Member Info for Shaun_LSE

We have another bearish sell signal on the MACD on Daily, on weekly, it's been sell for a long time and is accelerating. The thing is it's so oversold already it's crazy. With this 10 million buyback, it's barely keeping it afloat for big players who are jumping the ship still.

It's a bit disconcerting that with another round of 100mln in buybacks there is such a muted bounce. We may dump again to 100p!

Looks like a V shaped recovery... A double bottom may be more of a certain indicator of a turnaround. But 25% below NAV and a 9% yield isn't to be scoffed at. I'd buy some more here if it weren't for the fact my allocation is full.

Again I'm trading the spread between this and VGOV. If we breakdown again I'm out. But I have the feeling this may be a dip before we move higher I hope!

They have enough cash to pay for this next round of £100 million buybacks. And it'll improve their dividend cover.

Exactly! The £100 million buyback improves dividend cover because:

✔ Fewer shares in circulation → The same total cash flows are spread over fewer shares, increasing dividend cover per share.

✔ UKW keeps the 7-8% return on capital that was previously paid out as dividends to repurchased shares. Instead of paying those dividends, UKW reinvests the capital in its portfolio, which continues generating cash.

✔ Enhances per-share metrics → EPS, cash flow per share, and dividend sustainability all improve.

With a projected 1.9x dividend cover over the next five years, this buyback strengthens their ability to sustain and even grow dividends, while also boosting financial efficiency.

Source Chat GPT.

Was the recent loss "Greencoat UK Wind Swings to Attributable Loss in FY24" loss because of the NAV reduction? They still have good dividend cover apparently. ChatGPT stated :

Conclusion: The Loss Was Likely Due to NAV Revaluations, Not Buybacks

✔️ The -£74m loss in H2 2024 was most likely due to NAV reductions (lower wind speed assumptions & revaluations).

✔️ Buybacks don’t directly cause net income losses, but if they were debt-funded, they could impact financial stability over time.

✔️ A drop in power prices or wind generation could have also contributed."

The company also reduced 75m in debt. So it looks like cash was used to pay for the buybacks and the NAV reduction had an impact.

"Debt Levels:

As of June 30, 2024: Aggregate Group Debt stood at £2,329 million.

GREENCOAT-UKWIND.COM

As of December 31, 2024: Aggregate Group Debt was reported at £2,244 million.

UK.INVESTING.COM

Analysis:

Debt Reduction: Between June and December 2024, UKW reduced its debt by £85 million (£2,329 million - £2,244 million).

Gearing Ratio: The gearing ratio remained stable at approximately 39% of Gross Asset Value (GAV) during this period, indicating that the reduction in debt was proportionate to changes in asset values.

UK.INVESTING.COM

Debt Management Activities:

In 2024, UKW undertook significant debt refinancing:

Refinancing: The company refinanced £725 million of its debt, replacing £325 million of near-term debt with £425 million of term debt maturing in 5-7 years.

FINANCE.YAHOO.COM

Revolving Credit Facility (RCF): The RCF was adjusted to £400 million.

Conclusion:

Throughout 2024, Greencoat UK Wind effectively managed its debt, achieving a reduction of £85 million and maintaining a stable gearing ratio. The company's proactive refinancing efforts have contributed to a robust financial position."

Source ChatGPT

Yes the whole renewables sector is oversold and, again there's always a lot of negative new about them in the sector at bottoms, and hype at the top. I've about 5 funds making up about 10% of my portfolio in renewables. This wonderful revolution is happening, this seems like a coordinated "attack" on the sector. I can't think of anything better than us getting all of our energy from the sun and wind.

I read they may have some parts of their business not covered by CFDs, hence the drop in EPS. But the dividend cover is there. Inflation is still high so that'll mean more cash flow, but rates are coming down, which is good!

Smiths Group, Spectris, UPM

Feb 12, 202507:41 GMT

Greencoat UK Wind Plc

UKW

: RBC cuts target price to 165p from 170p

24% below NAV, 8% dividend, that's value!

All of this "bad" news about renewables happening after they are already oversold?

It's a ruse, I see it all the time. The big companies want liquidity to buy at dirt cheap prices. They post a load of media saying how it's going to be taxed, regulated, drill baby drill etc at the bottom. The same thing happened with BATS, I remember all the articles about it last year right at the bottom.

The new chap doesn't want an energy independent Europe, he wants us reliant on importing their LNG.

They want you to capitulate.

Buy LOW Sell HIGH.

Buy in Fear, Sell in Greed.

That's a tad dramatic? There's plenty of wind.

Https://www.proactiveinvestors.com/companies/news/1065250/greencoat-uk-wind-says-speeds-have-dropped-but-cashflow-will-remain-healthy-1065250.html?utm_source=chatgpt.com

https://www.investing.com/equities/greencoat-u-consensus-estimates?utm_source=chatgpt.com

"Analyst Outlook: Analysts maintain a favorable view of UKW, with a consensus rating of 'Buy' and an average 12-month price target of 170.67p, suggesting a potential upside of approximately 44.39% from current levels.

INVESTING.COM

Chat GPT

In summary, while UKW has adjusted its long-term generation forecasts due to recent wind speed trends, the company remains committed to delivering consistent dividends and maintaining robust cash flows. Strategic asset management and favorable analyst perspectives further underscore its stable financial position."

It's all about energy prices. Nat gas has been at a low since 23, but it's picked up because of the last pipe through UKR to Europe being turned off 31st Dec.

If wholesale prices stay up, UKW should be good. They have a strike price guaranteeing enough cash flow even if wholesale prices drop, as long as the wind blows, the recent low wind should revert to mean, but perhaps may affect the quarter's earnings.

MACD buy crossover. I've purchased back my position from the VGOV spread with about a 10% gain. If there's a big selloff my energy stocks will suffer, but it looks like they all are about to potentially rally. 119p for a long time now, looks like there's significant support here.

I'm down to 60p per share cost average. So am looking forwards to the dividend!

Yes buy the Dividend payment is 300%. I've been doing the same. These dropped some 10% against my VGOV again, I bought some back as they dropped 10% against my VGOV.

It's fallen through support. Payout ratio is 300%, nav dropping. I've sold out for VGOV and VUTY.

A lot of businesses going under, seems like a recession is coming. UKW/VGOV is sell as of July 24 monthly MACD. This period of 0 wind for weeks has me a tad worried. Germany emissions dropped 8%.

Https://www.msn.com/en-us/weather/topstories/dunkelflaute-sends-wind-power-generation-plummeting-in-uk-and-germany/ar-AA1tyTeq

Hopefully the wind picks up! This may affect their monthly revenue. Also, Germany net emissions have dropped 8 this year, energy consumption is going negative. Especially with Trumps "dig dig dig" policies, more cheap gas.

Well 1.33p. Hopefully bottom of this cycle.

Could be a value trap, there are tons of buybacks and loading up on debt. Buy energy prices are at low of the cycle. Been more executive selling this year than buying. Keeping less than 5% of portfolio due to risks.

I picked up a little more here from those I sold at 145p. Looks like a short term bottom here. Of course if there is a black swan event I have limit orders at 103p.

Looking at UKW/GBCPI, we are at £1 but in 2016 money.

IMHO energy is cheap currently. Even with this "EV & AI boom", prices are very low Natural gas prices are at the bottom of their cycle, once they start picking up energy prices will increase.