Completely agree with all of that. I know that recently the special dividend has been as you described (just a distribution of franking credits). But I don't think, looking back at the last couple of decades, that that has always been the case. Has it? Perhaps I need to re-check.
With regards to your comments about a business that is able to generate 20% ROE retaining more of its earnings. yes I agree (ONT's high payout ratio comes to mind). But remember. ARB (unlike ONT) already has a fairly low default payout ratio. A high ROE will only be sustained if management are opportunistic and selective with their capital allocation. I think a low payout ratio policy (as the default position) complemented by discretionary special dividends, is a good combination.
Ann: Half Yearly Report and Accounts, page-7
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Last
$41.32 |
Change
-0.600(1.43%) |
Mkt cap ! $3.401B | |||
| Open | High | Low | Value | Volume |
| $41.92 | $41.95 | $41.06 | $4.443M | 107.4K |
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| 1 | 486 | $41.15 |
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| Price($) | Vol. | No. |
|---|---|---|
| $41.32 | 207 | 1 |
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| ARB (ASX) Chart |