Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
If the sp drops around £3 when shares go x dividend thenthe nominal yield will be recorded as around 28%. (As sp will be £14). The end of year dividend should be bigger again and certainly much bigger than the 2021 Divi of 93p. The nominal yield at that point on a sp of £14 could be >50%. This share still seems to be rather cheap.
Pop31, this is interesting info
Coal plays a vital role in electricity generation worldwide. Coal-fired power plants currently fuel 37% of global electricity and figures from the IEA show that coal will still generate 22% of the world's electricity in 2040, retaining coal's position as the single largest source of electricity worldwide.
Even a 1% reduction in the 37% figure requires a massive effort. Coal is going to be around for a long time. But the price will not stay at for longer than a couple of years I’d say, then back to something like $200 perhaps. But thungela could pay out its own value in dividends just about in those 2 years.
The company is paying out ~£3 per share interim div on an average RB price around $270 and the average price running up to December is around $340 at the moment. The final eoy dividend could be well north of £4 giving an annual yield of > 40%. A SP of £25 is not out of the question surely, giving a yield of ‘only’ ~30%.
It would seem that at these coal prices, current production levels and current share price (which could be heading for low £20s admittedly, which would change the maths) the company will be paying out over 20% every 6 months . ASTONISHING
This is astonishing cash generation. The SP should be around £20 and then £17 xdiv in my humble opinion and the market will probably recognise the value of this share as the x div date approaches.
Every press release has good news and bad news. The bad news seems to dominate sp initially then the cash-positive implications of the good news eventually pull it back up again. This may be what has been happening with today’s drop.
There is big money to be made for many years in SA coal (for the SA people and investors) and it is so important that the organisational changes and financial investments necessary to sort out the woeful performance of transnet are made NOW!
I think the fact that the SP is already over 1000% higher than it was in June 2021 is a significant factor holding this market back from allocating a more realistic value to this company (ie A value that reflects the enhanced value of coal in July 2022)