-----------
35,639,155
- -----------------------------------------------------------------------------------------------------------------------------------
Healthcare/Supplies &
Services--6.0%
Apache Medical Systems, Inc.(1) 80,000 1,030,000
---------------------------------------------------------------------------------------------------------------
Boston Scientific Corp.(1) 120,000 5,505,000
---------------------------------------------------------------------------------------------------------------
Gulf South Medical Supply, Inc.(1) 140,000 3,045,000
---------------------------------------------------------------------------------------------------------------
HealthCare COMPARE Corp.(1) 139,100 5,946,525
---------------------------------------------------------------------------------------------------------------
HEALTHSOUTH Corp.(1) 100,000 3,237,500
---------------------------------------------------------------------------------------------------------------
Henry Schein, Inc.(1) 99,500 3,308,375
---------------------------------------------------------------------------------------------------------------
Lincare Holdings, Inc.(1) 105,000 3,917,812
---------------------------------------------------------------------------------------------------------------
Medtronic, Inc. 95,000 4,940,000
---------------------------------------------------------------------------------------------------------------
Nellcor Puritan Bennett, Inc.(1) 180,000 4,635,000
---------------------------------------------------------------------------------------------------------------
Oxford Health Plans, Inc.(1) 125,000 5,718,750
---------------------------------------------------------------------------------------------------------------
Sofamor Danek Group, Inc.(1) 70,000 2,012,500
---------------------------------------------------------------------------------------------------------------
Ventana Medical Systems, Inc.(1) 50,000 750,000
---------------------------------------------------------------------------------------------------------------
Ventritex, Inc.(1) 130,000 1,771,250
---------------------------------------------------------------------------------------------------------------
VISX, Inc.(1) 125,200 2,425,750
-----------
48,243,462
</TABLE>
7 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Statement of Investments (Continued)
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Household Goods--0.4%
Procter & Gamble Co. 35,000 $ 3,110,625
- -----------------------------------------------------------------------------------------------------------------------------------
Tobacco--1.0%
Philip Morris Cos., Inc. 30,000 2,692,500
---------------------------------------------------------------------------------------------------------------
UST, Inc. 185,000 5,550,000
-----------
8,242,500
- -----------------------------------------------------------------------------------------------------------------------------------
Energy--3.2%
- -----------------------------------------------------------------------------------------------------------------------------------
Energy Services &
Producers--1.7%
Global Marine, Inc.(1) 140,000 2,012,500
---------------------------------------------------------------------------------------------------------------
Sonat Offshore Drilling, Inc. 105,000 5,735,625
---------------------------------------------------------------------------------------------------------------
Tidewater, Inc. 145,000 5,564,375
-----------
13,312,500
- -----------------------------------------------------------------------------------------------------------------------------------
Oil-Integrated--1.5%
Mobil Corp. 60,000 6,765,000
---------------------------------------------------------------------------------------------------------------
Phillips Petroleum Co. 130,000 5,265,000
-----------
12,030,000
- -----------------------------------------------------------------------------------------------------------------------------------
Financial--16.4%
- -----------------------------------------------------------------------------------------------------------------------------------
Banks--3.2%
Bank of Boston Corp. 125,000 6,593,750
---------------------------------------------------------------------------------------------------------------
BankAmerica Corp. 42,000 3,255,000
---------------------------------------------------------------------------------------------------------------
Chase Manhattan Corp. (New) 14,000 1,041,250
---------------------------------------------------------------------------------------------------------------
NationsBank Corp. 90,000 7,661,250
---------------------------------------------------------------------------------------------------------------
SouthTrust Corp. 50,000 1,475,000
---------------------------------------------------------------------------------------------------------------
State Street Boston Corp. 87,400 4,730,525
---------------------------------------------------------------------------------------------------------------
Wells Fargo & Co. 5,000 1,243,750
-----------
26,000,525
- -----------------------------------------------------------------------------------------------------------------------------------
Diversified Financial--10.7%
Advanta Corp., Cl. A 175,000 8,553,125
---------------------------------------------------------------------------------------------------------------
Associates First Capital Corp., Cl. A 124,000 4,898,000
---------------------------------------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp. 60,000 5,302,500
---------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn. 100,000 3,100,000
---------------------------------------------------------------------------------------------------------------
Finova Group, Inc. 75,000 4,125,000
---------------------------------------------------------------------------------------------------------------
First USA, Inc. 190,000 10,070,000
---------------------------------------------------------------------------------------------------------------
Franklin Resources, Inc. 120,000 7,140,000
