Scott Phillips

speaker

1,587 appearances 2 recordings 1 series first heard Jun 2022 last heard 31 Aug

Scott Phillips’s voice in public audio — every appearance, attributed to the second.

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Recordings per month over the last 12 months — 1 in all, peaking in Aug 2026 with 1.

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Australian Finance Podcast · 📈 Investing for income: dividends & passive income · 2 Jun 2022 podcast

But yeah, as a total market, about 4% comes from dividends historically and about 6% from capital growth.

Yeah, nice.

And I've got to say, mate, to some degree, there is a trade-off or can be a trade-off between those two.

So it's really important if you're looking for income-producing companies in your portfolio, you want to see what you're looking for.

Telstra is probably the best example.

It's paid an absolute heap of dividends over.

It's had fully frank dividends at that.

The share price has hardly budged over, what, five, six years?

I haven't got the numbers I've got in front of me.

But there are some circumstances where if you're trading them off deliberately, you're not saying, well, the company will grow less because it's paying a dividend.

But you find that a business that is a stable, solid, really big business maybe doesn't have a lot of growth opportunity because it's already Telstra, right?

It owns most of the market.

So what does it do with excess cash?

I guess it'll pay the shareholder because it doesn't have those growth opportunities.

Other businesses will grow and grow and grow.

Warren Buffett's company, Berkshire Hathaway in the US, great example.

Hasn't paid a dividend since 1965, has done a spectacular job of reinvesting those profits and creating lots of value for shareholders.

So there can be a trade-off from time to time, or at least companies that exhibit different attributes.

But a business like, say, Domino's, for example, it's grown really nicely from a $3 or $4 share price to, what, $140 at one point, now they're about $60 or $65.

But even that, from $60 to a $20 return, it's grown really nicely at a sales line, at a profit line.

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