all time high, page-9

It was easy to see last week that it was a good buy because the financial result had already been flagged by M2 in its preliminary guidance. The price will probably go higher as the dividend cut-off date approaches and then drop back again as short term small traders abandon it when it goes ex-dividend as has happened before. Vaughan Bowen has indicated in his latest boardroom interview that there is more growth to come in 2011 so dividends should continue to increase. I can see a dividend of 12 or 13 cents in 2011 based on the forecasts so I won't be selling at the current prices. Vaughan pointed out in his interview that M2 is in the healthy position of effectively having zero net debt. It has healthy cash reserves and pays consistent good fully franked dividends while other Telcos similar in size (e.g. IIN) and with more debt pay smaller dividends yet are priced a lot higher or pay no dividends (e.g. MAQ) so you have to rely solely on capital growth to make anything. M2 has grown spectacularly over the last 18 months so I guess it is taking the market time to accurately value it on the basis of it continuing to grow and remain successful. I'm not selling at the current price because I cant get the sort of tax effective income that M2 gives me elsewhere along with the potential for further capital growth.