NHC - New Hope Corporation

[dansco88]

NHC - 13.3 % yeild in 30 days

I have found an interesting yield play with New Hope Corporation (NHC). due to the sale of the Saraji Coal project for 2.45 billion. This company is cashed up and at todays price is paying a 13.3 % special dividend in a one off payment on the 10th of November. NHC doesnt go ex-div until 20th October. Cannot understand with share price has not run up since this information was released to the market. Just wondering what your panel thought of this play?

 

[alphaman]

The special dividend was a long time coming. Analysts were talking about it back last year. Maybe market was expecting an even larger dividend.

 

[brianwh]

If, as is being speculated, the SP falls by more than the dividend after it is paid, then it may not be such a good yielder. I suppose it boils down to whether the fundamentals are there - which they seem to be.

 

[dansco88]

yeah understand analysts new last year bout special div. but it is still at 13.3 % at todays sp. that is huge and cannot really see share price falling back by more than that amount as the company has a very good project in the new acland coal mine. they also raised the normal div by 20 % or so which is always a good sign of a company increasing profits.

 

[Vizion]

Could someone perhaps speculate on why one director would sell 500,000 shares & another double his position? Interested in opinions on those kinds of circumstances. Perhaps to exercise his options rights?

 

[nomore4s]

Re: NHC - 13.3 % yeild in 30 days

I always find it quite amusing that a quality stock like New Hope gets barely any interest from ASF'ers. If people missed the announcement yesterday, let me spell it out for you again

current stock price : $5.80

paying a fully franked dividend (goes ex-dividend mid October) - about 77c

huuuuuge yield

with about 3 weeks before it goes ex-div we should see a nice run in the share price

apart from the meaty dividend - the company has great management, they continue to expand their operations and their profits -

72.5c of that D/E is a special payment from the profits of a asset sale, so while this is a huge yield it is not a standard d/e payment. Also the market has known of this special payment for a while. I have owned this stock since late March and the special D/E was known about then - only the amount was to be confirmed.

I have found an interesting yield play with New Hope Corporation (NHC). due to the sale of the Saraji Coal project for 2.45 billion. This company is cashed up and at todays price is paying a 13.3 % special dividend in a one off payment on the 10th of November. NHC doesnt go ex-div until 20th October. Cannot understand with share price has not run up since this information was released to the market. Just wondering what your panel thought of this play?

As stated above the market was already aware of this d/e payment and the stock has had a great run in since Feb. The annoucement was not a surprise and was already priced into the share price.

There is a very real chance that NHC could drop by more then the 77.25c of the d/e payment come ex d/e day. This will imo depend on the market in general, if we see continued weakness in the general market we could see a fairly big drop on ex d/e day.

I wouldn't be buying this stock purely for d/e yield at this time as imo it is a bit too late for that play. The time to buy for the d/e was when the market was first made aware of the possiblity of a special d/e payment.

 

[nomore4s]

Could someone perhaps speculate on why one director would sell 500,000 shares & another double his position? Interested in opinions on those kinds of circumstances. Perhaps to exercise his options rights?

There could be hundreds of reasons and obviously depends on the personal circumstances of each director.

 

[skc]

Re: NHC - 13.3 % yeild in 30 days

As stated above the market was already aware of this d/e payment and the stock has had a great run in since Feb. The annoucement was not a surprise and was already priced into the share price.

There is a very real chance that NHC could drop by more then the 77.25c of the d/e payment come ex d/e day. This will imo depend on the market in general, if we see continued weakness in the general market we could see a fairly big drop on ex d/e day.

I wouldn't be buying this stock purely for d/e yield at this time as imo it is a bit too late for that play. The time to buy for the d/e was when the market was first made aware of the possiblity of a special d/e payment.

It's funny how many people go for yield when what really happens in this instance is they give you a bit of cash back on your purchase price.

I wonder if one of the reasons that the fall is greater on ex-div day because some lazy traders forget to move their stop loss... big div also tend to destroy chart patterns which make technical traders more hesitate to buy? Dunno... pure speculation.

 

[theasxgorilla]

Re: NHC - 13.3 % yeild in 30 days

It's funny how many people go for yield when what really happens in this instance is they give you a bit of cash back on your purchase price.

I wonder if one of the reasons that the fall is greater on ex-div day because some lazy traders forget to move their stop loss... big div also tend to destroy chart patterns which make technical traders more hesitate to buy? Dunno... pure speculation.

Some of your speculation could be right. I bought on the breakout in week 38, purely technicals, now price has crashed through all kinds of stoplosses, trailing stops etc. conceivable.

