“Gabelli Global Multimedia Trust (GGT – yield 11%) is still relatively cheap. GGT currently trades at a 12% discount to its net asset value (NAV). This means you are getting the equivalent of a dollar’s worth of assets for just 88 cents. Better yet, you are getting the assets of one of the better-positioned sectors in the economy. Roughly 57% of GGT’s assets are made up of media distribution companies such as Discovery Communications (DISCA) and CBS Corporation (CBS). These companies are seeing very strong advertising growth.
“It also owns shares of specialty providers such as The Madison Square Garden Company (MSG), a stock that is surging on the popularity of the New York Knickerbockers’ new star, Jeremy Lin. Roughly 20% of the portfolio is comprised of cable companies such as Comcast (CMCSA) and wireless providers such as Verizon Communications (VZ) (discussed in my January 2012 issue). You’ll even find shares of technology powerhouse Google (GOOG) and Apple (APPL). The fund also has a dividend policy whereby it distributes 10% of the fund’s net asset value within each calendar year. That’s one reason why GGT bumped its December dividend to $0.27 per share, up from $0.20 per share. Investors should note that roughly 60% of the distributions are paid as return of capital. ... I think GGT is a well-managed fund in a promising sector. Its deep discount and double-digit yield are just more icing on the cake.”
Amy Calistri, StreetAuthority’s Daily Paycheck, February 21, 2012