---------------------------------------------------------------------------------------------------------------
Green Tree Financial Corp. 430,000 14,942,500
---------------------------------------------------------------------------------------------------------------
Morgan Stanley Group, Inc. 30,000 1,432,500
---------------------------------------------------------------------------------------------------------------
Price (T. Rowe) Associates 196,200 5,689,800
---------------------------------------------------------------------------------------------------------------
Salomon, Inc. 125,000 5,625,000
---------------------------------------------------------------------------------------------------------------
Schwab (Charles) Corp. (New) 150,000 3,750,000
---------------------------------------------------------------------------------------------------------------
Travelers Group, Inc. 262,500 11,385,937
-----------
86,014,362
- -----------------------------------------------------------------------------------------------------------------------------------
Insurance--2.5%
Allstate Corp. 120,000 5,355,000
---------------------------------------------------------------------------------------------------------------
Amerin Corp.(1) 15,000 341,250
---------------------------------------------------------------------------------------------------------------
MGIC Investment Corp. 70,900 4,493,287
---------------------------------------------------------------------------------------------------------------
SunAmerica, Inc. 150,000 10,218,750
-----------
20,408,287
</TABLE>
8 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Industrial--7.1%
- -----------------------------------------------------------------------------------------------------------------------------------
Electrical Equipment--2.2%
Emerson Electric Co. 105,000 $ 8,793,750
---------------------------------------------------------------------------------------------------------------
General Electric Co. 40,000 3,325,000
---------------------------------------------------------------------------------------------------------------
Honeywell, Inc. 73,700 4,283,813
---------------------------------------------------------------------------------------------------------------
Kemet Corp.(1) 75,000 1,275,000
-----------
17,677,563
- -----------------------------------------------------------------------------------------------------------------------------------
Industrial Materials--1.2%
Centex Corp. 141,000 4,529,625
---------------------------------------------------------------------------------------------------------------
Rayonier, Inc. 132,700 5,258,238
-----------
9,787,863
- -----------------------------------------------------------------------------------------------------------------------------------
Industrial Services--1.0%
Danka Business Systems PLC, Sponsored ADR 40,000 1,165,000
---------------------------------------------------------------------------------------------------------------
DecisionOne Holdings Corp.(1) 151,200 2,532,600
---------------------------------------------------------------------------------------------------------------
Manpower, Inc. 125,000 4,453,125
-----------
8,150,725
- -----------------------------------------------------------------------------------------------------------------------------------
Manufacturing--0.7%
AGCO Corp. 135,300 3,196,463
---------------------------------------------------------------------------------------------------------------
Kulicke & Soffa Industries, Inc.(1) 120,000 1,185,000
---------------------------------------------------------------------------------------------------------------
U.S. Filter Corp.(1) 60,000 1,567,500
-----------
5,948,963
- -----------------------------------------------------------------------------------------------------------------------------------
Transportation--2.0%
Burlington Northern Santa Fe Corp. 42,000 3,360,000
---------------------------------------------------------------------------------------------------------------
Canadian Pacific Ltd. (New) 370,000 8,325,000
---------------------------------------------------------------------------------------------------------------
Illinois Central Corp. 132,150 3,997,538
-----------
15,682,538
- -----------------------------------------------------------------------------------------------------------------------------------
Technology--25.6%
- -----------------------------------------------------------------------------------------------------------------------------------
Aerospace/Defense--0.5%
Goodrich (B.F.) Co. 114,000 4,275,000
- -----------------------------------------------------------------------------------------------------------------------------------
Computer Hardware--4.0%
Adaptec, Inc.(1) 140,000 6,982,500
---------------------------------------------------------------------------------------------------------------
Cabletron Systems, Inc.(1) 100,000 6,100,000
---------------------------------------------------------------------------------------------------------------
EMC Corp.(1) 345,000 6,641,250
---------------------------------------------------------------------------------------------------------------
Gateway 2000, Inc.(1) 170,800 7,611,275
---------------------------------------------------------------------------------------------------------------
Seagate Technology, Inc.(1) 95,000 4,560,000
-----------
31,895,025
- -----------------------------------------------------------------------------------------------------------------------------------
Computer Software--10.4%
BMC Software, Inc.(1) 121,000 9,014,500
---------------------------------------------------------------------------------------------------------------
Business Objects SA, Sponsored ADR(1) 68,700 1,219,425
---------------------------------------------------------------------------------------------------------------
Computer Associates International, Inc. 75,000 3,937,500
---------------------------------------------------------------------------------------------------------------
