You still have to have them

Finweek English Edition - - INVESTMENT - MARC ASH­TON

LAST YEAR I de­scribed the US-based in­dus­trial con­glom­er­ate Gen­eral Elec­tric (GE) as one of those must-have shares in your port­fo­lio. I gen­uinely be­lieve that if you are a re­tail in­vestor and have only been look­ing at South African shares, then you have two blue chips you should be buy­ing: GE and Google.

Th­ese are great busi­nesses and both have man­aged through chal­leng­ing times. GE has con­sis­tently paid out a quar­terly div­i­dend for the last 100 years and in the pre­vi­ous fis­cal it paid out $6.45bn in div­i­dends, or $17m per day!

GE is trad­ing on a for­ward price-to-earn­ings mul­ti­ple of just 13 times and while its div­i­dend yield of un­der 2% looks poor, keep in mind that man­age­ment has in­di­cated it will re­turn a to­tal of $18bn in the cur­rent fis­cal through share buybacks and div­i­dends to share­hold­ers.

GE is a great busi­ness as it of­fers ex­po­sure to tech­nol­ogy, fi­nan­cial ser­vices and in­fra­struc­ture. It is the bluest blue chip out there.

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