| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | 5% | 23.1% |
| 2025 |
|---|
| 5.0% |
Schafer Cullen's Global High Dividend ADR strategy underperformed in Q3 2025 due to growth outperforming value and US equities outperforming international markets, but remains ahead year-to-date by significant margins. The managers maintain their conviction in high-quality dividend-paying companies at reasonable valuations, with 91% of portfolio companies increasing dividends by an average of 10.9%. Key contributors included strong stock selection in Materials, Healthcare, Consumer Staples, and Financials, with standout performances from Zijin Mining, Johnson & Johnson, Altria, and UniCredit. The strategy added Vinci, a French infrastructure operator, while exiting UPM-Kymmene and Svenska Handelsbanken. Looking forward, the managers see compelling opportunities in international equities, which represent only 27.5% of the MSCI World Index versus a long-term average of 48.7%. They believe value investing remains attractive despite current headwinds, with global value as oversold relative to growth as during the Dot-Com Bubble. The portfolio's focus on leading companies with strong competitive advantages positions it well for technological innovations including AI, while maintaining defensive characteristics through dividend-focused investing.
The strategy focuses on investing in high-quality, dividend-paying companies at attractive valuations with a long-term investment horizon, emphasizing international diversification and value-oriented stock selection while maintaining disciplined price-to-earnings and dividend yield criteria.
The managers believe their strategy of buying shares in strong companies at attractive valuations and holding them for the long term remains attractive. They expect international equities to outperform US counterparts over the next decade as US market concentration normalizes. Global dividend-paying value equities are viewed as one of the few bright spots given attractive valuations in both absolute and relative terms.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Dec 4 2025 | 2025 Q3 | BTI, C, DG.PA, ET, IBE.MC, JCI, JNJ, JPM, MO, MS, NVS, RIO, SIE.DE, UCG.MI | AI, dividends, Europe, financials, growth, international, technology, value | DG FP | Schafer Cullen's dividend-focused strategy underperformed in Q3 as growth dominated value, but maintains strong year-to-date outperformance. The managers see compelling long-term opportunities in international value equities, which are deeply oversold relative to US markets. Portfolio companies delivered robust 10.9% average dividend growth, reinforcing the strategy's income-generating capabilities while positioning for eventual value style recovery. |
| Aug 27 2025 | 2025 Q2 | 2899.HK, 8766.T, AVGO, BA.L, BTI, CVX, DUK, ET, IBE.MC, JCI, JNJ, JPM, MRK, MS, NVS, SGO.PA, SIE.DE, TSCO.L, UCG.MI, ZURN.SW | dividends, Dollar, Europe, financials, international, long-term, Quality, value | - | Schafer Cullen's dividend-focused strategy outperformed value benchmarks in Q2 through strong international stock selection, particularly in Financials and Industrials. The managers maintain conviction in their value approach, citing attractive international valuations, expected USD weakness, and strong portfolio dividend growth of 8.6%. Strategy positioned to benefit from mean reversion away from US market concentration. |
| Mar 31 2025 | 2025 Q1 | AIBRF, BAESY, CVX, DNBBY, DUK, ENB, ET, IBE.MC, JNJ, KOF, MO, MURGF, NSRGY, NVS, SIE.DE, SVNLY, UNCRY, VICI, VOLVY, ZURVY | dividends, energy, Europe, financials, international, Utilities, value |
ENB.TO UCG.MI AIBG.L DTE.DE 2899.HK |
Global High Dividend ADR strategy significantly outperformed in Q1 2025 as international equities rallied versus US markets. European industrials and financials led performance while energy holdings benefited from supply concerns. Portfolio companies delivered strong dividend growth of 9.7%. Managers see international equities in early stages of multi-year outperformance cycle driven by attractive valuations and emerging fiscal catalysts. |
| Aug 27 2021 | 2021 Q4 | AA4.L, EGI.AX, ESP.L, SSIF.L, TPOU.L, VSL.L | activism, Discount Capture, global, Listed Funds, Outperformance, value | - | Global Value Fund achieved 29.2% NTA growth in FY2021, driven by exceptional 24.9% returns from discount capture strategy. Key winners included Third Point Investors and Empiric Student Property, while aircraft leasing exposure faced Covid headwinds. The manager aggressively deployed capital into dislocated markets and expects continued outperformance as opportunity set remains elevated despite market normalisation. |
