November 2019


Stock I'm watching this month:-

WAM - WAM Capital Limited

Sector: Financial Services
Market Cap:  1.59 Billion
Price/Earnings: 105.71
Price/Book: 1.18
Return On Equity: 1.09%
Return On Assets: -1.67%
Debt/Equity: 0.75%

Reasons to watch: WAM is a Listed Investment Company managed by Wilson Asset Management (founded by Geoff Wilson). I have followed Geoff Wilson since before I began investing and I regard him as one of the best investors in Australia. He has also recently championed and ran a campaign when Labor proposed to abolish franking credits in Australia. Besides WAM, Wilson Asset Management has other LIC's such as WAX, WAA, WMI, etc. WAM is purely a dividend play for me, with a current dividend yield of about 7%. The reason I hold WAM instead of the others (WAX, WAA, WMI, etc.) is because of its long track record of dividend payout. I do believe holding any of the other LIC's is just as good since it is all under the same management. WAM has consistently grown its dividend payout with a dividend growth rate of 7.9% over the last 10 years and 3.6% growth rate over the past 5 years.    

Risk: The dividends that WAM is able to payout depends on the performance of the fund. Also, in the event of a financial crisis, the ability to pay dividends is curtailed significantly. WAM did cut its dividend during the 2008 financial crisis.

Sentiment: Hold
Disclosure: Held
Current Price: $2.22
My Strike Price: $1.88 (NTA after tax: $1.88)




Disclaimer: This does not constitute any financial advice or stock recommendations. As always, Do Your Own Research.

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