I guess at the end of the day it is the return to the shareholders that is the important thing. If they pay you a fully franked 4.5% dividend and they take 5% performance fees and you say 'Hey, how come you make money than I?', you have to think 'Am I happy with a 4.5% return?'.
If you are happy, then you will just need to put up and shut up. All these executives of large companies get paid $20m, $30m, $50m a year to give you a 2-5% return a year or in some cases a negative 50% return (like the big banks), do they deserve it? What do they do everyday to deserve $80,000 a day salary? They go to lunch and you pay them $10,000, they screw their secretaries and you pay them $5,000.
Debt funding is actually a good idea these days as interest rates are so low. I would assume they pay less than 4.5% interest, that means debt funding is cheaper than equity funding. The banks issue billions of notes a year. If I can borrow at 1% in Europe and lend it to you at 2%, that is good business. Why do I need to use my own money to lend you?
One thing you have to like about D2O is that they tell you how much dividends they will pay you 2 years in advance and it is increasing every half a year. How many companies out there can do that, especially these days?
I don't expect D2O to go to $5 or $10 in my lifetime but it is a good place to park your cash when the banks are not paying you for deposits.
Another stock I park my idle cash in is WAM Research (WAX) paying over 7% dividends. It is more volatile as it is market related, not like D20 which is related to one of the three necessities in life.
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