WAM Research Limited (ASX: WAX)

Sound Investment Portfolio performance: WAX investment objective is to provide the shareholders with a rising stream of fully franked dividends and to achieve a high real rate of return which includes income and capital growth within the risk parameters acceptable to the Directors. WAX latest one-month investment performance as at December 31, 2017 was 0.8% lower than S&P/ASX All Ordinaries Accumulation Index while year to date performance has been up 0.5% and has outperformed the index by 9.7% (per annum) in last five years. WAX investment portfolio has otherwise delivered a strong performance during FY17 and performance returns for investment portfolio were 11.1% over the period while holding on an average of 34.5% of cash. The return on the equity portion of the portfolio was 15.9% and the return on the cash portion of the portfolio was 2.2% for the year 2017. The total shareholder return was 18.8% since 2010, driven by the increase in the share price premium to NTA. Throughout the history Company’s share price has traded at both premiums and discounts to its NTA. For FY17, the Company recorded a pre-tax profit of $20.3 million and paid tax of $7.7 million and dividends of $15.6 million. WAM Research entered the 2018 financial year with a conservative balance sheet, a high cash weighting with no debt and with a flexible and a proven investment approach. The share price has increased by 1.3% in the past one month (as at January 12, 2018) and the stock looks a ‘Speculative Buy’ at the current price $1.535


Dividend Trend (Source: Company Reports)
 

WAM Active Limited (ASX: WAA)

Positive Return with low volatility: WAA latest one-month investment performance as at December 31, 2017 was 0.1% lower than S&P/ASX All Ordinaries Accumulation Index while year to date performance has been up 1.9% and has outperformed the index by 3.6% (per annum) in last five years. WAA has otherwise performed better than the UBS Bank Bill Index overall. During FY17, it reported a pre-tax profit of $2.7 million and after-tax profit of $2.1 million and recorded a 16.0% total shareholder return. The investment portfolio continued to deliver a solid and an absolute performance during FY17 which increased by 11.6% over the period with an average cash of 34.4% held by the group. The investment portfolio delivered these returns while taking less risk than the markets as measured by the standard deviation with a portfolio which recorded a 4.2% against the S&P/ASX. As on 30 June 2017, the share price premium to NTA was 16.0% which was driven by WAM Active’s investment portfolio performance of 11.6%.  It is committed to grow the benefits to all the shareholders and bonus issue was the best option to do so. The options are currently trading on Australian Stock Exchange under the code WAAO and till date 4.6 million or 13.1% of all the options have been exercised. The share price has increased by 3.64% in the past six months but there was a downfall of 2.6% in last three months. Despite the recent fall, the stock looks slightly ‘Expensive’ at the current price of $1.15, looking at the returns and dividend scenario.


Dividend Trend (Source: Company Reports)

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