CNU - Chorus

[bung5]

would of thought that the divys come from the copper network and the billion doller investment roll out is going to be interest free loans from the goverment

[Silverlight]

Can anyone do a bit of explaining why CNU is seen as a divi yield stock? They are spending lots of money on fibre roll out for the next couple of years or more. In the meantime the income stream is not going to catch up. So it seems that they will be in an investment mode for quite a while. Where will the surplus profit come from? What do you think their divi yield will be?

Looking at the forecasts Chorus will earn around 45 cents this year, and 50 cents next year, they have not announced their dividend policy yet, however a conservative view is for 15 cent divdend this year, and around 25 cents next year. So currently a conservative yield at a touch under 5%, moving to 8% or so next year.

[sharer]

Hi SIlverlight - is that 15c dividend though for a part year/parted company - rather than a full year's dividend? I seem to recall that the dividend for CNU was going to be pro-rata'd to reflect the split from TEL.

I think the TEL pre-split docs indicated a possible 25c/s p.a. div for CNU, & most mkt commentators (& buyers?) seem to have been assuming that would be the case & quote their yield etc statements accordingly.
However the new board of the new company CNU have i think several times made comments that seemed (to me) to mean something like "well, that's what they said, but what actually happens will be decided by us as an independent entity". Which seems to leave it open for them to decide on a maiden div of anything, most likely less than the mooted 25c, & quite possibly zero ( i think unlikely for either business or public relations reasons). As others also pointed out, we don't really know anything until the first accounts are published in the fairly near future.
Which is why i tried to indicate some caution earlier on - though that did not stop my going for a substantial buy-in during the recent price slump. But that was a conscious punt, not validated by anything until the accounts come out. We might have made a big mistake, but i am still hoping this is going to come right as a steady earner, even if it has to be modest for the first few years.

[craic]

So why leave your money in a place wher the return might be "modest for the first few years'? Why not return to the main source TEL?

[sharer]

So why leave your money in a place wher the return might be "modest for the first few years'? Why not return to the main source TEL?

Good question.
I'm just contemplating what might be a good entry price to expand the TEL holding. Another consideration is that one doesn't want too much capital in one basket.
At current yield & p/e TEL has to be favorably considered when allocating new funds.

[macduffy]

Interesting article on the uncertainty which still surrounds who will bear what costs to connect households to fibre.

http://www.nzherald.co.nz/business/n...ectid=10809159

[CJ]

Interesting article on the uncertainty which still surrounds who will bear what costs to connect households to fibre.

http://www.nzherald.co.nz/business/n...ectid=10809159

I thought it was FTTH (fibre to the Home), not FTTRS (Fibre to the road side). If CHU doesn't pay, alot of people wont connect due to the cost and it wont achieve the effect it wanted (97% of people on fibre).

EG. Landlords and owners in lower decile areas wont pay to have fibre installed so those tenants/residents will miss out on the benefits.

[GTM 3442]

On the Chorus website, it says fibre to the premises.

http://www.chorus.co.nz/ultrafast-broadband

However, they only will build the last few metres when someone signs up. Who pays for the last few metres? That I don't know. Maybe someone wants to write to the Chorus investor relations people?

Sounds not unlike the Saturn rollout in the Hutt about 10-12 years ago. They'd cable the street, and if you signed up at the right time, the connection to (and within) your house was free.

If you signed up at the wrong time, the connection to (and within) your house wasn't free.

Not unlike the Sky "free installation" offers which used to appear from time to time.

[Major von Tempsky]

Seems to be quite a tussle going on between the glass half full and the glass half empty. CNU had the highest turnover on the market today, higher than TEL and higher than Fletch.
The brokers who said $4 aren't resiling from their evaluation and the doubters keep stirring.

Moi, I think I'll sit until the results come out and if they aren't totally convincing I'll get out then.

[blockhead]

Think I will sit on the sidelines with you Major, I sold all my NOG,s (@ 77.5c) a few days before the CNU price dropped, topped up my CNU @ $3.44 and have watched them struggling back up since then, would have been better to have stayed in NOG as it happens but after many many years I have cut the cord.

Still think CNU will get back close to $4 especially if the div represents a similar return as that of TEL.

I have a few quid needing a home but am content to just watch for the time being.

We recently sold our business and I have been working for a few agricultural contactors around Canterbury, man those cow cockies know how to get a few bob tied up in equipment and expenditure !