| Jun 30 2020 | 2020 Q4 | AA4.L, ESP.L, HAST.L, JGCI.L, PCFT.L, PSH.AS | activism, COVID-19, Discount Capture, Financial Services, global, real estate, value, volatility | - | Global Value Fund's discount capture strategy delivered resilient performance during COVID-19 market turmoil, generating 0.2% returns while adding 3.1% through value unlocking activities. The portfolio now contains significantly more embedded value than historically due to market dislocations creating wider discounts across the investment universe, positioning the fund well for future value realization. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2025 Q3 |
DividendsThe strategy focuses on high-quality dividend-paying companies with strong balance sheets. 91% of portfolio companies increased dividends by an average of 10.9% year over year, with portfolio dividend income growing 9.2%. The managers remain committed to investing in companies with operational resilience to deliver progressive dividend growth over the long term. |
Dividend Growth Income Yield Progressive Payout |
ValueGlobal value remains deeply out of favor relative to growth, similar to the Dot-Com Bubble peak. The managers believe value equities offer attractive valuations in both absolute and relative terms. They emphasize buying shares in strong companies at attractive valuations with low price-to-earnings ratios and high dividend yields. |
Valuation Price-to-Earnings Undervalued Contrarian Mean Reversion | |
AIThe managers view generative artificial intelligence as a modest positive for their portfolio companies, enabling cost reductions and margin expansion through productivity improvements. They believe technological innovations tend to benefit leading companies with higher market shares and stronger balance sheets that can invest in improving their competitive position. |
Artificial Intelligence Productivity Technology Innovation Automation | |
| 2025 Q2 |
ValueGlobal value has outperformed growth over the last one, three, five and seven years. Value remains more out of favor today over a trailing 10-year basis than during the peak of the Dot-Com Bubble. Key drivers include strong performance of financial companies benefiting from rising interest rates and industrial companies exposed to long-term secular tailwinds. |
Value Growth Outperformance Financials Industrials |
DividendsFollowing four consecutive years of strong dividend growth, 84% of portfolio companies that have declared dividends have increased their payments by an average of 11.4% year-over-year. Across the entire portfolio, dividend income has grown year-over-year by an average of 8.6%. The strategy focuses on companies with balance sheet strength to deliver progressive dividend growth. |
Dividend Growth Income Balance Sheet Progressive Yield | |
DollarAfter the worst first half performance for the US Dollar in the last 50 years, a long-term bear market in the USD appears likely. Continuing USD weakness would benefit non-US equity performance as historically demonstrated. Factors include de-dollarization trends, balance of payments challenges, and over-owned US assets by foreign investors. |
USD Weakness Currency De-dollarization Balance of Payments International | |
EuropeWestern Europe appears likely to benefit from substantially higher fiscal spending over the next decade and potential for further economic integration. In Continental Europe, meaningfully higher fiscal spending by countries such as Germany is likely to lead to structurally higher economic growth, particularly positive for well-positioned financial and industrial companies. |
Fiscal Spending Economic Integration Germany Growth Infrastructure | |
FinancialsFinancial companies such as banks and insurers benefit from rising interest rates. Strong performance from AIB Group, Morgan Stanley, JP Morgan, and UniCredit drove relative outperformance. UniCredit reported its best quarter in history with record results across all key performance indicators including 8.3% YoY increase in net profit. |
Banks Interest Rates Net Interest Income Capital Position Insurance | |
| 2025 Q1 |
DividendsFollowing four consecutive years of strong dividend growth, 82% of portfolio companies that declared dividends increased payments by an average of 9.7% year-over-year. Across the entire portfolio, dividend income grew 5.8% year-over-year. The strategy focuses on companies with balance sheet strength and operational resilience to deliver progressive dividend growth over the long term. |
Dividend Growth Shareholder Returns Income Progressive Dividends Yield |
ValueInternational value has already outperformed growth over the last one-, three-, five- and seven-year periods. MSCI EAFE Value has provided over five times the return as MSCI EAFE Growth since November 2020. Despite recent outperformance, value remains more out of favor today than during the peak of the Dot-Com Bubble. |
Value Investing Price Discipline Attractive Valuations Low PE Undervalued | |
Energy TransitionThe North American energy industry is experiencing a generational Golden Age driven by electrification, data center buildouts, and America's reindustrialization. Government decarbonization efforts and technological advancements in electric vehicles are creating surge in electricity demand. Enbridge is well positioned as a key supplier given abundant supply and low-carbon impact of liquified natural gas. |