First Data Corp. 217,577 16,971,006
---------------------------------------------------------------------------------------------------------------
HBO & Co. 60,000 3,277,500
---------------------------------------------------------------------------------------------------------------
Informix Corp.(1) 83,700 1,883,250
---------------------------------------------------------------------------------------------------------------
Microsoft Corp.(1) 230,000 28,175,000
---------------------------------------------------------------------------------------------------------------
Oracle Corp.(1) 358,850 12,649,463
---------------------------------------------------------------------------------------------------------------
PLATINUM Technology, Inc.(1) 180,000 1,935,000
---------------------------------------------------------------------------------------------------------------
Shiva Corp.(1) 60,000 3,030,000
---------------------------------------------------------------------------------------------------------------
Structural Dynamics Research Corp.(1) 70,000 1,767,500
-----------
83,860,144
</TABLE>
9 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Statement of Investments (Continued)
Market Value
Shares See Note 1
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Electronics--4.0%
Altera Corp.(1) 60,000 $ 2,640,000
---------------------------------------------------------------------------------------------------------------
Analog Devices, Inc.(1) 115,000 2,774,375
---------------------------------------------------------------------------------------------------------------
Applied Materials, Inc.(1) 160,000 3,880,000
---------------------------------------------------------------------------------------------------------------
Arrow Electronics, Inc.(1) 50,000 2,281,250
---------------------------------------------------------------------------------------------------------------
Intel Corp. 130,000 10,375,625
---------------------------------------------------------------------------------------------------------------
LSI Logic Corp.(1) 195,000 4,265,625
---------------------------------------------------------------------------------------------------------------
Motorola, Inc. 40,000 2,135,000
---------------------------------------------------------------------------------------------------------------
Novellus Systems, Inc.(1) 90,800 3,427,700
---------------------------------------------------------------------------------------------------------------
Teradyne, Inc.(1) 30,000 465,000
------------
32,244,575
- -----------------------------------------------------------------------------------------------------------------------------------
Telecommunications-
Technology--6.7%
3Com Corp.(1) 95,000 4,441,250
---------------------------------------------------------------------------------------------------------------
Andrew Corp.(1) 100,000 4,450,000
---------------------------------------------------------------------------------------------------------------
Ascend Communications, Inc.(1) 130,000 6,808,750
---------------------------------------------------------------------------------------------------------------
Cisco Systems, Inc.(1) 230,000 12,132,500
---------------------------------------------------------------------------------------------------------------
Hong Kong Telecommunications Ltd., Sponsored ADR 112,997 1,906,824
---------------------------------------------------------------------------------------------------------------
L.M. Ericsson Telephone Co., Cl. B, ADR 250,000 5,765,625
---------------------------------------------------------------------------------------------------------------
Newbridge Networks Corp.(1) 120,000 6,915,000
---------------------------------------------------------------------------------------------------------------
Telecom Corp. of New Zealand Ltd., Sponsored ADR 30,000 2,295,000
---------------------------------------------------------------------------------------------------------------
Tellabs, Inc.(1) 140,000 8,872,500
------------
53,587,449
- -----------------------------------------------------------------------------------------------------------------------------------
Utilities--1.0%
- -----------------------------------------------------------------------------------------------------------------------------------
Electric Utilities--0.3%
Empresa Nacional de Electricidad SA, Sponsored ADR 45,000 2,643,750
- -----------------------------------------------------------------------------------------------------------------------------------
Telephone Utilities--0.7%
Cincinnati Bell, Inc. 70,000 3,342,500
---------------------------------------------------------------------------------------------------------------
Telefonica del Peru SA, ADR 90,000 2,103,750
------------
5,446,250
------------
Total Common Stocks (Cost $515,551,917) 703,218,653
Units
===================================================================================================================================
Rights, Warrants and Certificates--0.0%
Windmere-Durable Holdings, Inc. Wts., Exp. 1/98 (Cost $0) 7,094 --
Face
Amount
===================================================================================================================================
Repurchase Agreement--12.6%
Repurchase agreement with Zion First National Bank, 5.25%,
dated 8/30/96, to be repurchased at $101,559,208 on 9/3/96,
collateralized by U.S. Treasury Nts., 5.625%--7.375%,
8/31/97--8/15/03, with a value of $103,601,036 (Cost
$101,500,000) $101,500,000 101,500,000
- -----------------------------------------------------------------------------------------------------------------------------------
Total Investments, at Value (Cost $618,775,667) 100.3% 806,699,153
- -----------------------------------------------------------------------------------------------------------------------------------
Liabilities in Excess of Other Assets (0.3) (2,392,712)
----- ------------
Net Assets 100.0% $804,306,441
===== ============
</TABLE>
1. Non-income producing security.
See accompanying Notes to Financial Statements.
