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Highlights
- Blue-chip stocks are often believed to be mature companies that carry lower levels of risk.
- Several blue-chip stocks have given high returns in the past 5 years outperforming the FTSE 100 index.
- If one had invested £1,000 into Ashtead shares 5 years ago, it would be worth about £4,110.60 as of December 2021.
Blue-chip stocks, or those stocks belonging to the FTSE 100 index, are often considered to hold less risk compared to midcap, small cap and other types of stocks by investors.
Since such stocks are usually mature companies, they may not always be considered growth stocks that give high returns. However, there are several blue-chip stocks that have yielded strong returns over the years, outperforming the benchmark index.
One such stock is UK based industrial equipment rental firm Ashtead Group PLC (LON:AHT). Let us take a closer look in blue-chip stocks and its historical share price performance.
Ashtead Group’s H1 2021 results
The group’s H1 2021 revenue rose by 18 per cent to US$ 3,884 million, compared to US$ 3,258 million. And its rental revenue during the period increased by 20 per cent to US$ 3,545 million, up from US$ 2,931 million.
The group’s H1 2021 adjusted profit before tax increased by 42 per cent to US$ 979 million, up from US$ 687 million in the year before.
The group increased its interim dividend, in the first half of 2021, by 28 per cent to 12.5 cents per share, compared to 9.76 cents per share in H1 2020.
The increase is in line with the group’s progressive dividend policy, considering Ashtead’s underlying profit, cash generation and other factors.
The group has generated a one-year return of 90.55 per cent in the past one year, as of 13 December 2021, making it one of the highest performing stocks in the FTSE 100 index.
Ashtead Group PLC’s (LON: AHT) historical share price performance
Ashtead’s adjusted closing price was at GBX 1,508.29 as of 13 December 2016. And its adjusted closing price stood at GBX 6,200.00 as of 10 December 2021. (Adjusted closing price includes adjusting for splits, dividends and other factors.)
Thus, over the last 5 years, Ashtead has given a return of about 311.06 per cent to its shareholders. On an annualised basis, this would mean Ashtead has generated about 62.21 per cent per year between Dec 2016 and Dec 2021.
In comparison, the FTSE 100 index, which Ashtead is a constituent of, has given a return of about negative 3 per cent over the past 5 years.
Thus, if one had invested £1,000 in Ashtead’s shares 5 years ago, it would be worth about £4,110.6 as of 10 December 2021.
The company has a market cap of £27,652.56 million as of 13 December 2021.
Ashtead Group PLC’s dividend yield performance
The group’s dividend yield stands at 0.7 per cent, and its five-year average dividend yield is at 1.5 per cent as of 25 November 2021.
Bottom Line
Given Ashtead’s share price performance over the past 5 years, investors seeking to invest in blue-chip stocks with high growth prospects may consider this stock.
However, one must conduct thorough research and consider if a stock investment aligns with one’s investment goals and other factors prior to investing.
