NWF - NZ Windfarms

[mfd]

I assume that NWF has a diminishing 0.5% of dividend yield. I can nearly get back our whole investment after 10 years. This ignores the potentials of NWF capital changes, takeover, merge, or other business activities.


Attachment 12287

Ok, I would probably make more optimistic assumptions but that's the kind of thing. As such, the yield should be significantly higher than someone like MEL who can keep running most of their plants indefinitely.

[tim23]

I agree, the company is doing quite nicely now and have turned things around. I have held in the past and think management are doing quite well with the hand they have.

My point is, when possible yields of 4% are being discussed, it is extremely relevant to consider that the assets generating the yield are not expected to survive the 25 years they would need to pay back your initial investment at that yield.

Furthermore, there will come a time when turbines start to fail and the company runs through the spare parts in stock. You'll be aware the company that built the turbines is no more, so replacement parts could become quite an issue in the future. This could start to eat into the yield.

A good company, and a good buy at the right price, but the finite life of the assets and lack of current plan to build more must be considered. The yield should absolutely be high to reflect this reality.

You ignore the value of the prime farm that they own.

[mfd]

You ignore the value of the prime farm that they own.

Most recently valued at 3.3 million so around 1cps. Doesn't really change the story.

[flyinglizard]

Ok, I would probably make more optimistic assumptions but that's the kind of thing. As such, the yield should be significantly higher than someone like MEL who can keep running most of their plants indefinitely.

If we assume that after 25 years, all NWF owned plants and equipment are written off from balance sheet.

The total dividend received during 25 years + NTA/share (2021) = $0.505. This ignores the capital appreciation of the land that they owned during 25 years.

double the current SP.

[mfd]

If we assume that after 25 years, all NWF owned plants and equipment are written off from balance sheet.

The total dividend received during 25 years + NTA/share (2021) = $0.505. This ignores the capital appreciation of the land that they owned during 25 years.

double the current SP.

Doubling your money over 25 years is an annual return of 2.8%. Not exactly an appropriate calculation as the dividends spin off earlier and can be invested elsewhere, just to highlight that doubling your money isn't necessarily a great result.

Again, not particularly trying to talk people out of their investment, just playing devils advocate.

[Arthur]

They have access to the technology to produce parts and they already have used third parties producing replacement parts. Replacement of the main wear areas occurs frequently, so aside from the main tower and blades they are rebuilt as required. It would take an updated resource consent, but they could replace the wind turbines with newer ones if the need arose. In the meantime it is a cash generating machine. That said I am tempted to take profits, but can't see where else to invest.

[The Punter]

I'm in a similar spot of limbo, cashed up but struggling to find a home for the $$. ..now if only the SP crashed (for no real reason)...

[nztx]

I wonder - next div due in Mar (if same pattern followed as last year) or will signalled review of NWF Div policy see quarterly payouts ?

2020 March div was from memory $0.007 ( or 0.7 of a cent) per share, if not mistaken..


Sorry - Mr Punter about the posting timing ..

[Getty]

Someone's lost the wind out of their sails, 19.4c, today , down from recent 22/24c

[nztx]

Someone's lost the wind out of their sails, 19.4c, today , down from recent 22/24c

I see that -- looks like they may have been a bit too soon in kicking over their bucket ..

May have to get the truck ready ..