National Grid Share Discussion Threads

[tuftymatt] 13/11/2023 11:23

With ex divi coming I thought that number was possible this week.

Good luck all 👍🏻

[skinny] 13/11/2023 11:00

FWIW :- Deutsche Bank raises National Grid price target to 1,020 (970) pence - 'hold'

[utyinv] 11/11/2023 00:51

anhar:

Re: post 8653 - Forward yield should be a little higher as the 23/24 final will likely be ahead of last year's.

I don’t think the increase will be as high ( percentage terms ) as last year because the Final will be based on the average CPIH for each month April ‘23 to March ‘24 less the interim paid in Jan.

I have posted each month through to Sept ( Sept data published in Oct) and to date we have:-
CPIH April 7.8%, May 7.9%, June 7.3%, July 6.4%, Aug 6.3%, Sept 6.3%

So let’s play guess work with CPIH for Oct, Nov, Dec, Jan Feb and Mar.

Hypothetically, if Oct data is 6%, Nov is 5.5%, Dec 5%, Jan 5%, Feb 4.6% and Mar 4.5% then the average CPIH will be 6.05%

If that is the figure ( which we will use determining our Final) then :

Last year Divi 55.44p x 1.0605 = 58.79p less 19.4p ( interim) = 39.39p so if the next six months of CPIH comes out as our exercise above, the final will be 39.39p. If CPIH falls faster we would get less and more if inflation persists.

With NG using this formulae to determine dividends then NG is one of the few Companies where investors can predict the dividend.

You also mentioned debt and dividend cover. This is normal for utilities like NG where income is almost certain. OFGEM have encouraged NG to capitalise future projects using debt rather than hiking customer bills higher. They (OFGEM) argue that NG can borrow cheaper than a risky Company and the business is secure. They then ask Grid to recoup project costs from customers over a 40 year period.

The only income Ofgem have no control over is income from the US ( which is regulated from within the US but usually the US is more business friendly / realistic) and of course unregulated businesses, ie ventures etc.

So unless NG change their divi policy or something seriously interferes with Company Strategy (politics), then NG is quite predictable.

Hope the above helps

[bountyhunter] 10/11/2023 09:04

anhar, I was simply agreeing with you re the value of the dividend and adding to what you said.

[skinny] 09/11/2023 10:50

Like a few on here, I've held since privatisation.

An interesting graphic from the website .

[anhar] 09/11/2023 10:44

bountyhunter: As a very long term holder I'm aware of their divi record and have no complaints there. I said as much in my comments, see my final sentence.

[bountyhunter] 09/11/2023 10:42

Yes anhar, and there are not many companies like NG consistently growing a decent dividend year on year...



Click on "Annual Dividends" at the top.

Viscount, maybe a good option rather than a special following asset sales, but I wouldn't like to see the excellent record of dividend growth shattered.

[viscount1] 09/11/2023 10:41

They are taking on a chunk of new loans which I don't imagine are cheap at the moment. I would prefer them to use their cash flow to pay those off rather than dividends.

[anhar] 09/11/2023 10:29

As an income investor, good to see the divi up an attractive 8.7% to 19.4p. Taking this and last year's final of 37.6p totals a rolling 12m 57.0p. On the share price of 975p this makes a historical yield of 5.8%. Forward yield should be a little higher as the 23/24 final will likely be ahead of last year's.

Downsides, in common with utility shares generally, are the low dividend cover and the huge debt and consequent gearing, which are nearly always present so nothing new there. These two negative features can threaten divis in time if not contained and utilities are not immune to divi cutting.

However I'll continue holding in my income port, as I have for a very long time now. Share prices don't interest me much, it's all about the divis in my strategy and NG. has a fine record on that.

[utyinv] 09/11/2023 10:02

Don’t forget, due to the additional projects / investments needed to get to net zero the number of shares in circ ( that account with a vote) has increased from 3.4billion to 3.69billion. We don’t want any further dilution and maybe when revenues eventually filter through, in time to come, we may see £20 / share🤞

[bountyhunter] 09/11/2023 10:01

That did cross my mind. Not that any reasonable profits (aka windfalls!) or shareholder payments are acceptable to many politicians nowadays!

[utyinv] 09/11/2023 09:55

Bounty, I don’t think its politically acceptable for a special. It will benefit shareholders as finding investments for future projects will not hit shareholder by increased dilution of shares

[bountyhunter] 09/11/2023 09:52

Re #8647
Another possibility may be a special, we had one back in 2017..

Special 84.375p paid 02 Jun 2017

[utyinv] 09/11/2023 09:51

First real comments on the issue of the NG SO being sold off.

As you recall, previous Labour administration wanted to Nationalise NG but this has significantly changed where the Labour proposed GB energy company will work together with Private companies to achieve real benefits to all stakeholders,ie, customers and shareholders.

NGSO already separately ‘ring fenced’ will be sold off to form part of a non-profit state owned office. The significant difference was that Corbyn and MacDonald wanted the whole if NG for free. So NGSO will be sold compensating shareholders what belongs to them.

[utyinv] 09/11/2023 09:39

Interesting that Andy Agg ( currently discussing /presenting results on web call) states that the 40% retained interest in UK Gas Transmission is not included in results neither will the revenue that will arise if Macquarie take up the option to purchase the remaining 40% ( which is highly expected).

I can see this additional revenue being invested into future projects, growth and net zero targets

[utyinv] 09/11/2023 09:34

I mis-calculated thinking the Interim Div was 1/3 of previous years divi. I should have used 35% rather than 1/3 but still a nice mistake to make😂

55.44p x 0.35 = 19.404p rounded off to 19.4p

[bountyhunter] 09/11/2023 08:36

Header link at the end updated to interim results and divi amount updated.

[bountyhunter] 09/11/2023 08:28

Sorry that broke the competition rules with too many decimal places ;-)

[skinny] 09/11/2023 08:26

Did you miss mine @19.3999p? :-)

[bountyhunter] 09/11/2023 08:18

Yes, was just about to post that.
You win the Divi competition with the closest guess at 18.48p! ;-)

[utyinv] 09/11/2023 07:37

Int Divi 19.4p 👍

[action] 09/11/2023 07:35

Will it reach year's low again?

[action] 09/11/2023 07:34

Profit down. Divi up.