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14-Jan-2021: In the cover letter accompanying their December 2020 Investment Update or "LIC Snapshot" as they now call it, Geoff Wilson (from WAM Funds) said today:
Dear Fellow Shareholder,
We are pleased to announce the December 2020 Investment Update for our listed investment companies.
Markets rallied in the final month of a very turbulent year. The Trump Presidency is coming to a disgraceful end with the storming of the United States Capitol building and a second impeachment of the outgoing President, while a new strain of the coronavirus and rising case numbers in the US and Europe weigh on healthcare systems. The vaccine roll-out and the US stimulus package approval supported equity markets in December.
The S&P 500 Index rose by 3.7%, the NASDAQ Composite Index 5.7%, the UK FTSE 100 Index 3.1%, the Euro Stoxx 600 Index 2.5%, Japan’s TOPIX Index 2.8% and China’s CSI 300 Index 5.1% in local terms, while the MSCI World Index (AUD) declined 0.5% for the month. In Australia, a coronavirus outbreak in Sydney and localised lockdowns during the month caused concern among investors ahead of the summer holiday period. The Australian dollar rose 9.7% against the US dollar in 2020, underpinned by rising commodity prices, with iron ore reaching a nine-year high in December. The S&P/ASX All Ordinaries Accumulation Index rose 1.8% for the month.
Our listed investment companies' 2020 performance
We are pleased to deliver strong absolute and relative investment portfolio performance during the challenging social, economic and financial landscape that we witnessed this year. Our six equity-focused listed investment companies’ (LIC) investment portfolios outperformed* their respective benchmarks in the 2020 calendar year and the 2021 financial year to date.
Supported by strong risk-adjusted outperformance and profits reserves available, WAM Leaders Limited (ASX: WLE) and WAM Global Limited (ASX: WGB) announced FY2021 fully franked interim dividend guidance of 3.5 cents per share and 5.0 cents per share respectively.
Based on their 13 January 2021 share prices, these represent annualised grossed-up fully franked dividend yields of 7.5%# for WAM Leaders and 6.0%# for WAM Global.
WAM Leaders has 24.3 cents per share in profits reserve**, representing 3.5 years of dividend coverage for shareholders. WAM Global has 43.0 cents per share in profits reserve**, representing 4.3 years of dividend coverage for shareholders. We look forward to sharing the interim results for all seven of our LICs in the coming weeks.
* Investment portfolio performance and index returns are before expenses, fees and taxes.
# Grossed-up dividend yield includes the benefit of franking credits and is based on a tax rate of 30.0%.
** The profits reserve is before the fully franked interim dividend guidance.
--- end of excerpt --- You can access their full December 2020 report here.
[I currently hold WGB and WMI, and I have held WAM, WMA (previously BAF), WAA, WAX and WLE previously, and may do so again in the future.]
19-Nov-2019: November 2019 Shareholder Presentation
Note: This Presentation is related to the WAM Group (WAM Funds) + FG (Future Generation) Funds November 2019 Australian Roadshow (which I'll be attending here in Adelaide next Wednesday) and covers all of WAM Group's 6 LICs: WAM Global (WGB), WAM Leaders (WLE), WAM Capital (WAM), WAM Research (WAX), WAM Microcap (WMI) and WAM Active (WAA).
This one is for the Sydney leg of the roadshow, which includes their AGMs, but similar Presentations will be made at all of the venues they attend during the roadshow over the next couple of weeks.
WLE (WAM Leaders) is one of six LICs (Listed Investment Companies) managed by Wilson Asset Management Group (WAMG). WLE focusses on larger companies, predominantly in the ASX100, and most of their positions are in the ASX50.
They are currently (as at Friday 17th May 2019) trading at a 10% discount to their April 30th pre-tax NTA - which was $1.23. WLE closed on Friday at $1.105. It would be reasonable to expect a little bit of a rise today (Monday 20th May 2019) considering Labor has just lost the unlosable Federal Election, partly on the back of their policy of changing the refundability of franking credits for a large number of Australians. With the Libs now set to retain government, that issue has been put to bed for at least another 3 years (and quite probably longer), and WAMG's founder and CIO, Geoff Wilson, who is also the Chairman of WLE, was a very vocal opponent of Labor's failed policy on franking credit changes. He was the first to coin the phrase "Retirement Tax" which was picked up by most of the opponents to the policy and most of the independents and minor party senators who in most cases also pledged to vote against the changes should Labor win the election and try to introduce legislation to bring into effect their poorly thought out and badly structured policy (a little editorial licence here thank you, those views expressed here are not necessarily those of Strawman.com owners or staff or even necessarily the views of the majority of Strawman users, although I suspect that most people who hold dividend paying shares would prefer the status quo). Anyway, bank shares might have a little bounce today, as might Telstra and other stocks viewed as "yield" or "income" stocks. WLE, ARG, AFI, MLT and some of the larger LICs who hold bank shares and other large cap income stocks might also do reasonably well on the back of Labor's defeat. WLE look good here as long as you can buy them below their last reported NTA, and, as I said, they closed Friday at around 10% below their last reported NTA (net tangible asset backing).