Member Info for Bismarck

I don't think it's all about the dividend and most here will agree I'm sure. It's about total return. If it so happens that DEC's SP remains fairly flat indefinitely but there is a divi of >12% based on the historic SP that also tracks inflation indefinitely, I think most would be happy with that.

I have another investment, GSL paying 8% divi with a dive cover of >5X (P/E = 2) and I've had a real dilemma of late deciding whether to buy more of that or of DEC. I decided DEC for now at least while SP is depressed, I bought a fair few in late 60's on Monday so now I can enjoy the divi, wait for SP no normalise (hopefully) then sell out half once it returns to £1+ and maybe buy GSL if the metrics are still favourable.

DEC has generally traded in the £1.00 to £1.20 range over the past 5 years, except for a few months during covid and during this past 9 months. This most recent drop, which I think has been caused by a number of factors, drop in commodity price, some institutions exiting fossil fuel investments, concerns about sustainability of the business model/dividend etc etc I think has been well overdone and I see no reason why the SP will should not return to historic levels within the next 12 months as long as they keep the money flowing in, the divis flowing out and can keep their hedged rates for future years above $3....

Well if DEC maintain their 17.5c divi for the next 30 months that will return about the same as their 47c target price to shareholders. Clearly Seeking Alpha's software is confused by their accounts, as am I. However I don't do daft things like telling people the shares are only worth 47c.

For anyone who's interested, DEC has a 97.4 Magic formula score % Percentile.

The Magic Formula is a value investing strategy invented by the hedge fund manager Joel Greenblatt in the bestselling and highly recommended Little Book that Beats the Market. It focuses on finding quality value stocks using a blended ranking system (the Magic Formula rank) composed from two fundamental ratios: Return on Capital (which Greenblatt argues is the best determinant of whether a business is a good one) and Earnings Yield (his favoured measure for cheapness). He summarised his philosophy with the maxim "buying cheap stocks at bargain prices is the secret to making lots of money". In the fourth edition of his book Greenblatt claimed the top scoring portfolio of 30 stocks appreciated by 30.8% each year over the previous 17 years, though he stressed that the strategy could underperform during periods of up to two years. Having now sold hundreds of thousands of copies, the "Magic Formula" is credited for reinvigorating the practice of value investing.

You need to decide whether you believe their business model stacks up, or whether you think it will come crashing down like a house of cards. I'm in the first camp. I'll admit that I struggle to understand their accounts, but Rusty is an accountant and has millions of his own money in this.

@Soldtoosoon

I would expect BBs to have the opposite effect of keeping the SP low.

Remaining shares will be worth more

Company will either be financially healthier in the long run OR will distribute the extra FCF to the remaining shareholders in the form of higher divis. Both are positives for shareholders.

Market will see that the company has spare cash to throw around and is using it wisely

All reasons for the SP to rise IMO

It's 86% owned by institutions according to Simply WS.

Sorry, that should say page 33 not 32.

I keep thinking about the paying off debt VS buyback argument. Surely the most financially sound approach given that divis are currently about 4 X higher than the interest on much of the debt would be -

Hold the divi at 17.5c for a couple of years (disconnecting it from FCF)

Use surplus FCF for BBs rather than additional debt repayment, releasing further FCF from the reduced dividend liability, allowing further BBs.

After a couple of years, maybe review the divi rate but generally continue this approach until such time as there is near parity between dividend % rate and interest repayment % rate, then once this exists switch the strategy from BBs to additional debt repayment.

In their "50 YEAR COMPLETE PORTFOLIO RETIREMENT SCENARIO" on P32 of the September presentation they use a 4.5% long term production decline rate

I agree Jim, irrespective of whether or not the company can afford to increase the current divi it's now at such an absurdly high % that it's deterring investors and adversely affecting the SP. However with most of their interest payments fixed at circa 5% vs divis at circa 20% surely BBs are a better option for them as every £ spent reduces annual liability by 20p with a BB VS 5p through interest?

There are UK companies listed (only) in the US who's market cap is completely disconnected from their earnings. GSL for example are on a P/E of 2.

It's odd that SP is about 35% higher in Nigeria than in London. Given that SP is influenced mainly by supply and demand (and sometimes market manipulation) you'd expect Nigerians just to buy London listed stock instead and parity would be maintained, at least approximately? I assume there are no laws in Nigeria to prevent individuals or institutions from owning shares traded on foreign exchanges?

Ukraine's Infrastructure Minister Oleksandr Kubrakov confirmed the incident on social media, adding that the ship was supposed to be transporting iron ore to China.

https://www.bbc.co.uk/news/world-europe-67360440

Yes they've historically released their half year report in early December so looking forward to that.

Pleased with £7.3M NP and EPS of 1.8p.

Significantly higher than the forecast of £2.1M NP and ESP 0.5p published on Stocko

And the future is looking very bright indeed.

i agree it's unlikely he would have gone to acapulco. regardless of the hurricane, us state dept advises it's citizens against travel to the state of guerrero. more likely he would have gone to *****ana roo on the gulf coast which is much closer to alabama and is considered much safer.

While a special would be lovely Seatank, I'd prefer them to put the money towards minimising the additional debt needed for the acquisition, especially with the country's base rate now approaching 20%

"Our Shanta? F off mate."

I filtered that twat weeks ago anon, dunno why everyone else hasn't

Maybe it's just "African time"?

Hopefully just dotting the I's and crossing the T's on the agreement with their new backer, whoever they are.......