The Merchants Trust (LSE: MRCH)

Currency in GBP

Last close As at 06/02/2023

GBP5.97

4.00 (0.67%)

Market capitalisation

GBP838m

The Merchants Trust’s investment objective is to provide an above-average level of income and income growth, together with long-term growth of capital, through investing mainly in higher-yielding large-cap UK companies (up to 10% of the fund may be invested in overseas equities). The benchmark is a broad UK stock market index.

Equity Analyst

Melanie Jenner

Mel Jenner

Director, Investment Trusts

Key Management

  • Colin Clark

    Chairman

  • Simon Gergel

    Fund manager

Share Price Performance

Price Performance
% 1M 3M 12M
Actual 6.4 13.1 2.6
Relative 0.8 2.7 1.5
52 week high/low 597.0p/483.0p

Overview

The Merchants Trust (MRCH) is managed by Simon Gergel, chief investment officer of UK equities at Allianz Global Investors (AllianzGI). He highlights that the remaining £16m of the trust’s £42m credit facility has recently been drawn down, taking gearing from c 13% to c 15%. This indicates that the manager, and MRCH’s board, see good value in the UK market, particularly in the type of stocks that fit Gergel’s disciplined investment criteria. The manager continues to seek undervalued companies with solid fundamentals, aiming to generate a high and growing level of income and long-term capital growth. MRCH has a commendable performance track record, outperforming the broad UK market over the short, medium and longer term. It also ranks highly versus its peers in the 22-strong AIC UK Equity Income sector. The trust’s annual dividend has grown for the last 40 consecutive years.

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