Electrification Data Centers LNG Renewable Energy Grid Demand | |
Defense SpendingEuropean companies like BAE Systems are benefiting from increasing multi-year spending on critical defense needs that had been neglected until recently. BAE Systems continued to enjoy tailwinds from global defense spending underpinned by realization of self-reliance by European nations. |
Defense European Defense Military Spending Self-Reliance Security | |
Infrastructure SpendingEuropean companies such as Siemens are benefiting from increasing multi-year spending on critical infrastructure needs that had been neglected until recently. Western Europe appears likely to benefit from substantially higher fiscal spending over the next decade along with potential for further economic integration. |
Infrastructure Fiscal Spending European Integration Automation Smart Infrastructure | |
AIDevelopments in artificial intelligence technology are demanding energy in orders of magnitude greater than prior modalities, with data center investments in North America expected to total $190bn by 2030. Most technological innovations like generative AI are a modest positive for portfolio companies which should be able to lower costs and expand operating margins via productivity improvements. |
Artificial Intelligence Data Centers Productivity Technology Innovation Energy Demand | |
| 2021 Q4 |
Discount CaptureThe Company's discount capture strategy generated gross returns of 24.9% in FY2021, representing significant outperformance over underlying market and currency exposures. This strategy focuses on unlocking value from securities trading at discounts to their intrinsic worth through catalysts and corporate actions. |
Discount Value Catalysts Outperformance Alpha |
Aircraft LeasingInvestment in Amedeo Air Four Plus, a London-listed aircraft leasing fund focused on providing steady income from long-term aircraft leases. Despite air travel being severely impacted by Covid-19, the company maintains strong cash position and continues receiving lease payments from Emirates. |
Aircraft Leasing Aviation Emirates Income | |
Student HousingInvestment in Empiric Student Property, a UK student accommodation REIT. The UK purpose-built student accommodation sector has attractive supply/demand dynamics including structural undersupply and growing international student market. Share price up almost 50% during FY2021. |
Student Housing REIT Property UK | |
Hedge FundsSignificant investment in Third Point Investors Ltd, a London-listed feeder fund investing in a US$8Bn hedge fund. Despite the manager's strong performance with 54.4% returns, the fund suffered from poor discount to asset backing, leading to shareholder activism efforts. |
Hedge Activism Third Point Discount Performance | |
| 2020 Q4 |
Discount CaptureThe fund's core strategy involves investing in assets trading at discounts to intrinsic value and actively unlocking that value through shareholder advocacy and activism. Despite market volatility, the discount capture strategy added 3.1% gross to performance in FY2020, demonstrating the effectiveness of this approach even during extreme market stress. |
Value Activism Discounts Catalysts Arbitrage |
Student HousingThe fund invested in Empiric Student Property, a UK student accommodation REIT, based on supply-demand imbalances and turnaround potential. While COVID-19 created significant headwinds for the sector, the manager sees the shares trading at a 40% discount to conservative asset backing and has been adding to the position. |
Real Estate Education UK Recovery Turnaround | |
Financial ServicesThe fund held Polar Capital Global Financial Trust, which was negatively impacted by the severe economic recession likely to increase loan losses and falling interest rates hurting loan profitability. The investment was partially hedged but still detracted from performance due to sector-specific headwinds. |
Banks Interest Rates Credit Hedging | |
AviationInvestment in Amedeo Air Four Plus, which owns and leases aircraft to Emirates and Thai Airways. Despite COVID-19 severely impacting air travel, the manager found an asymmetric opportunity with the company trading near cash backing, providing significant downside protection and multiple scenarios for value creation. |
Aircraft Leasing Recovery Cash Asymmetric |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Dec 4, 2025 | Fund Letters | James Cullen | DG FP | Vinci SA | Industrials | Construction & Engineering | Bull | Euronext Stock Exchange | Airports, Concessions, growth, infrastructure, valuation | Login |
| Mar 31, 2025 | Fund Letters | Global High Dividend ADR | ENB.TO | Enbridge Inc. | Energy | Oil, Gas & Consumable Fuels | Bull | Toronto Stock Exchange | AI, Canada, data centers, defensive, Dividend Growth, Electrification, energy infrastructure, LNG, long-term contracts, natural gas, Pipelines, utilities | Login |
