Welcome back to Dividend Talk! This week, we’re talking about underappreciated European dividend aristocrats. Spirax Sarco, Total Energies, Sage Group, and BAE Systems are four companies that are a part of the Nobel 30 Index, but we feel they are not talked about enough in our community. We also tackle listener questions about moral investing, high-yield strategies, and managing portfolios for the next generation.

Chapters:

• 00:00 Introduction and Work-Travel Realities
• 03:10 ASML Investor Day & Market Reactions
• 07:20 Siemens: Dividend Hikes, Electrification, and Automation
• 15:00 Spirax-Sarco: Steam Solutions and Cyclical Opportunities
• 21:12 Total Energies: Balancing Oil, Renewables, and Long-Term Strategy
• 32:30 BAE Systems: Defense Stocks, Morality, and Market Position
• 42:00 Sage Group: Small Business ERP Solutions & Cloud Transition
• 50:00 Listener Questions: Bitcoin, AI for Analysts, Pensions, and BDCs

Dividend Hikes and Cuts

• Siemens ($SIE.DE): A notable 10.6% increase in its dividend, backed by strong cash flow generation and a focus on electrification trends.
• Burberry: This once iconic UK company has cut its dividend but was this expected?

European Dividend Aristocrats

• Spirax Sarco ($SPX.L): Cyclical revenue trends and acquisitions have pressured margins, but its leadership in industrial safety solutions and dividend reliability remain appealing for long-term investors.
• Total Energies ($TTE): With a 5.6% yield, the company balances traditional energy investments with a growing portfolio in solar and hydro, offering cautious optimism for a greener future.
• Sage Group ($SGE.L): The shift to a cloud-first model has bolstered earnings and free cash flow. However, its debt-to-equity ratio (above 100%) and competition from fintech challengers remain areas to watch.
• BAE Systems ($BA.L): Defense spending continues to rise globally, boosting BAE’s order book. The company’s diversification across aerospace and maritime makes it a resilient pick, though moral questions around defense stocks persist.

Listener Questions

• Moral Investing in Defense Stocks: Is investing in companies like BAE Systems ethical? While some listeners struggle with this dilemma, others view defense stocks as vital for national security.
• Planning for the Unexpected: Advice for documenting portfolio details and access, ensuring family members can manage investments in case of an emergency.
• BDCs and High-Yield Strategies: Business Development Companies (BDCs) offer tempting yields, but understanding their underlying businesses and risks is crucial before investing.
• UK Wind Energy Trust ($UKW.L): Trading at an 18% discount to NAV, this trust’s inflation-linked dividend makes it appealing, but the potential for a wind-up vote adds uncertainty.

We hope you liked our four European Dividend Aristocrats, but do we feel others are left out? Let us know in the comments

Companies Mentioned ASML, Siemens, Spirax-Sarco, Total Energies, BAE Systems, Burberry, BP, Sage Group, and UK Wind.

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