They have solid ongoing cash flow from the existing business (look at the year to date figures). I am not sure why you think they could be expensive in your comment above. Can you explain please? MSG can pay at least 0.2 cps and retain funds for expansion. To be consistent with original promise of 80% payout they could pay over 0.3 cps given current cash flow.
I agree they need to get the share price higher to use shares in takeovers. The way to do that is to pay regular dividends from cash flow. At 0.3 cps dividend they are yielding 13.6% or the equivalent of 9.6% fully franked. The shares would not stay at 2.2 cps if they did that and said regular dividends would be paid. I agree the one off dividend did nothing, but that was because they did not flag future distribution policy.
Note they are slowly gaining new contracts and are investing to expand (Adelaide office) so organic growth should occur over time as well. One problem is the non-cancelled Boardman shares. Will they pay a dividend if his shares have not been cancelled and there is a dispute?
MSG Price at posting:
2.2¢ Sentiment: Hold Disclosure: Held
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