The share price of listed investment company (LIC) Argo Investments Limited (ASX: ARG) has firmed 1.7% in early trade on Monday morning after the $5.2 billion company reported strong half-yearly results.
Here's what shareholders need to know:
- Profit grew 8.9% to $114 million on the prior corresponding period (pcp) thanks largely to higher dividends and distributions from the group's portfolio of investments
- Earnings per share increased 7.6% to 17 cents per share (cps)
- A fully franked interim dividend of 15 cps has been declared, this represents growth of 7.1% on the pcp. The shares will trade ex-dividend on February 11 with payment scheduled for March 4.
- Net tangible asset (NTA) backing per share declined by 1.1% to $7.28
- For the 12 months ending December 31, Argo's portfolio returned 2.8% which was a slight outperformance against its benchmark the S&P/ASX 200 Accumulation Index
- Amongst the top performing holdings within the portfolio were automotive dealership group AP Eagers (ASX: APE), global investment bank Macquarie Group Ltd (ASX: MQG) and private hospital operator Ramsay Health Care Limited (ASX: RHC)
- The largest purchase made during the six months ending December 31 was $21.4 million spent on shares in Westpac Banking Corp (ASX: WBC)
- Two other notable purchases for the portfolio during the half year were New Zealand-based insurer CBL CORP FPO NZ (ASX: CBL) and newly-listed real estate agency Mcgrath Ltd (ASX: MEA)
Foolish takeaway
With an historic track record of outperforming the market and a diversified portfolio of quality companies, Argo is an easy way for investors to gain wide exposure to the ASX.
It's worth noting however that at its current share price around $7.70, shares in Argo are trading at a meaningful premium to its NTA backing.
