Over the past five years, the UK’s elite FTSE 100 index has hardly covered itself in glory. In 60 months, the Footsie has added just 2.5% in value. Meanwhile, the US S&P 500 index has leapt by 57.3%. But some blue-chip stocks have easily beaten the wider London market, Glencore (LSE: GLEN) shares being one of them.
Glencore shares have boomed since 2020
On 20 March 2020, as Covid-19 panic crashed global markets, Glencore stock dropped below 120p. How I wish I’d bet the farm on these shares back then, because they have skyrocketed since.
As I write (at lunchtime on Tuesday, 5 September), this popular stock stands at 435.65p. This values the global miner and commodity trader at £54.3bn, making it a FTSE 100 super-heavyweight. But the Glencore share price has dropped well below its 2022-23 highs.
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At its 52-week peak, this share briefly hit 576.12p on 18 January of this year. Thus, the stock is much closer to its 52-week low of 405.06p (on 15 March) than its 2023 top. But thanks to its powerful market presence in key metals and commodities, I see Glencore as a key player in the drive towards a low-carbon, clean-energy future.
What if I’d bought Glencore five years ago?
Over one year, this Footsie share has lost 7.6% of its value, excluding cash dividends. But these cash distributions are one reason why my wife bought this stock last month. We paid an all-in price (including stamp duty and buying commission) of 435.1p a share. Thus, we are sitting on the tiniest paper profit to date.
Over five years, Glencore shares have been one of the FTSE 100’s best performers. They have leapt by 47.2%, easily beating the wider index. Indeed, I calculate this makes them the 21st-best-performing blue-chip share over this timescale.
That said, these figures also exclude dividends, with which Glencore loves to reward its shareholders. How much have these totalled over the past five years? Here’s the answer:
| Financial year | Total dividends | In sterling |
| 2018 | $0.20 | £0.16 |
| 2019 | ||
| 2020 | $0.16 | £0.13 |
| 2021 | $0.37 | £0.30 |
| 2022 | $0.52 | £0.42 |
| Total | $1.25 | £1.00 |
Rather neatly, Glencore’s dollar dividends of $1.25 over the last five years equal a nice, round pound. To make life easy for me, I will assume that these dividends were not reinvested into new shares.
Therefore, based on a share price of 295.95p five years ago, these dividends would have added a further 33.8% to the capital gain. Hence, had I bought this FTSE 100 stock at this price five years ago, my shares would be worth 435.65p, plus I’d have 100p of dividends, totalling 535.65p. That’s 81% more than my hypothetical buy price of 295.95p.
Therefore, I can finally answer the question I asked in my title. Had I invested £5,000 into Glencore shares five years ago, I would have around £9,050 today. That’s a profit of £4,050 (+81%). And as a veteran value/dividend/income investor, I’d be more than happy with this market-beating performance!
