STU - Steel & Tube Holdings

[Dassets]

Imputations are irrelevant. Tax is paid either by the company or shareholders. If the company pays it then it attached credits to prevent double taxation. Note the government will never prevent tax being paid at least once!!!!

[winner69]

Interesting piece on Vulcan

Doubt whether STU could command a story like this.

Interesting Vulcan gross margin is 37% of sales ….STU struggles at 20%

https://businessdesk.co.nz/article/i...-is-in-our-dna
Might be paywalled

[Balance]

Interesting piece on Vulcan

Doubt whether STU could command a story like this.

Interesting Vulcan gross margin is 37% of sales ….STU struggles at 20%

https://businessdesk.co.nz/article/i...-is-in-our-dna
Might be paywalled

Think of the upside potential of STU as it aims for the 37% margin.

[SailorRob]

Sure, I like them too. But what's the point of paying unimputed dividends where the yield is far less than what could've been achieved with buy back as the capital appreciation would be far superior. Or they could've done half each way.

Mate, look back in the thread a bit, I've banged on about buy backs until blue in the face, been through the math the facts, included passages from Buffetts letters you name it... Directors paying a dividend over buying back stock at these levels is against their fiduciary duty to us, the owners and bloody near criminal.

Buybacks GUARANTEE us way more money. Dividends in this case are an awful capital allocation decision.

[SailorRob]

Imputations are irrelevant. Tax is paid either by the company or shareholders. If the company pays it then it attached credits to prevent double taxation. Note the government will never prevent tax being paid at least once!!!!

Very good point and thinking as a business owner here. We should all be behaving as if we owned STU as a private business in it's entirety in which case whether the company pays the tax or you personally is irrelevant.

[nztx]

Very good point and thinking as a business owner here. We should all be behaving as if we owned STU as a private business in it's entirety in which case whether the company pays the tax or you personally is irrelevant.

In those shoes, I think I would have made the ultimate sale back when FBU were sniffing around

Even taking a few FBU shares out as part consideration wouldn't have turned out too badly

[Balance]

In those shoes, I think I would have made the ultimate sale back when FBU were sniffing around

Even taking a few FBU shares out as part consideration wouldn't have turned out too badly

I bought FBU shares last year - even better!

And I believe STU will do us alright too. Everything heading in the right direction - needs a few more runs on the board after the bitter disappointments over the last 3 years. Market can have a long memory but can be seen with FBU, a short one too!

[nztx]

I bought FBU shares last year - even better!

And I believe STU will do us alright too. Everything heading in the right direction - needs a few more runs on the board after the bitter disappointments over the last 3 years. Market can have a long memory but can be seen with FBU, a short one too!

very good points there

[Scrunch]

Imputations are irrelevant. Tax is paid either by the company or shareholders. If the company pays it then it attached credits to prevent double taxation. Note the government will never prevent tax being paid at least once!!!!

I stongy disagree with this. It would only be correct if the only way of distributing monies back to shareholders was via dividends and there was no choice on dividend timing. Sharebuybacks return money to shareholders and don't lose part of it to the taxman. A factor in the retirement coys dividends may be so some tax is paid reducing the likelihood of negative tax changes for that sector.

If close to paying tax, deferring dividends until imputation credits can be attached will improve the net of tax return shareholders get. I'm not sure if its still possible but in the past you could even pre-pay the tax and have a tax asset. The prepayment allowed imputation credits to be added to the dividend.

And if looking for an example where the gov't doesn't collect tax - a company sells a major asset for a good tax free capital gain and then cancels shares as part of a capital return to shareholders.

[SailorRob]

I stongy disagree with this. It would only be correct if the only way of distributing monies back to shareholders was via dividends and there was no choice on dividend timing. Sharebuybacks return money to shareholders and don't lose part of it to the taxman. A factor in the retirement coys dividends may be so some tax is paid reducing the likelihood of negative tax changes for that sector.

If close to paying tax, deferring dividends until imputation credits can be attached will improve the net of tax return shareholders get. I'm not sure if its still possible but in the past you could even pre-pay the tax and have a tax asset. The prepayment allowed imputation credits to be added to the dividend.

And if looking for an example where the gov't doesn't collect tax - a company sells a major asset for a good tax free capital gain and then cancels shares as part of a capital return to shareholders.

Are buybacks and dividends not paid out of a companies after tax earnings?

Regarding the cancelling of shares, whose shares are getting cancelled?