RE:RE:RE:$27.50 the silliness continues .... wynner wrote: Seems like someone bought for the dividend announcement that never came. I picked some up today.
I expect the dividend before April. I know nothing.
wynner knows what the rest of us don't, that makes him a
Winner.
Low-volumes here, dribs and drabs of share lots; this run-up and quick collapse smells more like WFC was recommended in some kind of Investment newsletter.
But buying has been going on 3-weeks, so does support an idea that there was effort to run up share price pre-announcement of shares being issued.
Here's the thing:
They paid out $97mm in dividends at a time when they were better suited to be paying down debt. Debt carrying costs just tripled. Surely the BOD here knows that when BoC wants to kick inflation in the nuts, they will be raising rates. So paying out almost $100mm right before mortgage costs spiked seems a little too obtuse for RE experts.
Company has to renew some $235mm of their $565mm total debt within 12mo, that means higher cost to carry.
You're not going to like what I have to say.................................................
My guess is that insiders lobbied for previous $3 dividend because they needed capital for ventures outside of WFC. This is their piggy bank, and they just cracked it open because their financial planner said to raise cash.
Just my opinion. Hope I'm wrong, but probably not.
I really don't see another dividend announcement, or nothing meaningful, unless they sold off some assets and really de-leveraged.
Bigger picture...................... There's been cheap money made available to RE buyers for decades now; that was reversed by BoC after they spiked overnight rate from 0.25% to 5.00%. That's some serious pain on the way for borrowers. And when buyers cannot qualify for big debt at low rates, their bids for properties etc fall accordingly. So valuations of all this stuff are set to be reduced. Wouldn't be shocked if some RE falls -25% from here.
That said, they have some irreplaceable, iconic assets in their holdings, so if times got tough they could put stuff up for sale, maybe BAM or CPP make bids.
Still, I see capital mismanagement in that $3 dividend. I don't like execs who disrespect their dollars.
Was content to exit at $19 even when I believed shares might be worth north of $30 in a bull market.
Can't buy good management, you gotta grow it from the ground up.
Wish you well with this.......................... great assets, questionable capital allocation by execs.
Just my opinion based on decisions made with dividend.