Legendary investor tips Shopping Centres Australasia as a top pick

A 7% dividend yield is part of the appeal.

a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Anton Tagliaferro is a name synonymous with value investing in Australia. As the founder and Investment Director of fund manager Investors Mutual, which manages over $4 billion in funds and has produced market beating performance since its inception in 1998, Anton's commentary on stocks is always closely followed by the investment community.

In a recent interview published in the Herald Sun, when pushed for a stock pick by the interviewer Anton stated that he liked the "out of favour and low profile" real estate investment trust Shopping Centres Australasia (ASX: SCP).

SCA was spun out of retailer Woolworths (ASX: WOW) in October 2012 and houses around 69 shopping centre assets that generally include Woolworths supermarkets as a major tenant. As Anton stated in the interview, "With a 7 per cent yield and 20-year leases from Woolworths, that's not too bad."

Investor Mutual's flagship fund, the IM Australian Share Fund, has $1.85 billion in funds under management and has returned 11.8% per annum since inception, which is an outperformance of nearly 3% per annum compared with its benchmark. The largest position in the portfolio is Westpac Bank (ASX: WBC). In second place is BHP Billiton (ASX: BHP), however Investor Mutual notes that the portfolio remains "cautious and underweight the resource sector given our concern on the medium term outlook for many commodities, particularly iron ore, due to continued rapid growth in supply, which in our view at some stage will seriously undermine the price."

Also a top 10 portfolio holding is Insurance Australia Group (ASX: IAG), which the fund manager describes as its preferred pick of the insurers. It expects IAG will produce another strong result in financial year 2014 thanks to the Australian operations as well as improvements from IAG's New Zealand and Malaysian operations.

Foolish takeaway

Keeping an eye on what top performing fund managers are doing can certainly be useful for all investors and Anton's comments surrounding Shopping Centres Australasia are definitely worth further investigation by inquisitive investors.

Shopping around the market for dividend-paying stocks? Discover The Motley Fool's favourite income idea for 2013-2014 in our brand-new, FREE research report, including a full investment analysis! Simply click here for your FREE copy of "The Motley Fool's Top Dividend Stock for 2013-2014."

More reading

Motley Fool contributor Tim McArthur does not own shares in any of the companies mentioned in this article.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »