Diversified Energy Share Discussion Threads

[premium beeks] 19/3/2024 10:47

Yes, contrary to popular opinion early this morning, the shorts had it 100 percent right!

[mondex] 19/3/2024 10:44

Whilst I accept this should put the company back on track it is a gut punch to those, like me, who have been invested for a long while, looking for a reliable income provider. Despite reinvesting my dividends I now have a total return of -42%, with 3 years of dividend payments currently approximating around 4% to look forward to. So, for me, & I suspect many others, the choice is to hang on hoping the share price growth will return my original investment or crystallise my loss & sell out. Not good enough!

[1knocker] 19/3/2024 10:42

I am afraid so, bulltradpt.

But the past is the past. We can't change that. For holders, our capital has been committed and that fixes our return on it.

I try to remember that every top up is a separate purchase, whether it is a top of an existing holding or a new holding, rather than an opportunity to reduce my average. A top up does not alter the return on a previous purchase, it is the purchase of a return on new capital committed.

Thus if the share price falls to the point where I can again purchase (a now much safer) 12% return, that will be attractive to me. My regret lies in the 5% return at which the capital I have previously committed is locked in!

I think it very important to assess the merits of any 'top up' as though it is a new holding (which in substance it is), without regard to the cost of previous purchases. A current purchase price is neither more nor less attractive because one previously bought at some other price. The same goes for sales. A sale price is 'good' or 'bad' according to whether, looking forward, one can deploy the proceeds of sale better elsewhere. The price at which one bought, and whether one has made a profit or a loss, is completely irrelevant to that equation.

The mental discipline becomes much easier if you think of any any purchase as a new holding. I wish my account shoed each purchase (and dividend received on each purchase) separately, as DEC1, DEC2 etc! It takes effort to avoid thinking in terms of averages when everything is consolidated. I am not led into thinking in terms of 'averages' purchase prices (up or down) when looking across separate holdings, eg DEC and BATS !!

[lab305] 19/3/2024 10:40

bluemango ..I expected them to sell whilst they still had some money left.

[marksp2011] 19/3/2024 10:38

Cold snapWtfSpot prices for delivery today/tomorrow soar.Completely irrelevant to anyone who isn't a spot trader.

[stevensupertrader] 19/3/2024 10:38

DEc is now a falling knife and even under £8 later on - who the hell wants to buy ?
This is just a one way to administration or someone buying it at a fire sale price .
Banks that made loans to DEC is now very worried as falling share price affects DEC assets value

[topazfrenzy] 19/3/2024 10:37

Storm in a tea cup today

People complaining about a dividend yield of over 10% is laughable, better they use the money on buybacks and reducing debt

[lab305] 19/3/2024 10:36

marksp what do you mean hindsight ? I have been negative about Dec for ages culminating in selling all of my considerable holding months ago. I was honest and have not financially recovered yet but am well on the way . I was dam right on this one but should have sold out sooner. What beggars belief is that posters still believe what they say . " The dividend is safe for 3 years" The tender offer didn't last much more than 3 weeks ! Unbelievable.

[topazfrenzy] 19/3/2024 10:35

'Gas prices surge 20pc as cold snap hits Europe'

[stevensupertrader] 19/3/2024 10:35

Definitely missed it - under £8. - the way it is moving .

[marksp2011] 19/3/2024 10:34

It has been called off already. It wasn't legal in the US of A. Or so Honesty Huston says

[hericsaba] 19/3/2024 10:33

There is no tender offer. Read the RNS!

[marksp2011] 19/3/2024 10:33

And the pact of the hedges would be that if gas to quintuple DEC gets little of it. hedges work both ways

[stevensupertrader] 19/3/2024 10:31

I can bet Tender Offer will be called off by by early next week and then all he’ll breaks loose on SP

[marksp2011] 19/3/2024 10:30

So now yields about the same as a HY Bond IT. Why on earth would you buy an equity that promises a fixed income?Hutson has announced this is now a three year bond no commitment to pay anything after year 3. The gem here is that it is a fixed income investment where the investees have no seniorityAnyone buying this on those terms is a foolDoesn't mean the share price won't go up but as an equity investment this isnt

[bulltradept] 19/3/2024 10:29

I'm wondering if there's much selling to come when the yanks wake up?

