Thanks for the thoughts. I agree that a DRP is a good way to retain cash in the business. In this case I imagine to allow for working capital or repay upcoming debt obligations; but it can be seen as a sign of potential liquidity issues.
It provides those shareholders who want the cash dividend with the option to take it, and those who want a greater stake in MOF the opportunity to reinvest.
I also understand the theory of getting the SP down as low as possible during the VWAP period (provided it can be done on small volume), thus receiving more shares as part of the DRP and then watching the SP bounce as large insto's remove the selling pressure.
Can the pull back from approx 25c to the current 19c be explained so simply --> or is there something my rose-tinted-spectacles are missing?
As I've said before I can't help but see upside for MOF even if there is a large asset writedown in the FY09 accounts.
Mostly, brokers seem confident in the MOF story also (given E*Trade broker recommendations) but why is the SP not responding?
It would appear to me that MOF represents the best value of all the 'better' REITs....
Any contrary views would be welcomed...
MOF Price at posting:
19.5¢ Sentiment: Buy Disclosure: Held
