Hi @groins and Pioupiou and thank you both for your relevant thoughts from someone who’s a bit aghast at the wipe out of a fortune that-might-have-been.
I’m definitely not one of those with the ‘uncanny knacks’ for predicting the highs and lows of life, the universe, or the price of NWH, but Pioupiou I reckon it’s those ones who are the canny, and it’s me who’s UNcanny.
— And instead of taking ‘losses’ on the chin as I told myself I would, as a consequence of the disappointment I was all for sending myself to a knack-ery!
…. …. Right up until I tripped over the puppy into the limestone pavers of my driveway, copping a hard knock to the forehead rather than the chin!
(A lesson there on the consequences of the knack for pointlessly beating oneself up given the {uncanny?} one for instant karma?)
So what next?
Personally I am back to counting blessings!
And as far as NWH goes, those near-19 million shares that went through on Friday must surely have consisted largely of index funds entering before the official ASX 200 rebalance day yesterday?
(more than half of them after the CSPA at the closing price of $2.20?)
So maybe we will see a new substantial holder position announced tomorrow?
And surely that lot won’t want the price to drop too low from here before a solid recovery seeing as - as Pioupiou so succinctly summed up - nothing has changed in regards the solid and largely moated assets that sent the price soaring in recent months?
Plus there were intimations we might be seeing new contracts before EOFY
- Not much on Seek hinting at where those might be from bar some recent ads from Primero seeking engineers for “new green energy hydrogen projects” and noting a strong pipeline of works.
Beyond this, and a hello to all, FWIW on life, the universe and half year reports, Stock head’s Eddy Sunarto wrote a useful summary about a fortnight ago which I’m putting in the spoiler for future reference.
It has no direct mention of NRW, but some gems on the wider picture including;
• …”the best word to sum up this earnings season is “underwhelming”.According to CommSec, only 46 per cent of ASX 200 companies reporting earnings had a lift in share prices on the day those figures were released.”
• …”Profits were generally lower as expenses outpaced revenues.
Only 41 per cent of companies had a lift in profits.
From a total market perspective, consensus EPS (earnings per share) over the next 12 months is expected to hold steady, reflecting robust sales and revenue expectations.”…
• … “According to CommSec, there were a few major themes this reporting season.
Profit margin was one key theme, as it has come under pressure on the back of soaring operating costs.
But many companies (mainly retailers) are also reporting that input costs and overall cost pressures may have peaked.
• …. The reporting season is not just a backward-looking event, but also a time when companies outline what lies ahead.
According to CommSec, the next six months look to be equally challenging, judging by comments made by companies.
For one, more interest rate hikes lie ahead and Commonwealth Bank economists are expecting another 25bp rate hike in April…”
But he says many companies think the labour issues will continue to ease .. plus a lot more …
These companies are splashing the cash, as they hand out dividends. Picture: Getty Images
By EDDY SUNARTO
*
8:18AM MARCH 9, 2023
The half-year earnings season has drawn to a close. And amid all the grumbling, some stocks still managed to pay a decent dividend.
But pocketing a dividend isn’t the only way to profit from the ex-div date. More of that below, after a look at how things went.
Clearly, inflation was the key theme, but we also heard from company execs about (among other things) rising interest rates, lingering supply-chain issues, and changing consumer behaviour.
In truth, the best word to sum up this earnings season is “underwhelming”.According to CommSec, only 46 per cent of ASX 200 companies reporting earnings had a lift in share prices on the day those figures were released.
Here’s CommSec’s snapshot of 137 companies in the ASX 200 Index during this earnings season:
30 per cent fall in profits, to $40 billion
11 per cent increase in sales
15 per cent rise in expenses
87 per cent of companies posted profits
5 per cent average growth in dividends
Profits were generally lower as expenses outpaced revenues.
Only 41 per cent of companies had a lift in profits.
From a total market perspective, consensus EPS (earnings per share) over the next 12 months is expected to hold steady, reflecting robust sales and revenue expectations.
Aggregate cash holdings rose 0.3 per cent to $207 billion.
