Ann: Dividend/Distribution - NWH, page-19

I am hopeless when it comes to trading, which in a sense has a great deal to do with guessing what holders X are going to think, and what holders Y are going to think about the thinking of holders X, and how intos are going to think about the thinking of both holders X and Y and their fellow instos, and so on. All of this thinking is intrinsically based on guessing thought patterns, with the fundamental outlook of the business being ignored.

Nobody of whom I am aware has mooted that there is any reason to believe that EPS is going to decline, or that the sector in which NWH is operates is going to shrink, or that NWH holds too much debt, and hence is inherently risky, or that there are too many service suppliers reducing margins by frenetic competition.

Some investors (whether holders or not) might think that labour is going to be difficult to secure, its costs are going to increase, and hence margins will be squeezed. However, Management has opined that labour as a resource is "managable", and risk sharing via rise-&-fall provisions is generally accepted by the customer base, and that there is so much work being offered that NWH can be selective, and lose tenders at prices that fail to meet Management's margin and risk-mitigation hurdles. Of course, Management could be lying, but I doubt it.

I take the attitude that because NWH is a dividend-paying stock, a shareholder can sit out these times of mood negativity. I have been through these swings a few times over the last decade, so they do not concern me as much as it concerns other shareholders. The only difference with the current SP slump relative to earlier ones is that there is less reason for the negativity from a business performance perspective than was the case in earlier years.

If you bought below $3, you should, IMO, have little concern, unless you are one of those very clever people who are aware of better opportunities, and you have an uncanny knack of picking highs and lows. Such individuals exist, but I am not smart enough to be one of them.