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Institutional Investor Advisor Individual Investor
Total AUM Avg. PM Years Experience Years Since Inception
$218.6M 23 7
As of March 31 2020

Strategy Average Annual Total Returns

(%, Gross of Fees)2
YTD 1 Year 3 Years 5 Years 7 Years Since Inception
ClearBridge Dividend Strategy ESG SMA Composite -20.74 -8.67 3.91 5.43 7.77 8.19
S&P 500 Index -19.60 -6.98 5.10 6.73 9.62 10.07
As of March 31 2020

Overview

The Dividend Strategy ESG portfolio targets a high level of current income, growth of income and capital preservation in challenging markets by owning large cap companies with positive ESG attributes that pay a dividend and have the potential to significantly grow their dividend.

Strategy Overview Primarily large cap strategy focused on dividend income
Benchmark S&P 500 Index
Total Strategy AUM $218.6M
Holdings Range 40-601
Objective High current income, income growth and long-term capital appreciation3

Investment Philosophy

Total return portfolio focused on large cap, high-quality companies that pay an attractive dividend, have the potential to significantly grow their dividends and provide consistent and competitive risk-adjusted returns.

Meet Our Managers

John Baldi

Portfolio Manager
22 Years experience
16 Years at ClearBridge

Michael Clarfeld, CFA

Portfolio Manager
20 Years experience
14 Years at ClearBridge

Scott Glasser

Co-Chief Investment Officer, Portfolio Manager
29 Years experience
27 Years at ClearBridge

Mary Jane McQuillen

ESG Head, Portfolio Manager
24 Years experience
24 Years at ClearBridge

Peter Vanderlee, CFA

Portfolio Manager
21 Years experience
21 Years at ClearBridge

Strategy Facts

Portfolio managers John Baldi, Michael Clarfeld, Scott Glasser, Mary Jane McQuillen and Peter Vanderlee have worked together since 2008 and bring a long tenure of experience managing dividend-focused strategies.

The Strategy focuses exclusively on dominant, well-run businesses that pay a dividend or have the potential to do so.

The team does not deviate from a disciplined investment process focused on income growth.

Literature & Perspectives

  • ESG Investment Program
    1Q20 Commentary: In these challenging times, advancing basic issues of sustainability for all stakeholders will support more positive long-term outcomes.
  • Dividend Strategy
    1Q20 Commentary: Volatility enabled us to increase our focus on more resilient sectors less exposed to transactional consumer business.
  • Energy MLP Strategy
    1Q20 Commentary: Lower midstream cash flows should be manageable at the company level given current distribution coverage ratios.
  • Sustainability Leaders Strategy
    1Q20 Commentary: A quality orientation to companies with strong balance sheets, sustainable cash flows and leading ESG profiles helped during the turbulence.
  • Large Cap Growth ESG Strategy
    1Q20 Commentary: We are proactively sharing our intentions with portfolio companies to support all stakeholders through the coronavirus crisis.

Investment Process

  • Strong focus on current income and income growth
  • Identify strong, well run businesses through proprietary research that integrates environmental, social and governance factors with fundamental characteristics. Seek companies with predictable revenues and superior margins and return on investment
  • Avoid deep cyclicals, turnarounds and enterprises that cannot be reasonably analyzed

Performance

A dividend focus has led to competitive returns over multiple time periods. 

Average Annual Total Returns (%, Gross of Fees)2

YTD 1 Year 3 Years 5 Years 7 Years Since Inception
ClearBridge Dividend Strategy ESG SMA Composite -20.74 -8.67 3.91 5.43 7.77 8.19
S&P 500 Index -19.60 -6.98 5.10 6.73 9.62 10.07

Characteristics

The Strategy's stock selection process results in diversification across all sectors with overweights to those that have historically paid meaningful and growing dividends.

