Preference shares

[simoan]

So... Just out of curiosity, and because I'm at a loose end with it raining cats and dogs here, I have quickly run a screen to see which HYP shares have produced dividend payments that have kept up with inflation (in reported currency) over the past 10 years. I have used Sharepad and based my filter on CPI inflation numbers taken from the BoE website which show total CPI inflation over the 10 years to March 2024 of roughly 33%. Anyone want to name any companies that have managed the lofty 3.3% average per annum increase over the 10 year period? BTW the data does not include index membership from 10 years ago so I have used a £1bn market cap as a low water mark.

Good news. I own two of the winners, so I'll give you for starters Legal & General and BAE Systems. Just a bit of fun! There are 8 companies in total.

[kempiejon]

New thread perhaps?
Quick n dirty look at my port
Segro, BAE, Severn Trent, National Grid, UU., BATS, Diploma, 3i group.

I have LGEN but not held for anything like 10 years, perhaps 4?
I have not necessarily checked the full parameters of 10 years growth and being a yielder 10 years ago. Rather things I have that have bettered 3% for 10 years I hold.

[88V8]

I have considered Pref shares for my HYP, but ultimately I think I'd rather just go down the common stock with high yield route.
There are also debt funds that you could consider that may be a better risk/reward play - NCYF and SEQI come to mind.

Yes, NCYF, SEQI and SMIF all look worth taking a look at. I guess the likes of RECI is similar to SEQI. RECI is yielding 10% and some of those others not far behind.

If you were going to look at ITs in that field, then BIPS and TFIF are also in the mix.

V8

[simoan]

New thread perhaps?
Quick n dirty look at my port
Segro, BAE, Severn Trent, National Grid, UU., BATS, Diploma, 3i group.

I have LGEN but not held for anything like 10 years, perhaps 4?
I have not necessarily checked the full parameters of 10 years growth and being a yielder 10 years ago. Rather things I have that have bettered 3% for 10 years I hold.

Very Good! The other six are HSBC, BATS, 3i Group, Segro, Severn Trent and BHP. Not sure Diploma has ever qualified for HYP but it’s grown its dividend at around 14% per annum over 10 years. One of my largest holdings, just wished I’d owned it 10 years ago

[monabri]

How about some FTSE250 companies ( still within HYP rules) such as Assura AGR or Primary Health Properties PHP?

RIO and ULVR have given compound annual growth rates over 3.3% over 10 yr.

[simoan]

How about some FTSE250 companies ( still within HYP rules) such as Assura AGR or Primary Health Properties PHP?

RIO and ULVR have given compound annual growth rates over 3.3% over 10 yr.

You need to be careful. The data is for the currency in which the dividend is reported. So it does not allow for the post-Brexit devaluation of Sterling which would be cheating, wouldn’t it? Not a very impressive list is it? If you allow for FTSE 350 you get IG Group and Intermediate Capital Group.

[kempiejon]

New thread perhaps?
Quick n dirty look at my port
Segro, BAE, Severn Trent, National Grid, UU., BATS, Diploma, 3i group.

I have LGEN but not held for anything like 10 years, perhaps 4?
I have not necessarily checked the full parameters of 10 years growth and being a yielder 10 years ago. Rather things I have that have bettered 3% for 10 years I hold.

Very Good! The other six are HSBC, BATS, 3i Group, Segro, Severn Trent and BHP. Not sure Diploma has ever qualified for HYP but it’s grown its dividend at around 14% per annum over 10 years. One of my largest holdings, just wished I’d owned it 10 years ago

Diploma hit a sweet spot in 2000 and again 10 years later I collected some both times and added since at lower yields. Dumb luck I'm sure. Lucky me as I also have BHP which have cut their dividends in that time same for HSBA.

How about some FTSE250 companies ( still within HYP rules) such as Assura AGR or Primary Health Properties PHP?

RIO and ULVR have given compound annual growth rates over 3.3% over 10 yr.

You need to be careful. The data is for the currency in which the dividend is reported. So it does not allow for the post-Brexit devaluation of Sterling which would be cheating, wouldn’t it? Not a very impressive list is it? If you allow for FTSE 350 you get IG Group and Intermediate Capital Group.

