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  1. #141
    The past is practise. Vaygor1's Avatar
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    Quote Originally Posted by BlackPeter View Post
    You are absolutely correct - the big majority shareholder seems to have no interest in a high SP ... reflected in accounting policies and stock liquidity.
    Totally agreed.
    - Accounting policies on realised worth effectively suppressing NTA, Total Assets and Shareholders Funds.
    - No interim dividend
    - Suppressed dividend payout
    - Sitting on high imputation credits
    - Higher H1 unaudited results than needed meaning a scaled back FY result (comparatively)
    - Payout 3 months after announcement release date. About 3 times longer than practically everyone else
    - Very low profile company with minimum media exposure (this one has obvious advantages too)
    - Tightly controlled share-holding structure currently requiring ongoing NZXR dispensation


    Quote Originally Posted by BlackPeter View Post
    Obviously - this might change at somes stage, but nobody knows when ... there is certainly no urgency for them to remove the SP restraints as long as the money from their hotel business is flowing as well.
    Flow of money from CDI to MCK until quite recently was zero with MCK taking their full allocation of dividends as shares via the DRP. That was until they maxed out 2 or 3 years ago (and currently in breach of) their allowance of non-public ownership.


    Quote Originally Posted by BlackPeter View Post
    Still - for me was CDI so far an outstanding investment. I bought in less than 2 years ago (and accumulated since on dips). SP appreciated on my average buy in price so far by 42% - and on top of that I bought into a reliable (though somewhat frugal) dividend stream. The only drawback is for me the low liquidity ... i.e. you don't want to be stuck with a too high CDI allocation in case you need to sell for any reason.

    Apart from the liquidity issue I could live with all my investments behaving like CDI ...
    Same here. Despite my negativity on the dividend and liquidity issues, I fully acknowledge the excellent results CDI have delivered in the last many years. Top marks to them for that, and no complaints whatsoever about company performance. Just wish the minority shareholders were able to benefit a bit more from it.

    Brian Gaynor used to mention CDI (in a negative sense) occasionally in his newspaper column some years back. Be nice to see another CDI mention from him soon, but in a positive light.

    Disclosure:
    Commenced holding and steadily accumulating since July 2013 (3.5 years ago). Never sold any to-date.
    Average price paid: 57.6c/share
    Capital gain on average buy price in the 3.5 year period (based on market price at yesterday's close): 52.8%
    Received to-date and about to receive in May 2017, a total of 18.5% of the sum invested by way of gross dividends and imputation.
    Last edited by Vaygor1; 19-02-2017 at 12:29 PM.

  2. #142
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    well, a bonus issue, for some shareholders, would make their (small) parcels more tradeable, which would improve liquidity for that shareholder, not the company. which was what I was getting at. and it would also add value to their holdings via a means other than a dividend. I was referring about how some shareholders had raised this issue at recent agms. so, from and investor's perspective, rather than the company's. ok?

  3. #143
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    Quote Originally Posted by podg View Post
    well, a bonus issue, for some shareholders, would make their (small) parcels more tradeable, which would improve liquidity for that shareholder, not the company. which was what I was getting at. and it would also add value to their holdings via a means other than a dividend. I was referring about how some shareholders had raised this issue at recent agms. so, from and investor's perspective, rather than the company's. ok?
    How would it make it more tradeable? From a small shareholders perspective?

    For arguments sake you have 2000 shares at 88 cents (now worth $1,760).

    The company does a 1:5 bonus issue so you now have 2,400 shares.

    After the bonus issue the shareprice is 73.3 cents (your parcel is still worth $1,760)

    I do not see how this makes your shareholding more liquid or tradeable.

  4. #144
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    liquidity is how easily one can turn an asset into cash, yes? trading in CDI can be a challenge. some weeks, and months, almost no shares are traded. and what's on offer, buy or sell, is negligible to say the least. Thus, the market is not conducive to active trade. Put more shares into investor's hands and the market activity increases as some smaller shareholders take the opportunity to sell and some new shareholders see a more meaningful parcel on offer. Last week, there was $300k of trade .... and this was a 12-month high !!! just 300k.

  5. #145
    Reincarnated Panthera Snow Leopard's Avatar
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    Thumbs down Splitting shares does not make them more dynamic

    What you are saying podg is that people who are reluctant to buy or sell 5,000 shares at $0.88 would be happy if there could buy or sell 10,000 for $0.44 even though the dollar amount ($4,400) is the same.

    I regard that as unlikely.

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  6. #146
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    well it's happened many, many times in the past 50 years all over the world. unlikely as that may seem to you. You assume that, post a bonus issue, that the share price always adjusts downward accordingly. you might never have had GPG shares in the 90s. It was uncanny how, after a rights and bonus issue, the share price held steady, before rising again. I wouldn't be at all surprised if the same would happen to CDI, given it's medium-term prospects. just a little bit of patience required, Paper Tiger. not too much to ask.

  7. #147
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    Quote Originally Posted by podg View Post
    It was uncanny how, after a rights and bonus issue, the share price held steady, before rising again..
    It may also have risen had there not been a bonus issue. I held GPG shares and there were times when the share price fell post the bonus issue too. The fact of the matter is though, a bonus issue will not increase liquidity one bit. What the problem with CDI is is that the majority shareholders hold 77% or thereabouts of the company and they are not buying or selling. A bonus issue will not change their outlook. It will not change my outlook on selling either. Just because I have more shares (still worth the same in $ terms) is not going to sway me to sell.

  8. #148
    Reincarnated Panthera Snow Leopard's Avatar
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    Arrow Written to the tick, tick, tick of cooling CPU's

    Quote Originally Posted by podg View Post
    ...I wouldn't be at all surprised if the same would happen to CDI, given it's medium-term prospects...
    and there we have it, the admission of belief that an increase in liquidity is not related to share-splits but to other factors including the actual performance of the company.

    Whilst there are papers that show a benefit from share-splits there are also papers which show there are no benefits and then there are papers that show that both the previous two sets of papers were flawed in their assumptions.

    I have reliable data for a few stock splits. [My data sources used to automatically adjust for reconstructs, but the past few years I have been gathering raw data] and all I can say is that within the bounds of statistical probability there is no liquidity benefit to a share-split.

    I also have data for hundreds of share consolidations, often failed companies with 10+ to 1 ratios and an associated reverse takeover or other significant event to muddy the waters.


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  9. #149
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    I wonder why it is that some companies will mop up unmarketable parcels of shares. the very fact that there is such a thing as an unmarketable parcel of shares might seem a bit unlikely to you? but it happens. this isn't about the value of shares, but the number of shares that might make them more viable as an asset than can easily be turned into cash ... liquidity. it's really not that difficult.

  10. #150
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    again, it's not about value. liquidity is about how easily an asset can be turned into cash. a larger parcel of shares provides the investor with more options, should they want to sell and turn that asset into cash. the GPG example is a good one. Post bonus, shares can go up, down or hold steady. we shouldn't assume they go down. You are, of course, free to have your own outlook. But don't assume everyone has the same outlook as you.

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