for those who are doubting the shareprice appreciation after the announcement of an unexpectedly high dividend, just take a look at the shareprice performance of FXL, they recently announced an unexpected 3c dividend when the stock has trading at 30c within a couple of days the stock had put on 50% to 45c and it still has a couple of weeks before it goes ex-dividend.
there is no doubt that the market is still not pricing in a 3.5c dividend for SSM and when they do announce it on friday expect a significant upward re-rating of the stock.
even without the 32% dividend yield SSM has been overly punished for its recent profit downgrade, it is important to remember they have a fairly constant revenue stream involved in essential services such as water,electricity and telecommunications.
and with the government's stimulus package to boost infrastructure spending expect SSM to pick up significant projects in the water and telecommunication sectors especially in regards the national broadband network.
SSM Price at posting:
21.5¢ Sentiment: None Disclosure: Not Held
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