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$2.43 erm power limited

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leasx

1,214 Posts.

116

27/01/17

12:02

Post #: 22167719
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Originally posted by FSW ↑

1) Market price for LGCs is up at $90 per certificate versus non tax deductible shortfall charge of $65 per certificate - cheaper to pay penalty than buy LGC
2) Company guidance is unchanged - consensus estimates are at NPAT $8.75m and EPS $0.05
3) Availability of tax credits carried forward will determine impact - although company has reaffirmed earlier guidance
4) EPS is already under pressure falling from 15c to 5c on consensus AND consensus is now in downward trend
5) Dividend payout ratio is already high at 78%
6) Maintaining payout ratio will still see dividend fall from 12c to 4c per share
7) Payment of tax should make franking credit available.
8) At some point high payout ratio can come at a price as it signals the company has no opportunities for investment and funds are better returned to shareholders
9) Risk is payout ratio falls with falling dividend per share
10) Expect stock will establish new share price range - 80~90 cents per share being the lower bound.

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The wholesale price in QLD has been higher than usual and Oakey will benefit from that. Also US operations seem to be going quite well. You seem to be using a new account so I don't know what your downramping is for.

EPW Price at posting: $1.30 Sentiment: Buy Disclosure: Held
2 Upvote

0 Great analysis

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