Some things cant be explained other than irrational exuberance IMO stocks like this and CNU are hugely overpriced and just waiting for a big thumping. PS-Even the divvy yield is currently nothing special. PPS- Best left alone, once again IMO.
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Good news for MELs Aussie generation
https://www.smh.com.au/business/the-...20-p51p7t.html
We think our market is broken just look at what aussies are paying for their power. Mel spokesmen quoted in the article as per below.
Ed McManus, chief executive of electricity retailer Powershop and generator Meridian Energy, said it was time the energy industry and the government repaired their relationship and create stable policy.
“There is an opportunity for Scott Morrison to reset the agenda,” Mr McManus said.
“There is also an opportunity for politicians and industry to work together to solve the issue of combined energy and environment policy, in a way that allows Australia to both decarbonise and get energy prices down.”
I wonder if MEL are looking to purchase other Australian energy assets - clearly huge scope to grow profitability in Australia as the green alternative to all other power companies more so thank NZ one would think ....
See above posted early March. Important to understand that we have moved into a situation where interest rates are the lowest in our lifetime and are likely to stay at ultra low level's for the foreseeable future. If you have a look at the bond market yields for safe senior debt you'll see yields typically around 3%.
Against this backdrop the gross yield of a company like MEL which by my estimate inclusive of partial imputation credits is about 5.5%, (given its safe renewable utility status) makes an excellent bond proxy and will see many investors chasing very safe reliable yield doing quite well. I don't share your view on this one and am a happy holder of this GNE and Contact. The price of these utility companies is perfectly logical as risk averse investors chase solid dependable very low risk returns that will safely weather any possible exogenous shocks or any possible recession.
Yes, the yield for HLG may be better, however I certainly would be concerned about my capital compared with the power companies. But then, i'm not a fan of retail companies. To many variables that are hard for them to control, let alone the fashion component.
Having said that, I'm not buying any at the moment having got into them at much lower prices.