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NAV gradually recovering and the SP is trying its best to follow suit, hope it will continue.
Divi is locked at 5.9pps for the year giving a current yield of 7%. Acceptable but can the sp hold?
Thanks for useful comments guys. Apologies for my paranoia re winding up, just seems to be happening all too regularly now across my portfolio. Agree no reason to suspect it might happen here though, I certainly hope not.
Trotsky. Yes, I'm aware that the d reserves aren't all cash. The fund holds a diverse portfolio of quality companies but with generally low dividends. As such the sustainability of EATs dividend's going to rely on their trading skills otherwise the fund's going to cannibalise itself. They've done a pretty good job up to now
Silvernight, Don't get distributable reserves confused with cash. The distributable reserves have been reinvested into new investments. As at 30 June 2023, EAT had c£12m of cash and c£17m of bank loans. EAT currently generates c£8m of income before costs and pays c£21m in dividends. The annual dividend isn't covered by net income and EAT therefore needs to sell investments to maintain its dividend. The distributable reserves do give EAT the capacity to continue paying dividends but, without investment growth, those distributable reserves are likely to be progressively eroded.
Distributable reserves gives the trust flexibility to maintain a dividend at 6% of NAV even if not covered by earnings. I see no reason for winding this down. It's been going for 40 years and I'm happy to add on weakness
What a difference a day makes! The net asset value has fallen 4p between the end of December and the start of January; the difference between an annual dividend of 5.9p (declared today) and 5.7p!
The distributable reserves are irrelevant. The trust has a current NAV of 94.7pps and if you allow for selling and winding up costs, investors would do well to receive the current market price of c87.6pps. Where's the gain in that?
Couple of interesting numbers here:
Distributable reserve £289m (at half year); market cap £319m.
With the current vogue for winding down relatively successful Trusts (e.g. VSL, TENT, HDIV, RMII) one wonders if questions have been asked by the larger shareholders?
Well, they did round up last year, so it's possible.
Final NAV 98.33 multiplied by 6 = 589.98 ..I wonder if they will round it up to 5.9 pence for the year to make a quarterly payment of 1.4725 p.......Please??
As it stands the yield (based on todays sp and nav) will be about 6.75% from January. I like the geographical diversity and the strong revenue reserves.
Decided to add a further 3K shares this morning.
Looking to steadily build on my existing position here as long as the yield is greater than 6% and at a discount to NAV.
Not expecting much either in capital appreciation this year, but live in hope.
...might be achievable by the end of the week zac but yes, I understand what you are saying & on that basis I think it's still worth a shot. I'm certainly holding for now.
zac. I hold these in my ISA . Don't expect much capital appreciation in 2023 but prefer exposure to Europe rather than UK. You know what income you're getting for the next 12 months.
Although I'm currently well out of pocket here it doesn't alter my thinking. What return can I reasonably expect from here over the next 12 months?
I tend to ask myself this question of all of my holdings at the end of each year. Providing the answer is a double digit total return then I'm ok with that irrespective of my previous performance.
On that basis I think a share price of 95p by the end of the year should be achievable. Shouldn't it?!!!!!!
I invest in high div stocks and although the current nav has dragged the dividend down, the holdings in this fund are well poised for a europe wide recovery this year if the. I consider the European recovery will be stronger than the UK one so I remain invested here and continue to add.
6% plus potential good capital growth in a well managed fund is exactly what I am looking for.
Yep, see my posts of 29th Dec & yesterday (below). 6% of NAV (which sets the dividend for the year) is a lot less this year than it was last. K
To answer my own q a guy on the ADV board seems to approx concur. If that's the only bad news from EAT.L I'm ok. .. or?..
Any more info on this? i just saw that the div payments for 2023 were projected 1.45/pq/sh which IMHO is 6.44% @90 SP. Right? Or..?
Sounds like a plan zac. I think it's been a tough year for many investors, I know it has been for me. Investing is about the long-term though, so you have to take the rough with the smooth. Let's hope prospects for 2023 soon start to look a bit better.
Currently sitting with an average price of £1.48! So, up to now not one of my better buys. With the exception of energy and infrastructure pretty much everything outside the UK has taken a hammering, particularly small cap stocks.
So, whilst I'm far from happy with my investment here to date, I'll probably add as dividends become available from here and other holdings.
I won't go silly but will keep this for the foreseeable future as part of my global equity portfolio. I've 22 holdings of which only 8 didn't fall in value over 2022. As a side I had 3 holdings that performed worse than this over the last 12 months! Not one of my better years!!!!
We'll never agree on everything adv11, and it's been a tough year all round. My average is 116 so it's not great for me either. EAT maintain the dividend at 6% of NAV so they can't directly control the value. The difference for me is that I expect EAT to make a slow & steady recovery from here, with increasing dividends in future years, whereas RLE will have to keep selling properties to pay down their debt and maintain the dividend until, eventually, there's nothing left to sell. You pays your money and takes your choice of course.
Sorry to disagree @K - One year ago the price was 140p, yet they talk about providing capital growth as well as a 6 percent dividend. Anyone bought in a year ago is getting 4.14% Yield. My average is 122p = 4.75% yield. All good for the new investors, forget about the long termers.
Unless I am missing something, it's a bigger disgrace than RLE.
Dividend confirmed, 5.8p for 2023. First instalment of 1.45 XD 12 Jan, payable 31st Jan. Still not a bad yield for an asset class of this nature, but clearly disappointing after last year's exceptional 8.8p.
Based on the company's declared target dividend of 6% of NAV, it looks like the yield will drop to c. 5.7% (latest NAV 96.26 x 6% = 5.78p - down from 8.8p this year). All tbc by EAT of course, & adjusted for NAV at 31/12/22.