10 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Statement of Assets and Liabilities August 31, 1996
===================================================================================================================================
<S> <C> <C>
Assets Investments, at value (including repurchase agreement of $101,500,000)
(cost $618,775,667)--see accompanying statement $806,699,153
---------------------------------------------------------------------------------------------------------------
Cash 76,159
---------------------------------------------------------------------------------------------------------------
Receivables:
Investments sold 9,019,051
Interest and dividends 543,820
Shares of beneficial interest sold 340,531
---------------------------------------------------------------------------------------------------------------
Other 141,517
------------
Total assets 816,820,231
============
===================================================================================================================================
Liabilities Payables and other liabilities:
Investments purchased 10,264,958
Shares of beneficial interest redeemed 1,541,681
Trustees' fees 248,886
Distribution and service plan fees 220,067
Dividends 32,466
Transfer and shareholder servicing agent fees 31,152
Other 174,580
------------
Total liabilities 12,513,790
===================================================================================================================================
Net Assets $804,306,441
============
===================================================================================================================================
Composition of Paid-in capital $533,332,192
Net Assets ---------------------------------------------------------------------------------------------------------------
Undistributed net investment income 2,693,760
---------------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investment transactions 80,357,003
---------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments--Note 3 187,923,486
------------
Net assets $804,306,441
============
===================================================================================================================================
Net Asset Value Class A Shares:
Per Share Net asset value and redemption price per share (based on net assets of
$788,504,058 and 25,596,271 shares of beneficial interest outstanding) $30.81
Maximum offering price per share (net asset value plus sales charge of 5.75% of
offering price) $32.69
----------------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on net
assets of $5,447,519 and 178,275 shares of beneficial interest outstanding) $30.56
----------------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price and offering price per share (based on net
assets of $10,354,864 and 342,134 shares of beneficial interest outstanding) $30.27
</TABLE>
See accompanying Notes to Financial Statements.
11 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Statements of Operations
Eight Months
Ended Year Ended
August 31, December 31
1996(1) 1995
===================================================================================================================================
<S> <C> <C> <C>
Investment Income Interest $ 4,345,256 $ 6,740,731
---------------------------------------------------------------------------------------------------------------
Dividends 4,506,648 4,701,943
Foreign withholding taxes (74,006) (22,014)
----------- ------------
Total income 8,777,898 11,420,660
===================================================================================================================================
Expenses Management fees--Note 4 3,767,997 3,882,505
---------------------------------------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 861,250 839,340
Class B 28,544 1,030
Class C 60,358 37,800
---------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 659,037 568,898
---------------------------------------------------------------------------------------------------------------
Shareholder reports 204,395 132,075
---------------------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 93,600 318
Class B 854 931
Class C 959 1,864
---------------------------------------------------------------------------------------------------------------
Trustees' fees and expenses--Note 1 89,928 202
---------------------------------------------------------------------------------------------------------------
Legal and auditing fees 73,634 67,500
---------------------------------------------------------------------------------------------------------------
Custodian fees and expenses 28,604 41,449
---------------------------------------------------------------------------------------------------------------
Insurance expenses 3,367 23,612
---------------------------------------------------------------------------------------------------------------
Other 43,033 19,830
----------- ------------
Total expenses 5,915,560 5,617,354
===================================================================================================================================
Net Investment Income 2,862,338 5,803,306
===================================================================================================================================
Realized and Unrealized Gain
Net realized gain on investments 75,873,404 71,199,990
---------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on investments 11,279,147 58,150,018
----------- ------------
Net realized and unrealized gain 87,152,551 129,350,008
===================================================================================================================================
Net Increase in Net Assets Resulting From Operations $90,014,889 $135,153,314
=========== ============
</TABLE>
1. The Fund changed its fiscal year end from December 31 to
August 31.
See accompanying Notes to Financial Statements.
