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Thoughts on Anglo?

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klapka
Super Contributor
A lot of the bad news priced in? We know about Anglo plats and De Beers needs - going to take quite a bit of AGLs cash and profit drop is expected. No profit warning so far. Share price down 15 to 18% since January. Though well up today. The big unknown is will they pay a dividend? That is not priced in?
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6 REPLIES 6
SimonPB
Valued Contributor
I agree a div not priced in .. but I think they'll hold back another year, firstly the AMS and DBR have hit their cash reserves (swapping debt for equuity) .. an it not being priced in means market not expecting, so play it safe an keep the div for another day ??
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Not applicable
Have to say that the AMS rights issue is probably quite good for AGL, since the debt will be repaid - putting them in a nice cash position - in exchange for slightly diluted equity in an asset that is probably going to underperform in the medium term (electricy increases, rand strength, weak platinum demand, etc). If it is successful, i certainly hope that AGL has some offshore investment strategy worth looking into
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SimonPB
Valued Contributor
in the medium term both deals are good as they free up the two companies as the debt is lower ..
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klapka
Super Contributor
agree and platinum and diamonds (especialy with lower debts) looking better going forward......... but on the dividend story wonder if they wont be paying a small div to appease the very unhappy shareholders last year? Maybe a case of damned if they do, damned if they dont?
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SimonPB
Valued Contributor
surely small not going to make them happy, and they already dammed .. so nothing to loose if they don't ??
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klapka
Super Contributor
Yep youre right. Silly to pay a small divi.
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