24 Mar 2021 09:09
London, UK, 24 March 2021
Edison issues review on The Scottish Investment Trust (SCIN)
The Scottish Investment Trust (SCIN) seeks to provide investors with above-average long-term returns, by investing in undervalued international companies. The trust also targets regular dividend growth ahead of UK inflation. SCIN's team, led by manager Alasdair McKinnon, are contrarian, value-focused investors who believe the market is significantly underestimating the strength of the post-pandemic recovery and its capacity to support cyclical and value-type stocks. In February, he revamped the portfolio to take advantage of what he sees as the many 'tremendous opportunities' among unloved areas of the market that he believes will benefit from the multi-year economic rebound he foresees. There are very early signs that these changes are having a positive impact on performance (see chart).
SCIN's share price is trading at a 9.0% discount to cum income NAV, slightly lower than its long-term average around 10% and there is scope for the discount to narrow from its current level if the trust's recent revamp lifts performance and/or value-focused strategies return to favour with investors. The trust offers a yield of 3.1% (based on current share price and the FY20 dividend).
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