Flagship’s portfolio outperforms index by 20%
Published 13-AUG-2018 14:33 P.M.
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2 minute read
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Name: Flagship Investment Ltd (ASX:FSI)
Market Capitalisation: $44 million
Share Price: $1.73
Funds management group, Flagship Investments Ltd (ASX:FSI) performed well in fiscal 2018 with its after-tax profit increasing by 10.2%.
However, it was the performance of the ASX listed companies in its portfolio that made it stand out from the pack, with many larger funds management groups no doubt envious of its 20.1% increase in value.
This represented a substantial outperformance compared with the overall market.
As a result, the Net Tangible Asset (NTA) per share value of the company increased by 8.5% in fiscal 2018 to 198.2 cents per share at 30 June 2018, after paying dividends of 7.5 cents per share or 4.1% of the 2017 NTA. Interestingly, this isn’t reflected in the company’s current share price which is trading at a 25 cents per share discount to its NTA value.
The past performance of this product is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.
Key holdings performing well during reporting season
FSI’s has an investment horizon of three to five years and focuses on quality companies that have the ability to grow their earnings and dividends over this period.
Management is of the view that this should ensure continued growth in the future dividends it declares, while also believing there is significant capital appreciation potential for the portfolio.
Rather than simply focusing on the big banks and miners and a clutch of other top 20 ASX companies, FSI throws the net wider, looking for emerging companies.
However, casting an eye across the portfolio there are a few big names that have performed well in the last week following the release of strong results.
Note that any decision with regards to adding this stock to your portfolio should be taken with caution and professional financial advice sought.
Some strong performances since June 30
One in particular that stands out is Magellan Financial Group (ASX:MFG) which is in its top 10 investments.
Based on its share price as at June 30, Magellan Financial Group accounted for about 3.8% of FSI’s portfolio by market value. After delivering an outstanding result last week and flagging the likelihood of earnings growth and stronger dividends the company’s shares surged to a 12 month high of $28.32, not far short of its all-time high of $29.50. Importantly, from Flagship’s perspective, its shares were trading at $23.30 as at June 30, implying a capital gain of circa $430,000 in the last six weeks.
The past performance of this product is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.
For investors looking to take a leaf out of Flagship’s book, here is a list of its investments as at June 30:
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