when you pay a dividend you open up to a new group of investors, may I call them ‘boomer investors’ who, when all the banks or income stocks cut their dives will actually realise that it’s much better to buy stocks with growth and a growing divy. So basically I think that it will be an inflection point for a lot of investors who will take not that this is no longer a specy but a mature divy paying stock.
in theory - increased demand for stock, future equity raising becomes cheaper (higher share price/ less dilution) and Tom and Noel will be happy to sit on their huge share balances without having to sell any.
plus I remember voc paying their first divy back in the day of less than one cent - it makes a huge statement
EML Price at posting:
$3.29 Sentiment: None Disclosure: Held
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