- Larger cap shares struggle against strict dividend quality checks
- Mid- and small-cap stocks remain riskier but dividend tests are a first sense check.
Larger companies are still struggling to score well against our quality income stock criteria. Again, miner BHP Group (BHP) is the biggest company passing at least 6/8 tests. The same score is also achieved by investment platform business Hargreaves Lansdown (HL) and private equity focussed investment company 3i Group (III).
Spread betters CMC Markets (CMCX) and IG Group (IG) did slightly better - both passing seven large cap screen tests.
The only company to score 8/8 was agricultural specialist Carr’s Group (CARR) but it is much more appropriate to judge it against the small cap criteria. It fails to rank on the small-cap screen, however, as it falls down on account of not being in the top third of small-cap dividend payers by yield.
On Aim the dividend yield is a good sign of a value but quality sanity checks are crucial. Miner Pan African Resources (PAF) and fund management business Polar Capital Holdings (POLR) reassuringly pass all our tests but, as ever, further research should be carried out before deciding to invest.
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