 

[skc]

Re: NHC - 13.3 % yeild in 30 days

Some of your speculation could be right. I bought on the breakout in week 38, purely technicals, now price has crashed through all kinds of stoplosses, trailing stops etc. conceivable.

Ex-div for 77c, prices crashed over $1.08 but only in the first 10 minutes. Definitely looked like stops being triggered.

Other major coal stocks were flat or slightly up...

 

[McCoy Pauley]

Not often a coal company makes the New York Times, but it's not a good article to read if you're a shareholder.

It's an article about the last homeowner in Acland resisting the overtures from NHC to buy his property.

http://www.nytimes.com/2010/06/29/world/asia/29coal.html

 

[basilio]

Very intriguing announcement in The Age today.

Seems that New Hope has bought a 25year exclusive license for a Coal to Oil technology that seems to be cheaper and more environmentally friendly than the traditional Tropp-Fischer process.

In theory they should make a mint turning cheap coal into high value oil at a good price. They was little reaction from the market and I feel a bit uneasy about the technology. Just wonder if there may be a lot of blue sky in the story.

On the other hand if this is for real it will be a monster.

New Hope unveils coal to liquids project
September 14, 2010 - 1:29PM

AAP

New Hope Corporation Ltd is hoping to eventually produce up to 50,000 barrels of synthetic oil per day, after buying a 25 per cent stake in technology to liquefy coal.

New Hope has undertaken a deal with Canadian firm Quantex Research Corporation to commercialise the technology, which Quantex acquired with a licence from West Virginia University in the United States.

Under the deal, New Hope will have a 25-year exclusive worldwide licence for the technology, which allows coal to be converted into synthetic crude oil.

The conversion process is cheaper than other systems and does not produce any carbon dioxide, New Hope managing director Robert Neale told AAP.

"Our process is quite different because we don't gasify the coal at all, we dissolve it," Mr Neale said.

"We dissolve the coal under very moderate conditions, without extremes in temperature or pressure, and we create a product called pitch," he said.

Mr Neale said the pitch can be refined into oil, with high-grade coke as a byproduct.

http://news.theage.com.au/breaking-...s-coal-to-liquids-project-20100914-15aa7.html

 

[laurie]

Name me anything that New Hope Corporation that has been involved with hasn't turned to GOLD! The captain of the ship Robert Millner only gets involved if he see potential for the group of companies he runs

laurie

 

[BrightGreenGlow]

Northern Energy shareholders are recommended to accept NHC's $1.85 takeover bid. This is to be done by the end of the week. Finally a bit of pressure off NHC lately due to the first 2 failures. NHC is obviously cashed up and no need for a CR.

NEC has been firmly against the takeover due to the cheap price New Hop has offered but they seem to think NHC will buy a big %age of NEC shares anyways and have controlling majority over the board. Good news.

 

[BrightGreenGlow]

I see NHC will now own NEC.. great value here and you can read more about this value on the NEC announcements... I was at work today and read that the toowoomba rail line will now reopen at the end of this month and that's 3 months a head of schedule should pump the price a bit I'd say... Any thoughts on NHC's 2 mines on the toowoomba line, their port in Brisbane, their cash reserves or NEC takeover? Sounds good to me and just checked the SP and it's up a few % today.. highly doubt this is due to the market rebounding from yesterday's hammering..

 

[BrightGreenGlow]

I see NHC will now own NEC.. great value here and you can read more about this value on the NEC announcements... I was at work today and read that the toowoomba rail line will now reopen at the end of this month and that's 3 months a head of schedule should pump the price a bit I'd say... Any thoughts on NHC's 2 mines on the toowoomba line, their port in Brisbane, their cash reserves or NEC takeover? Sounds good to me and just checked the SP and it's up a few % today.. highly doubt this is due to the market rebounding from yesterday's hammering..

I see NHC was on Your Money Your Call last night... these spoke of the excess of cash NHC has and that it would be a smart buy if you wanted to get into the coal sector... that as COC i think.

 

[BrightGreenGlow]

The western rail line/ toowoomba line is now relieved and a head on schedule which is great. I also see a nice jump in SP since I last posted. All good news. Should be a good dividend this time too with their latest sakes they are cashed up.

 

[laurie]

interesting to see it now at $5.44 what's causing it I haven't a clue unless it's eying a T/O they are cashed up

 

[laurie]

A take over target up over .73c this a.m.

 

[Julia]

Has anyone been following what's going on with New Hope? They've just completed a takeover of the Colton Mine Project in Qld.

It's within commuting distance of where I live and could represent a boost to real estate here if the numbers of employees are significant.

The company seems pretty on the ball. I emailed them yesterday when I heard about this and had a reply from the Financial Controller within a few hours (on a Sunday!)
Then two more from other parts of the company this morning.