So couple things about yesterday’s new release…Let's start with, I kinda questioned the reason for this release, I'm pretty sure I haven't seen this in the previous offerings, does that mean that they know that it's interest was maybe low? I don't know how they would know this or if it is, maybe the amount of rights traded and the major fluctuations in price indicate disinterest from some holders. I fully subscribed and am taking as much as I can in over allotment but I don't expect to get too many overallotted shares (I could not add rights as I don't have much extra free capital avalible especially with the market action since Black Friday). I barely skimmed the release yesterday and took my time a bit more this morning.
They dangled a few carrots in the release discussing reasons you should invest and how well they have done the past few years.
Two things really of interest jumped out, Dividends! As discussed buy anouther poster earlier, it was mentioned how they were restricted by the government on increasing payouts, they mention now that they are out of restrictions they will reassess thier rate in Q1 (February-March for April Payout) and that they are exceeding taxable income to payout per share ratio they are suppose to pay (I believe it's 90% return to shareholders required). Banks are increasing payouts 10-25% but they don't have the same required payout rules which has always ment our payout ratio is always high, Maybe we see 2-4 cents added which would be like 6-12% increase. For a year we payed 37 cents per Q in 2018, seems like we can return to that, maybe exceed.
Also, they mention that they anticipate paying out a special dividend due to this built up cash during the restricted period. I wonder if that will be paid out in cash or shares. I would guess this may be between 10-35 cents I would be very surprised to see more than that. My calculation on that is based on 7 quarters of restrictions times 1.5-4.5 cents with a little rounding. (Remember our previous special was due to a one time unexpected return of a taxes, thus I don't think this one will have that size to it)
I love this cash cow and the outlook on the buisness side seems solid, we will have to see how the market reacts post rights hang over, all this dividend news in Q1 and anticipated Fed Rate increases to borrowing costs all coming at us in the next 6 months. I don't know that I'm bullish on the shareprice but I expect a mild rise to around 19s which is just a return to the area before this dilution, but I'm a very happy holder.