SEV stock is in cup and handle formation. Waiting for break out at above $6.7. If so, we shall see $7.5 in no time.
IOOF is buying it like crazy. There are very few companies that still trading well under its NTA. Ridiculous.
Well, If step up do happen, I guess SEVPC would be worth at least at par. I think it is BBB- rating, right? Let's see $4 for every 1% additional margin, 2.25% would easily translate into $10.
The best outcome is the step-up, you have the choice to sell it at higher margin.
Recently, the banks offer margin over 90 days margin from 3.8% (WBCPB), 3.4% (CBAPA), and 3% (ANZPA?), but they have A grade rating. 4.75% over 180 day BBSW for BBB- is not too bad.
If the debt market is good, SEV can still redeem it, and issue new notes to replace it, at 4%? margin? Anyone know any such an issue out side bank majors?
sevpc, page-4
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