HTD: 8.7% Yielding CEF, Supported By Secular Trends In Utilities
Published Jul 9, 2020 on Seeking Alpha

Seeking AlphaClosed End FundsHTD: 8.7% Yielding CEF, Supported By Secular Trends In UtilitiesJul. 9, 2020 8:54 AM ET|| About: John Hancock Tax-Advantaged Dividend Income Fund (HTD), Includes: AEE, AEP, AMZN, BRK-B, D, DRUA, DUK, DUK.PA, DUKB, DUKH, EVT, GDV, GDV.PA, GDV.PG, GDV.PH, HPI, JTD, LQD, MSFT, PFF, QQQ, SPY, VNQ, XLUby: Bridger ResearchBridger Research Value, Growth, contrarian, long/short equitySummaryElectrification of vehicles is one of the most important secular trends to drive revenue and EPS growth of utility companies over the next decade.
The fund recently reported a monthly distribution of $0.1380, which currently makes up a 8.67% yield.
The fund has underperformed the Utilities Select Sector SPDR ETF over the last five years.
This time, we will present our readers with the John Hancock Tax-Advantaged Dividend Income Fund (HTD), which was incorporated in February 2004. It is a closed-ended fund that is primarily focused on preferred and common stocks of companies in the utility industry. It pays a regular monthly distribution of $0.1380 per share and offers an 8.67% dividend yield as of July 06, 2020. This fund has experienced a sharp market price and NAV decline after the COVID-19 pandemic outbreak in the U.S. with a follow-up strong pullback over the last couple of months. In terms of the key bullish catalysts, we find the following: (1) electrification of vehicles, (2) shift away from coal, and oil-specific to cleaner sources of power generation (3) utilities are undervalued compared to the broader stock market.
About the Fund

(Source: Investor Factsheet)
This fund has a total managed assets of $1.17 billion with a total number of holdings of 102, which makes it one of the bigger CEFs in the tax-advantaged dividend income universe. It currently uses effective leverage of approximately 35%, which is in line with other tax-advantaged CEFs in the field. In the case of a further worsening of the COVID-19 pandemic, we would... Read more