12 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Statements of Changes in Net Assets
Eight Months
Ended
August 31, Year Ended December 31,
1996(1) 1995 1994
===================================================================================================================================
<S> <C> <C> <C> <C>
Operations Net investment income $ 2,862,338 $ 5,803,306 $ 2,339,881
---------------------------------------------------------------------------------------------------------------
Net realized gain 75,873,404 71,199,990 38,815,275
---------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation 11,279,147 58,150,018 (40,560,449)
----------- ------------ -------------
Net increase in net assets resulting from operations 90,014,889 135,153,314 594,707
===================================================================================================================================
Dividends and
Distributions to
Shareholders
Dividends from net investment income:
Class A -- (5,896,377) (2,361,728)
Class B -- (8,658) --
Class C -- (24,850) (2,907)
---------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A -- (69,237,207) (35,048,552)
Class B -- (100,605) --
Class C -- (663,926) (102,047)
===================================================================================================================================
Beneficial Interest
Transactions
Net increase (decrease) in net assets resulting from
beneficial interest transactions--Note 2:
Class A (58,800,845) 397,611,091 (30,283,681)
Class B 2,415,163 2,840,388 --
Class C 2,250,436 5,989,404 1,154,378
===================================================================================================================================
Net Assets Total increase (decrease) 35,879,643 465,662,574 (66,049,830)
---------------------------------------------------------------------------------------------------------------
Beginning of period 768,426,798 302,764,224 368,814,054
----------- ----------- ------------
End of period [including undistributed (overdistributed)
net investment income of $2,693,760, $(168,578) and
$(69,749), respectively] $804,306,441 $768,426,798 $302,764,224
============ ============ ============
</TABLE>
1. The Fund changed its fiscal year end from December 31 to
August 31.
See accompanying Notes to Financial Statements.
13 Oppenheimer Target Fund
<PAGE>
<TABLE>
<CAPTION>
Financial Highlights
Class A
----------------------------------------------------------------------------------
Eight Months
Ended
August 31, Year Ended December 31,
1996(3) 1995 1994 1993 1992 1991(2)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Data:
Net asset value, beginning of period $27.44 $22.63 $25.72 $25.25 $23.76 $17.47
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .11 .24 .20 .13 .16 .27
Net realized and unrealized gain (loss) 3.26 7.61 (.11) .86 2.28 6.87
------ ------ ------ ------ ------ ------
Total income (loss) from investment
operations 3.37 7.85 .09 .99 2.44 7.14
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income -- (.24) (.20) (.12) (.17) (.18)
Distributions from net realized gain -- (2.80) (2.98) (.40) (.78) (.67)
------ ------ ------ ------ ------ ------
Total dividends and distributions
to shareholders -- (3.04) (3.18) (.52) (.95) (.85)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $30.81 $27.44 $22.63 $25.72 $25.25 $23.76
====== ====== ====== ====== ====== ======
====================================================================================================================================
Total Return, at Net Asset Value(6) 12.28% 34.85% 0.46% 3.93% 10.27% 41.33%
====================================================================================================================================
Ratios/Supplemental Data:
Net assets, end of period (in thousands) $788,504 $758,439 $301,698 $368,806 $401,256 $369,351
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $789,903 $538,210 $325,003 $383,875 $362,295 $209,596
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) 0.55%(7) 1.08% 0.72% 0.47% 0.69% 1.25%
Expenses 1.09%(7) 1.03% 1.16% 1.07% 1.09% 1.17%
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(8) 45.2% 71.9% 34.7% 22.9% 42.3% 65.6%
- ------------------------------------------------------------------------------------------------------------------------------------
Average brokerage commission rate(9) $0.0595 $0.0578 -- -- -- --
<CAPTION>
Class B Class C
------------------------- -------------------------------------------
Eight Months Period Eight Months
Ended Ended Ended
August 31, December 31, August 31, Year Ended December 31,
1996(3) 1995(4) 1996(3) 1995 1994(2) 1993(1)
=========================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Data:
Net asset value, beginning of period $27.37 $29.77 $27.11 $22.50 $25.72 $25.92
- -------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) --(5) (.14) (.03) .09 -- (.01)
Net realized and unrealized gain (loss) 3.19 .78 3.19 7.43 (.15) .31
------ ------ ------ ------ ------ ------
Total income (loss) from investment
operations 3.19 .64 3.16 7.52 (.15) .30
- -------------------------------------------------------------------------------------------------------------------------
Dividends and distributions to shareholders:
Dividends from net investment income -- (.24) -- (.11) (.09) (.10)
Distributions from net realized gain -- (2.80) -- (2.80) (2.98) (.40)
------ ------ ------ ------ ------ ------
Total dividends and distributions
to shareholders -- (3.04) -- (2.91) (3.07) (.50)
- -------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $30.56 $27.37 $30.27 $27.11 $22.50 $25.72
====== ====== ====== ====== ====== ======
=========================================================================================================================
Total Return, at Net Asset Value(6) 11.65% 1.67% 11.66% 33.56% (0.50)% 2.11%
=========================================================================================================================
Ratios/Supplemental Data:
Net assets, end of period (in thousands) $5,448 $2,751 $10,355 $7,237 $1,066 $8
- -------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $4,285 $661 $9,053 $3,792 $467 $6
- -------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income (loss) (0.25)%(7) (0.54)%(7) (0.30)%(7) 0.19% (0.02)% (0.07)%(7)
Expenses 1.94%(7) 2.62%(7) 1.93%(7) 1.90% 2.18% 2.18%(7)
- -------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(8) 45.2% 71.9% 45.2% 71.9% 34.7% 22.9%
- -------------------------------------------------------------------------------------------------------------------------
Average brokerage commission rate(9) $0.0595 $0.0578 $0.0595 $0.0578 -- --
</TABLE>
1. For the period from December 1, 1993 (inception of offering) to December 31,
1993.
