Trading212 Portfolio- 22/06/20

Weeks summary


Stock picked: GlaxoSmithKline

Ticker: GSK

Shares added: 0.3

Total shares owned: 1.23

Dividend yield: 4.61%

Payout ratio: 74%


Dividends received:

£0.18

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This weeks stock

From this weeks poll, GlaxoSmithKline ticker GSK won by a large margin. With this £5 investment we have now hit a total of £20 invest into GSK and we were able to average down in the stock, which is brilliant. Currently at the close of the UK market we are down £0.54 (2.6%), but we will be reinvesting the quarterly dividend to compound this stock.


What does GlaxoSmithKline do?

GSK creates, discovers, develops, manufacture and market pharmaceutical products, vaccines, over-the-counter medicines, and health related consumer products in the Uk, USA and internationally. It operates through four segments: Pharmaceuticals, Pharmaceuticals R&D, Vaccines, and Consumer Healthcare. GSK creates many products from nasal sprays too toothpastes and anti-viral to dermatology medicines. You may recognise some of their products such as Aquafresh, Nicorette, Voltaren and many more. An intresting fact is that they were founded in 1715, making this company over 300 years old.

Fundimentals:

Dividend Yield: 4.61%

Payout ratio: 74%

Profit margin:15.29%

Return on assets: 7.78%

Return on equity: 50.8%

P/E ratio (price to earnings): 15.47

Adjusted EPS: 123.9

EPS (Earning per share) Growth: 4%

BETA: 0.44

Cash: 4.86B

Debt: 32.01B

EBITDA: 10.03B


Stock breakdown:

What I do like about GSK is that they have a very attractive dividend yield, with it yielding 4.61% currently it pays out much above inflation. The little red flag which comes with this nice dividend yield is the 74% payout ratio. This is fairly high which makes this a dividend income stock.


Now looking to the profit margin I see a very nice 15%, what looking into stocks I would like to see a minimum of a 10% profit margin and seeing 15% is a nice sign. Looking deeper into where the profits come from we see the return on assets is around 7.78% which isn’t to impressive. Until we look at the return on equity which is a whopping 50.8%.


Noting that the P/E ratio on this stock is 15.47, this indicates to me that this stock is about fair value. With 20 being over valued in my opinion. Looking at the 52week chart of this stock it is on the average value of this stock. Noting that the recommended trends show majority are hold on this stock. In my opinion it is a great stock to hold in the long term. It is nice to see that for the last 4 quarters GSK has consistently beat earnings


Looking at the cash to debt ratio, we can see that it is fairly high amount of debt to cash. We do have to remember that not all debt is bad as companies can use this to expand and develop further. Compared to an competitor, AstraZeneca which has 4B cash to 21B debt it shows how much more debt GSK carries. The CEO has been committed in changing and streamlining the business so much so that in August 2019 they announced that they completed their transaction with Pfizer to combine their consumer healthcare businesses into a new world leading consumer healthcare joint venture.

https://www.gsk.com/en-gb/investors/consumer-healthcare-joint-venture/

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Dividends received


This week we received another 3 dividend payments totalling £0.18.

O @ £0.08

MAIN @ £0.07

YUM @ £0.03

This added another £0.04 to the charity donation at the end of the month.


Total dividend (Month): £1.98

Total dividend (6 month): $4.32


Amount for charity (6 month): £1.08


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General account summary


For the first time in a while the portfolio went positive, though it was shortly lived. The account is now sitting at -£6.48 (-1.85%) with £351.39 invested at this current moment. This portfolio is really starting to build up and we will soon be pushing £400 invested. This portfolio is making huge milestones, with almost weekly dividends coming into the account and an ever increasing amount of dividends, its a nice feeling knowing this portfolio and our community is working towards a better world. We still have 33 stocks in the portfolio, the aim of this account is to still reach £20 invested into each stock. We have successfully managed this with 5 stocks at the moment, though some of these stocks are currently not paying a dividend we may increase the weighing of some of the more stable stocks.


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What is:

P/E ratio EPS Payout ratio BETA Dividend

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