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This latest Jefferies report makes no sense, why just SUPR and not other REITS, why now when it was recommending SUPR just a few weeks ago and nothing has changed.
IMO we are now in a transition phase for inflation and Interest Rates which will eventually be good for SUPR but it is not a good situation at present as Inflation is below Interest Rates as this will restrict inflation based rent reviews while still paying more on interest rates but probably not that significant as most of the loans are fixed.
Would add more but already have quite a lot as it is my second biggest holding and don't like adding on a day the general market is up. Also looking more toward REIT special situation like ASLI and API as both may well be liquidated.
All that said good day to buy your own shares and save future dividend payments.
I just hope that the Central Banks do not keep pushing back the interest rate cuts. IMO it will all rest on the FED as the BOE will just follow.
As can be seen on the ADVFN board this is most like to Jefferies downgrade.
Thanks to chucko1
Jefferies has moved (actually - REVERTED BACK) from an NAV model to a DCF model. This has caused a drop from 90p to 60p. They stated that the V (in NAV) was relevant in 2022/23 owing to the plunge in (V)aluations etc.
God only knows what discount rate they elected to use, but a change can cause any valuation change you care to mention. A TP of 60p, as previously mentioned, results in a yield of 10%+ - but TSCO33 bonds yield 5.2%. Figure that one out. Also, 850bps over linkers???
All the is relevant is the usefulness of the yield - even the current 8% is stated (by Atrato) to result in a 12% IRR (long run). So, if like me, you own this for the long run, one could only logically buy more this morning.
So it's not ASDA, it's not the movement in rates (per se), it's not leverage, it's not a profits warning, it's not something corporate - it's a change in methodology. I wonder how much that change will effect the future cashflows??!!
We are truly blessed on this board, we have GG popping up when the SP falls or some bad news and skier1 nonstop ramping where the SP is rising or some good news.
Is skier1 GGs alter ego, would explain why we only see one of them at a time. Best if these 2 start a separate board and then they can argue with each other and leave the rest of us alone.
I would also like to add what has really p1ssed me off is that this complete change of strategy was not put to a vote along with Rustys and others free shares for abysmal performance, just dumped on us long suffering shareholders.
Trisor, Savage_KeyboardR
Totally Agree, how does it help to open a green office in a part of the world which is in crisis suffering political uncertainty.
https://www.bloomberg.com/opinion/articles/2024-02-06/south-africa-election-means-more-uncertainty-as-anc-falls
VistaMan
I am negative because I bought into Rustys promises on the dividends and add in the promises on the BBs and I can only say I have been well and truly lied to and now in an investment which is not what I expected if Rusty had told the truth.
So it bounced back a bit, if it gets to £16 I will still be in losses but can say the new strategy looks like it is working.
IMO it makes no sense buying more wells at a much higher price than you can buy wells by buying your own shares. If these funds has been used for BBs and the dividend not destroyed I believe the SP would be a lot higher, now it is waiting game perhaps it all changes if Trump get elected, who knows.
It should be noted the SP was rising at a decent pace from it lows before the dividend announcement and then fell for a time once this was announced, other gas companies cutting back and HH has been rising recently as the effect of el nino is gone, neither of which is down to Rusty or his new policies. So IMO the recent rise is not because of the dividend drop but down to other factors.
Trisor, also GDP figures as these are being held up because of the increase in the UK population but GDP per head is going down. Bit like CPI in the past, it can raise its turnover by loss making contracts but the only thing that counts are profits.
With GDP and other metrics we are in an Alice in Wonderland world, good GDP means more money to spend but will potentially delay BOE rate cuts so likely to drop SPs.
What matters now is interest rates which depend on inflation, we seem to be a bit like CPI with the jam tomorrow as potential rate cuts are being put back.
