Contact Energy - CEN Chart

[troyvdh]

...cheers fish...youve woken me....

...can you please send me the link....that alerts you to what you have spoken about.....cheers troy

[fish]

...cheers fish...youve woken me....

...can you please send me the link....that alerts you to what you have spoken about.....cheers troy

google WITS free to air

spot 5 minute power prices are back to reasonable levels atm-around $70

Companies like CEN that have largely fixed expenses stand to make big increases in profits for smaller increases in power prices

[troyvdh]

...whats with the latest bouyancy of the SP on thin volume.....is it the 4.35 % div....some trades look like computer generated...i.e. multiple mini trades....I suppose if one gets 4.35 % imputed ..then that probably equates to what...6 plus gross....not bad i suppose....if i was an old fella....cheers

[fish]

cheap generation-lakes full but power prices up-bodes well for growth in profit and increased dividends.
Dont forget cen reached $10 pre-crash . Now we have more and cheaper generation and a far better company .Announcement of 2% pa growth in economy today and christchurch rebuild will help prices

[troyvdh]

....lakes full....is that right ...I thought that wakatipu,wanaka/hawea...relied on southern generated air flow.....are you saying that the last few days of southerlies has indeed made a significant contribution to warrant a share price increase....no need to remind me about the $10....share price....I did sell a few....But I remain a beliver.....cheers....am missing the Alexandra Blossom festival this year.....occuring this weekend.....because of work obligations....quite sad about that...

[fish]

just putting down a few ideas I should have said fuller rahter than full-a few weeks ago the lakes were well below average levels now they are above yet power prices havnt fallen as much as expected by me.
The market price will reflect so many factors and maybe the positives are building .I could list so many but off to work-one important newish factor could be more investment money available and delay in mighty river.

[Jaa]

I doubt short term factors like the lakes filling up a bit move the CEN share price much.

The more important drivers in my opinion are:

• Economic growth - more growth traditionally means more electricity demand.
• Decoupling of electricity demand from economic growth. Traditionally electricity demand grows at a faster rate than economic growth but this has not been happening for the last few years. Blame energy efficient heating or the loss of energy hungry manufacturing overseas (the aluminium shelter is the biggest potential example, but the pulp and paper mills are also reducing capacity).
• Ability of the new and upgraded cook strait cables upon completion to balance power prices between the North and South Islands. This is a big win for Contact but even more so for Meridian.
• Ability of Contact's new gas storage and peaker plant to optimally manage Contact's gas contracts and maximise profits.

Note the upgraded cook strait cables are the key reason Meridian is not so fussed about the smelter shutting down. There will be capacity to shift some if not most of this power (the cheapest in NZ) north. This of course would be a big negative for Contact and the other generators.

[MANDRAKE]

cen obv chart.jpg

Ill just leave this here..
Check out the OBV trend breaking above the long term downtrend, retesting it, and then reversing. Interesting ay

[troyvdh]

..its always good seeing the SP go up.....but Im somewhat confused...(again)...what will happen should Tiwai close....wont the issue of 25 % more supply of electricity to the grid suppress prices...?...or is that to simplistic...cheers

[CJ]

I dont see Tiwai closing.

I think the increases has been in part due to the prospects of a higher dividend. In the past 6m, CEN and TPW are both up 20% though TPW much higher if going YTD.