New Hope Corporation Limited

ASX:NHC

New Hope Corporation Limited

ASX:NHC
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$5.12 (+2.2%)
Last close price
#42
Rank
12
Held by
18
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Reports (5) My Report Forum Investors
Forum Topics NHC NHC Where's me divvies?

Pinned straw:
DrPete
Added a month ago

New Hope's down 6% today, at time of writing, following today's official 1H report.

All the news channels are attributing it to profit sliding from lower coal prices in 1H.

But the company released that information a month ago when they announced the 4Q results. First lesson: new channels have no idea what they're saying when they attribute causes to share price movements.

From what I can tell there was only 1 bit of new information in today's presentation (which they took all of 6 minutes to deliver). 1H dividend was 10c, down from 15c last half and 19c previous half. The drop correlates almost perfectly with profitability for the last half because of trough in coal prices. So it isn't a great surprise (although admittedly I thought they'd dig into their cash pile a bit to reduce volatility in dividends).

Still . . . second lesson: Folks don't like losing their divvies!
Seymourbutts
Added a month ago

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21
lowway
Added a month ago

While I would have loved the bigger divvie @DrPete,especially for my RL SMSF portfolio and the attached franking credits, having a more strategic business decision by NHC in regards to their cash reserves definitely works for me. I'm hoping (semi-confidently) that the upside will be in growth in the business and SP longer-term, which should be a better option than a simple divvie distribution.increase short-term.

I agree with you thinking this is the core reason for the SP drop as it seems investors view a divvie rate drop as significantly bad, instead of (IMO) the bigger picture and the longer-term benefits for NHC.

Disc held IRL and SM portfolios

10
thunderhead
Added a month ago

It will be nice if it drops enough to offer another attractive buying opportunity like it did below $4 recently. I took that opportunity to open a position, but have plenty of room to add.

10
tomsmithidg
Added a month ago

I reckon the buggers cut the dividend intentionally to lower the share price since they are kicking on with the share buyback. While I respect their cunning, I second the 'where's my divvies?' *shakes fist at cloud* standpoint.

7