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aramalap2

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04/07/15

23:55

Post #: 15582099
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Originally posted by Katavi ↑

The attraction here is the minimum 3.5% of the milk pool that goes to shareholders as a fully franked dividend before the farmers get the rest. ( Regardless of the milk price )
The milk pool is typically around 50 % of total sales .
At a price of around $2.20 this equates to a five percent dividend essentially guaranteed .
I agree the upside is limited to about 7 percent of the milk pool or about a return of 11 percent on $2.20.
So, the investment deal is this:
I will always guarantee you a five percent dividend but will limit your upside to about an 11 percent dividend .
The question is whether investors will like this deal.
Suspect they might.

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a unit trust set up
what evidence that payments will be fully franked?
i would have thought they'd be unfranked,well at least initially?
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