MEL - Meridian Energy

[JAYAY]

I wonder if lack of comment form Labour/Greens means that they have realised they destructiveness of their policy and would be looking to backtrack on it if they win the election. Their policy could only be for the purpose maximising their share of the vote after which they simply would not implement it. Am I guilty of wishful thinking.

[macduffy]

Yes, perhaps the penny's dropped that tying a generator's returns to its costs will encourage and perpetuate those nasty fossil fuel burning stations!

[Xerof]

And a permanent loss of significant dividends to the Crown, read voters/taxpayers, as well as a huge writedown in the value of the 51% still owned by the Crown, read voters/taxpayers

[mouse]

I too agree with you and biker.
Sound assets at a reasonable price.
We are "well positioned."

The question that has to be asked is, what is the expected life of the Hydro system and what is the cost of generation using hydro.
The hydro consists of stored water, which can be switched on and off as required. Now That applies mostly to the water in the lakes. At the top of the system. I think you then get a certain amount of storage in the canals etc., but basically once the water starts flowing, its generating electricity. The water is not stored, it is used.
Ignore the wind farms. They are obviously cheap to build. But their economic life may well be only 20 years.
So, your conclusion Percy, of 'Sound Assetts at a Reasonable Price' is mine too. A long term hold with good dividends paid. Plus no 'buy' brokerage fees enables a modest investment to turn a profit even, plus we have the dividends.

[stanace]

Surely they realise that if the public buy up large in Meridian, just as they did in MRP, then when election time comes, nobody who bought either will vote for Labour, as this will affect the share price of both. It was a very poor move, and is a guarantee that Labour will lose the next election.

I have been thinking the same thing

[FarmerHamilton]

Surely they realise that if the public buy up large in Meridian, just as they did in MRP, then when election time comes, nobody who bought either will vote for Labour, as this will affect the share price of both. It was a very poor move, and is a guarantee that Labour will lose the next election.

I would guess that 75-80% minimum of the Mums & Dads who buy into privatisations are John Key voters anyway regardless of whether they are now a shareholder in Meridian or MRP.

In for 10,000 each for Mr & Mrs FH , allocation confirmed from ForBar . ( Thanks Synlait !! )

[Master98]

Surely they realise that if the public buy up large in Meridian, just as they did in MRP, then when election time comes, nobody who bought either will vote for Labour, as this will affect the share price of both. It was a very poor move, and is a guarantee that Labour will lose the next election.

me think any share holder( could be family members also) of electrity sector will not vote for labour.Labour party probably already realise this i guess.

[RTM]

I brought MRP and although a long term holder as we need the dividends, as with many have been disappointed with the price drop of around 10-12%. So trying to figure out how best to participate in the Meridian float. All in at IPO ? Or 50% in and keep 50% to buy post float, whether they go up or down. Or keep powder dry and invest at sometime in the future.

Trying to figure out a way to compare MRP with Meridian...and perhaps other power co's as well.

One approach I have been considering is to work out a market capitalisation price (share price x no. of shares): units of power capacity ratio. So some advice please. Does this seem a valid way to compare the companies ? I was thinking that if the Meridian ratio was say 10-12% lower than MRP ratio, then this might indicate that the price is about right. Assuming that Mr Market has now done a decent job of pricing the MRP company.

Any thoughts ? Or is this a waste of time ? Are there more meaningful ways to compare the two IPO's ?

Any help / thoughts appreciated.
Cheers
RTM.

[CJ]

MRP may have dropped 10% but you have had a 4% dividend in the meantime (my records show I'm down 6.8% from IPO).

Given it is a yield stock, I have focused on yield. Seem simplistic but I cant fault the thinking. The main question is whether the proposed yeild is sustainable.

Based on yield, Meridian is a good buy. Planning to send in my application this week.

[Beagle]

^^First N.Z. capital compared the power companies on a relative PE basis and came to the conclusion that on this basis Meridian is worth $1.43 - $1.60.

Those of you who are investing might want to note the U.S. Debt extension deadline is October 17, that's October 18 here and the deadline for applications is hand delivery to the registrar by 5.00 p.m. Friday 18th October.

If I thought this was a good investment I'd be waiting to see if the American situation is resolved in a satisfactory manner and then hand delivering my application. On the other hand, with all this international uncertainity maybe the book build price will be around where Bryan Gaynor thinks it ought to be $1.30 -$1.40. ?