BlackRock North American Income Trust plc (LON:BRNA) has announced its latest portfolio update.
All information is at 31 December 2020 and unaudited.
Discover more about the trust at blackrock.com/uk/brna
Performance at month end with net income reinvested
| One Month | Three Months | Six Months | One Year | Three Years | Five Years | |
| Net asset value | 1.0% | 9.8% | 7.8% | -0.8% | 16.8% | 69.9% |
| Share price | 2.0% | 11.9% | 12.5% | -8.6% | 17.7% | 78.3% |
| Russell 1000 Value Index | 1.4% | 9.9% | 11.0% | -0.4% | 18.1% | 71.6% |
At month end
| Net asset value – capital only: | 175.03p |
| Net asset value – cum income: | 175.71p |
| Share price: | 165.75p |
| Discount to cum income NAV: | 5.7% |
| Net yield1: | 4.8% |
| Total assets including current year revenue: | 140.2m |
| Gearing: | Nil |
| Options overwrite | 18.7% |
| Ordinary shares in issue2: | 79,784,044 |
| Ongoing charges3: | 1.1% |
1 Based on four quarterly interim dividends of 2.00p per share declared on 20 March 2020, 5 May 2020, 6 August 2020 and 4 November 2020 for the year ended 31 October 2020, and based on the share price as at close of business on 31 December 2020.
² Excluding 20,577,261 ordinary shares held in treasury.
³ Ongoing charges represent the management fee and all other operating expenses excluding interest as a % of average shareholders’ funds for the year ended 31 October 2019.
| Sector Analysis | Total Assets (%) |
| Financials | 26.3 |
| Health Care | 16.8 |
| Information Technology | 12.4 |
| Consumer Staples | 8.1 |
| Energy | 7.1 |
| Industrials | 6.7 |
| Communication Services | 6.4 |
| Consumer Discretionary | 4.8 |
| Utilities | 4.2 |
| Materials | 2.2 |
| Net Current Assets | 5.0 |
| —– | |
| 100.0 | |
| ===== |
| Country Analysis | Total Assets (%) |
| United States | 74.9 |
| Netherlands | 4.6 |
| United Kingdom | 4.3 |
| Germany | 3.9 |
| France | 2.2 |
| Ireland | 2.1 |
| Switzerland | 1.7 |
| Norway | 0.9 |
| Canada | 0.4 |
| Net Current Assets | 5.0 |
| —– | |
| 100.0 | |
| ===== |
| Top 10 Holdings | Country | % Total Assets |
| Citigroup | United States | 3.4 |
| Verizon Communications | United States | 3.1 |
| Bank of America | United States | 2.8 |
| Wells Fargo | United States | 2.6 |
| American International Group | United States | 2.4 |
| Anthem | United States | 2.3 |
| Comcast Corporation | United States | 2.3 |
| Samsung Electronics | United States | 2.2 |
| Cisco Systems | United States | 2.2 |
| Medtronic | Ireland | 2.1 |
Tony DeSpirito, Franco Tapia and David Zhao, representing the Investment Manager, noted:
For the one-month period ended 31 December 2020, the Company’s NAV increased by 1.0% and the share price by 2.0% (all in sterling). The Company’s benchmark, the Russell 1000 Value Index, returned 1.4% for the period.
The largest contributor to relative performance was stock selection and an underweight exposure to the industrials sector. Notably, selection decisions among industrial conglomerates and an underweight exposure to machinery proved beneficial. In information technology, stock selection and an overweight exposure to the technology hardware, storage and peripherals and IT services industries boosted relative performance. In consumer staples, stock selection in food and staples retailing helped relative results. Other contributors during the month included an overweight exposure to financials and an underweight exposure to consumer discretionary and utilities.
The largest detractor from relative performance was the portfolio’s cash balance, which remains a preferred defensive allocation of the portfolio management team. At the sector level, selection decisions in the communication services sector was the largest detractor from relative results. Within the sector, a lack of exposure to the entertainment industry proved costly during the month. In health care, stock selection in pharmaceuticals weighed on relative results, as did an overweight exposure to health care providers and services.
The portfolio’s option overwriting strategy detracted from relative performance during the month.
Transactions/Options
Transactions: In December, the portfolio initiated a new position in Ameren. Allocations to Cisco Systems and Morgan Stanley were increased during the month. Conversely, we reduced our exposure to Cognizant Technology Solutions, Constellation Brands and Samsung Electronics.
Options: As of 31 December 2020, the Company’s options exposure was 18.7% and the delta of the options was 86.8.
Positioning
As of the period end, the Company’s largest overweight positions relative to the benchmark were in the financials, health care and energy sectors. The Company’s largest underweight positions relative to the benchmark were in the industrials, real estate and communication services sectors.
Source: BlackRock. Data as of 31 December 2020.
19 January 2021
Discover more about the BlackRock North American Income Trust plc at blackrock.com/uk/brna
