Even in 2020 (amid a pandemic which shut down face-to-face business in most of the Asian markets it operates in), AIA still managed to record a 7.5% year-on-year increase in its dividend.
Second, and perhaps the more important factor, a whopping US$10 billion share buyback was announced, the company’s first ever.
The amount represented nearly 9% of AIA’s market cap at the time of the announcement. The insurance firm will repurchase the stated US$10 billion worth of shares over three years.
Beyond that, the strength of its balance sheet and capital allocation policies has highlighted how well the business has performed, across various metrics, over the long term (see below).
With demand for life and health insurance in Asia riding strong structural tailwinds, it’s further proof for long-term investors that there are gems to be found in the Hong Kong stock market – even amid its current malaise.
Source: AIA full-year 2021 earnings presentation
Disclaimer: ProsperUs Head of Content & Investment Lead Tim Phillips owns shares in AIA Group Ltd.
Tim, based in Singapore but from Hong Kong, caught the investing bug as a teenager and is a passionate advocate of responsible long-term investing as a great way to build wealth.
He has worked in various content roles at Schroders and the Motley Fool, with a focus on Asian stocks, but believes in buying great businesses – wherever they may be.
In his spare time, Tim enjoys running after his two year-old son, playing football and practicing yoga.