What’s going on with the Scottish Mortgage share price now?

The Scottish Mortgage share price is up 30% over the past 12 months, outperforming the index. Our writer explains why it’s performing so well.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Mature Caucasian woman sat at a table with coffee and laptop while making notes on paper

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

The Scottish Mortgage Investment Trust (LSE:SMT) share price has recovered from its post-pandemic lows. In fact, up 30.5%, it’s among the top-performing stocks on the FTSE 100 over the past 12 months.

So why has it performed so well and where might it go next?

Created with Highcharts 11.4.3Scottish Mortgage Investment Trust Plc PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.co.uk

It’s always important to compare the Scottish Mortgage share price with the company’s net asset value (NAV) per share.

Should you invest £1,000 in Aviva right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva made the list?

See the 6 stocks

Around a year ago, the shares were trading at a discount of around 20% to the NAV per share.

In other words, analysts said that the asset value of each share was around £8.50, but the stock was changing hands for just £6.50.

Now that discount has fallen. The shares are trading with a discount of 8.99% to the NAV, which currently sits around £9.91.

One reason for this is simply improving sentiment. Another is improving forecasts for the sectors in which the Scottish Mortgage Investment Trust invests.

The other reason for the improving share price is also indicated by the NAV. It has grown by over 20% in a year because the value of the trust’s investments has surged.

The trust has dozens of holdings, but looking at the top ones, we can see where some of this growth has come from.

Holding no.StockOne-year performance
1Nvidia209%
2Moderna15.2%
3ASML40%
4Mercadolibre30.2%
5Amazon45.5%
6SpaceXNot publicly traded
7PDD Holdings92.2%
8Ferrari34.8%
9Tesla-28.9%
10NorthvoltNot publicly traded

Of course, the caveat to this data is that these stocks are the largest holdings partly because of their strong performances over the past 12 months.

Should I buy more stock?

I already hold Scottish Mortgage in my pension and it’s performing rather well to date. But should I buy more?

Well, it’s hard to assess the portfolio as a whole. But when we look at the consensus of analysts covering the top 10 stocks in it, we can see a broadly positive trend.

Holding noStockConsensus ratingPrice target vs current price
1NvidiaStrong Buy-2.1%
2ModernaModerate Buy0.4%
3ASMLStrong Buy6.7%
4MercadolibreStrong Buy20.9%
5AmazonStrong Buy20.9%
6SpaceXNot publicly traded
7PDD HoldingsStrong Buy45%
8FerrariModerate Buy4%
9TeslaHold-6.2%
10NorthvoltNot publicly traded

This is all very positive, but there are several important things to highlight here.

First, Scottish Mortgage has traditionally been excellent at finding the next big thing to invest in before any of us have even heard of it. So that’s another plus.

However, one concern is that the Scottish Mortgage no longer has James Anderson at the helm. A change of management may have concerned some investors over the past year. Only time will tell if it performs as well without him.

And finally, the NAV we see above includes the estimated value of a number of unlisted stocks. As unlisted stocks don’t have a market value, we have to take the trust’s word for it.

Unlisted companies also publish much less data. So it’s really hard for us to make up our minds as to whether these parts of the portfolio are something to cheer about or worry about.

However, I’m rather bullish on Scottish Mortgage. I see the long-term direction as upwards and I’m considering buying more given supportive trends within growth sectors like AI and biotech.

Should you invest £1,000 in Aviva right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva made the list?

See the 6 stocks

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. James Fox has positions in Nvidia and Scottish Mortgage Investment Trust Plc. The Motley Fool UK has recommended ASML, Amazon, MercadoLibre, Nvidia, and Tesla. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

We think earning passive income has never been easier

Do you like the idea of dividend income?

The prospect of investing in a company just once, then sitting back and watching as it potentially pays a dividend out over and over?

If you’re excited by the thought of regular passive income payments, as well as the potential for significant growth on your initial investment…

Then we think you’ll want to see this report inside Motley Fool Share Advisor — ‘5 Essential Stocks For Passive Income Seekers’.

What’s more, today we’re giving away one of these stock picks, absolutely free!

Get your free passive income stock pick

More on Investing Articles

Investing Articles

10% dividend yield! Here’s a FTSE 100 share to consider in April for passive income

This FTSE 100 stock just soared past the 10% yield mark, making it a potentially lucrative option for investors targeting…

Read more »

Young black woman using a mobile phone in a transport facility
Investing Articles

3 FTSE 100 safe haven stocks to consider as trade wars bite

I'm confident in the long-term outlook for the FTSE index of stocks. But these blue chips may protect investors from…

Read more »

Investing Articles

Here’s how Trump tariffs could hand us some top passive income bargains

As tariff terror grips the stock market, it's time for passive income investors to steel our nerves and look for…

Read more »

Investing Articles

These FTSE shares may offer some safety as Trump slaps tariffs on trading partners

FTSE shares moved lower on 3 April, after US President Donald Trump introduced hefty tariffs on its trading partners. These…

Read more »

Investing Articles

6.8% dividend yield! Consider these 2 ‘secret’ passive income stocks to target a £1,360 payday in 2025

Looking for ways to generate above-average dividend income? These lesser-bought income stocks are worth a close look.

Read more »

Elevated view over city of London skyline
Investing Articles

The M&G dividend yields over 10% — and could get higher!

Christopher Ruane explains why he's upbeat about the long-term outlook for the M&G dividend yield and would happily buy the…

Read more »

Young Caucasian man making doubtful face at camera
Investing Articles

2 popular UK growth stocks I wouldn’t touch with a bargepole in today’s market

Buying growth stocks can deliver market-beating returns, but this FTSE 250 pair doesn't look like a convincing investment for our…

Read more »

The flag of the United States of America flying in front of the Capitol building
Investing Articles

10 FTSE shares falling today after President Trump’s tariffs bombshell!

Our writer explains why JD Sports Fashion from the FTSE 100 and a diverse bunch of other UK stocks are…

Read more »