Vector Limited (VCT)

[JAYAY]

I see AGM coming up 23 Sept.
Director nominations - Election and Re-election of DirectorsEarlier in the year, the Board appointed Tony Carter,Dame Paula Rebstock and Bruce Turner as directors ofthe Company. In accordance with NZX Listing Rule 2.7.1Tony Carter, Dame Paula Rebstock and Bruce Turner willretire and, being eligible, offer themselves for election.The meeting will be asked to consider by ordinaryresolution:

Rebstock's got a nerve hasn't she. She displayed gross incompetence at ComCom as well as malice and vindictiveness towards Vector back in 2006.
Who wants her as a director?

[JAYAY]

I have been searching the internet for Mai Chen's open letter regarding the Rebstock debacle back in 2006.
I can't find it. I thought once something hits the internet it could never be deleted.
Does anyone know where to find it?

[stoploss]

I have been searching the internet for Mai Chen's open letter regarding the Rebstock debacle back in 2006.
I can't find it. I thought once something hits the internet it could never be deleted.
Does anyone know where to find it?

Maybe ask ...

info@chenpalmer.com

[JAYAY]

Maybe ask ...

info@chenpalmer.com

Thanks for that Stoploss. I will post it here if they send it to me.

[JAYAY]

Maybe ask ...

info@chenpalmer.com

Two emails to Chenpalmer, completely ignored. Some serious strings must have been pulled to get that letter purged from the internet.
Someone must have a copy of it.
I would love to see it posted here again.

[ananda77]

Just a question: what do people think of investing in Vector at current prices, please

[BlackPeter]

Just a question: what do people think of investing in Vector at current prices, please

Dropped them some time ago off my watch-list and marketscreener not working - i.e. I don't have my hand on their pulse, but from memory they have more directors on their board who made me loose money in the past than directors who made me gain money.

On the other hand - just looking at the chart, they well might bounce up if enough people see them as quasi bond, though I doubt that investors would see them in the AIA (and similar) league.

Analyst consensus (Reuters) is tending towards underperform and PE does not look that flash at above 30 ...

Others might have a better view on Vectors economic future and potential opportunities in the electricity industry - I don't.

Why would you consider them as a good potential investment?

[ananda77]

Dropped them some time ago off my watch-list and marketscreener not working - i.e. I don't have my hand on their pulse, but from memory they have more directors on their board who made me loose money in the past than directors who made me gain money.

On the other hand - just looking at the chart, they well might bounce up if enough people see them as quasi bond, though I doubt that investors would see them in the AIA (and similar) league.

Analyst consensus (Reuters) is tending towards underperform and PE does not look that flash at above 30 ...

Others might have a better view on Vectors economic future and potential opportunities in the electricity industry - I don't.

Why would you consider them as a good potential investment?

My interest would be more like seeing them as a bond like investment rather than for capital gain. I also like that they are a monopoly and heavily regulated already. Yes, the P/E is higher than those of other power companies, but I would consider their dividend payment discipline as solid with a 100% franking.
I can not bring myself to even consider other power companies at current elevated price levels to intrinsic valuations.

[BlackPeter]

My interest would be more like seeing them as a bond like investment rather than for capital gain. I also like that they are a monopoly and heavily regulated already. Yes, the P/E is higher than those of other power companies, but I would consider their dividend payment discipline as solid with a 100% franking.
I can not bring myself to even consider other power companies at current elevated price levels to intrinsic valuations.

I agree that Gentailers look pretty dear at the moment as well, but they are really quasi bond investments.

You can't really value Gentailers on PE, but you need to look at cashflow - their earnings is artificially reduced based on too high write offs (you might write off e.g. a hydro dam over 50 years, but you can use it for more than 100 years).

Vector however is in the main an electricity distribution company - and I suppose that most of their assets are worthless when written off. While I am not a specialist for electricity distribution, it is clearly a quite different industry like electricity generation.

[ananda77]

I agree that Gentailers look pretty dear at the moment as well, but they are really quasi bond investments.

You can't really value Gentailers on PE, but you need to look at cashflow - their earnings is artificially reduced based on too high write offs (you might write off e.g. a hydro dam over 50 years, but you can use it for more than 100 years).

Vector however is in the main an electricity distribution company - and I suppose that most of their assets are worthless when written off. While I am not a specialist for electricity distribution, it is clearly a quite different industry like electricity generation.

Actually, Vector's financials are not looking too good.

- VCT's debt to equity ratio = (117.5%)
- VCT's debt to equity ratio has increased from 107% to 117.5% over the past 5 years
- VCT's debt is not well covered by operating cash flow (12.6%)
- VCT's interest payments on its debt are not well covered by EBIT (2.4x coverage)

...so I think, at current prices, like the gentailers, Vector is trading substantially above fair value, estimated at 2.44 and expensive