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Institutional Investor Advisor Individual Investor
Total AUM Avg. PM Years Experience Years Since Inception
$17.5B 27 8
As of June 30 2017

Strategy Average Annual Total Returns

(%, Gross of Fees)2
YTD 1 Year 3 Years 5 Years 7 Years Since Inception
ClearBridge Dividend Strategy Composite 8.75 15.67 9.00 13.27 14.76 12.25
S&P 500 Index 9.34 17.90 9.61 14.63 15.41 9.83
As of June 30 2017

Overview

The Dividend Strategy portfolio targets a high level of current income, growth of income and capital preservation in challenging markets by owning high-quality large cap companies that pay an attractive dividend and have the potential to significantly grow their dividends.

Strategy Overview Primarily large cap strategy focused on dividend income
Benchmark S&P 500 Index
Total Strategy AUM $17.5B
Holdings Range 50-801
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

Michael Clarfeld, CFA

Portfolio Manager
17 Years experience
11 Years at ClearBridge

Hersh Cohen

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

Peter Vanderlee, CFA

Portfolio Manager
18 Years experience
18 Years at ClearBridge

Strategy Facts

Portfolio managers Hersh Cohen, Michael Clarfeld 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

  • Dividend Strategy
    2Q17 Commentary: Markets moved higher amidst conflicting signals from different parts of the economy.
  • Dividend Strategy
    1Q17 Commentary: Growing political uncertainty and rich valuations failed to slow market gains.
  • Dividend Strategy
    4Q16 Commentary: Despite a narrowing yield advantage, stocks reacted positively to potential pro-growth policies.
  • Dividend Growers Can Thrive in Rising Rate Cycle
    Targeting stocks with increasing dividends has proven effective in past tightening regimes.
  • Dividend Strategy Update
    3Q16 Update: PM Peter Vanderlee, CFA discusses market activity during 3Q, how the PM Team has managed the portfolio, and gives his outlook.

Investment Process

  • Maintain a strong focus on current income and income growth
  • Identify strong, well run businesses. 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 long-term returns.

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

YTD 1 Year 3 Years 5 Years 7 Years Since Inception
ClearBridge Dividend Strategy Composite 8.75 15.67 9.00 13.27 14.76 12.25
S&P 500 Index 9.34 17.90 9.61 14.63 15.41 9.83

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
Financials 16.93 14.55
Consumer Staples 13.11 9.05
Information Technology 13.10 22.26
Industrials 9.95 10.28
Consumer Discretionary 9.43 12.27
Health Care 6.83 14.51
Utilities 6.07 3.16
Energy 6.00 6.01
Materials 5.68 2.85
Real Estate 4.17 2.93
Telecommunication Services 2.09 2.14
Cash 6.66 0.00
Portfolio Characteristics1,2
Characteristics Representative Portfolio S&P 500 Index
P/E Ratio (trailing 12 mos.) 22.7 21.5
P/E Ratio (forward 12 mos.) 19.2 18.6
Price/Book 4.3 4.5
EPS Growth Next 3-5 Years (%) 10.9 12.0
Weighted Median Market Cap ($ bn) 91.5 87.8
Weighted Average Market Cap ($ bn) 168.6 162.1
ROE 17.3 17.9
Dividend Yield 2.4 1.9
Turnover (trailing 12 mos.) 11.9 --
Risk Statistics1
7 Year Risk Statistics Composite S&P 500 Index
Annualized Returns (7 Years) 14.76 15.41
Standard Deviation (%) 9.65 11.69
Sharpe Ratio 1.47 1.28
Tracking Error (%) 3.81 --
R2 0.91 --
Alpha (%) 2.41 --
Beta 0.79 --
Top 10 Holdings1
Characteristics % of Total Representative Portfolio
Berkshire Hathaway Inc. Class B 3.70
Nestle S.A. Sponsored ADR 2.56
Apple Inc. 2.51
Blackstone Group L.P. 2.44
Brookfield Infrastructure Partners L.P. 2.40
Microsoft Corporation 2.34
Alphabet Inc. Class C 2.32
Comcast Corporation Class A 2.31
Home Depot, Inc. 2.28
Raytheon Company 2.20
Total 25.05
Total Number of Holdings 66
  • 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. Neither ClearBridge Investments LLC nor its information providers are responsible for any damages or losses arising from any use of this information.

  • Annualized Returns  1 Year (ending 30-Jun-17) 3 Years (ending 30-Jun-17) 5 Years (ending 30-Jun-17) Since Inception (ending 30-Jun-17)
    Net-of-fees  14.9% 8.3% 12.5% 11.5%
    Gross-of-fees  15.7% 9.0% 13.3% 12.3%
    S&P 500 17.9% 9.6% 14.6% 9.8%
  • 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 composite invests in large and mid cap U.S. equities across a wide variety of industries and sectors. The portfolio managers seek dividend income, growth of dividend income and long-term capital appreciation. Investments may also be made in targeted investments in preferred stock, convertible bonds and REITS. Results are calculated in U.S. dollars.  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.