JPMorgan Claverhouse

JCH’s consistency and pure UK equity exposure mark it out from its peers…

The Hardman & Co Monthly: September 2023

Feature article: Equity Income – UK or Global? Should investors widen their horizons? Introduction: ► The UK Equity Income sector (UKEI) is the fourth-largest investment company (IC) sector in the Association of Investment Companies’ (AIC) universe, with £12.5bn of assets (as at August 2023), and is the traditional home for investors looking for income in the equity market. ► The UKEI not only provides investors with a better dividend yield than the ge

Hardman & Co Insight: Equity Income – UK or Global? Should investors widen their horizons?

Introduction ► The UK Equity Income sector (UKEI) is the fourth-largest investment company (IC) sector in the Association of Investment Companies’ (AIC) universe, with £12.5bn of assets (as at August 2023), and is the traditional home for investors looking for income in the equity market. ► The UKEI not only provides investors with a better dividend yield than the general UK market, but also has a strong track record of dividend growth. Indeed, many funds feature on the AIC’s “dividend heroes”

JPMorgan Claverhouse

JCH is on track for half a century of consecutive dividend growth…

JPMorgan Claverhouse

JPMorgan Claverhouse (JCH) offers an actively managed pure exposure to companies listed on the London Stock Exchange. This makes it relatively unusual in the UK Equity Income sector in offering undiluted access to UK companies, but it also stands apart because of its near unrivalled track record of increasing its dividend over 49 consecutive years. JCH offers a prospective dividend yield of 4.6% (see Dividend section).

Catch a tiger by the tail

It’s the topic on everyone lips. Yes, Inflation. It is thirty years since the UK has seen inflation at a higher level. Will it subside, or will it persist? Not possessing a crystal ball, this isn’t something we are going to determine here. However, what we will discuss are the various trusts that investors might like to consider as a reaction to this very novel environment. We consider how one might most directly benefit from rising inflation, and potentially protect capital or income in real te

Dividends in the time of corona

“A cow for her milk, a hen for her eggs, and a stock, by heck, for her dividends.” This ditty was written by John Burr Williams, a foundational thinker in the theory of investment valuation and one of the foremost influences on another investor also known for his pithy investing wisdom, Warren Buffett. In markets, attention is often grabbed by glamourous and exciting opportunities for investors looking for the next big thing, so it is all too easy to forget that there is a large, more sober coho

JPMorgan Claverhouse - Overview

JPMorgan Claverhouse (JCH) has a straightforward mandate that requires all of its investments to be listed on the London Stock Exchange. This makes it relatively unusual in the UK Equity Income sector, where trusts often have some flexibility to invest overseas. This means that investors who share the managers’ belief that the UK stock market is cheap by international standards are getting an undiluted exposure through the trust. In the managers’ view, the UK market is at a ‘once in a generation

JPMorgan Claverhouse - Overview

JPMorgan Claverhouse (JCH) seeks to provide both capital and income growth from UK equities. It has a long track record of delivering dividend growth and the board recently announced the total dividend was up 1.7% in FY 2020, the 48th consecutive year of increases. JCH is the only AIC UK equity income ‘dividend hero’ to have achieved dividend growth ahead of inflation every year for the last two decades. The current dividend yields 4.6%. As discussed under Dividend section, revenue reserves hav

JPMorgan Claverhouse - Overview

JPMorgan Claverhouse (JCH) seeks to provide both capital and income growth from UK equities, and is one of the AIC’s dividend heroes, having grown its dividend every year for 47 years. The trust is run by William Meadon and Callum Abbot with a bottom-up stock-picking approach within a strong risk-control framework. The team believe it is this which has enabled them to outperform the benchmark in c. 70% of the quarters since 2012, when William took over management. The team rely on a blend of qua

Hold fast

A long, long time ago, I can still remember how, that election had us all talking about sterling (well, some of us). Instead now we are hard put not to talk about mass dividend cuts, with Link Group estimating dividend cuts of 47% or more in the UK equity market. Way back in those distant epochs of early December 2019, we appeared to be approaching a greater degree of certainty about the shape of the future in the UK: an election was in the offing which promised to help resolve the outlook for o

The importance of buying earners*

March is traditionally considered ‘ISA season’, when UK investors focus on their annual ISA allowance and are encouraged to ‘use it or lose it’. As we highlighted in our article last year, investment trusts within ISAs are an excellent way to benefit from the power of compounding over the long term, without worrying about the tax consequences of whether you are receiving capital gains or dividend income. Our analysis last year showed that the top ten compounding trusts – since Personal Equity P

