Invesco Perpetual's Neil Woodford is backing the Thomas Cook turnaround story, Investment Week can reveal, and has bought his first FTSE 100 financial since the crisis.
The manager of Invesco Perpetual’s £14bn High Income and £11bn Income funds added Thomas Cook and Legal & General to the portfolio earlier this year.
Woodford held over 19m Thomas Cook shares in High Income, a stake worth £25m, as well as 2 million Legal & General shares worth £3.4m at the end of Q2 2013.
Close to collapse two years ago, Thomas Cook shares have risen by around 1,000% during the past year, to a current level of 156p, as investors back a three-year turnaround plan.
The stock, which does not currently pay a dividend, is a favourite among some of the manager’s Invesco Perpetual colleagues, ranking in the top ten of Mark Barnett’s UK Strategic Income fund and Martin Walker’s UK Aggressive vehicle.
Woodford is thought to have made his purchase in Q2, during which time the travel operator’s shares traded as high as 164p and as low as 106p.
Legal & General, meanwhile, has risen by 50% over the past year, and by over 15% since Woodford’s Q2 purchase. The stock yields around 4.5% and the insurer has indicated further dividend hikes are on the horizon.
L&G is another popular pick on Invesco Perpetual’s UK equity desk, featuring in the top ten of Walker’s Aggressive and UK Growth funds as well as Ciaran Mallon’s Income & Growth portfolio.
Woodford has also added a small position in bookmaker Ladbrokes as part of his move into the travel & leisure sector, buying a £1m stake for his High Income fund.
The company’s shares have struggled in recent months following an April profit warning and uncertainty over the potential impact of a new tax on online gambling slated for 2015.
Thomas Cook share price
£92bn transferred since 2015
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