Rising Dividend Highlights HM1’s Challenge to Narrow Share Price Discount

Robust Investment Performance Drives Dividend Increase

Hearts and Minds Investments Limited (ASX:HM1) has delivered a striking 23.6% uplift in its investment portfolio for the six months ending 31 December 2024. This strong performance has underpinned the Board’s decision to announce an increased fully franked half-year dividend of 8.0 cents per share, up from the previous 7.5 cents.

The half-year dividend translates to an annualised fully franked yield of 5.2%, or 7.4% on a grossed-up basis relative to the company’s share price at the end of December. This yield enhancement reflects both the portfolio’s gains and the company’s commitment to returning value to shareholders.

Portfolio Highlights and Market Drivers

The investment portfolio’s pre-tax return, net of expenses, was buoyed by a favourable decline in the Australian dollar, amplifying gains from global holdings. The Core Portfolio was the primary driver, with standout performers including Zillow (+60%), Guzman y Gomez (+48%), Brookfield Corporation (+45%), Rokt (+40%), and Block (+32%).

Since its inception in November 2018, HM1’s portfolio has achieved an impressive compound annual growth rate of 12.3%, outperforming the MSCI World Index (AUD) benchmark over the same period.

Share Price and Total Shareholder Return

HM1’s share price appreciated 20% over the half-year, rising from $2.58 to $3.10. Coupled with the dividend payments, this resulted in a total shareholder return of 23% for the period. The company has cumulatively paid fully franked dividends totaling 60.5 cents per share since inception, underscoring its consistent income distribution track record.

Outlook and Strategic Confidence

The Board expressed confidence that the continued strong investment performance and increased dividend will help narrow the discount between HM1’s share price and its pre-tax net tangible assets per share. Investors will be watching closely for the full half-year results scheduled for release on 20 February 2025, which will provide further insight into portfolio composition and future dividend prospects.

Hearts and Minds Investments remains distinctive in its dual mission of delivering strong financial returns while supporting Australian medical research, having donated over $72 million to date. This blend of purpose and performance continues to resonate with investors seeking both growth and impact.