Scottish Mortgage Turns the Page: From Stock Buybacks to Share Issuance as Premium Returns
24.05.2026 - 01:07:15 | boerse-global.de
After nearly two years of aggressive share buybacks totalling roughly £2 billion, Scottish Mortgage Investment Trust has executed an abrupt about-face. On Friday, the trust placed 1.8 million new shares from its own treasury at £14.48 each, marking the first equity issuance in almost five years. The move signals that demand for the trust has swung decisively back in its favour — a far cry from the persistent discount that prompted billions in repurchases since March 2024.
The London-listed shares closed at 1,489.50 pence, just 80 pence shy of the all-time high of £15.28 set in November 2021. In euro terms, the stock hit €17.93, a new 52-week high, and has gained 29.12% since the start of the year. The shift from discount to premium is stark: according to the Association of Investment Companies, the trust now trades at a 4% premium to net asset value (NAV), compared with an average 8% discount during the buyback era. Issuing new stock is the logical consequence — and a clear vote of confidence in the trust's own valuation.
SpaceX Fuels the Rally
The single biggest catalyst behind the 68% share price surge over the past twelve months is Scottish Mortgage's outsized bet on SpaceX. Elon Musk's space and AI venture now accounts for 19.3% of the portfolio, making it the largest holding by a wide margin. Market speculation points to a June 2026 initial public offering at a valuation between $1.75 trillion and $2 trillion. Even for US tech benchmarks, that would be an extraordinary debut. Index funds tracking the S&P 500, Russell 1000 and Nasdaq 100 would be forced to buy an estimated 19% to 24% of the available float, creating massive demand.
For Scottish Mortgage, which holds a significant unlisted stake in SpaceX, a public listing at that level would directly bolster the valuation of its private holdings. The trust's NAV total return for the year to end-March 2026 came in at 11.2%, comfortably beating the 5.5% delivered by the FTSE All-World Index over the same period.
Should investors sell immediately? Or is it worth buying Scottish Mortgage Investment?
Axon Expansion and Tesla Retreat
Baillie Gifford, the trust's manager, has been active elsewhere. In the first quarter of 2026 it added another 2.5 million shares of Axon Enterprise, expanding the position by 50%. Axon, best known for its Taser devices, is pivoting into AI-driven security solutions and has posted revenue growth above 30% for nine consecutive quarters. Its stock trades around $400, roughly 50% below its record high, with a consensus price target of $649. The move fits Scottish Mortgage's long-established playbook: placing early, long-term bets on companies with a pronounced technology edge.
At the other end of the spectrum, the trust has dramatically reduced its long-held bet on Tesla. The electric-vehicle maker has fallen out of the top 30 holdings for the first time in over a decade, ranking only 37th with a 0.8% weighting. Roughly £700 million has flowed out of the position over the past twelve months, with some of that capital redirected into neobank Revolut.
Financial Strength and a 41-Year Dividend Streak
The trust's ongoing costs have edged down from 0.34% to 0.31%, while the dividend rose 3.4% to 4.24 pence per share — the 41st consecutive annual increase, cementing Scottish Mortgage's status as an AIC Dividend Hero. The share issuance from treasury, rather than from new capital, helps manage the premium without diluting existing holders excessively.
A Broader Tailwind
Beyond stock-specific moves, the macro environment has turned more supportive. The FTSE 100 closed the week at a record 10,846.70 points, gaining 2.65% as cooler inflation data and weaker retail sales eased rate concerns. European tech names such as ASML and Schneider Electric have surged more than 20% since early April, providing a tailwind for a portfolio heavily weighted toward AI, platform business models and long-cycle innovation.
Political developments in Scotland also offer a potential boost. First Minister John Swinney, following meetings with business leaders, has signalled a clearer growth agenda. He plans to review commercial property taxes quickly and place economic stability above constitutional debates. Entrepreneur Sir Tom Hunter had warned that political uncertainty was deterring investment, and the government is now eyeing a £26.5 billion fiscal gap. If the shift succeeds, it could make Scotland a more attractive domicile for institutional capital.
With the SpaceX IPO pencilled in for June, the next major catalyst is already on the calendar. Whether the current premium to NAV persists will depend on the valuation at which the rocket company eventually goes public. For now, Scottish Mortgage has turned a corner — from buying back its own shares to issuing new ones, and from discount to premium.
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