Share price growth and getting a share dividend

The share price of a lot of ASX stocks are lower than six months ago. A current company's share price however does not indicate future performance, earnings or dividend payments.

Despite the the current market price we find it hard to contain our excitement as this selling process runs its course and opportunities to buy shares and receive a dividend payment present themselves.

If you are interested in learning more about the Small Cap Stocks and how to invest in this area read more here.

1 in 5 of our Small Cap stocks are taken over 

Just this week our Small Cap stocks are being taken over delivering big price rises on these company's shares and possible future cash dividends paid to investors like our subscribers.

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There have been a number of takeovers in our sector in recent weeks, which includes :

  • Infomedia (IFM)

  • Alliance Aviation (AQZ)

  • Reckon (RKN)

  • and a couple of months back Senex Energy (SXY)

The list of Small Cap takeovers is growing by the day.

50% of our Small Caps issue dividend payments

When companies pay dividends it is a sign of value. More to the point, positive medium-term results in our portfolios demonstrate that dividends work no matter the share market sentiment.

We have been recommending Small Cap dividend portfolios since 2016 and it’s a fact that

"once they’ve been running for longer than 12 months, two to three stocks in each of our small cap portfolios have returned more than 100%."

Therefore through looking at the past performance our Small Caps shares, payments include both a dividend payment PLUS big potential for capital gains. The valuation goes from being dividend based to growth based.

Stunning performance - Dividend portfolio

We have recommended 11 Small Cap Dividend Portfolios over the past five and a half years, which includes 14 stocks that have doubled or more. That includes their dividends, but the bulk of the return was from share price growth.

Both contributing to a rewarding investment strategy for our investors.

Overall our dividend portfolio's have an average return of 32.0%.

  • Compare that to the 10.4% return of the S&P/ASX All Ords Index, or the 1.6% from the S&P/ASX Small Ords.

A general point across all portfolios is that buying additional shares over time, rather than just buying and forgetting, greatly reduces the risk of the share market ups and downs.

Also, the more shares you own the better as diversification increases earnings for investors.

The best performing portfolios have an array of shares i.e. 9 plus, which illustrates a benefit of diversification. 

One of the key takeaways is that when you decide to buy a small cap from a company that does pay dividends, the first thing you look at isn’t the dividend amount of those paid, but the balance sheet.

I cannot emphasise this enough.

This is one of the elements highlighting just how important stock picking is to make money as an investor.

Gold Stock update

We look again at the major gold producers Evolution Mining (EVN) and Northern Star Resources (NST). The former has come under tremendous pressure due to production & cost downgrades.

EVN remains a quality producer, forecast to grow production 25% over the next two years.

Also, the miner’s costs are among the lowest in the business. NST is also world class and also has cost issues, although being an underground miner, these are less acute.

Opportunity to buy shares now

Our advice to investors throughout Covid was correct to buy more quality shares in small parcels.

Shareholders like our subscribers made a lot of money.

We see the opportunity to profit again now.

Advice on buying and selling

Prices are lower than six months ago. We find it hard to contain our excitement as this selling process runs its course at the opportunities which present themselves.

Investors must be careful not to chase mirages, be patient, let the shares come to you, and remember that there is always another around the corner.

Find out which Blue Chips to invest in.

11 years of big performance for our subscribers

✅ 19% or 1 in 5 of all Small Caps we tipped in the last 11 years have been taken over!

✅ Why does this matter? Takeovers rocket up the share price and making money is the reason why investors love small caps!

✅ 57% average return on all our 250 + Small Cap shares!

✅ 67% average return on our best buys.

✅ 1000% return on our 10 best performing Small Cap shares.

How do I make money as a shareholder? We’re buying more shares!

Want access this performance?

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Our in-house portfolio manager has spent more buying shares in one day last week than he has in the entire 12 months.

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Richard Hemming

Richard Hemming

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Richard is a leading market commentator and expert on ASX Small Caps provides investment opportunities in Small Caps that you won’t get anywhere else.

Under the Radar Report is licensed to give general financial advice only (ASFL: 409518). The author does not own shares in any of the stocks mentioned.

Under the Radar Report is licensed to give general financial advice only (ASFL: 409518). The author does not own shares in any of the stocks mentioned.

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