Interestingly, 50 per cent of companies lifted their cash holdings, and 50 per cent reduced cash.
More than 88 per cent of companies issued a dividend.
Although dividends per share rose by 5 per cent, in dollar terms they fell 3 per cent, reflecting lower payouts by big resource companies. What did the companies say?
According to CommSec, there were a few major themes this reporting season.
Profit margin was one key theme, as it has come under pressure on the back of soaring operating costs.
But many companies (mainly retailers) are also reporting that input costs and overall cost pressures may have peaked.
Some companies, such as Accent Group (ASX:AX1), are reporting that their segments are holding up – for instance, footwear for younger Aussies not burdened by mortgage debts.
Banks are experiencing some margin pressures amid a slowing housing market, as cited by Bendigo & Adelaide Bank (ASX:BEN).
Insurance, consumer staples and health care stocks have been the best sectoral performers this reporting season, with banks the biggest drag on the benchmark index.
Companies have also preferred to use share buybacks rather than lift dividend ratios in an environment where borrowing costs are increasing – as evidenced byCochlear (ASX:COH) and Qantas (ASX:QAN). Outlook
The reporting season is not just a backward-looking event, but also a time when companies outline what lies ahead.
According to CommSec, the next six months look to be equally challenging, judging by comments made by companies.
For one, more interest rate hikes lie ahead and Commonwealth Bank economists are expecting another 25bp rate hike in April.
In terms of consumer behaviour, Aussies are buying up more home brands at supermarkets and cheaper cuts of meat. Consumers are expected to spend more time at home, rather than going out for dinner.
But there are exceptions. For example, Endeavour Group (ASX:EDV) noted softer sales from packaged liquor at its Dan Murphy and BWS stores, but more spending at its hotels. According to Endeavour, “sociability is absolutely recession-proof” after Covid-19 lockdowns.
A number of companies also said they are expecting benefits from higher migration that should happen later this year, including Medibank (ASX:MPL), Stockland (ASX:SGP), and IDP Education (ASX:IEL).
Other businesses, such as JB Hi-Fi (ASX:JBH) and Ansell (ASX:ANN) said they have already noted some easing in price pressures.
Major resources companies are also putting their faith in a China revival, such as BHP, Rio Tinto, Alumina and Fortescue.
While BHP Group (ASX:BHP) and Rio Tinto (ASX:RIO) each blamed rising costs and have trimmed their respective interim dividends, Santos (ASX:STO)increased its dividend payment by 78 per cent.
Top ASX large cap dividend payers
Column 1
Column 2
Column 3
Column 4
Column 5
0
Code
Name
Sector
Div yield
Current div
1
YAL
Yancoal
Energy
15.60%
$0.53
2
FMG[/FONT][/COLOR]
Fortescue Metals
Materials
11.10%
$0.75
3
WDS[/FONT][/COLOR]
Woodside Energy
Energy
10.80%
$2.11
4
WHC[/FONT][/COLOR]
Whitehaven Coal
Energy
8.40%
$0.32
5
BHP[/FONT][/COLOR]
BHP
Materials
7.70%
$2.55
6
IPL[/FONT][/COLOR]
Incitec Pivot
Materials
7.20%
$0.17
7
SGP[/FONT][/COLOR]
Stockland
Real estate
6.90%
$0.12
8
ALD[/FONT][/COLOR]
Ampol
Energy
6.20%
$1.55
9
ANZ[/FONT][/COLOR]
ANZ Bank
Financials
6.20%
$0.74
10
DXS[/FONT][/COLOR]
Dexus
Real estate
6.20%
$0.28
11
BEN[/FONT][/COLOR]
Bendigo & Adelaide
Financials
5.90%
$0.29
12
WBC[/FONT][/COLOR]
Westpac Bank
Financials
5.80%
$0.64
13
S32[/FONT][/COLOR]
South32
Materials
5.70%
$0.25
14
AZJ[/FONT][/COLOR]
Aurizon
Industrials
5.60%
$0.07
15
NAB[/FONT][/COLOR]
National Australia Bank
Financials
5.50%
$0.78
Can we trade ex-dividend date to our advantage?
