w534220.
Understand that the market is pricing ELDPA where they are because of risk of never seeing $100 again.
ELDPA are one stock that I'd consider buying, hell, I nearly did buy (I got STO instead, ELDPA was probably my 3rd choice at the time, though).
However, you *ARE* downplaying the risk, compared to what the market thinks.
You say ELD don't need capital? What if the economy keeps going like it is? Will they need cash flow?
Realistically, there's no reason why ELD has to pay dividends before 2013. 3 years away. In fact, one may argue that, from this position, that looks most prudent. They have too much debt for their cash flow... why would they give some of their cash to s/holders!?
ELDPA may give the nice $110 or so in 18 months time. Who knows? However, understand how little risk you are implying, compared to the market.
Read the latest announcment.... the SP dropped 40% for a reason.
"Is that a specific condition of ELD's hybrid paper? "
Yes.... quite an unusual clause, but, a certainly 'sensible' one...
They may get par, or may have to accept a discount. Who knows.
By the way why do hybrid holders get 50% of the takeover premium? Is that a specific condition of ELD's hybrid paper?
why, when the ELD's are up 52% from their lows are the ELDPA's (which are senior to common equity) not bouncing at all? ELDPA's remain a bargain.
Or eld is now overpriced on euphamistic optimism? Big run up today from a low of $0.43. to a high of $0.515. Is someone buying up a stake?
A check with Online CommSec shows more buyers than sellers, interesting to 'Watch' as someone knows something.
They sold their two most profitable interests last financial year. Their entire stake in AAC and another chunk of Elders Bank to BEN. Look elsewhere IMHO!
DYOR
I stand by this.
The glossy write up ELD had in the Fin Review May 2009 pages 52-53.
Total smokescreen.
And Malcolm Jackman quotes:
Fin Review: "Why should investors buy Futuris rather than other agricultural stocks when the share price is hovering around 18 year lows?
Jackman: I think it's because of the Elders brand. It's been around for about 170 years and is the oldest in Australia. Every so often severe drought has whipped it to within an inch of it's life, but it will continue and survive and prosper.
Jackman: Agribusiness in Australia is a world-class enterprise. People wanting to invest in the country look for it's competitive advantages, and agribusiness is one of those. The thing that makes us unique is our connection with farmers across the country.
Jackman: We are on track with our agenda of change, and the company is in better shape than it was six months ago, despite share price lows."
Bulldust!
Any Idea why ELD sp surged today despite the market falling.
I cannot find any anouncements.
ELD up more than 6% today on no news. Could just be trading/noise.
I really wish these guys would ditch their MIS delusions and get on with the agriculture side of the business.
ELD up more than 6% today on no news. Could just be trading/noise.
I really wish these guys would ditch their MIS delusions and get on with the agriculture side of the business.
Elders up 12.5% anyone got any news?
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