OTCPK:MAUXF - Post by User
Comment by
zeus55on Sep 27, 2013 5:30pm
398 Views
Post# 21774474
RE:RE:gibbons
RE:RE:gibbons"that dividend was the smartest thing they did"
"The divi pulled sp through a very bad time in MMT's history, when the pipleline was out of service twice in under six months for extended periods"
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It would have been smart if they had used the strength in the share price that the dividend created, to do a financing in the $2 range, and they probably could have pulled it off. That would have enabled them to avoid having to go to the bank for a high-interest loan.
As it stands now, all that dividend has done is put the company in debt, and provide minimal support to the share price for the moment. The run to $2.30 is history, and only benefitted those who bailed in that one-month period where the share price exceeded the $2 level. Although, anyone selling over $1.50 looks pretty smart right now.
Mart can afford to pay the dividend as long as their situation doesn't get worse again, but to say it was "the smartest thing they did" is simply ludicrous. It probably did seem reasonable at the time. But that is the problem with establishing a dividend policy. It is easy to implement, but difficult to stop if things don't go as planned.
We are all armchair quarterbacks, and it is easy to use 20/20 hindsight. But I was one of the few who felt uncomfortable about the dividend from the very start, while everyone else was pumping the crap out of the stock, all the way up to the crash and burn. Now, not surprisingly, a lot of those same people are expressing concerns. Where was their common sense a year ago?