Sure will mate. I've been busy buying at 42 and 43 cents after the result which looks like a winning strategy seeing as they closed the week at 45:t_up:
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Agreed Roger. Have myself been accumulating PGW for 3 years now and the SP has been all over the place in that time. Very happy to have it has my biggest holding. Onwards and upwards.
Snoopy, I think you may be looking in the rear mirror. Brokers are unanimously in disagreement with you over your no-growth call. Broker estimates for FY15 are 0.046,0.042,0.045. Broker targets are 50c+.
Of course time will tell, but I look forward to 3.5+2+2.5=8c + imp credits dividends over the next 13 months. What sort of yield is that? Around 24%!!!
I'm not all in yet, but I will be looking to add if the AGM guidance is in line with the brokers.
Snoopy, I recall you bought in the high 20c. Nice trade if you just exited.
What no growth call? My PE of 10 estimated still implies growth.
If underlying growth is estimated to be around 10% (from 4.0eps in FY2014), to say 4.4c eps in FY2015 that is still only half of Roger's 5.0c eps end point growth expectation.
If broker's think earnings of 4.4c justify a share price 50c I would suggest their assumed multiple is too high. Have those brokers made any allowance for droughts floods currency strains etc.? I thought not. A PE of 12 might be appropriate at the bottom of the business cycle, but not at the top. I suspect those analysts experience in PGW falls short of the ups and downs over 17 years I have been investing in it. Pain is a very good teacher!
Arbitrarily choosing a twelve month period to incorporate three dividend payments earned over an 18 month period does not help your case. I diagnose a case of 'dividend fever' here, and you are by no means the most acute sufferer on this thread Noodles.Quote:
Of course time will tell, but I look forward to 3.5+2+2.5=8c + imp credits dividends over the next 13 months. What sort of yield is that? Around 24%!!!
Yes I did buy in the high 20s, but al that good work was undone by earlier higher priced purchases. After 17 years, I finally just broke even last week! Mind you that does not include the dividends received over that time.Quote:
Snoopy, I recall you bought in the high 20c. Nice trade if you just exited.
SNOOPY
With your 17 years poor history with this stock I think I will side with the brokers' forecasts!!!!!! lol.
Hi SNOOPY, appreciate your views. Cheers!
Roger undershot on the dividend announcement. He bullishly predicted 2c. Instead we got 3.5c. Maybe he is being conservative over the 5c eps as well. And hats off to Roger for making that dividend call well before the announcement.
Actually, it is 3 dividend payments in the next 12 months and 2 weeks (not 18 months as you suggest). My 24% is a bit light actually.
I wish I had so much capital I could hold a loser for 17 years.
[QUOTE=noodles;498545]Actually, it is 3 dividend payments in the next 12 months and 2 weeks (not 18 months as you suggest). My 24% is a bit light actually.
Thanks for your sound logic.
May pay me to pay more attention and think longer than just a year ahead.!!
Another two weeks makes a HUGE difference.!
Thanks Noodles and you're dead right that I am extremely pleased with the final divvy of 2.5 cps which comfortably exceeded my expectations and the extra 1 cps special divvy was definitely not on my radar but it a very nice bonus.
I think this highlights an important attribute with PGW, something that many of us know already, but it shines the spotlight on the fact that the majority owner definitely likes high dividends.
I had a quick look at the balance sheet yesterday and it looks in good shape to me.
Broker forecasts are indicating 4.5 cps next year which is great but it wouldn't surprise me in the slightest if there's another 1 cps special divvy, I rate this as 50/50 chance depending if they have another good year of cash flow for a total of 5.5 cps but given the special is maybe 50/50 lets call it 5.0 cps :)
I'll have a more detailed look at the financials when I get more time but there's nothing leaping out of there that worries me. Abnormal items and tax look lower than the figures you've indicated Snoopy.
A small correction to my previous commentary. I said I had owned PGW for 17 years, but this of course can't be right. PGW only came into existance in CY2005. Before that 'PGW' was two separate companies, Pyne Gould Guiness and Wrightsons. It was Wrightson's I held shares in all those years ago.
Noodles says I held a loser for 17 years. In terms of capital appreciation he is correct. But as I said before, that 'capital result' doesn't include the effect of dividends. Include those and the picture is very different.
SNOOPY
With a cyclical share like PGW I prefer to look at dividends over a business cycle. Going back in history is a little complicated with PGW.
1/ There was a cash issue on 11th December 2009 (TaxYear2010 for me), where shareholders had the opportunity to apply for 9 new shares for every 8 they already owned. That means that looking backwards a PGW share today was only entitled to 8/(9+8) = 8/17s of the dividends paid before that date.
2/ Just before the above cash issue, Agria upped their stake in PGW by being issued 41m new shares which were added to the 289m shares already in existance before that time. That in turn means that looking backwards,any PGW share now is only entitled to 289/(41+289) = 289/330s of dividends declared on PGW shares before that date.
Combining theese two effects, any shares today would have been entitled to receive the declared historical dividend (as paid before 10th December 2009) multiplied by the appropriate equity dilution factor:
(289/330) x (8/17) = 0.4121
From my tax files (year ended 31st March) , I can pull out the following dividend information:
TY2008: 6c x 0.4121 = 2.5c
TY2009: 12c x 0.4121 = 5.0c
TY2010: 16c x 0.4121 = 6.6c
TY2011: 5c x0.4121 = 2.1c
TY2012: 0c
TY2013: 2.2c
TY2014: 1.0c
TY2015F: 5.5c
Average that over 8 years and I get a net yield of 3.1cps. Based on a market price of 45c that gives a business cycle net yield of:
3.1 / 45 = 6.9%, or a gross yield of 6.9/0.67= 10.3%
I think that a gross yield of 9% is the sort of figure I would be looking for over the business cycle.
Based on that fair value for PGW, on a vield basis is: 45c x (10.3/9) = 51.5c
Blimey, I am starting to agree with Roger! And Noodles, I don't think any investment that has returned 10.3% gross return each year (averaged over 8 years) can be called a 'loser'.
SNOOPY
discl: hold PGW
Being a dividend bloodhound, I am always looking for good dividend yields. However, reality should remind us that there is no long term history yet for reliability and consistency of dividends here. Four or five years of consistent dividends would be more desirable to my way of thinking. However I'm rooting for you all (in a metaphorical sense of course).
The Annual Accounts are really an annual reminder how much wealth has been destroyed over the years
Shareholders have put $606 million into the company (real cash at some point in time)
Its only worth $$270 million now (and don't kid me into believing that the $336 million difference has been dividends ....its noted as accumulated losses)
Amazing eh
So just as well that Mark has inherited the dog that has had a decent groom and got of rid of its fleas and is looking very sleek in a shiny healthy coat.
See things can be 'different this time'
I calculated tax payable for FY2014 at $11.8m, based on NPBTx (1-0.28), which is assuming a 28% tax rate. The actual tax payable was $8.472m. How can a company continue to pay tax a rate lower than the NZ corporate rate? In the long term it can't. There are all sorts of reasons why the actual tax paid was less than my 'Continuing Profit' calculation in FY2014.
What I am implying (and now saying) is that going forwards PGW looks like it will be paying more tax than it does now. That isn't good for PGW shareholders.
SNOOPY