Contact Energy - CEN Chart

[fish]

Its surprising to me that this thread is so quiet whilst movement is being noted overseas

eg-Contact Energy Ltd (CEN.AX) has been garnering interest of retail and insitutional invenstors alike as the shares have seen its VMA (volume moving average) steadily rise over the past 7 sessions. In the most recent session, shares touched a high point of 4.92, while dipping down to 4.85. Shares closed with a change of -0.03 from the most recent open.
I sold 2% of my large holding yesterday because I needed the money and immediately regretted it.I feel they have a long way to go.
Annual results are out soon.I am not expecting any surprises here.
What I think is happening is that big investors have seen a big change in the outlook .
One month into this financial year and power prices remain high.Demand is up 3% on last year.
Tiwai is not going to close.National look like winning.Immigration will continue..
To meet this increase in demand Genesis imports coal-dirty and not cheap.Contact can just increase the flow-water is arriving today-no extra costs but big profits.Their CGCT is a lot cleaner and more efficient than Huntly

[fish]

Just a small heads up (ramp)
Last month it was annoucned electricity demand was up 3% so far this year.
Has increased even further last 7 days rolling demand.
Prices remain high.
Could this be a portent of things to come-ie much higher profits for cen this financial year-starting 1st july 2017?

[fish]

Just a small heads up (ramp)
Last month it was annoucned electricity demand was up 3% so far this year.
Has increased even further last 7 days rolling demand.
Prices remain high.
Could this be a portent of things to come-ie much higher profits for cen this financial year-starting 1st july 2017?

anyone noticed the annual report released today?
They have indicated a big lift in dividend payments for FY18-a rough calculation is around 9% return counting imp credits.
A lot better than money in the bank is likely to give

[Snoopy]

Below I present my corrected earnings picture for the last eight years. You will note that:

1/ I have deleted last years 50cps special dividend from the record, because it will not be possible to repeat that into the future.
2/ The 'Scenario Dividend Per Share Column' represents a prediction of an ongoing dividend of 26cps being paid into the foreseeable future.
3/ The (A) - (B) difference column, if negative, represents the amount of the projected dividend not covered by imputation credits. This is important, because a dividend paid without imputation credits is in accounting terms, equivalent to giving shareholders their own capital back (equal to the amount of the unimputed dividend) complete with a tax bill. This is generally bad for investors. It is necessary to make a negative adjustment to account for any expected tax to be paid on the unimputed dividend component.
4/ The capital component of the dividend is the portion of shareholder equity being returned to shareholders. This will need to be removed from the dividend return calculation. Because to pay it is to return to shareholders money on the balance sheet that they already have, so it isn't a shareholder benefit.
5/ The unimputed component tax bill column, represents the income tax charged on share capital that is expected to be paid by the shareholder. A 28% tax rate is assumed. Note that if the (A)-(B) differnce is positive there is no extra tax bill. That's because in such a year, the dividend is fully imputed.
6/ The final column represents the dividend per share adjusted for any extra tax obligation.

Scenario Basis Financial Year	eps (A)	Scenario dps (B)	Difference (A)-(B)	Divie Capital Component (C)	Unimputed Tax Bill (D)	Difference (B)-(C)-(D)
2009	27.0c	26.0c	+1.0c	0c	0c	26.0c
2010	25.3c	26.0c	-0.7c	0.7c	0.2c	25.1c
2011	22.4c	26.0c	-3.6c	3.6c	1.0c	21.4c
2012	24.6c	26.0c	-1.4c	1.4c	0.4c	24.2c
2013	27.5c	26.0c	+1.5c	0c	0c	26.0c
2014	27.1c	26.0c	+1.1c	0c	0c	26.0c
2015	22.0c	26.0c	-4.0c	4.0c	1.1c	20.9c
2016	22.2c	26.0c	-3.8c	3.8c	1.1c	21.1c
Total	198.1c	208.0c				190.7c

The expected average dividend per year, net of tax is therefore: 190.7 / 8 = 23.8cps (net)

Using a tax rate of 28c this is equivalent to a gross income of: 23.8cps /(1-0.28) = 33.0c

If we assume that a business cycle investment 'gross return' of 6% is required, then this equates to a CEN share price of:

33.0/0.06 = $5.50

So $5.50 is therefore 'fair value'. Naturally this valuation assumes no gross disruption to the market, i.e. Tiwai Point remains a going concern

There you go fish. We have reached my 'fair value' projection of September 2016. You have my permission to sell down now if you like. Mind you, now we are on a roll, nothing to stop the CEN share price going higher from here.

SNOOPY

[fish]

There you go fish. We have reached my 'fair value' projection of September 2016. You have my permission to sell down now if you like. Mind you, now we are on a roll, nothing to stop the CEN share price going higher from here.

SNOOPY

Thanks snoopy,

With your permission I sold at 5.54 at close.
Still holding quite a lot but now have enough money so will keep the majority for now.

[winner69]

Business with electricity to 3 sites with Contact

Nova said they could do it ~15% cheaper

Rang Contact to see whether they would 'discuss' pricing - 'No, you already on best rate.' When pushed 'We don't compete with competitor prices'

Obviously churn hasn't been too bad this month and below budgeted levels so need to 'discuss'

I see Contact's churn is about 20% so we just 1 of the 5 they expect to switch,

Wonder how much cheaper it'll be if we switch back in a year or two.

Suppose Nova are a pack of ratbags and we'll just get screwed somewhere else.

Not a shareholder. just thought you guys might be interested

[minimoke]

Nz first mp Richard prosser has said sell your contact shares. Is he able to give this financial advice?

On the back of nz first policy to nationalize all generation

[LAC]

Prosser said that would be done over time, but NZ First's stance was the institutions would be purchased back at the price they were sold for.

Hehehe. Wonder if I can buy back his house for the same price he paid for it years ago

[artemis]

Prosser said that would be done over time, but NZ First's stance was the institutions would be purchased back at the price they were sold for.

Hehehe. Wonder if I can buy back his house for the same price he paid for it years ago

Mr Seymour's response was on the money! The asterisked bit anyway. Mr Prosser could be in trouble over his comment.

[couta1]

Mr Seymour's response was on the money! The asterisked bit anyway. Mr Prosser could be in trouble over his comment.

Idiotic comments by Mr Prosser and modified by Winston. Put your hand up those who believe that any Govt going forward is going to cough up 10 Billion odd to buy back ownership of power companies ,without stuffing up the economy. Tui time folks. PS-Any panic selling caused by idiotic comments like these would be a great buying opportunity.