JPMorgan Claverhouse - Overview

JPMorgan Claverhouse (JCH) invests solely in the UK equity market. The trust has an enviable track record of dividend growth which now stands at 47 consecutive years, and it is the only UK equity income ‘dividend hero’ (a trust which has raised its dividend every year for 20 or more years) to have achieved dividend growth ahead of inflation in every year of the past two decades. Managed by the highly experienced William Meadon and (since January 2018) Callum Abbot, the investment process emphas

Holding something in reserve

It used to be said that in central London you were never more than six feet from a rat. Nowadays, the saying has been updated: you are never more than six feet from a Pret-aManger. Before Pret came McDonald’s, serving the same burgers in the same buns from London to Tokyo. Such was the ubiquitous nature of the fast food giant that in 1986 The Economist launched the ‘Big Mac Index’. Presently, this famous index of relative currency strength suggests sterling is seriously undervalued [1] . Sterlin

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

Tatton Asset Management (TAM LN) - Record net inflows

Tatton, the leading on-platform discretionary fund manager (DFM) and IFA support services Group has released a trading update ahead of its results to 31 March 2024, due on 18 June 2024.

BlackRock World Mining

BRWM’s managers: we see all the classic signs of high commodity prices...

LIBERUM: Plus500: Strategic progress pays dividends

Jupiter Green

JGC’s fundamental story continues to show resilience, but the discount remains wide…

Lowland Investment Company - Is the tide turning?

Lowland Investment Company’s (LWI’s) unconstrained, multi-cap investment policy differentiates it from most peers in the AIC UK Equity Income sector. It offers investors broad market exposure, outside of the large, traditional ‘income stocks’ at a 13% discount to NAV. The underperformance of small- and mid-cap companies versus larger peers has slowed and a turnaround would be very positive for LWI. Portfolio returns are already benefiting from acquisition activity, spurred by low valuations, and

NextEnergy Solar Fund – High- and growing-income opportunity?

NextEnergy Solar Fund (NESF) is almost 10 years old. Since launch, it has built a £1.2bn, 933MW portfolio of 100 operating solar assets, powering the equivalent of over 330,000 homes, declared dividends totalling £333m, and avoided the emission of about 2.2 Mt CO2e. NESF is on track to pay 8.35p in dividends, with forecast dividend cover of about 1.3x. Share price weakness that has afflicted the whole sector means that dividend translates to a yield of 11.1%, one of the highest in its sector, a

LIBERUM: Speedy Hire: Weakness in FY 24 but recovery in FY 25

Primary Health Properties - Strategic and accretive Irish expansion

Primary Health Properties (PHP) has agreed to acquire Ireland’s first Enhanced Community Care (ECC) facility for a total consideration of €30m. With its interim results, PHP highlighted its continued plans for strategic expansion in Ireland, where higher yields support accretive investment in an expanding market. Alongside low-risk, value-creating asset management schemes and accelerating organic rental growth, this represents a key opportunity for continuing growth in income. Our forecasts are

Building a robust platform for growth - FY24 pre-close statement

Against a tough trading background in FY24, Speedy Hire has taken steps to build a platform for long term sustainable growth through the launch of its Velocity strategy. While progress has been more strategic than financial in the year – although we note positive underlying cash flow was achieved - new business wins, the acquisition of Green Power Hire and a transitioned B&Q model all suggest that profitability is likely to move ahead again from FY25 onwards. Speedy’s FY24 pre close statement e

abrdn Private Equity Opportunities – On the way to greener pastures?

Despite navigating through what its managers considered to be challenging conditions in 2023, abrdn Private Equity Opportunities (APEO) was able to report both positive NAV growth and double-digit share price returns in its recently published annual results. APEO’s discount has narrowed by more than 10% in recent months, so that it is trading on a 28.9% discount currently, narrowing from about 45% last October. These figures were generated over a period that saw a slowdown in activity in Europea

Vanquis Banking Group+ (VANQ, House Stock, 47p) - Deep value

VietNam Holding - Introducing redeemable shares

VietNam Holding (VNH) posted a solid net asset value (NAV) per share total return (TR) in 2023 of 15.8% (22.4% in US dollar terms), outperforming the Vietnam All Share index (VNAS), which posted an 11.7% return, and its direct peers. The investment manager remains confident that 2024 will be strong for Vietnamese equities, underpinned by average 20% y-o-y expected earnings per share (EPS) growth. VNH recently introduced a share redemption facility (on top of regular share buybacks), which allows

UK Equities: Overlooked, oversold, and over here

In this note we look at the gap between perception and reality in the UK equity market, the opportunities and threats in the economic and market outlook, and the emerging consensus that the valuation discount versus other major markets is at or close to an inflection point. We consider the benefits of UK equity strategies both for income investors and for those seeking exposure to the higher growth potential of smaller and mid-cap companies.

Bigger and better