SHIELD – Sustainable High Yield | Yield trade to benefit from growth remaining low for longer

We maintain a bullish long term view while short term volatility offers cheaper entry into SHIELD picks. Global growth struggling with US Fed interest rate outlook and China growth plan. Investors are waiting for a magic bullet to get growth back above trend while the reality of the global economy points to lower growth for longer. Markets will once again chase high yielding stocks in an environment of falling interest rates and lower growth. Small cap stock MOC and micro cap VTG are the only low growth cheap yield pick from the SHIELD screen that has average earnings and cash flow per share growth of below 10%, an average of price-earnings and price-cash flow below 10, a dividend yield above 5% and a BUY rating. SHIELD Top 20 picks are: large cap – CBA, WBC, ANZ, NAB and BHP; mid cap – MFG and RMD; small cap – IMF, MOC, PTM, TME, VLW, RRL, IFM, PRG, MIN, CWP and HFA; and micro cap – DDR and VTG. (VIEW LINK)