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From: | "tennyson@caverock.net.nz" <tennyson@caverock.net.nz> |
Date: | Wed, 22 Jan 2003 17:18:05 +0000 |
Hi Pat, > > >Some of you may have read today's article on how a high NZD is >impacting farmers. Does this have a flow-on effect on companies >such as Wrightsons, Allied Farmers, Pyne Gould, etc.? Does a high >NZD erode their NZD-denominated earnings? > > Yes it does. But the market is way ahead of you. This is why it is possible to buy such shares as WRI on a dividend yield of 15%. It is true that the dollar has risen a little quicker than most anticipated. Perhaps WRI may trade down from $1.17 to $1.10 or so within the next couple of months because of this. But what's your alternative? Sell and put the money in the bank? Let's say you were able to get a super competitive bank interest rate of 7.5%. That is still only half what holding those shares in WRI will pay you. So as a shareholder in Wrightsons you can take your dividend, swallow a capital loss of some 7.5c per share, and still be ahead. Isn't that quite an attractive worst case scenario? That's why I'm sticking with my WRI. SNOOPY disclosure: hold WRI --------------------------------- Message sent by Snoopy e-mail tennyson@caverock.net.nz on Pegasus Mail version 2.55 ---------------------------------- "Dogs have big tongues, so you can bet they don't bite them by accident" ---------------------------------------------------------------------------- To remove yourself from this list, please use the form at http://www.sharechat.co.nz/chat/forum/
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