AGL faces political headwinds, likely increased competition,...

AGL faces political headwinds, likely increased competition, technological change and (probably) higher cost structures going forward. As a result, I am sceptical about the ability of AGL to continue to grow its dividend in the next few years (although the consensus predictions per FNArena are for 120.5 cents in FY20 which is a small uptick from current levels). Add in weakness in equity markets generally, and it's not surprising the share price has fallen.

That said, a 6.5% forward looking dividend yield in a stock which provides a need to a growing population and is not in the financial, real estate or mining sectors (which make up such a big part of my Australian portfolio) is attractive (even without full franking credits).

I am happy to hold for income and diversification, although if the share price falls much further I would consider buying a few more.

I see a few of people have expressed a reluctance to sell at a loss. With all due respect, what I paid for share should be utterly irrelevant in deciding whether to continue holding or to sell – decisions should be made on a forward looking basis (tax management aside). If I felt that a share I held was going to decline further by a meaningful amount, I would be taking my losses and moving on rather than clinging to a sinking ship. (And, so that there is no misunderstanding, I am not expressing any view on AGL's future share price.)