Some * readers have asked if there is a way for investors to exploit ex-dividend dates. In other words, buying shares before or after ex-dividend date.
To answer that question, we’ve reached out to Adam Dawes, a senior investment adviser at Shaw and Partners.
Dawes explained there are a few things an investor can do to trade the ex-dividend date.
“Today (Wednesday) is a great example of buying a stock after it goes ex-div, “Dawes told *.
“WDS (Woodside Energy, ASX:WDS) has gone ex-div today paying out $2.11, plus 100 per cent franking. If all things being equal, the stock should fall by the dividend amount as investors that hold the stock before the ex-date get the dividends paid out.”
(WDS paid a final dividend of $2.11 this half, and $1.60 interim dividend six months ago, taking its full dividend to $3.71 for the year).
“(So) buy a stock after the ex-dividend date, when the stock price may have declined due to the dividend payout, and then hold it for the long term,” he added.
“This strategy can be attractive to investors who are more interested in the potential long-term growth of the stock than in the immediate dividend payout.” What about buying before the ex-dividend date?
“Another way is of course to buy a stock before the ex-dividend date, hold it long enough to receive the dividend, and then sell it,” said Dawes.
This strategy is called dividend stripping, and is seen as a tax avoidance scheme by the Australian Taxation Office, which has now introduced the 45-day tax rule.
“There are lots of rules around this and investors should seek professional help,” said Dawes.
“One rule is that you must hold the stock for 45 days to get the franking credits.
“This strategy can be attractive to investors who are looking for a short-term gain from the dividend payout.” Top ASX small cap dividend payers
Column 1
Column 2
Column 3
Column 4
Column 5
Column 6
0
Code
Name
Sector
Div Yield
Current div
Market cap
1
MFB
My Food Bag Group
Staples
27.70%
$0.03
$57m
2
FEX[/FONT][/COLOR]
Fenix Resources
Materials
20.60%
$0.05
$146m
3
SDG[/FONT][/COLOR]
Sunland Group
Real Estate
20.10%
$0.40
$182m
4
EPY[/FONT][/COLOR]
Earlypay
Financials
16.00%
$0.02
$58m
5
PCG[/FONT][/COLOR]
Pengana Capital
Financials
14.50%
$0.02
$151m
6
IMA[/FONT][/COLOR]
Image Resources
Materials
14.30%
$0.02
$151m
7
ADA[/FONT][/COLOR]
Adacel Technologies
Technology
14.10%
$0.02
$48m
8
BSE[/FONT][/COLOR]
Base Resources
Materials
14.10%
$0.03
$283m
9
HZN[/FONT][/COLOR]
Horizon Oil
Energy
12.50%
$0.01
$272m
10
BST[/FONT][/COLOR]
Best & Less Group
Discretionary
11.90%
$0.12
$241m
11
MTO[/FONT][/COLOR]
MotorCycle Holdings
Discretionary
11.80%
$0.08
$125m
12
RCT[/FONT][/COLOR]
Reef Casino
Discretionary
11.80%
$0.23
$148m
13
AMO[/COLOR][/FONT]
Ambertech
Technology
11.10%
$0.01
$25m
14
DSK[/COLOR][/FONT]
Dusk Group
Discretionary
10.70%
$0.10
$106m
15
TWR[/COLOR][/FONT]
Tower Ltd
Financials
10.00%
$0.03
$224m
With the current inflation rate of 7.4 per cent, some traders are looking into the smaller cap names to find that extra yield pick-up.
A higher dividend yield however doesn’t automatically translate to great companies.
Yields could be high due to several factors, including a depressed share price.
Companies could also pay high dividends because they’re not seeing much opportunity to grow right now, and this can be a sign that dividend payments could be cut in the future.
So all up we are doing more than OK and will continue to do so, and this temporary price battering is just providing new investors opportunity to enter at great prices?
.. And next level down - if the battering continues - is around $1.94?
cheers
NWH Price at posting:
$2.13 Sentiment: Buy Disclosure: Held
(20min delay)