There was little to like in regards to the Lloyds (LSE: LLOY) share price within the years after the monetary disaster. It mainly flatlined whereas a string of embattled executives struggled to clear up the mess left behind by the massive financial institution greed.

Lloyds shares are nonetheless a great distance from their glory years. In 1999, they topped 475p. In the present day, I should buy them for simply 60.4p every, and that’s after a powerful run. But it’s now certainly one of my favorite portfolio holdings, and I’m liking it extra by the day.

It helps that I wasn’t holding Lloyds shares when the banking disaster struck. So I’ve no bitter, private reminiscences. I solely added them to my self-invested private pension (SIPP) in June final yr and topped up my stake in September. My common buy price was 43.6p.

FTSE 100 favorite

I’m up 39.08% to date, which rises to 46.4% with dividends reinvested. That’s the form of return I’d usually affiliate with a fast-growing smaller firm. Over 12 months, the Lloyds share price is up 33.82%. What’s to not love right here?

I purchased Lloyds inventory as a result of it was low-cost, buying and selling at six instances earnings, whereas yielding north of 5%. But it was making enormous income: £7.5bn in full-year 2023. Traders refused to be seduced and understandably so. They’d been damage earlier than. I hadn’t and dived in.

Many buyers have been additionally down on the UK, however I noticed brighter instances forward, as inflation eased, the financial system skirted recession and home costs stabilised.

In the present day, Lloyds shares are pricier however nonetheless look good worth to me at 8.09 instances earnings. The trailing yield has fallen to 4.55%, nevertheless it’s forecast to hit 5.4%. Dividends are by no means assured however this one appears extra strong than most, lined precisely twice by earnings.

Dividends to die for

I don’t anticipate Lloyds shares to maintain rising at their latest velocity. Falling rates of interest shall be a combined bag for the massive banks. Whereas this can enhance the financial system and mortgage market, it can additionally squeeze web curiosity margins. But I feel there’s room for progress.

I don’t love Lloyds shares the best way I like my children, clearly. At coronary heart, it’s a transactional relationship. But I’m hoping we are able to go the gap, and this shall be a portfolio holding for years and with luck, a long time.

And whereas I say that to each inventory I purchase, I actually imply it with Lloyds. Even when the share price slows, or retreats, I ought to nonetheless get my dividends. I’ll reinvest each single one to purchase extra inventory, and possibly take them as revenue after I retire

Lloyds has let buyers down earlier than, nevertheless it’s modified its methods. It’s not taking part in quick and free with different individuals’s cash, however is a much more strong proposition.

That mentioned, I’m holding my breath to see whether or not alleged motor finance mis-selling turns into one other PPI scandal. Even when it does, I’ll stand by my inventory. I feel Lloyds will ship extra ups than downs. Even through the unhealthy instances, I anticipate these dividends to maintain coming by way of. I’d purchase extra however I have already got a reasonably large stake in its future.