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Pantherm100,
You don't receive the dividend until 26 February. Are you still "down" once you take that into account? Obviously I don't know how many "old" shares you owned, but the dividend will be that number times the 50.93p.
Mike.
Interactive investor has incorrect average price and therefore stating I am 20% down also no trade history for Tesco. I've reported it.
Longtime there is a cost as far as the share portfolio on his HL screen is concerned.
Atanasoff purchased shares at £2.15. To keep the maths simple let’s say he purchased 380 shares at £2.15 so the cost was £817 or average cost of £2,15 per share.
After consolidation he has 300 shares so his average cost per share is £2.72 (£817/399 shares)
So with the share price at £2.40 he will be showing a loss of 10% £2.72 avg price per share vs share price of £2.40.
In terms of total value of his holding he now has 300 shares at £2.40 each so it’s £720 a loss of £97:versus his original purchase of £817.
The special dividend will be his original 380 shares x 50p so he will receive £190 which means he hasn’t lost out on the deal but his portfolio will still show it as a 10% loss. If he spends the special dividend on shares he will get another 79 shares meaning he has spent £1007 (£817+£190) on his now 379 shares giving him an average share price of £2.65 which will still show as a loss on a per share purchased basis on his portfolio against the £2.72.
Thanks for the response Mike
But whilst I still own the same fraction of Tesco it is worth less. Even with the 51p / share ( as of today) I’m worse off than last week. My original view remains.
Logged onto Eqi this morning. My investment account value is down and there is no balance in my stocks and shares isa but its reading the share balance ok? I thought the shares and therefore total value would decrease and then the "dividend" would bring the value back up on 26th Feb. Why is my ISA empty of value? There are 3044 shares in it....
Pantherm100,
How do you work that out?
Mike.
It’s OK saying don’t worry. Everyone is worse off.
Pantherm100,
What you are missing is the fact that (if invested) you will shortly have a very large dividend (cash) in your pocket. They have not "pocketed the sale proceeds themselves", but they are passing a majority of them directly to shareholders via this special dividend. The remainder have been used for corporate purposes such as reducing the deficit in the pension fund. The consolidation of the shares from 19 to 15 is arguably something of a red herring; you will still "own" the same fraction of Tesco as you did before, because the *total* number of Tesco shares reduces (and in fact has now reduced) in the same proportion.
Rgds, Mike.
As a new investor / speculator I can’t believe the Tesco Board have persuaded myself and presumably institutions to take up the special offer of buy 2, pay for 3 deal. They’ve simply given with one hand and taken with the other whilst pocketing the sale proceeds themselves. Or am I missing something?
There is no cost.
Instead of you having z amount of shares at about 190p you have y amount of shares at 240p.
190 x Z being equal to 240 x Y
s
'' those who had a buy in price north of 300p ''
An investor should take responsibility for their decision to invest in the stock market, rather than continual whinging.
Years ago I paid 340p for a tranche of Tesco shares
The same investors had plenty of opportunity to purchase as I did in the 140's
Can someone explain what is happening to Tesco shares? It does not allow to sell.
Fully understand some investors frustration if they bought circa 240 but I also think many are taking short-term views. Assuming the yield is the same as last year then the division will be into less number of shares. Additionally what was discussed and passed at last weeks GM was an option to buy their own shares.
The sp has been held in a tight channel for the last few weeks to facilitate this SD so private investors should relax and either move on stay invested and hopefully enjoy a CG and their well covered dividend.
What is the consolidation ratio?
Regarding the move from Share, to ii Investors, not impressed so far. Had lots of problems getting the new account up & running. Still have to get ‘Regular Investment’ set up, not as easy as we were led to believe.
As regards Tesco’s, share price all over the place, this morning. Presumably, still settling down. Am waiting for the Special Dividend to be received, then re-invested into the new shares, so I will then know exactly where I stand with the new shares, against what Shares I used to have. Will hang in there for the present, probably topping up, to see what the next dividend will be in May. Get the feeling that the new share price will be volatile for a while. Guess everyone’s position, will be whether they are in for a quick profit, if possible, or believe in Tesco’s in the longer term.
p
''Now if July div stays the same, ie 7p''
Dividend amounts are determined by profitability and dividend policy. What ever money is available from profits under a dividend policy will be distributed to shareholders. The amount per share will be determined by money available divided by the number of shares.
Spindler
LOL
I meant a dealing charge of £1.50!
To put 1k or so into a fund I'd like to buy anyway
As opposed to about £15 if I bought a stock
Take care of the pennies.....
And personally I would just love to have been in the room when the SD decision was made. To explain to the city bigwigs that Special Dividend in the accepted meaning within the confines of the english language means a Dividend albeit a special one. And that is how investors will perceive it. If you do it alongside a consolidation it isn;t a dividend special or not ! It's a return of capital via a complicated construct. These A hats don;t know their A from their elbow very often
My Tesco shares were 215p each. My understanding was that in the consolidation the shares would be reduced 19 to 15. What I didn't realise is that the "new" shares would be "sold" to me at the closing market capitalisation rate meaning that my unit cost is now 273p (according to HL). This means on current share price I am 10% under water. I realise we have the Divi to come (not showing yet in HL) but I feel a bit cheated. My own fault for not really knowing what would happen but leaves a sour taste for this LTHer.
p
''believe they would receive a cash benefit''
the benefit was in the market cap of Tesco, against a general market drop. The asset benefit could have been unlocked at any time by an investor prior to it's handing over.
The SD that isn;t an SD would be salt in the wound. But I get what you say look forward but for them must be hard to
In my situation I have made too much this year in stock sale gains, so I will be paying CGT. However I have been way under my dividend tax threshold.
So if I bought Friday then sold today, I move the losses from one pot to the other, reducing the tax paid on investment, but increasing dividends tax free. As it is, I am not planning to just dump all my TSCO shares for a loss, but the point still stands :) Just an alternative way to look at it.
To be fair LTI those who had a buy in price north of 300p or 400p and got mugged due to management activity well outside of what was to be expected and in blatant contravention of Stock Exchange rules are entitled to feel like another kick in the teeth(I'm not one of them). As someone said on this board or another how hard was it for Lewis to right the cheques for fines etc not coming out of his pocket. I do think he's done a sterling job that aside but this was not the right move and i had invested in a FTSE 100 company and it cost me I would want redress or at least see the perpertrators held to account financially or legally or both.
In the end I phoned EQi and they suggested clearing the browser cache and if that didnt work, then to send some screen prints in. The lady kindly offered a trade over the phone but at online prices, so I got my foot in the door this morning.... sounds like teething problems at II as well then.... good luck with sorting that out.
Fully agree and no issue with this reasoning. Maybe the phrase "special dividend" caused many to believe they would receive a cash benefit, but in reality at very best its a marginal gain. In my opinion, a marginal gain on such recent "income" for TSCO is poor. Looking at the BB, it seems there are more who arent happy than are happy. Thats either a mass misunderstanding of the program, or poor communication as to its actual, final impact.... take your pick. However you slice it, many believed the phrase special dividend would deliver , ooops a special dividend but its has in reality delivered a claw back program. Now if July div stays the same, ie 7p, afain we all actually get much lower here also as we hold lower stock numbers.If nothing chnaged, I would have expected 2550 x 7p = £178 divi, if divi remains uncganhed then its down to £140, so if and its a major if at the moment, I hold until July there needs to be a bigger dividend. Baed on what I am seeing at the moment, I dont believe that will be the case. To stand still, the July divi would need to be 9p, thats a dividend increase of 28.5%....... not at all likely!! Maybe I am one of the numpties, but a numpty who knows the numbers. Stay well all....