There seems to be many people who bought into this one with the expectation of quick returns - me included. That simply will not be the case - however I am very confident of longer term returns.
Where to from here?
The traffic numbers(& revenue) is building. It will take a couple of months for the readjustment of traffic flows and we will see a gradual move to the new Eastlink tollway. I expect they will surpass their targets by end of calander year. We will see the SP gradually climb, spike a little with the next month new stats on traffic and for steeper rise in SP to end of year - I expect at least $1.30.
The steady rise in SP will be largely driven by insto's & funds buying - they like the sound gradual returns. They can put their money into these stocks and fold them away in the bottom draw for 12 months - good div and rising share price is what they value.
The 10.5c dividend will be valuable and an incentive to hold, so look for a buy opportunity when it goes ex-div.
The big unknown is what TCL will do - and yes a move by them would put a rocket under the SP - I expect to at least $1.50 if not $2.00 when you look at the 30-year outlook.
If you have cash, I think this is a no brainer. If you are borrowing, I still think it gives you sound net returns within 12 months.
just my view - happy to receive critique
Trop
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