[fordtin] 19/3/2024 10:23

topazfrenzy - re #1648, It's a coin toss. People holding on in the hope of a share price recovery may well regret it once companies in other sectors see their share price double in the next 12 months as gas prices languish.

[bulltradept] 19/3/2024 10:19

Sorry to hear that 1knocker, but I think you may be right.

The share price in old money did have a relentless downward trajectory, so even though I don't go in for the funny mental side of things too much, mr market was anticipating something like this one could argue.

[topazfrenzy] 19/3/2024 10:15

Doubling from here would be c.85p in old money so not out of the question

Also, people were buying it for its 12% yield not so long ago so it's really not that far off now if you are getting in now lol

[topazfrenzy] 19/3/2024 10:13

Those selling now to get a better yield elsewhere may well regret it once the share price here doubles in the next 12 months as gas prices recover

[1knocker] 19/3/2024 10:11

We have recognised for some while that the share price and he dividend were out of kilter. One had to move. Now we know which. Unhappily it has not been the (as we hoped, but now know better) an oversold share price. At the future dividend rate, he share price now looks about right. The market knew better than we did.

I was braced for up to a 50% cut at some time, but 66% is a bad blow. A substantially bigger cut than my worst case scenario, and sooner than I had bargained for. Moreover, the business model (substantial hedging), while it lends itself to certainty, also makes special dividends highly unlikely. We should be safe from further dividend cuts for 3 years, but with no prospect held out of any increase.

To my eye the reduction of the dividend to 'in line with industry peers (albeit the higher paying industry peers) without any prospect of special dividends or even a progressively increasing dividend from a lower base, means that DEC has lost its USP, which was the very high dividend. There is now no reason to opt for DEC in preference to its peers.

I am a little over 50% down on my capital account. I had hopes that in time we would see a return to at least £20 (£1 old money, which not long ago we thought a once in a lifetime buying gift price). A return to that price during the next 3 years would imply a reduction in the yield to 5%. That is not going to happen. Not even close to that price.

For those of us who have held for a while, our holdings do not look so bad on a total return basis, but most of us will still be down, albeit by nothing like so much. The fact remain though that for those of us like me with an average purchase price of a bit under £10, our return of that capital is now going to be only about 5%, which is not much more than can be had on a 3 year fixed return Building Society account. For those subject to 30% withholding tax, or even 15% tax, well, do the maths for yourselves. Fortunately I hold DEC in a SIPP. For those who do not, and especially if they bought when the price spiked to about £1.40 old money (£28 after consolidation) the return on their capital will be very poor indeed. Those who bought in the last capital raise must feel absolutely gutted.

As for the talk about paying down debt and further share buy backs, that is no comfort if it is not reflected in any increase in the dividend on the shares remaining in issue to reflect the reduced debt servicing cost and smaller number of shares on which the dividend will be paid. There appears to be small prospect of that, as there is not even the hope held out of a progressive dividend policy. It is at least as important to note what company announcements do NOT say as what they do.

The only small ray of comfort is the prospect of a strengthened balance sheet to enable further acquisitions when the price of gas (and thus acquisition costs) are depressed.

Given the good operational performance reported, this is all deeply, deeply disappointing.

I suppose the moral is 'if it looks too good to be true, it generally is'. For us, an old lesson expensively relearned.

Make the most of this month's dividend. Its the end of the bonanza times, with no return to the glory days in prospect.

[stevensupertrader] 19/3/2024 10:03

As i wrote share price now £8.55 - just unbelievable . Don’t DEC Board know why majority of investors went to buy is because of good yield but now DEC is no longer a decent yield after today result announcement.
Just a bunch of amateurs running DEc that don’t know how to stabilise share price

[premium beeks] 19/3/2024 09:59

A 10% p/a is great, however maybe speak to those who invested up until.Nov to.see of they are happy with the share performance!This is a great SIPP share I agree, but at the right price. I don't think it's there yet.