RE:RE:Q4 2023 Next MonthTend to agree with you here Trapped! No surprise as I usually do.
With an estimated FCF of about $650 M to spend in 2024 they can probably hit that $.25 per quarter or $1 annual dividend mark but only if they suspend buybacks which may not happen given management's desire to reach a pre-merger share count of aproximately 350 M so targeting another 150 M in buybacks.
So there are 2 ways they can go IMO:
1. They can give the stated minimum of a 10% increase making the dividend $.75 per year eating up about $450 M of FCF and leaving 200 M for buybacks if they feel the 2% buyback tax does not impact its affect as a superior shareholder return vehicle.
2. They can suspend buybacks and raise the divy to $1 per year spending $600 M of estimated FCF and leaving about $50 M as a buffer saving it for future buybacks or upcoming debt repayment in 2026 at which time their increased production and reduced capex with attachie online should allow a return to buybacks which could even be done with no buyback tax depending on political promises or regime changes.
I like the second option but I also know management is historically conservative and may not want to push out of the "Goldilocks" range of dividend yield and payout ratio.
As long as I get at least option 1 and I am fine with whatever mangement chooses to do including a blend of the two options.
Either way the comany is obviously firing on all cylinders and is off to the races.
GLTA ARX BULLS
Trapped wrote: Hey Rus. I think it is likely in the near term. Some bank analysts were calling for a move to .24 per quarter more than a year ago. With the share count successfully brought into line and the buyback tax now in place, it would make sense to shift to a more attractive dividend while still nibbling at ongoing buybacks at a slightly reduced pace.
This is strengthened by the fact that Attachie development remains on track and on budget by all accounts. And you have to wonder if they are taking some comfort in the stronger NG prices this month.
ARX is now in a lot of energy-weighted ETFs etc. given its dramatically improved reputation coming out of the downturn. In my opinion, a stronger dividend yield would cement its place as a blue chip of choice moving forward. I am really looking forward to Q4 and FY-2023 earnings.
ReitsRus wrote: Hey Guys, Trap and Quint, both your thoughts on likely Divy hike next Month, do u think we can go to .25 or that unreasonable? Always respect your comments.