Forum Archive Index - March 2001

["Dannie Hawkins" <dannie@es.co.nz>]

Hi

All share prices go up and down. The only protection is portfolio diversification and time.

RBD has two things that should help protect it.

1 AMP never quite filled their order at $1.25.

2 They have great cash flows, suggesting that the div can grow over time.

 

If they can grow their margins and business the share price should increase. Their pizza and coffee operations seem to be the main growth areas. Plus they sometimes give you free coffee and pizza vouchers (disclosure very profitably hold some RBD)

 

If you are after divs many of the property companies are attractive. Also take a look at HLG. They have made some questionable changes the last few years - scaring off loyal customers by only stocking clothing for teens, closing some rural stores a few years ago.... and their move into Aussi may be painful at the moment. But they have no term debt and a long history of profit in a changable and difficult retail envirionment.

 

Don't forget that most divs are tax paid. You should add 50% to compare them to bank interest rates.

 

All the best

 

Dannie