2. Per share amounts calculated based on the weighted average number of shares
outstanding during the period.
3. The Fund changed its fiscal year end from December 31 to August 31.
4. For the period from November 1, 1995 (inception of offering) to December 31,
1995.
5. Less than $0.005 per share.
6. 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.
7. Annualized.
8. 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 August 31, 1996 were $309,153,341 and $317,132,673, respectively.
9. 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.
14&15 Oppenheimer Target Fund
<PAGE>
Notes to Financial Statements
================================================================================
1. Significant
Accounting Policies
Oppenheimer Target Fund (the Fund) is registered under the Investment Company
Act of 1940, as amended, as a diversified, open-end management investment
company. On August 15, 1996, the Board of Trustees elected to change the fiscal
year end of the Fund from December 31 to August 31. Accordingly, these financial
statements include information for the eight month period from January 1, 1996
to August 31, 1996. The Fund's investment objective is to seek capital
appreciation, primarily through investment in equity securities. The Fund's
investment adviser is OppenheimerFunds, Inc. (the 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 clo sing 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 Trustees. 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 Trustees 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.
- --------------------------------------------------------------------------------
Repurchase Agreements. The Fund requires the custodian to take possession, to
have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is required
to be at least 102% of the resale price at the time of purchase. If the seller
of the agreement defaults and the value of the collateral declines, or if the
seller enters an insolvency proceeding, realization of the value of the
collateral by the Fund may be delayed or limited.
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
Trustees' Fees and Expenses. The Fund has adopted a nonfunded retirement plan
for the Fund's independent trustees. Benefits are based on years of service and
fees paid to each trustee during the years of service. During the eight months
ended August 31, 1996, a provision of $26,931 was made for the Fund's projected
benefit obligations, and payments of $9,705 were made to retired trustees,
resulting in an accumulated liability of $239,137 at August 31, 1996.
- --------------------------------------------------------------------------------
Distributions to Shareholders. Dividends and distributions to shareholders are
recorded on the ex-dividend date.
- --------------------------------------------------------------------------------
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 the 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.
16 Oppenheimer Target Fund
<PAGE>
================================================================================
1. Significant Accounting
Policies (continued)
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. Shares of
Beneficial Interest
The Fund has authorized an unlimited number of no par value shares of beneficial
interest. Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
Eight Months Ended Year Ended Year Ended
August 31, 1996(2) December 31, 1995(1) December 31, 1994
--------------------------- --------------------------- ---------------------------
Shares Amount Shares Amount Shares Amount
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A:
Sold 2,809,568 $ 83,949,691 3,305,271 $ 90,988,885 1,091,689 $ 27,823,899
Dividends and distributions
reinvested -- -- 2,635,092 71,461,980 1,592,900 35,776,790
Issued in connection with the
acquisition of Oppenheimer Time
Fund--Note 5 -- -- 11,277,345 315,314,574 -- --
Redeemed (4,852,702) (142,750,536) (2,909,180) (80,154,348) (3,693,115) (93,884,370)
---------- ------------- ---------- ------------ ---------- ------------
Net increase (decrease) (2,043,134) $ (58,800,845) 14,308,528 $397,611,091 (1,008,526) $(30,283,681)
========== ============= ========== ============ ========== ============
- -----------------------------------------------------------------------------------------------------------------------------------
Class B:
Sold 358,325 $ 10,711,635 107,562 $ 3,071,314 -- $ --
Dividends and distributions
reinvested -- -- 3,988 107,888 -- --
Redeemed (280,568) (8,296,472) (11,032) (338,814) -- --
---------- ------------- ---------- ------------ ---------- ------------
Net increase 77,757 $ 2,415,163 100,518 $ 2,840,388 -- $ --
========== ============= ========== ============ ========== ============
- -----------------------------------------------------------------------------------------------------------------------------------
Class C:
Sold 152,465 $ 4,501,923 257,084 $ 7,022,376 65,435 $ 1,619,304
Dividends and distributions
reinvested -- -- 22,545 604,205 4,518 100,882
Redeemed (77,259) (2,251,487) (60,076) (1,637,177) (22,893) (565,808)
---------- ------------- ---------- ------------ ---------- -------------
Net increase 75,206 $ 2,250,436 219,553 $ 5,989,404 47,060 $ 1,154,378
========== ============= ========== ============ ========== ============
</TABLE>
1. For the year ended December 31, 1995 for Class A and Class C shares and for
the period from November 1, 1995 (inception of offering) to December 31, 1995
for Class B shares.
