SIQ is a very stable business with strong customer retention in the government and not for profit sectors where the ability to offer salary benefits is key to retaining staff.
Post the changes to insurance arrangements and the impact of Covid-19 I am forecasting annual dividends of 35 cents per share.
When adding in franking credits this takes the dividend yield up to 9.4%.
SIQ generates very strong operating cash flows, is a capex lite business and has the ability to pay out a very high proportion of NPAT as fully franked dividends.
Given where the share price currently sits this should be attractive to retiree's who want secure fully franked dividends in their SMSF accounts, just like me.
At some stage the smart money will start moving into SIQ just for the dividends. Better than a bank in my view.
SIQ Price at posting:
$5.28 Sentiment: Buy Disclosure: Held
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