Lindsell train has bought a stake in experian, the worlds largest credit data company, as the 22bn fund manager expands its bets on technology stocks with strengths in data and analytics.
Experian is the third new position that lindsell train has added over the past year to its 6.3bn uk equity fund, a rare burst of activity for the portfolio manager nick train who prefers to make relatively few adjustments to his holdings.
Mr train said that rising demand for experians advanced analytics and data management tools would drive strong growth for the dublin-based company over the next decade.
We should have owned experian years ago and the fault that we didnt is all mine, said mr train, who has a dedicated following among retail investors.
Experians shares have risen by 14.8 per cent so far this year after hitting an all-time high in september. the shares trade on a multiple of 29 times consensus earnings forecasts for 2020, an expensive valuation compared with its two main us competitors transunion and equifax.
Sylvia barker, an analyst at jpmorgan, said experian was a highly cash generative business that was well positioned to benefit from rising demand for consumer and business data.
Experian, which is valued at 26.8bn, declined to comment.
Mr train said he wanted to invest in more uk companies with expertise in technology, data and analytics to add to similar existing holdings, including relx, the publishing and events group, and london stock exchange group.
Lse, which is the largest holding in the lindsell train uk equity fund, generated 39 per cent of its revenue from its data business in 2019. it is chaired by don robert, who performed the same role at experian until his departure in 2019.
Mr train is also planning to target other uk companies with luxury, premium or aspirational brands such as fever-tree, the mixer drinks maker, which the uk equity fund bought into earlier this year.
More opportunities are being presented to us as other investors give up on the uk, said mr train, adding that recent outflows from uk equity funds were substantial and sobering.
British retail investors have pulled nearly 13bn from uk equity funds since the start of 2016 as uncertainty about brexit and a wave of dividend cuts due to coronavirus triggered substantial withdrawals. the share of retail investor assets sitting in uk equity funds dropped to just 14 per cent at the end of june, a record low, down from 23 per cent in 2015, according to the investment association, the trade body representing uk asset managers.
The lindsell train uk equity fund has delivered a net total return (including dividends and fees) of -5.7 per cent in the first nine months of 2020, compared with the -19.9 per cent return registered by the ftse all share. since launching in july 2006, the fund has produced a cumulative net return of 351.7 per cent compared with 83 per cent for the ftse all share.