| Mar 31, 2025 | Fund Letters | Global High Dividend ADR | UCG.MI | UniCredit SPA | Financials | Banks | Bull | Borsa Italiana | Central Europe, consolidation, dividend yield, European Banking, Fiscal Expansion, Germany, Italy, M&A, pan-European, Value | Login |
| Mar 31, 2025 | Fund Letters | Global High Dividend ADR | AIBG.L | AIB Group PLC | Financials | Banks | Bull | London Stock Exchange | capital returns, dividend yield, Government Divestiture, infrastructure investment, Irish Banking, Mortgage Lending, oligopoly, Post-Crisis Recovery, Pricing power, Value | Login |
| Mar 31, 2025 | Fund Letters | Global High Dividend ADR | DTE.DE | Deutsche Telekom AG | Communication Services | Diversified Telecommunication Services | Bull | XETRA | 5G Spectrum, Brand Premium, Defensive growth, Dividend Growth, Germany, network infrastructure, Quality, T-Mobile, telecommunications, US market | Login |
| Mar 31, 2025 | Fund Letters | Global High Dividend ADR | 2899.HK | Zijin Mining Group Company Ltd. | Materials | Metals & Mining | Bull | Hong Kong Stock Exchange | Battery metals, China, Copper, Counter-cyclical, Critical Minerals, Electrification, energy transition, Geopolitical hedge, Gold, Lithium, Mining, Resource nationalism | Login |
| TICKER | COMMENTARY |
|---|---|
| JNJ | Johnson & Johnson delivered a robust second quarter earnings report that exceeded consensus expectations and included a notable upward revision to full-year guidance, supported by a strong performance in its medical devices segment, driven by continued post-pandemic recovery in elective procedures and strong growth in interventional solutions and orthopedics. |
| MO | Altria Group enjoyed a combination of strong growth in its On! nicotine pouch brand, resilient earnings driven by pricing power in its core cigarettes business and share repurchases. |
| BTI | British American Tobacco benefited from an improving performance in its modern oral and US combustibles categories, prompting a raised revenue forecast for 2025, while the ongoing monetization of its stake in ITC and strong free cash flow generation supported its dividend and deleveraging efforts. |
| UCG.MI | UniCredit outperformed following better-than-expected quarterly results; the company stands to benefit from several catalysts including fiscal stimulus driven loan growth across its European footprint along with the potential for consolidation across several of its key markets. |
| MS | Morgan Stanley reported record Capital Markets revenue in the second quarter, driven by equity capital markets activity and equities trading volumes, while its Wealth Management division reported 14% y/y revenue growth, as fund flows grew 7% and market share was strong. Furthermore, management was able to control expenses well despite the strong revenue growth, as a 70.7% efficiency ratio was 130 bps below consensus estimates. |
| SIE.DE | Siemens outperformed on the back of strong growth in its Mobility division, which saw orders triple thanks to large-scale rail contracts in Egypt and the US, while its Smart Infrastructure division saw strong demand from data center and AI-related infrastructure projects. |
| RIO | Rio Tinto outperformed on the back of a sharp recovery in iron ore prices following second quarter weakness. Investor confidence was further supported by the company's continued progress on strategic growth projects, notably the ramp-up in lithium and the Simandou iron ore development, which is on track for first production in November. |
| C | Citigroup was part of a rally as the big banks passed the Federal Reserve's annual stress tests this summer and subsequently raised their dividends. The group should benefit from interest rate cuts that spur economic activity, loan growth, and M&A activity. |
| JPM | JP Morgan Chase was part of a rally as the big banks passed the Federal Reserve's annual stress tests this summer and subsequently raised their dividends. The group should benefit from interest rate cuts that spur economic activity, loan growth, and M&A activity. |
| DG.PA | Vinci is a major global operator of concessions and a provider of energy and construction services primarily in Europe. In its concessions division, Vinci operates a network of motorways in France spanning over 4,000 kilometers that provides predictable cash flow while being indexed to traffic growth and inflation. The company also operates 72 airports serving 318 million passengers in 14 countries. In its Energy Services division, Vinci benefits from several long-term megatrends such as the modernization of energy generation and distribution infrastructure, the increased desire for energy efficiency in factories and buildings and the build-out of data centers and telecommunication networks. |
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