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Compass Group Trading Statement.

Practical discussions about equity High-Yield Portfolios (HYP) for income
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idpickering
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Compass Group Trading Statement.

#199462

Postby idpickering » February 7th, 2019, 7:07 am



Compass' organic revenue for the three months to 31 December 2018 grew by 6.9% driven by strong levels of new business wins, continued good retention rates and bolstered by the impact of the new UK Defence contracts and a positive sporting events calendar.

We continue to generate efficiencies through our management and performance (MAP) programme to offset inflationary headwinds.


https://www.investegate.co.uk/compass-g ... 00033013P/

Bouleversee
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Re: Compass Group Trading Statement.

#199687

Postby Bouleversee » February 7th, 2019, 7:16 pm

Many thanks, Ian. Am I the only holder here? One of my better holdings, having bought at 625p in 2000 and 530p in 2001. Not a HYP buy now with a yield of only 2.14% but a very acceptable yield on what I paid, together with an excellent increase in price, of no interest on here, of course. :lol:

I have no idea what the yield was when I bought, however, but am not really bothered.

Grumpsimus
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Re: Compass Group Trading Statement.

#199740

Postby Grumpsimus » February 7th, 2019, 10:12 pm

I also hold Compass, so you are not the only one. The dividend was roughly 4.5% when I purchased.

It is a classic LTBH share, very rarely in the news, just keeps going delivering increases in the dividend year after year. This year it is 12.5% increase.

tjh290633
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Re: Compass Group Trading Statement.

#199748

Postby tjh290633 » February 7th, 2019, 10:39 pm

The problem with CPG is its yield. I have it as a result of having owned Forte, taken over by Granada, merged with Compass, demerged into Compass and Granada TV, which merged with Carlton and became ITV.

The current company dates from January 2001, when it demerged at 482p, with a starting yield of 1.2%, the first two dividends totalling 5.7p. In 2005 the yield was just over 4%, so marginally HYP material then. In fact that was when I transferred the SC PEP into my main PEP at 227p, the next two dividends being 9.8p.

Now we are up at 1630p and the dividends total 37.7p for the last year. Not much over 2% there but my IRR has been 13.7%, and the growth in the dividend has been fourfold in 14 years, so not to be sneezed at.

TJH

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Re: Compass Group Trading Statement.

#199791

Postby Arborbridge » February 8th, 2019, 7:45 am

Like a number of low yielding shares, it is one I've often wanted to buy when the opportunity arises. However, this also applied to other shares, and when the opportunity did arise due to rising yield, it turned out to be the overture to problems being later revealed.

The latest example was WPP, before that Tesco. Both were lauded for being consistent payers of low or sub HYP yield with good dividend growth rates and bigget and best in class. Neither turned out well and both are in the sick bay.

I don't think one can come to a general conclusion, except perhaps there's usually a good reason if a yield alters rapidly when it has been traditionally low. Buying in at such a time risks years of waiting around for recovery.

Arb.

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Re: Compass Group Trading Statement.

#199838

Postby kempiejon » February 8th, 2019, 10:23 am

Arb,
I too was tempted by the WPP history of income growth but I fear I had missed a bit of information that was available when I made my buy or certainly soon after. There was a stated change in financial planning to reduce debt/leverage; that would mean dividend growth slowing. I suspect we'll see a held dividend for a while and those growth years are gone now. I bought at above my HYP yield and they've not fiddled with the dividend yet, that's good enough so far. I'm not so confident I want to buy more at an even higher yield. I think the results are March so we'll see I guess.

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Re: Compass Group Trading Statement.

#199840

Postby bluedonkey » February 8th, 2019, 10:26 am

tjh290633 wrote:The current company dates from January 2001, when it demerged at 482p, with a starting yield of 1.2%, the first two dividends totalling 5.7p. In 2005 the yield was just over 4%, so marginally HYP material then. In fact that was when I transferred the SC PEP into my main PEP at 227p, the next two dividends being 9.8p.

Now we are up at 1630p and the dividends total 37.7p for the last year. Not much over 2% there but my IRR has been 13.7%, and the growth in the dividend has been fourfold in 14 years, so not to be sneezed at.

TJH

Yes, 2005 was when I bought it. I think it was a Pyad recommendation at the time, probably in his "dividend letter" or similar. If only it was a classic HYP share!

pyad
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Re: Compass Group Trading Statement.

#199854

Postby pyad » February 8th, 2019, 11:07 am

bluedonkey wrote:Yes, 2005 was when I bought it. I think it was a Pyad recommendation at the time, probably in his "dividend letter" or similar. If only it was a classic HYP share!


Indeed it was in the first HYP I picked for The Dividend Letter many years ago. A spectacular performer since in both dividend growth and capital growth, though income was the sole reason for my selecting it as with all HYP shares. I never picked it again in any subsequent portfolio because as mentioned by others, its yield became far too low for our purposes.

MDW1954
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Re: Compass Group Trading Statement.

#199870

Postby MDW1954 » February 8th, 2019, 11:48 am

Bouleversee wrote:Many thanks, Ian. Am I the only holder here? One of my better holdings, having bought at 625p in 2000 and 530p in 2001. Not a HYP buy now with a yield of only 2.14% but a very acceptable yield on what I paid, together with an excellent increase in price, of no interest on here, of course. :lol:

I have no idea what the yield was when I bought, however, but am not really bothered.


No, you're not the only one! I inherited a few in 2011, priced at £5.75 at the time of transfer, and was happy to keep them, despite the lowish yield.

I see they're £17.86 today.

The income paid equates to 47% of the value of the inherited shares.

MDW1954


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