I collected PHP in the past couple of years and Assura but that was long ago and I didn't have them down as HYP when I bought them along with Rio (cuts and specials) and ULVR (not made inflation beating increases in the past 5 years). IGG and ICP have evaded me thus far.

[IanTHughes]

I have used Sharepad and based my filter on CPI inflation numbers taken from the BoE website which show total CPI inflation over the 10 years to March 2024 of roughly 33%. Anyone want to name any companies that have managed the lofty 3.3% average per annum increase over the 10 year period?

If one is looking for an overall gain of 33.00% over a 10 year period, the Year-on-Year annual gain required would actually be 2.90%.

The data is for the currency in which the dividend is reported. So it does not allow for the post-Brexit devaluation of Sterling which would be cheating, wouldn’t it?

Not really. The study is using UK Inflation, which is of course GBP based, so it is GBP income that should be considered. Any devaluation of GBP, causing increased GBP dividends, will be factored into the Inflation figure used in any case.


Anyway, I must be doing something right. The overall dividend on my High Yield Portfolio (HYP) has increased 41.00% over 10 years ago, making for a Year-on-Year annual increase of around 3.5%.

Enjoy!


Ian

[simoan]

I have used Sharepad and based my filter on CPI inflation numbers taken from the BoE website which show total CPI inflation over the 10 years to March 2024 of roughly 33%. Anyone want to name any companies that have managed the lofty 3.3% average per annum increase over the 10 year period?

If one is looking for an overall gain of 33.00% over a 10 year period, the Year-on-Year annual gain required would actually be 2.90%.

You’re assuming compounding which I am not, I’m not sure the Sharepad screen allows it. All I am filtering for is companies where the most recent FY dividend is 33% higher than it was 10 years ago given the starting point that the market cap was > £1bn and the yield was at least 4%. As I said, it’s a simple filter.

The data is for the currency in which the dividend is reported. So it does not allow for the post-Brexit devaluation of Sterling which would be cheating, wouldn’t it?

Not really. The study is using UK Inflation, which is of course GBP based, so it is GBP income that should be considered. Any devaluation of GBP, causing increased GBP dividends, will be factored into the Inflation figure used in any case.

I don’t agree. I am only interested in the increases in the dividends as declared by the company.

Anyway, I must be doing something right. The overall dividend on my High Yield Portfolio (HYP) has increased 41.00% over 10 years ago, making for a Year-on-Year annual increase of around 3.5%.

The filter does not include any special dividends, so if you include them it will juice your return. As will the beneficial currency movement.

Enjoy!

[simoan]

How about some FTSE250 companies ( still within HYP rules) such as Assura AGR or Primary Health Properties PHP?

RIO and ULVR have given compound annual growth rates over 3.3% over 10 yr.

I must admit I expected RIO to pass the filter, so I have checked the data. It seems both RIO and ULVR fail purely because the yield of both (according to Sharepad) was less than 4% at the start point i.e. FY 2013. I assumed 4% was a reasonably low bar for a High Yield Portfolio but perhaps that’s a more recent phenomenon!

[IanTHughes]

If one is looking for an overall gain of 33.00% over a 10 year period, the Year-on-Year annual gain required would actually be 2.90%.

You’re assuming compounding which I am not, I’m not sure the Sharepad screen allows it. All I am filtering for is companies where the most recent FY dividend is 33% higher than it was 10 years ago given the starting point that the market cap was > £1bn and the yield was at least 4%. As I said, it’s a simple filter.

My apologies. When you stated:

Anyone want to name any companies that have managed the lofty 3.3% average per annum increase over the 10 year period?

I rather assumed that you would be looking for:

any companies that have managed the lofty 3.3% average per annum increase over the 10 year period?

My mistake!

I don’t agree. I am only interested in the increases in the dividends as declared by the company.

Then I can only suggest that you use the inflation figure for the currency "as declared by the company". It would make more sense.

Anyway, I must be doing something right. The overall dividend on my High Yield Portfolio (HYP) has increased 41.00% over 10 years ago, making for a Year-on-Year annual increase of around 3.5%.

The filter does not include any special dividends, so if you include them it will juice your return. As will the beneficial currency movement.

My income figures do not include "specials", with the notable exception of special dividends paid by Admiral Group PLC (ADM). Other special dividends are recorded as Return of Capital (RoC). I am very careful not to record non-income returns as income.

Enjoy!


Ian