Contact Energy - CEN Chart

[macduffy]

So everyone selling now are losing.... Why keep selling?

There's several reasons for selling. Expectations of bad news; better opportunities elsewhere for some; need to raise cash for -whatever. As Mickey says, that's the market, we all have different criteria for investments and make our own judgements on stocks.

[BlackPeter]

So everyone selling now are losing.... Why keep selling?

Maybe the fear of losing still more than they already have lost and the desire to preserve what is left?

Personally I do think that the markets are overreacting (as usual), which would offer a marvellous opportunity to buy in cheap. However difficult to say whether we reached already the bottom. Markets are nervous these days.

Discl: holding

[troyvdh]

Dear BP...agreed re overacting.But hold on ...if a company SP falls on small volumn ..perhaps an opportunity....But hey $30m...Instos must be selling yes.

This company probably will continue to pay 5 % (net ?)...not bad....so why the selling.......

Has the Clutha dam got a crack in it ?....cheers troy..

[pierre]

Dear BP...agreed re overacting.But hold on ...if a company SP falls on small volumn ..perhaps an opportunity....But hey $30m...Instos must be selling yes.

This company probably will continue to pay 5 % (net ?)...not bad....so why the selling.......

Has the Clutha dam got a crack in it ?....cheers troy..

I think the dam is OK - at least it was when I visited last Thursday while holidaying in the region. However, a leak could have appeared over the past few days while I wasn't available to stick my thumb in the hole!

[horus1]

Contact and Meridian down, not the other Generators. Looks like Tiwai reduction to me. Big sales of Contact.

[Joshuatree]

Very good re 40 page article on Craigs website titled "NZ Electricity Sector Curse or Cure"

"Why keep Tiwai around" it represents less than 7 % of current INDUSTRY revenue." "TIwai likely to stay meaning GNE'S yield looks attractive...... but if tiwai goes early then genesis faces the biggest risk"....."Is Tiwai a sector burden" etc
4 buys with Contact having t/p of $5.60.

[BlackPeter]

Dear BP...agreed re overacting.But hold on ...if a company SP falls on small volumn ..perhaps an opportunity....But hey $30m...Instos must be selling yes.

This company probably will continue to pay 5 % (net ?)...not bad....so why the selling.......

Has the Clutha dam got a crack in it ?....cheers troy..

Agreed - quite some volume yesterday. Maybe all the people who missed out on Monday trading desperately doubling up the Tuesday volume?

Not sure - a handful of reasons I could imagine:

* Overseas owners moving due to the perceived "higher" safety of US stocks back into the US$ ... and selling their NZD holdings;
* Maybe some people perceiving a negative outcome of the next stage of the Tiwai smelter saga - though this wouldn't be that bad for CEN, and according to Craig's not even that bad for the whole of the NZ electricity sector;
* Owners in need of money due to having problems in other areas (don't remember - does "Deutsche Bank" hold CEN shares, they seem to sell these days?)
* investors listening to horus doomsday stories (decentral solar generation taking over) and running for the hills ... (tongue firmly in cheek)

Not sure, whether this helps - and hey, my crystal ball is cloudy. However, if there is only one industry, where it might be appropriate to apply the value proposition, than this is in my view the Gentailers ...

DYOR and have a good chat with horus. I am sure he will convince you that the industry is doomed.

[BlackPeter]

Actually - looks like nice little recovery today - already 5 cents up on reasonable volume. Twice the number of bids than offers.

I guess the big seller yesterday might already start to regret their selling strategy of swamping the market with cheap shares ...

[sb9]

Not quite bp, given up all its gains from this morning due to the usual afternoon pressure from Asian markets.

disc - topped up more in the past hour, may drop further but can't ignore the fact that the results are due out on Monday.

[workingdad]

I am hanging in there with CEN. There has been some disappointment but I think they will have good cash flow with increased dividend of NPAT % as indicated by them already. The Otahuhu land sale will generate some $, they still have 25 million to spend on the share buy back and although I don't anticipate a stellar announcement on Monday I think it will have some benefit for the SP. I have been through the last 6 months operational data and it isn't great but sales and cost of generation are still looking reasonable despite customer numbers. One of the unknowns is the cost of the Origin split, perhaps a blowout??

My previous thoughts haven't exactly been right but a lot of the weakness comes down to the state of the market and perhaps those withdrawing their money in anticipation of a bear market. Either way I look at it, CEN seems a reasonably good buy if things come out smelling of roses Monday

Results season about to kick in which will impact on the sentiment of the market even more.....