Anyone holding DUE securities should have read of this analysis on www.makethemaccountable.com.au
James Dunphy reckons its only worth $1.85 a share and that it only has free cashflow for a 12 cps distribution (a long way from the 18 cps guidance). In fact he believes they haven't had the cash to pay their distribution for the last five years and have been using new equity to fund the shortfalls. This is a very, very detailed look through analysis of Duet's cashflows. If you can find holes in its arguments, let me know, because I can't.
I have been looking previously at when DUE's debt is due for renewal and it appears a large chunk is in 2017 and 2018. Dunphy is a former senior M&A banker for Credit Suisse who did some similar analysis on Spark Infrastructure recently. In a nutshell it, dump Duet and buy Spark instead.
Maybe it's not quite the "safe" defensive stock we thought.
T
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