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PGIM INVESTMENTS | Bringing you the investment managers of Prudential Financial, Inc. PRUDENTIAL JENNISON SMALL COMPANY FUND, INC. FUND COMMENTARY | APRIL 30, 2017 MARKET REVIEW KEY CONTRIBUTORS According to the Commerce Department’s advance estimate, US real gross domestic product (GDP) grew 0.7% in the first quarter of 2017, moderating from +2.1% in 2016’s fourth quarter. Ferro Corporation Minutes of the Federal Open Market Committee (FOMC) March meeting, at which the federal funds rate target range was raised to 0.75%-1.00% from 0.50%-0.75%, indicated that the labor market “continued to strengthen” and that economic activity “continued to expand at a moderate pace.” Job gains remained “solid,” and the unemployment rate was “little changed.” Household spending continued to “rise moderately,” while business fixed investment appeared to have “firmed somewhat.” The headline Consumer Price Index (CPI) in March fell 0.3% month over month but rose 2.4% year over year. Core CPI (excluding food and energy) dipped 0.1% month over month and rose 2.0% year over year. Retail sales dipped 0.2% in March. Core/control retail sales (which the Commerce Department uses to estimate consumer spending in the GDP report) increased 0.5%. The Conference Board’s Consumer Confidence Index (CCI) fell from 124.9 in March to 120.3 in April. PolyOne Five Below Ferro Corporation started the year with a strong quarterly earnings report. We like its rejuvenated leadership team’s focus on growth and believe they are executing both from an operational standpoint and business development perspective. We think it will continue to increase shareholder value through cash generation, savvy acquisitions and capital returns. PolyOne also reported above consensus earnings and it looks as though recent negative trends are reversing and momentum is building. They reported solid organic growth across almost all segments. Our outlook remains bullish and we believe organic growth will be driven by new business wins, an expanding geographic presence, and a higher level of customer service. Five Below enjoyed strong grand openings of the first nine stores in Los Angeles. We believe these stores will deliver strong returns, similar to the rest of the fleet and we remain positive on Five Below’s long-term growth outlook. Nonfarm payrolls increased by 98,000 in March. The unemployment rate edged down to 4.5% from 4.7%. Average hourly earnings rose 0.2% month over month. KEY DETRACTORS The European Central Bank (ECB) left its key lending rates, the refinancing rate and deposit facility rate, unchanged at 0.00% and -0.40%, respectively. As previously announced, the bank reduced its monthly bond purchases to €60 billion (beginning in April), a pace it will maintain until the end of December, or beyond, if necessary. Forum Energy Technologies China’s GDP in the first quarter expanded 1.3% sequentially and 6.9% year over year. Retail sales in China increased 10.9% year over year in March. Brazil’s GDP in February expanded 1.3% month over month but contracted 0.7% year over year. Brazil’s central bank cut its Selic rate by 100 basis points to 11.25%. Brazil’s national unemployment rate was 13.7% in the 3-month period ended in March, up from 10.9% a year ago. MONTH The broad equity markets were mostly positive in April. Growth stocks outperformed value, while both large caps and small caps topped mid cap. The Russell 2500 Index returned 0.8%. In the index, telecom services was the best performing sector; energy was the weakest. Other sectors were up modestly, ranging from 0-2%. The Fund performed in-line with the index. Positive stock selection in materials was offset by our holdings in the financials sector. Other sector performance did not deviate meaningfully from the index. In materials, Ferro Corporation and PolyOne drove outperformance. Specialty retailer Five Below was also a key contributor. Energy positions WPX Energy and Forum Energy Technologies were notable detractors, as was ClubCorp. WPX Energy ClubCorp WPX Energy has come under pressure due to the decline in oil prices which occurred during the second half of April. We continue to believe that the Company offers inexpensive exposure to the Permian Basin, providing leverage to high-quality acreage. In addition, the restructuring story has not only made valuation attractive, but in our view could also provide running room for lowercost growth and a potential monetization option down the road. Shares of Forum Energy Technologies likely fell as a result of the slower cost absorption and less-robust pricing than investors anticipated. In our view, the company continues to be well situated for what we still expect to be a broader recovery, particularly after it absorbs costs at its facilities and pricing picks up at the same time. Shares of ClubCorp fell on the announcement that it would not be pursuing a strategic transaction at this time. Our positive thesis remains intact as a number of clubs continue to perform well, and it continues to execute on its strategy