Mike
My SMH has WBC at 6% against WOW at 4.4%. WIth franking credits, you are looking at 8.6% against 6.3%. If you argue that the 8.6% is based on a high bad debt charge due to the cycle, there is upside on the dividend yield - at 10% it looks very attractive, although you will be looking at 70% payout ratio with the balance to support new business.
WOW has a lower payout ratio to support growth so perhaps not a fair comparison as you have to look at total return. But at 8.6% dividend yield you do not need much capital growth for a decent return. And funding is still tight, competition remote so plenty of opportunity for margin increases, Just wait for the next RBA rate increase (or decrease). I guarantee it will not be passed on.
I have WOW as well as ANZ, CBA. I am pretty boring investment wise - I have a cross section of shares across all sectors. I have a bias to energy but still invest across most sectors in case my energy call is wrong. Has been OK so far.
BTW, should probably disclose, I am a banker........
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Last
$29.66 |
Change
0.360(1.23%) |
Mkt cap ! $102.6B |
Open | High | Low | Value | Volume |
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Buyers (Bids)
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1 | 136 | 29.400 |
1 | 2000 | 29.310 |
3 | 5804 | 29.300 |
1 | 20 | 29.200 |
Price($) | Vol. | No. |
---|---|---|
29.680 | 3655 | 2 |
29.700 | 22998 | 12 |
29.710 | 500 | 1 |
29.720 | 8507 | 5 |
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