2. The Fund changed its fiscal year end from December 31 to August 31.
================================================================================
3. Unrealized Gains and
Losses on Investments
At August 31, 1996, net unrealized appreciation on investments of $187,923,486
was composed of gross appreciation of $206,379,596, and gross depreciation of
$18,456,110.
17 Oppenheimer Target Fund
<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 0.75% on the first
$200 million of average annual net assets, 0.72% on the next $200 million, 0.69%
on the next $200 million, 0.66% on the next $200 million and 0.60% on net assets
in excess of $800 million. The Manager has voluntarily undertaken to waive a
portion of its management fee, whereby the Fund shall pay an annual management
fee of 0.58% of its net assets in excess of $1.5 billion. The Manager has agreed
to reimburse the Fund if aggregate expenses (with specified exceptions) exceed
the most stringent applicable regulatory limit on Fund expenses.
For the eight months ended August 31, 1996, commissions (sales charges paid
by investors) on sales of Class A shares totaled $609,225, of which $193,794 was
retained by OppenheimerFunds Distributor, Inc. (OFDI), a subsidiary of the
Manager, as general distributor, and by an affiliated broker/dealer. Sales
charges advanced to broker/dealers by OFDI on sales of the Fund's Class B and
Class C shares totaled $126,984 and $29,748, of which $7,913 was paid to an
affiliated broker/dealer for Class B. During the eight months ended August 31,
1996, OFDI received contingent deferred sales charges of $1,559 and $2,184,
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. OFS's total costs of providing such services are allocated
ratably to these companies.
The Fund has adopted a Service Plan for Class A shares to reimburse OFDI
for a portion of its costs incurred in connection with the personal service and
maintenance of accounts that hold Class A shares. Reimbursement is made
quarterly at an annual rate that may not exceed 0.25% of the average annual net
assets of Class A shares of the Fund. OFDI uses the service fee to reimburse
brokers, dealers, banks and other financial institutions quarterly for providing
personal service and maintenance of accounts of their customers that hold Class
A shares. During the eight months ended August 31, 1996, OFDI paid $38,347 to an
affiliated broker/dealer as reimbursement for Class A personal service and
maintenance expenses.
The Fund has adopted a compensation type Distribution and Service Plan for
Class B shares to compensate OFDI for its services and costs in distributing
Class B shares and servicing accounts. Under the Plan, the Fund pays OFDI an
annual asset-based sales charge of 0.75% per year on Class B shares that are
outstanding for 6 years or less. OFDI also receives a service fee of 0.25% per
year to compensate dealers for providing personal services for accounts that
hold Class B shares. Both fees are computed on the average annual net assets of
Class B shares, determined as of the close of each regular business day. If the
Plan is terminated by the Fund, the Board of Trustees may allow the Fund to
continue payments of the asset-based sales charge to OFDI for certain expenses
it incurred before the Plan was terminated. During the eight months ended August
31, 1996, OFDI retained $25,624 as compensation for Class B sales commissions
and service fee advances, as well as financing costs. As of August 31, 1996,
OFDI had incurred unreimbursed expenses of $140,499 for Class B.
The Fund has adopted a reimbursement type Distribution and Service Plan for
Class C shares to reimburse OFDI for its services and costs in distributing
Class C shares and servicing accounts. Under the Plan, the Fund pays OFDI an
annual asset-based sales charge of 0.75% per year on Class C shares. OFDI also
receives a service fee of 0.25% per year to reimburse dealers for providing
personal services for accounts that hold Class C shares. Both fees are computed
on the average annual net assets of Class C shares, determined as of the close
of each regular business day. If the Plan is terminated by the Fund, the Board
of Trustees may allow the Fund to continue payments of the asset-based sales
charge to OFDI for certain expenses it incurred before the Plan was terminated.
During the eight months ended August 31, 1996, OFDI retained $31,545 as
reimbursement for Class C sales commissions and service fee advances, as well as
financing costs. As of August 31, 1996, OFDI had incurred unreimbursed expenses
of $125,540 for Class C.
