Be interesting to see the latest analysts targets, last one in May 3450p by Deutsche, I can't see why we can't go back to June 22 price of around 3500p. Everything seems ok to me. |
The above 3 posts highlights exactly reinvestment risk.
We have all enjoyed the safety associated with interest on cash at over 5% but what happens when that comes off quickly and by then the high divi payers have already reacted??
I got 6.2% on an NS&I bond last September for a year and was very pleased with that but when it matures I won't get anything like that again and quality shares will have already legged up.
Good luck all 👍🏻 |
Lower cash deposit interest returns will drive money into equities.. :o)
August/September for the tide to turn.. |
Agree monty. Right now I'm getting 5.1% on instant access savings. But am looking to shift that into high dividend shares before rates start coming down. |
Yes you're right, if BOE cuts rate next week, I think investors may start looking at high yield shares. |
Divi reinvestments next should push Bats higher |
Must be due some brokers views next week, the last one was May 2024, Deutsche saying buy target 3450p. |
@MC, sounds like an investor(BAT) top slicing a profitable investment to invest in a (mistakenly) low rated investment(BATS own shares).
Again, I think it is possible that there may be a mismatch between the divs that ITC delivers on a regular basis and the value that the market puts on those divs and the valuation of ITC itself.
Fact is I don't know....at least not yet. |
We all know Bats are cheap, even the bears, lol.I think ITC at around a record high, bodes well for Bats. |
On 12th March 2024 ITC share price was approx. 404. Today, its about 495.
On 12th March I posted as below:
I never did understand the logic in selling down its ITC stake.
MCunliffe1 - 12 Mar 2024 - 11:02:24 - 8629 of 9351 British American Tobacco - BATS
BATS sells down part of its stake in ITC.
BATS consequently receives a smaller amount of dividend from ITC.
BATS uses some of that ITC sale receipt to buy its own shares.
BATS can pay a greater dividend to its shareholders because there are fewer shares.
BATS has less income from ITC to pay its own shareholders.
Kinda' strange don't you think?
Is this a good time to be selling some of the ITC stake given ITC share price has fallen 16% this year so far. Wouldn't your BB logic imply that BATS should be buying MORE of the ITC shares?
With BATS owning 29% of ITC perhaps ITC's drop is also dragging down BATS. However, there are 36 analysts covering ITC. 15 give ITC a strong buy, 17 a buy.
So, BATS management are considering a 4% sell. |
Dividend paid next week, dividend reinvestment including mine, I knew we would get less bang for our buck as the yanks say, lol |
The massive dividend was thru the sale of the shares, not thru routine dividends. The question surely is what are the regular divs worth on an annual basis? |
Of course they received a massive dividend last year from ITC. |
#Muscletrade, ITC return cash to BATS on a regular basis through the dividends paid out AFAIR.. |
The current valuation of BAT is c£60billion while the ITC valuation is 10b or 16.7%.
Does ITC contribute and send 16.7% of funds/revenue back to the centre on an annual basis ? I doubt it very much.Would have to have to trawl through historic data.
It could look like the kind of historic Aviva situation where their far flung empire all looked very nice on paper but did very little in returning cash to the centre on
a consistent basis. |
from the BAT update
"As a result of the sale, the Group's share of ITC has reduced from 29.02% (31 December 2023) to 25.49% at 30 June 2024".
Perhaps the market is waking up to the value of the ITC investment.just a thought.
The reduction in holdings of c3.53% from 29.02% to 25.49% brought in approx 1.35 billion.so the holding in ITC is still worth c 10Billion. |
keeping tight ahold. Lovely divis while we wait for much more journey north |
On July 1st if I was told BATS would close above 2700 I would not have believed it.
Just goes to show you have to always stay invested as the market can move PDQ at times.
Even if we do run to 2900 I won't be selling my holding as that opens up 3000 and with the divi on offer why cash out and be forced into finding a new home if you don't need the money.
Good luck all 👍🏻 |
£15 billion I think - 6.12 trillion rupees is £60 billion - BATS have 25% ish. |
3150p my view. Whats the ITC stake worth. |
Looks good yanks aren't selling it off?? |
Just moved into profit on paper excluding those lovely divs |
I agree there , most uncivilised lol |
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