Vector Limited (VCT)

[AMR]

Ouch...an all time low. Let's hope the $2 provides some resistance.

Disc : Don't hold, but relatives do!

[Dr_Who]

Sorry Doc
Possibly a poor attempt at sarcasm/joke. AECT the Auckland Energy Consumer Trust a highly politicised body who are trustees of 75% of VCT for Aucklander's. Look them up - Vector's potential is almost unlimited - hence the Labour government's zeal to suppress any capitalistic tendency. The debate has always been about a suitable capital structure and governance structure for VCT's licence to print money.

They were always highly leveraged because they were presented opportunities to make more profits and grow but the Trust refused to sell shares to reduce debt. VCT is capable of generating buckets of cash. With the right capital structure this company would support a very much higher price than $2.08. It will come but it will take much longer than it should have. Selling some of VCT's Wellington interests is another way.

I agree with you. So, when do you think is a good time to accummulate some more VCT shares?

[Steve]

I agree with you. So, when do you think is a good time to accummulate some more VCT shares?

Now may be good while it is down, or you may want to wait until it turns back up over its MA?

VCT is on my watch-list also.

[duncan macgregor]

Now may be good while it is down, or you may want to wait until it turns back up over its MA?

VCT is on my watch-list also.

Its 14c below its buy signal today. I have it on my watch list, might buy a few myself when it crosses my moving average buy signal. Regardless of what happens the business must keep running even in a crash. macdunk

[Grimy]

I've been watching also for a while. Decided to pick up a few today. Should move the SP down a bit!!

[Steve]

I've been watching also for a while. Decided to pick up a few today. Should move the SP down a bit!!

My purchases always seem to sink the share price too!

[kura]

Yep, I also picked up a few today, sure , it may not have bottomed yet, but I just figured that it wouldn't drop below $2

In any case, it will give me an interest in their forthcoming profit announcement.

[Bilo]

I agree with you. So, when do you think is a good time to accummulate some more VCT shares?

Doc
I see not one person has been keen to attempt to address your question:
When would be a good time to accumulate VCT?

This is not an easy question to answer in a market where company fundamentals have been ditched in favour of slavish following of indices, shorting of good companies with the knowledge that institutional investors aren’t buying, selling a few on the basis of buying back more for less once smaller or geared investors have been squeezed out – all part of the grab bag of “legitimate” manipulation tools used by big traders.

This market, where the dog’s tail wags it’s head, could discount the share price of a company with cash in the bank greater than their capitalisation. Based on a World recession scenario then this is no time to be in shares, not even VCT. It just weighs on those of us who try to make our savings work for NZ (unlike the Cullen Fund).
But on the fundamental side (for those with cash and time on their side):
A glance at VCT’s results last year indicate:
· Cash flows of $358M – or ~$1M per day
· EBITDA $610M
· Dividends set at 81pc of net profits
· Fantastic businesses, electricity lines, gas and gas reticulation, telecommunications
· Constrained by government intervention on unrealistic rates of return – (hopefully the government will stop meddling before the likes of VCT and Transpower stop investing and electricity and gas services become unreliable
· Two dividends in the next ~8months (~18cps gross last year)
The problem is that there will be better opportunities to make a dollar in this depressed market – possibly none with the long term financial security of VCT. In a balanced NZX portfolio VCT would be there despite the problems that I referred to above. PE guessed to be less than 20 but capable of being reduced rapidly on divestments and with cash flows/deferred investment.

But to answer your question:
· Phaedrus would keep his hand in his pocket
· McD likes excitement and VCT is definitely not that
· Bilo says when you think a stock is cheap, it can always go lower – and just has!..I think $3.50 will look cheap when it comes...

[duncan macgregor]

Doc
I see not one person has been keen to attempt to address your question:
When would be a good time to accumulate VCT?

You are wrong my friend Macdunk is not scared to tell you when to buy a good business opportunity like this. The market will tell you when to buy all in good time when the time comes. When the share price moves above the thirty day moving average and not before. Look it up all will be revealed at a later date. Macdunk

[tsb]

Well at $2.03 I couldnt resist buying a few more. Its a bit sad though that after 2.5 years it has managed to shed so much value.
'Praps the chairman will get voted out at long last.