Abrdn Smaller Companies ... Share Discussion Threads

[davebowler] 05/9/2017 14:25

4 Sept Aberdeen Smaller Cos Income Trust Plc NAV Including Income £313.49p

[spectoacc] 02/8/2017 15:07

Thanks @davebowler. I maintain "small cap" is a misnomer.

[davebowler] 02/8/2017 14:50

Winterfloods;
· Differentiated from peers – Aberdeen Smaller Companies Income is differentiated within the UK Small Cap sector by its fixed income portfolio, which broadly offsets its c.10% gearing and boosts income. The fund also has a relatively focused portfolio of 45 stocks, although it remains diversified with less than 30% invested in the top 10 holdings. Other than its stable-mate, Dunedin Smaller Companies (79%), the fund’s highest portfolio overlap with peers is just 16%. With the impending merger of Aberdeen AM and Standard Life it is worth noting that Aberdeen Smaller Companies Income and Standard Life UK Smaller Companies* are differentiated by their investment approaches, with the latter focusing on growth, and just a 10% overlap between the two portfolios.

· Focus on quality businesses has delivered outperformance – The managers, Jonathan Allison and Ian Hewett, aim to invest in companies with strong management teams and balance sheets that are generating high returns on capital. The fund’s NAV has outperformed its benchmark, the FTSE Small Cap ex Investment Companies Index, over the last one, three and five years and has also outperformed the UK Small Cap peer group over the last three and five years. Perhaps more importantly, since Jonathan Allison and Ian Hewett took charge of the fund in March last year, the NAV has outperformed both the benchmark and the UK Small Cap peer group.

· Attractive yield – The fund has a historical dividend yield of 2.8%, based on the current share price, and was 1.07x covered by revenue in 2016. The yield, which is boosted by the fund’s allocation to fixed income, is at the higher end of the small cap peer group. Dividend growth has been above 3% in each of the last four financial years and the fund also benefits from a revenue reserve equivalent to 1.4x aggregate dividends in FY2016.

· Discount wider than peers – The fund’s discount is currently around 20%, which is at the wider end of the UK Small Cap peer group. It is broadly in line with its 12 month average, but over the period the discount has ranged between 17% and 25%. In June the differential in discount level between the fund and the UK Small Cap peer group reached its highest level in the last five years, and, although it has since narrowed, it still remains significant.





Winterflood View

Aberdeen Smaller Companies Income has a solid performance record, with outperformance of both its benchmark and peer group over the last five years. However, the focus on quality makes it likely that the fund would lag in rapidly rising markets. In terms of its market capitalisation the fund is at the smaller end of the peer group and so liquidity can be patchy. However, we believe that the 2.8% yield is attractive and the 20% discount offers value, both in absolute terms and also relative to the fund’s small cap peers. Given the relatively small size of the fund, performance is likely to be the key driver of any re-rating rather than share buybacks. It is also possible that there could be some discount tightening in the lead up to the fund’s next continuation vote, which is due in 2020 and is held every five years.

[riverman77] 18/7/2017 16:28

Couldn't see any tips, but it was always a bit of an outlier. While most of the other smaller company funds have rerated, this is still on very wide discount despite solid performance and a decent yield. I note the directors have been buying too so clearly a bargain.

[mozy123] 18/7/2017 15:01

5% - rather large move - tipped somewhere?

[davebowler] 18/7/2017 14:20

17/7/17 Aberdeen Smaller Cos Income Trust Plc NAV Including Income 298.49p

[spectoacc] 27/6/2017 09:38

Wonder at what point - if at all, to be fair - someone attempts to deal with the NAV discount. Seems a bit illiquid/small for the activists to get involved, but never know - eg an Elliott or a BTEM. The portfolio itself seems fairly liquid (being mid-cap not smallcap on the whole) if they pushed for wind-up rather than buyback.

Remain a holder - NAV near £3, yield in meantime.

[taylor20] 07/6/2017 17:13

Typo I guess?

Roughly 70-odd% in UK equities:

Anyway, discount has widened massively so topped up this morning.

[deadly] 07/6/2017 14:40

portfolio shows 76% in Indian fixed interest! Yet this was not shown in the last annual report. Would like to know more....e.g. is it hedged?

[spectoacc] 06/6/2017 19:18

Some very strange big fallers today, when lots of the things that should fall on a Corbyn victory (or Corbyn/Nicola Sturgeon coalition) really didn't do much at all - eg the bus/rail co's. I know the communists aren't calling for instant privatisation of these, but their business model is basically in run-off if Corbyn's PM.

I've a few choice bets on just in case - JC is like the Second Coming to many. After Brexit & Trump, can't rule it out.

[killing_time] 06/6/2017 18:51

Yep, all my small companies trusts are taking a bit of a hammering with Thursday looming.
Expect them to all bounce back if Cons get a majority. If Comrade Corbin gets in heaven help us.

[mozy123] 06/6/2017 18:44

Fear selling - discount is get juicy again

[killing_time] 04/5/2017 13:26

Bought ASCI about a month ago then start of this week bought HSL and BRSC.
All small companies trusts seem to be really motoring at the moment. Surprised by how fast the NAV's are rising.

[davebowler] 04/5/2017 09:38

2/5/17 Aberdeen Smaller Cos Income Trust Plc Undiluted NAV Including Income 294.52p

[mozy123] 02/5/2017 12:30

Well im still not selling. :)

[davebowler] 02/5/2017 11:12

27 Apr NAV Aberdeen Smaller Cos Income Trust Plc Undiluted Including Income 291.07p

[mozy123] 13/4/2017 18:37

looking good boys!

[essentialinvestor] 13/4/2017 11:19

286.43, wow.

[davebowler] 13/4/2017 10:22

11 Apr NAV Aberdeen Smaller Cos Income Trust Plc Undiluted Including Income 284.54p

[essentialinvestor] 13/4/2017 09:53

IF there is another leg to this bull market (would define that
as the UKX somewhere near 7700 approx) ASCI may trade well into the 2.30-2.45
range.


That is very much speculation/guesswork and IMV only, as always please DYOR.

[essentialinvestor] 12/4/2017 19:40

VCP is the latest addition along with Scandinavian Tobacco.

They top sliced, Fenner, Dechra, Intermediate Capital and Hiscox on the last update.
Dechra was a 3.5% holding following the reduction, so adjustments made usually
tend to be conservative.

[mozy123] 12/4/2017 18:45

Loving the discount here. Adding more.

[wskill] 12/4/2017 15:20

Yes I hear what you are saying guys but with a 31.7% discount to net assets it does give a decent sized moat .
Pretty good stock picking here as well held SHRS for a decent length of time and had some very good dividends and capital growth which was mostly due to narrowing of discount which I hope to emulate here.