to de-lever its balance sheet and shed underperforming non-core clubs. Longer term, we believe the Company's exposure to attractive, higher-end demographics through a high-quality portfolio of more than 200 clubs will lead to sustainable growth. PRUDENTIAL JENNISON SMALL COMPANY FUND, INC. APRIL 30, 2017 PORTFOLIO OUTLOOK While the new administration in Washington is off to a somewhat shaky start, equity market gains so far this year have been supported by earnings growth and margin expansion across many industries. Potential regulatory relief has contributed to improved manufacturing confidence, and low unemployment is bolstering consumer confidence; however, the nature, timing, scope, and ease of future policy change are increasingly uncertain. From where we sit today, there are a number of outcomes from policy changes being discussed that could be positive for the overall US economy and equity market. This includes reduced regulations and a more business-friendly environment; a likelihood of lower corporate and personal tax rates; rising confidence of consumers and small business owners; and increased capital spending and/or stimulative fiscal policy. On the other hand, there are certain economic headwinds that we see that indicate it might not be entirely smooth sailing. Labor productivity is at an alltime low, but it could be improving; rising commodity prices (particularly oil) will spur inflation, put pressure on profit margins, and could slow growth; rising interest rates could pressure consumer spending, constrain the housing market, and further swell government budget deficits; calls for protectionism, increased tariffs or border taxes would be negative for the economy and will have a disproportionate negative impact on certain industries; a rising US dollar will impact exports, pressure trade deficit, and could lead to a crisis in one or more emerging markets; and domestic auto sales seemed to have peaked with increasing sales incentives, weakening fleet sales, and deteriorating credit trends. In terms of what this means for our portfolios, we are more positive on the financial sector which should benefit from the combination of rising rates, reduced regulation and possibly lower taxes. We are also constructive on technology and selected parts of industrials which have been depressed and should benefit from increased spending in infrastructure and/or defense and improvement in energy markets. In contrast, we are concerned about uncertainty impacting health care -- both services and pharmaceuticals. At the same time, we are cautious on cyclical stocks which have rebounded strongly but where the magnitude and duration of the recovery is very uncertain. We favor more services oriented businesses in the consumer discretionary sector over retail. As always, we remain biased towards long term secular growth stories with attractive valuations, good balance sheets, and strong free cash flow. With inflation rising for the first time in many years, we are particularly focused on companies which can demonstrate pricing power and the ability to hold margins against cost pressures. PRUDENTIAL JENNISON SMALL COMPANY FUND, INC. APRIL 30, 2017 AVERAGE ANNUAL RETURN AS OF 3/31/2017 Total Returns (without sales charges) YTD 1-year 3-year 5-year 10-year Since 03/01/1996 Prudential Jennison Small Company Fund, Inc. Z 6.35 20.09 7.18 11.63 7.89 9.45 Russell 2500 Index 3.76 21.53 7.43 12.60 7.71 9.86 ― 20.09 7.18 11.63 7.89 9.45 SEC Standardized Returns (with sales charges) Prudential Jennison Small Company Fund, Inc. Z Past performance does not guarantee future results. Current performance may be lower or higher than the past performance data quoted. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than original cost. For the most recent month-end performance go to pgiminvestments.com. Gross operating expense: Class Z, 0.84%. Class Z shares are available to institutional investors through certain retirement, mutual fund wrap, and asset allocation programs, and to institutions with an investment minimum of $5,000,000. Performance by share class may vary. Other share classes, which contain either a sales load or a contingent deferred sales charge, are also available. These expenses could lower total fund return. Please see the prospectus for additional information about fees, expenses, and investor eligibility requirements. Annualized returns without sales charges describe the return to the investor before any sales charges are imposed. SEC standardized return describes the return to the investor after maximum sales charges are imposed. All returns assume share price changes, as well as the compounding effect of reinvested dividends and capital gains. Returns may reflect fee waivers and/or expense reimbursements. Without such, returns would be lower. Performance by share class may vary. The Fund may invest in small- and mid-cap stocks, which may be subject to more erratic market movements than large-cap stocks; foreign securities, which are subject to currency fluctuation and political uncertainty; short sales, which involve