Member Info for tomglan

Coeurdelion, the only issue I have with that logic is whether a single stock like Berkshire is any more diversified if it splits itself into separate listings for its 60+ wholly owned operating businesses and its 30+ public securities portfolio. Likewise, one could argue that L&G is simply a collection of a few disparate yet intertwined businesses, and that both, therefore, add more diversification to a portfolio than, say, a pure-play widget manufacturer would.

Dividend paid, withdrawn, and now sitting in my bank account thanks to AJ Bell. Beats my old platform (looking at you, iWeb).”

The point is to grow your passive income. If a company pays an 8% dividend yield and grows its dividend at 2% a year, then by reinvesting those dividends, your income grows at roughly 10% annually. That means your passive income doubles every ~7 years, which is the real goal.

> Correct me if I'm wrong but we have never before been taxed for just owning something, be that property, valuables or money.

Actually, we already do have ownership taxes in the UK: Council Tax (for property), Vehicle Excise Duty (for cars), Boat licences, and ATED (for company-held property). Even holding money gets hit indirectly via inflation eroding its value (stealth tax).

"In the first six months of 2024, 18% of its revenue was generated by its new categories portfolio, up from just 6% in 2017." It seems BATS sleight of hand has caught someone off guard. According to the 2024 annual report, the revenue for new categories was £3,432, representing 13.3% of total revenue. The ~18% figure refers to 'Smokeless,' which includes traditional oral products.

UK is 8% of group net revenue (per the 2023 annual report, page 85).

"Tomglan - how do you get to an averaged annualised return of "just under 10% per year" when (i) you state the average yield has been 6.5% pa, and (ii) the share price is only up 17% over the 10 year period, so an average annualised growth rate of 1.6%?"

You can re-create and verify the ~10% return by creating a simple spreadsheet that maps out the number of shares you'd end up with if you re-invested the dividend each year. Here's a rough calculation of where the 10% comes from though: 6.5% average div yield for the period + 8% average div growth = 14.5% (assuming yield stays constant) - 4.5% due to de-rating of shares (i.e. you purchased the shares with a 5% yield, they now sit at 8% which works out as a -4.8% per year headwind) = ~10% return.

“Considering LGEN sp is the same as it was 10 years ago you have to ask whether it's a good investment.”

A £10,000 investment in 2013 would have bought around 5,000 shares, with dividends re-invested at around the average price for each year you’d now have 10,000 shares. Including the recent dividend, this now totals about £25,000, which equates to an average return of just under 10% per year. This is despite the shares having de-rated to an 8% dividend yield compared to an average of 6.5% for the 10 years.

29th Feb "These purchases are the last purchases to be made under the first £550 million tranche (the "First Tranche") announced on 06 October 2023, part of the £1.1 billion share buyback programme announced on 05 October 2023; accordingly, the First Tranche of the programme has been completed in accordance with its terms. Under the First Tranche, the Company repurchased 30,317,505 shares of 10 pence each at an average price of 1,814.13 pence per share."

So the board knew of an offer for ~230p in late Jan but decided not to tell shareholders and subsequently shares were changing hands for 155p yesterday morning. They then had their hand forced when the shares started to randomly spike up 10-13% on seemingly no news. Is this how bids are normally handled?

"Total capital returns in FY24, including ordinary dividends and share buyback, expected to exceed £2.4bn" So working backwards that's at least a 2% dividend increase on top of the buyback.

"Prime minister Rishi Sunak is considering imposing a complete ban on smoking for the next generation in what would amount to some of the strictest measures to tackle the health problem anywhere in the world." From FT

If they only keep the US listing then UK shareholders will have to pay a 15% dividend withholding tax on all future dividends which would be a major disaster for UK shareholders in my opinion. There are some SIPP providers that have arrangements for US dividends to be paid gross, however, this wouldn't work for shares held within ISAs.

Americans blowing up the global financial system due to greed... can't we have a different crisis for once?! Let's hope that LGEN's 240% SII coverage is enough to weather what's on the horizon.

Yes and the market also thought LGEN was exposed to the pandemic fallout in March 2020 which allowed me to pick up a chunk of shares in the 140s. Who knows what the future holds but they seem to be performing and if they can continue to do so eventually the price will come to reflect this.

I thought it was Tuesday as well until I double-checked their website: "Direct Line Insurance Group plc ("Direct Line Group") will publish its 2022 preliminary results on Monday 13 March 2023 at 7am. Management will host a presentation for investors and analysts at 11.30am."

Looks like the price moves on results day was just algos upset that they won't be able to dance around another big buyback. I must admit I was confused why the SP went down on those results, especially given the div 6% increase. Not sure I buy the debt shock either... BATS has about £3bn of free cash flow after paying the dividend, did they really expect the debt to go down much during a year they also spent £2bn on buybacks? Next gen starting to look interesting too. ATB

Well done for holding on for so long Jon. I recall BAT produced a chart in their 2017 Investor Day presentation which showed total shareholder return grew at a compound annual rate of 17.5% for almost two decades - totally eclipsing the FTSE 100. The smart strategy was to hop aboard and not get off - as you did.

Trading Update for Q3 2020 released 8th Nov 2022 "our 2023 and medium-term targets and the outlook for dividend capacity remain unchanged". Hmmm... time for a new CEO and board I think, preferably hired based on competence.

Change of management? No thanks. Check out the performance of LGEN vs AV over 5 years or more on google finance, speaks for itself.