how far can this fall?, page-2

Ok so yesterday it traded a bit below $3.88 on a volume of about 10 million.

It has had high volume all the way down. Now, today it is trading flat in the $3.88- $3.89 range.

However, it is only midday and there have already been over 11 million shares traded. Indeed, most of that has happened in the last hour or so.

Volume at 11am (from memory) was less than 1 million.

So somebody has decided to buy (or at least churn) $40 million worth of shares, and they are happy to pay just under $3.90 for them.

That's a lot of money. Could it be some of those that jumped ship in the $4.00 - $4.10 range (there was a lot of volume there as well.

I held off buying shares until the big orders came through. For all I know it will keep dropping, though.

Current yearly dividend is (11.5c +16c = 27.5c). Now, even if there is a cut in the dividend (which I doubt, somewhat) then MTS will still pay at least 23c in my view (it would make no sense to cut the final div below the interim dividend, plus, just six months ago they raised the interim dividend by .5c - not something you would do if there was a chance you would have to cut the yearly dividend).

So, even with a worst case scenario 23c dividend MTS pays 5.75% at a share price of $4. On top of that, you get franking credits.

In my view, even in the worse case scenario, even at $4, MTS still pays you term deposit rate + franking credits.

That's good enough for me right now.