costs and the risks of potentially unlimited losses; and derivative securities, which may carry market, credit, and liquidity risks. These risks may result in greater share price volatility. Diversification does not assure a profit or protect against a loss in declining markets. There is no guarantee the Fund's objective will be achieved or that a dividend will be paid. The following are the percentage of total net assets represented by the above mentioned holdings as of 4/30/2017: WPX Energy (1.37%), Five Below (1.11%), PolyOne (0.97%), Ferro Corporation (0.92%), Forum Energy Technologies (0.59%), ClubCorp (0.51%). Holdings are subject to change. Russell 2500 Index is an unmanaged index that measures the performance of the 2,500 smallest companies in the Russell 3000 Index, which represents approximately 17% of the total market capitalization of the Russell 3000 Index. Russell 2000 Index measures the performance of the small-cap segment of the U.S. equity universe. The Russell 2000 Index is a subset of the Russell 3000 Index representing approximately 10% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership. Russell 2000 Value Index measures the performance of small-cap value segment of the U.S. equity universe. Russell 2500 Value Index represents the performance of small to mid-cap value companies within the U.S. The Russell 2500 Growth Index is designed to measure the performance of those Russell 2500 companies with higher price-to-book ratios and higher forecasted growth values. Standard & Poor’s 500 (S&P 500) Index is an unmanaged market capitalization-weighted index of 500 stocks of large U.S. companies. MSCI All Country World Index is an unmanaged free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The MSCI ACWI consists of 46 country indexes comprising 23 developed and 23 emerging market country indexes. An investment cannot be made directly in an index. Yield curve is a line that plots interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity dates. Brexit is an abbreviation of “British exit,” which refers to the June 23, 2016 referendum by British votes to exit the European Union. Macro: Macroeconomics is the field of economics that studies the behavior of the aggregate economy. Macroeconomics examines economy-wide phenomena such as changes in unemployment, national income, rate of growth, gross domestic product, inflation and price levels. Global Industry Classification Standard (GICS) is a standardized classification system for equities developed jointly by MSCI and S&P. Real estate investment trust (REIT) is a type of securities that invests in real estate through property or mortgages. Beta is a measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. Return on equity (ROE) is a measure of profitability that calculates how many dollars of profit a company generates with each dollar of shareholders’ equity. Consumer Price Index is an index that measures the variation in prices paid by typical consumers for retail goods and other items. Consumer Confidence Index is an indicator designed to measure consumer confidence, which is defined as the degree of optimism on the state of the economy that consumers are expressing through their activities of savings and spending. Affordable Care Act is the landmark health reform legislation passed by the 11th Congress and signed into law by President Barack Obama in March 2010. The views expressed herein are those of Jennison Associates investment professionals at the time the comments were made, may not be reflective of their current opinions, and are subject to change without notice. Neither the information contained herein nor any opinion expressed shall be construed to constitute investment advice or an offer to sell or a solicitation to buy any securities mentioned herein. Consider a fund’s investment objectives, risks, charges, and expenses carefully before investing. The prospectus and summary prospectus contain this and other information about the fund. Contact your financial professional for a prospectus and summary prospectus. Read them carefully before investing. Mutual funds are distributed by Prudential Investment Management Services LLC, member SIPC. Jennison Associates is a registered investment advisor. Both are Prudential Financial companies. © 2017 Prudential Financial, Inc. and its related entities. Jennison Associates, Jennison, the Prudential logo, and the Rock symbol are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide. These materials are for informational or educational purposes only. The information is not intended as investment advice and is not a recommendation about managing or investing your retirement savings. In providing these materials PGIM Investments is not acting as your fiduciary as defined by the Department of Labor. Please consult with a qualified investment professional if you wish to obtain investment advice. Mutual Funds: Are not insured by the FDIC or any federal government agency | May lose value | Are not a deposit of or guaranteed by any bank or any bank affiliate 0282493-00024-00 Expiration: 07/31/2017