I made my only purchase for August this week using the left over money I had saved from July and as much as I could afford from August's wage. I bought 199 shares at 515.35p per share of Catlin Group Ltd (GCL). The total cost including charges was £1,037.49.
They paid out a yield of 5.1% for 2013 and they averaged 6.2% over the last 5 years. This covers the minimum 3.5% I'm looking for in an investment. I'm very fond of the investments that pay over the 5% mark consistently. It's high enough to receive a nice return and it's sustainable. You can pay off the initial cost to an investment in twenty years. This time frame will decrease further with dividends that grow each year.
CGL increased their dividends from 2004 to 2008. In 2009, they were impacted by a 'Rights Issue', which resulted in them making a loss. The dividend was cut by 7.82%. Since then it has increased every year. The Dividend Increase average over 5 years is 2.96%, which includes the -7.82% from 2009. The dividend increased 8.26% for 2013. They recently revealed the Interim payment for September and it has increased from 15.50 cents to 17.7 cents (14.2% increase). I'm looking for companies that increase year after year. CGL have shown a lot of consistency in this area, outside of 2009. The recent increase is encouraging, and I'm comfortable that the positive increase far outweighs the isolated decrease.
CGL averaged 2.1 dividend cover for the last 5 years. It was 2.23 for 2013. These figures are above my base of 1.5.
The share price was 13% below their 52 week high. There is 'potential' value to be had here. CGL's recent first half year results were also positive. They have doubled their pre-tax profits compared to 2013, and they are 'significantly ahead' of their consensus estimates.
The purchase has now taken my portfolio value over the £14k mark. I'm now one purchase away from taking it over the £15k total.
Do you own shares in Catlin Group Ltd? Have you been happy with them? What do you think of it as an investment?
Labels: Stock Purchase