Schafer Cullen High Dividend Value Equity


Strategy Overview

Portfolio Managers: Jim Cullen and Jennifer Chang Firm Strategy AUM: $12.1 billion as of 06/30/2020 Benchmarks: Russell 1000 Value Total Return & S&P 500

The High Dividend Value Equity strategy, launched in 1994, allows investors to participate in the long-term upside potential while simultaneously providing substantial downside protection of stocks. In accordance with our underlying philosophy, the High Dividend portfolio invests in undervalued companies with above average earnings growth. In addition, we place an emphasis on stocks with dividend yields greater than that of the S&P 500 and strong dividend growth. The added component of higher dividend yields have demonstrated greater protection during market downturns.

The main features of this strategy are:

  • Low P/E Discipline
  • High Dividend Yields
  • Strong Dividend Growth

The dynamic aspect of this strategy is the ability of the stocks in the portfolio to grow their dividends. Steady dividend growth has a surprisingly powerful impact over time. An overlooked fact is that half of the return for equities over the last 85 years has been attributed to the compounding of dividends. Looking at a more recent period, from 1975 to 1990, the Dow Jones Industrial Average achieved a total return of 831%. But without reinvesting dividends, the gain would have been only 346%.