================================================================================
5. Acquisition of
Oppenheimer Time Fund
On June 23, 1995, the Fund acquired all of the net assets of Oppenheimer Time
Fund, pursuant to an Agreement and Plan of Reorganization approved by the
Oppenheimer Time Fund shareholders on June 20, 1995. The Fund issued 11,277,345
shares of beneficial interest (Class A), valued at $315,314,574 in exchange for
the net assets, resulting in combined Class A net assets of $686,360,280 on June
23, 1995. The net assets acquired included net unrealized appreciation of
$67,068,398. The exchange qualifies as a tax-free reorganization for federal
income tax purposes.
18 Oppenheimer Target Fund
<PAGE>
Independent Auditors' Report
================================================================================
The Board of Trustees and Shareholders of Oppenheimer Target Fund:
We have audited the accompanying statements of investments and assets and
liabilities of Oppenheimer Target Fund as of August 31, 1996, and the related
statements of operations for the eight month period then ended and the year
ended December 31, 1995, the statements of changes in net assets for the eight
month period ended August 31, 1996 and the years ended December 31, 1995 and
1994, and the financial highlights for the eight month period ended August 31,
1996 and for each of the years in the five year period ended December 31, 1995.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
August 31, 1996 by correspondence with the custodian and brokers; and where
confirmations were not received from brokers, we performed other auditing
procedures. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Target Fund as of August 31, 1996, the results of its operations for
the eight month period then ended and the year ended December 31, 1995, the
changes in its net assets for the eight month period ended August 31, 1996 and
the years ended December 31, 1995 and 1994, and the financial highlights for the
eight month period ended August 31, 1996 and each of the years in the five year
period ended December 31, 1995, in conformity with generally accepted accounting
principles.
KPMG Peat Marwick LLP
Denver, Colorado
September 23, 1996
19 Oppenheimer Target Fund
<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.
Dividends paid by the Fund during the eight months ended August 31, 1996
which are not designated as capital gain distributions should be multiplied by
22.24% 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.
20 Oppenheimer Target Fund
<PAGE>
Oppenheimer Target Fund
================================================================================
Officers and Leon Levy, Chairman of the Board of Trustees
Trustees Donald W. Spiro, Vice Chairman of the Board of Trustees
Bridget A. Macaskill, Trustee and President
Robert G. Galli, Trustee
Benjamin Lipstein, Trustee
Elizabeth B. Moynihan, Trustee
Kenneth A. Randall, Trustee
Edward V. Regan, Trustee
Russell S. Reynolds, Jr., Trustee
Sidney M. Robbins, Trustee
Pauline Trigere, Trustee
Clayton K. Yeutter, Trustee
Robert C. Doll, Jr., Vice President
Jane Putnam, 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.
================================================================================
Distributor OppenheimerFunds Distributor, Inc.
================================================================================
Transfer and OppenheimerFunds Services
Shareholder
Servicing Agent
================================================================================
Custodian of The Bank of New York
Portfolio
Securities
================================================================================
Independent KPMG Peat Marwick LLP
Auditors
================================================================================
Legal Counsel Gordon Altman Butowsky Weitzen Shalov & Wein
This is a copy of a report to shareholders of Oppenheimer
Target Fund. This report must be preceded or accompanied by
a Prospectus of Oppenheimer Target Fund. 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.
21 Oppenheimer Target Fund
<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 comfortable 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 $50 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 telephone.1 For more information on
Oppenheimer funds, please contact 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 Global Emerging Growth Fund Growth Fund
Enterprise Fund2 Global Fund
International Growth Fund Quest Global Value Fund
Discovery Fund Disciplined Value Fund
Quest Small Cap Value Fund Oppenheimer Fund
Gold & Special Minerals Fund Value Stock Fund
Target Fund Quest Value Fund
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Stock & Main Street Income & Growth Fund Equity Income Fund
Bond 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
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Bond Funds International Bond Fund Bond Fund
High Yield Fund U.S. Government Trust
Champion Income Fund Limited-Term Government Fund
Strategic Income Fund
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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
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Money Market
Funds(4) Money Market Fund Cash Reserves
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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.
22 Oppenheimer Target Fund
<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
RA0320.001.0896 October 31, 1996
[PHOTO-CUSTOMER SERVICE REPRESENTATIVE]
Customer Service Representative
OppenheimerFunds Services
"How may I help you?"
As an Oppenheimer fund 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.
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OppenheimerFunds Distributor, Inc.
P.O. Box 5270
Denver, CO 80217-5270
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