MENU

Should you invest in Bki Investment Co Ltd for its large 6.68% yield?

Bki Investment Co Ltd (ASX: BKI) is one of Australia’s largest listed investment companies (LICs) with a market capitalisation of nearly $1 billion. The LIC released its quarterly investment report earlier today and made a staunch defence of franking credits for its shareholders.

This LIC has a management expense ratio of 0.17%, which is one of the lowest in the industry.

It looks to invest for the long-term in profitable, high yielding and well managed companies. Bki aims to increase the dividend over the long-term and it has done this effectively.

Over the last 10 years Bki’s total shareholder return has been an average of 8.3% per annum compared to the S&P/ASX 300 Accumulation Index average return of 5.2% per annum. This translates to a 3.1% average outperformance per annum over the past decade.

It owns shares of many of Australia’s blue chips like National Australia Bank Ltd (ASX: NAB), Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC) and Wesfarmers Ltd (ASX: WES).

Foolish takeaway

Bki is currently trading with a trailing grossed-up dividend yield of 6.68%, which is quite good, and it has proven to be a very consistent dividend payer over the last 15 years. The share price is $1.56 compared to the pre-tax NTA of $1.54 and the post-tax NTA of $1.47. Bki has a reasonably good record but I wouldn’t buy it just for the dividend, I’d want a stronger performance from the underlying portfolio.

That’s why I’d much rather invest in this top dividend stock if I wanted growth and growing dividends over Bki.

OUR #1 dividend pick to grow your wealth over the new financial year is revealed for FREE here!

Financial year 2018 is here and The Motley Fool’s dividend detective Andrew Page has revealed his must buy dividend share to grow your wealth in 2018.

You might not know this market leader's name, but it's rapidly expanding into a highly profitable niche market here in Australia. Even better, the shares boast a strong, fully franked dividend that should balloon in the years to come. In other words, we're looking at the holy grail of incredible long-term growth potential AND income you can watch accruing in your account in real time!

Simply click here to grab your FREE copy of this up-to-the-minute research report on our #1 dividend share recommendation now.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Wesfarmers Limited. The Motley Fool Australia owns shares of National Australia Bank Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…

Including:

The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!