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27 April 2019
By Maynard Paton
For this market trawl I employed two ratios favoured by ‘quality’ investors.
The first measure was operating margin, which represents the percentage of sales converted into profit.
The second measure was return on equity, or ROE, which is calculated by dividing earnings by the shareholder equity used to produce those earnings.
I used SharePad to identify a suitable company, and selected Victrex — a £2 billion specialist manufacturer of high-performance polymers — for further investigation.
Victrex offered a wonderful 39% operating margin and a robust 23% ROE.
Read my full Victrex article for SharePad.
Maynard Paton
Hi Maynard,
Thanks for this analysis of Victrex.
One of the things that I look at when seeking quality companies is whether they regularly pay special dividends, like Victrex.
I can’t find an easy way of looking for companies that do this in Sharepad, all I do is trawl through the dividend record for each company is there an easier way? What do you think of this approach, some rather wonderful small caps pop up when I do this : Bodycote, Softcat, Bioventix.
Hi Roger,
I have tried looking for special-dividend payers, too, and could not find an obvious way in SharePad. I ended up on investegate.co.uk and using the ‘keyword’ option within that top search box and searching for ‘special’. Even then some specials are missed as companies sometimes refer to them as ‘additional’ distributions etc. Generally a good sign when a company pays a special, although SYS1 is a notable exception within my portfolio.
Maynard