OK ...no bond proxy or quasi bond talk
But the GNE share price will be driven by prevailing 5 year govt bond rate plus what premium punters see as appropriate in light of associated risks
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GNE has been under performing when compared to other power companies. Anyone have insight to why?
Disc: hold and regularly adding on weakness to my long term portfolio.
GNE looking like its overdue for some love compared to the other Gentailiers. Brokers are forecasting dividends of approx. 17.5 cps which together with 80% imputation = 22.5 cps gross in the year ahead and they have an excellent track record of increasing dividends slightly each year.
22.5 cps / 316 = 7.1% Gross Yield.
That's a stunning yield for a Gentailier compared to the others in this sector who by comparison have seen their share prices really run away.
Disc: I bought some more quite recently.
Beagles are very good at sniffing out tasty morsels at ground level, but sometimes they need a bigger beast to see the enemies & storm clouds on the horizon.
As you would already know, GNE has a lot of thermal capacity, and despite the wishes of some, it isnt going to be turned off tomorrow.
However, medium term it will be.
What is happening globally, institutions, pension funds & the like are withdrawing exposure to such investments.
Recent examples are NZR, and AGL on Asx, where capital is being withdrawn, ahead of future dents to cashflow.
So while your divvies are safe for now, the capital value of such stocks will be eroded, as that capital takes flight, & these companies re invent themselves. to wind, hydro, geo, nuclear, oops, who said that?, and may have to capital raise to do so.
Albert Brantley turned off the Rankines last year, but the ever pragmatic Gennie Shipley said give them another spin Albert, I like feeling the heat in the kitchen.
Strategic review ofvKupe
I hate it when they give this veiled warning - It is not expected that the outcome of this strategic review will impact our ability to maintain the current level of dividends
http://nzx-prod-s7fsd7f98s.s3-websit...038/336214.pdf
I knew I’d timed this dividend hype game wrong ...without DYOR on an industry I know squat all about that’ll teach me
kupe probably not very profitable in a low price environment. im picking they sell it for way less than its on the books. so one would need to factor this in gne financials going forward.