Sector Weights1,2

Representative Portfolio S&P 500 Index
38.53 25.35
Information Technology 16.33 25.48
Consumer Staples 13.21 7.79
Financials 10.78 10.93
Materials 10.48 2.43
Health Care 10.08 15.38
Industrials 9.47 8.22
Utilities 7.67 3.57
Communication Services 7.20 10.74
Consumer Discretionary 5.21 9.80
Real Estate 3.46 3.01
Energy 3.28 2.65
Unassigned 0.00 0.00
-20.74 -19.60
Cash 2.82 0.00
Portfolio Characteristics1,2
Characteristics Representative Portfolio S&P 500 Index
P/E Ratio (trailing 12 mos.) 17.2 17.4
P/E Ratio (forward 12 mos.) 16.1 16.7
Price/Book 4.8 5.7
EPS Growth Next 3-5 Years (%) 8.7 10.2
Weighted Median Market Cap ($ bn) 95.1 118.7
Weighted Average Market Cap ($ bn) 205.8 274.4
ROE 23.4 24.9
Dividend Yield 3.1 2.3
Turnover (trailing 12 mos.) 8.9 --
Risk Statistics1
5 Year Risk Statistics Composite S&P 500 Index
Annualized Returns (5 Years) 5.43 6.73
Standard Deviation (%) 12.44 13.65
Sharpe Ratio 0.40 0.46
Tracking Error (%) 3.30 --
R2 0.95 --
Alpha (%) -0.66 --
Beta 0.89 --
Top 10 Holdings1
Characteristics % of Total Representative Portfolio
Microsoft Corp 4.85
Apple Inc 3.26
Comcast Corp 2.91
Visa Inc 2.69
Nestle SA 2.64
PPG Industries Inc 2.57
Merck & Co Inc 2.56
Procter & Gamble Co/The 2.54
American Tower Corp 2.51
NextEra Energy Inc 2.47
Total 29.00
Total Number of Holdings 54
  • 1

    Source: FactSet. Representative portfolio characteristics, holdings, sector weightings and market cap are based on a representative portfolio and are subject to change at any time. Holdings, sector weightings, market cap and portfolio characteristics of individual client portfolios may differ, sometimes significantly, from those shown. This information does not constitute, and should not be construed as, investment advice or recommendations with respect to the securities and sectors listed.

  • 2

    Past performance is no guarantee of future results. See GIPS endnotes. Performance is preliminary and subject to change.

  • 3

    There is no guarantee that the Strategy's objective will be met.

  • P/E ratios are weighted harmonic average. Price/Book is weighted average.

  • Performance source: Internal. Benchmark source: Standard & Poor’s.
  • Annualized Returns

    1 Yr (3/31/20)

    3 Yrs (3/31/20)

    5 Yrs (3/31/20)

    Since Inception (3/31/20)

    Net of Fees

    -11.2% 0.9% 2.4% 5.1%

    Pure Gross

    -8.5% 4.0% 5.5% 8.2%

    S&P 500

    -7.0% 5.1% 6.7% 10.1%

     

  • ClearBridge Investments, LLC claims compliance with the Global Investment Performance Standards (GIPS®). ClearBridge Investments, LLC ("ClearBridge") is a wholly owned subsidiary of Legg Mason, Inc. ("Legg Mason"). The investment advisory business now known as ClearBridge was registered in September 2005 to facilitate Legg Mason's acquisition of substantially all the equity asset management businesses known as Citigroup Asset Management. These former businesses serve as the foundation of ClearBridge and its claim of GIPS compliance for institutional accounts through predecessor firms, effective as of January 1997.  In June 2008, ClearBridge combined this business with its retail business to form a single GIPS firm.  As of April 1, 2013 and January 1, 2016, ClearBridge's affiliates, Global Currents Investment Management, LLC, and ClearBridge, LLC, respectively, have become part of the ClearBridge GIPS firm. The ClearBridge Dividend Strategy ESG SMA composite actively integrates criteria inclusive of environmental, social and governance (ESG) issues into the portfolio construction of the strategy.  Accounts within the composite are primarily invested in large and mid cap U.S. equities across a wide variety of industries and sectors but could also include ADR's. The portfolio managers seek dividend income, growth of dividend income and long-term capital appreciation. Managers may sometimes hold significant portions of portfolio assets in cash equivalents while waiting for buying opportunities. Results calculated in U.S. dollars. Pure gross returns shown do not reflect the deduction of "bundled" fees and are presented as supplemental information to net returns. The S&P 500® Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks. To receive a complete list and description of ClearBridge composites and/or a presentation that adheres to the GIPS standards, please contact ClearBridge Institutional Marketing.