Rock solid dividend?I dont want to be a "stick in the mud" or "rain on your parade", but in response to TwentyChances November 21st post about a rock solid dividend, if you read TD Banks latest research on Torstar, they are adamant that the dividend will be cut to ZERO after this quarter.
They also reduced their forecasted stock price to $1.85 from $2.00. RBC also reduced their price forecast, just in case you have not seen these forecasts. I really don't respect Bank forecasts but the potential for a further cut or elimination of the dividend is highly likely, unless Boynton can show improved financial results.
As an aside, whoever sold Fairfax the $11.8mm block of stock would be mighty angry (and the potential for a court case,) if Fairfax immediately decided to take Torstar private at a much higher price. Sometime in the New Year makes more sense to me and there may be advantages for going private for tax purposes in 2018.
I agree with others views that it is interesting that Postmedia's B shares (PNC-B.TO) trading up from $.50 on November 16 with volume of 1,000 shares to $2.00 at the end of November with over 1,000,000 shares traded just after the Torstar - Postmedia swap announcement.
While all eyes are on the "Going Private" ball, keep your eyes on the 40 day moving average that is on the cusp of trading thru the 200 day moving average. So who cares? You should! The last time the 40 day moving average traded up thru the 200 day moving average was on Dec 22 when Torstar was trading at $1.67. Within two weeks the stock traded up to $2.07. Just sayin'
I have not read one post on this bullboard that suggests Boynton can turn Torstar around. If he can show a quarter that is profitable AND improves on the previous years quarterly results, the stock should move significantly higher. Fingers crossed.
It is also interesting that the short interest ratio (expressed as the number of day it will take to cover the outstanding short position on the stock) has moved to 22 days from about 55 days, a few months ago, which suggests some of the buying interest has been coming from covering of short positions.
With all this positive news:
- potential for going private,
- strong technicals
- short covering
- chance that Boynton can turn this around, even if it is slowly
Those on this bullboard should belly up to your on-line brokerage account and buy more shares, especially since many of you are suggesting a price of $4.00 or more if it goes private. A board lot of 100 shares sets one back $165 + $10 commission. Come on man!