Notrex
You like myself understand the different type of investors, those who invest in Oil and Gas, Banking etc are looking for dividends so for a gas company to destroy the dividends makes no sense. Especially when one of the main reasons given was for BBs which seemed to be another thing now missing along with the dividends. The simple truth is Rusty wants to run a bigger company so he can pay himself more money and there is no other way than to take the dividends and buy more gas wells even though there is an over supply of gas. Of course he was too important to take a income reduction because of his dividend cut so he simply gave himself more shares, nice work if you can get it.
"He has pivoted away from outdated dividends"
Really, Oil and Gas companies are in a mature industry like banking Insurance etc so pay a high dividends not a growth area like AI where there will be low or no dividends for a time.
I like dividends otherwise what is the point of owning shares in legacy industries. For capital growth I have bought Gold and Uranium, also Uranium miners, let see if DEC can outperform the likes of Cameco, while DEC SP has fallen off a cliff my Cameco shares have gone through the roof. Also all my other Oil and Gas shares are doing very well, partly due to increased dividends and the huge BBs they are making to offset the ESG sell offs.
"If current trends continue, DEC will be £20 by the summer"
If so I will be out to a company with good dividends (I am getting around 5% on what I paid, less than my Santander easy access account) and ones that does not lie to shareholders. We can dream that this nightmare investment will be over.
"The future is important not the past"
Those who fail to learn from history are doomed to repeat it
BOE can say what they like but they will follow the FED, sometimes right away sometimes with a delay. All in all the BOE is a waste of time concentrating on ESG and WOK issues, all we need is a simple computer program that follows the FED makes the odd useless comment (just choose at random from a list) replacing the overpaid Andrew (out for lunch) Bailey and his cronies.
Https://finance.yahoo.com/news/uranium-stocks-soar-bullish-goldman-173921891.html
I bought some gold at the $1900 Oz level now waiting to sell to take some profit but will hang on for now. The current rise is said to occur because of the Chinese are buying gold instead of property which has collapsed. Gold is predicted to go up as/when interest rates fall but so many factors influence the gold price.
As for Russia they produce a lot of gold (Polymetal biggest miner) but not easily sold so I believe they get a lower price but the Chinese are buying. Bitcoin (which I don't understand enough to buy) is a good way to get round sanctions, probably why it has risen but I guess not for Governments to buy who will stick with gold.
With all that said I still prefer Uranium either buying U3O8 by buying YCA or Miners like Camerco, I have put a lot more in Uranium than gold as predicted world structural shortage.
As for UK house prices they will probably stay strong due to the vast numbers entering this country, they have got to live somewhere.
As always DYOR.
On the subject of property I am really annoyed with the way the government tax rented property, I can sort of understand the logic in the UK (though I personally disagree) but they apply this to foreign properties as well so clearly just another tax grab. I am planning a move to Gibraltar and want to buy a small property and rent it out before I make the move in a around 2 years time to help establish a connection for residency. However with the UK tax on any rented property it makes this unfeasible, another great change by the so call called Conservatives.
Natural Gas Producers Are Ready To Pounce When Prices Rebound
https://oilprice.com/Energy/Gas-Prices/Natural-Gas-Producers-Are-Ready-To-Pounce-When-Prices-Rebound.html
You can add DEC to the list of shares with no SD.
"Mine are in an ISA with ii and divi there is paid in gbp."
That is because you cannot hold $s in an ISA, do II use the DEC dividend exchange rate? mine are in a SIPP where you can hold $s and II do not give you a choice but you can exchange USD to GBP at 1.5% charge.
With II you have no choice but to be paid in $s (I tried), you may make on the exchange rate but II charge 1.5% conversion charge. I have been keeping the $s and buying US stock, if DEC delist from London I assume we will be able to then buy DECs US stock in $. However I am not interested in adding and may well sell at some point now the dividend has been cut, I know it is good at 10% but can't trust this will not happen again. I prefer Uranium stocks for CG and many other companies, like PHNX (which I already own )and REITS for reliable dividends.
If you have enough $s in II or intend to keep it in $s for a time worth looking at at something like SMTC short term $ fund, was getting 5%+ for my $s.