WMI wam microcap limited

Ann: October 2019 Investment Update, page-4

  1. 679 Posts.
    lightbulb Created with Sketch. 114
    A couple of things you need to keep an eye on.

    The shares are now trading ex -dividend so NTA is$1.43. At $1.46 current price they are now trading at a slight premium to NTA. Historically this is OK as up until 12 months ago this was the norm, but with the collapse of the small caps market in October last year, the shares traded at a discount to NTA for about 9 months, so that was the ideal time to buy them. Hence on this basis they are currently a little over valued.

    However, the NTA at the end of last FY was $1.32, and with the information released in this monthly report, they have earned 18.7% on the NTA, so for this financial year, that is over 24cps in only 4 months! Their annual dividend last year was 4.5cps with an additional special dividend of 2.25cps, giving 6.75cps all up. The Wilson group like to have a gradually increasing series of fully franked dividends across all their LICs, which has been the case since WMI listed in 2017. So under this policy, you might expect a dividend of at least 5cps fully franked, or 7.5cps if the special dividend is retained. Their earnings however have been 28.3cps in 17-18 and 5.0cps in 18-19. With the 24cps already earned in 2019-20, they have a significant store of dividend reserves tucked up their sleeve (Earnings for 28 months of 28.3+5.0+24=57.5cps vs Dividend for 24 months of 6.0+6.75=12.75cps). Shareholders need to ask the question, is this reserve (to accommodate market down-turns) too generous? A case could be mounted for the dividends to increase substantially. By this I mean maybe 100% . This would equate to 13.5cps annual dividend and a yield of about 9% fully franked. If this back of the envelope analysis came to pass, it could lead to a 30%+ price increase in the share price

    Cheers Westwind
 
Add to My Watchlist
What is My Watchlist?
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)
Last
$1.51
Change
-0.010(0.66%)
Mkt cap ! $421.5M
Open High Low Value Volume
$1.52 $1.52 $1.51 $264.3K 174.2K

Buyers (Bids)

No. Vol. Price($)
1 440 $1.51
 

Sellers (Offers)

Price($) Vol. No.
$1.52 8024 1
View Market Depth
Last trade - 15.59pm 25/07/2025 (20 minute delay) ?
WMI (ASX) Chart
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.