Power shares

With the NZX down 246 points or 2.2% atm and power company shares in particular whatsup ?

Contact down 9.7%
Genesis down 4.9%
Mercury down 8%
Meridian down 8.2% !

I know! Just asked the same question on the CEN thread.

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Originally Posted by penn

I know! Just asked the same question on the CEN thread.

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Just noticed that, what is going on surely they all cannot be shedding divs atm !

in case you missed it

Owners of Tiwai Pt aluminium smelter seek talks with the Government, raising possibility of closure

https://www.nzherald.co.nz/business/...ectid=12278907

thats why all the gentailers are crashing

https://www.stuff.co.nz/business/116...elter-in-bluff

This is whats up - would dramatically cut revenues/cashflows
Even a 'renegotiation' (best case scenario) could cause revenues/cashflows to stagnate = dividends no longer expecting to increase at or above inflation (and possibly even decrease) = very, very bad for companies that are valued basically off being a dividend payer (as they are overvalued to ridiculously overvalued, depending on the gentailer, on any other metric other than yield)

I have never taken much notice of the Morningstar recommendations, but they have a big red SELL on MEL

They've had a long run of good performance so I'm not that worried about some adjustment to valuations.

I'm more concerned about local economic factors like long running under-target CPI, low business confidence, low impact fiscal policy and RBNZ not having many bullets left. Tiwai alone isn't a high impact event but the cumulative pressure may cause a downturn.

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Originally Posted by Tomtom

They've had a long run of good performance so I'm not that worried about some adjustment to valuations.

I'm more concerned about local economic factors like long running under-target CPI, low business confidence, low impact fiscal policy and RBNZ not having many bullets left. Tiwai alone isn't a high impact event but the cumulative pressure may cause a downturn.

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except for the 1000 direct employees and the thousands and many more down stream workers, say good by to the Southland economy along with the dairy industry re carbon credits, nice one Labour !

Rio Tinto having a go again can’t blame them with JK chucking them cash a few years ago. The reality is closing the smelter would cost a load and it’s still profitable at these prices

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Originally Posted by penn

I have never taken much notice of the Morningstar recommendations, but they have a big red SELL on MEL

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A rare day when I agree with tj and Morningstar at the same time. Lol

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Originally Posted by Tomtom

They've had a long run of good performance so I'm not that worried about some adjustment to valuations.

I'm more concerned about local economic factors like long running under-target CPI, low business confidence, low impact fiscal policy and RBNZ not having many bullets left. Tiwai alone isn't a high impact event but the cumulative pressure may cause a downturn.

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The world’s buying heaps of our goods in spite of these ‘global headwinds’

Total exports going gangbusters - doesn’t that say our economy going pretty good.

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Originally Posted by couta1

A rare day when I agree with tj and Morningstar at the same time. Lol

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As I agree with you Couts does that mean I agree with tj and Morningstar as well ....WOW

Mum and Dad investors putting term deposit money into gentailers are going to ask ‘heck where’s my money gone’ one day.

Tiwai comes up every few years - it always gets sorted

No need to worry ...or panic.

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Originally Posted by winner69

As I agree with you Couts does that mean I agree with tj and Morningstar as well ....WOW

Mum and Dad investors putting term deposit money into gentailers are going to ask ‘heck where’s my money gone’ one day.

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And to think Beagle was telling punters not long ago that these companies we're the best thing since sliced bread. The lynch mob might be out soon to give him a good old snout whacking.

Fairly certain unless they bought in the last few months they would still be laughing all the way to the bank let’s see how the shares trade going forward ....