Westwood Dividend Growth
Dividend Growth Reports
The Westwood Dividend Growth portfolio pursues long term growth of capital through bottom-up security selection while focusing on companies with a sustainable and growing dividend yield. At least 80% of the portfolio is invested in securities that pay a dividend currently. The process favors companies with high cash flow returns on capital and attractive valuations. The strategy invests in approximately 40-60 companies with market capitalizations greater than $1 billion.
The process begins with a series of quantitative screens that are designed to identify high quality companies with characteristics such as attractive valuation, a high level of cash flow return on capital, sustainable dividend, and a demonstrated commitment to growing the cash flow payout.
After such companies are identified, they are subjected to a proprietary Multi-Factor model which ranks companies based on:
- Free cash flow metrics
- Earnings quality, comparing economic profits to GAAP (Generally Accepted Accounting Principles) profits
The companies that rank in the top quintile are then reviewed by the fundamental research team, and those demonstrating strong fundamental underpinnings are considered for purchase by the portfolio team.
Risk control techniques include a sector weight limit of 25% on an absolute basis, exposure to at least six sectors, and a 5% maximum position size.
Sell triggers may include:
- Decline in the proprietary Multi-Factor ranking score
- Cut in the dividend payout
- Violation of the investment thesis
- Achievement of the predetermined price target
(As of 3/31/2013)
|Inception date||1Q13||YTD||1 yr trailing||3 yr trailing||5 yr trailing||Since Inception|
|Net of Fees||10.9%||10.9%||12.8%||10.1%||6.4%||7.0%|
Click to download composite performance details.
“Past performance is not a guarantee of future returns. Returns are preliminary and are subject to change.
Click here for the performance disclosure. The disclosures provided are considered an integral part of this presentation.”
Contact us to learn more about this and other Westwood portfolios.
Assistant Vice President,
Christopher J. MacDonald, CFA
Senior Vice President,
Matthew R. Lockridge