Sky Network Television Ltd: Time for some Stripping!

After the latest Sky Network Television Ltd [SKT.NZX] profit result current shareholders are in for an early Christmas present in the form of a hefty and very attractive (like the completely in context photo to your left)dividend.

SKT have had a very good 12 months to June 30 2011 and on top of their 10.5c regular dividend they are paying a special dividend of 25c as a bonus. If you are eligible for the tax credits this is just under 50c per share or an approx 8% return on the current share price of $5.80.

What I am surprised about is that the share price has been stagnant since the announcement last Friday given the hefty return this would give the average investor and the fact that one would be stretching to get a third of this return if they left their green stuff in the bank.

The company is likely to have a another good year for full year 2012 with revenue gleaned from increased Rugby World Cup subscriptions so either I am missing something or potential investors are asleep at their computers.

If you look at the SKT share price (see 1 year chart below) it has been trading around its current level since May and is up about 15% since January so the stock price has mirrored an overall increase in stock prices for that period so you couldn't really say its share price has left the realities of its fiscal performance for the previous 12 months.

Investors have until 7 September to qualify for the payout and will get the green stuff in their banks just a week latter.

I good move for you dividend strippers out there.


Sky Network Television @ Share Investor

Share Price Alert: Sky Network Television Ltd
Long Term View: Sky Network Television Ltd
Watching Sky Television
Market Quickie: Sky TV Worth Watching

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c Share Investor 2011

Share Price Alert: Sky Network Television Ltd

Sky Network Television Ltd [SKT.NZX] has been a major beneficiary of the strong NZ dollar over the last year or so and recently the dollar has been very strong vs the US dollar, the currency SKT buys its programming in, and the share price has responded in kind.

The share price has risen 13% since December 2010, around half of that over the last month or so, and its current share price as at 19 April 2011 of $5.75 looks fully valued based on recent results.

The current share price must be put in context of a 52 week high of $5.90c and a 52 week low of $4.51.

In order for the share price to break out of the 6 buck range the NZ dollar would have to sustainably push above the 80c mark against the US dollar and it is anyones guess whether that will happen.

If we focus on financial performance for the medium term things are looking good for the company, with new technology offerings giving Sky more reasons to extract additional revenue from current subscribers and also pull in new punters.

I couldn't have been more wrong back in April 2008 when I thought the company would come under pressure from new technology from competitors biting at the company's monopoly. SKT managed to grab the technology for themselves while potential competition has been left well and truly in the dust.

The combination of medium term revenue and profit increase looks good for the company but the impact of currency movements against SKT will clearly have a big impact on the bottomline.

Wait for a pullback from current prices if you are looking to buy.


Share Price Alert

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Sky Network Television @ Share Investor

Long Term View: Sky Network Television Ltd
Watching Sky Television
Market Quickie: Sky TV Worth Watching

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Download SKT Company Reports




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c Share Investor 2011

Long Term View: Best Stocks from the Series

In the Long Term View series (see links to each individual stock at the bottom of this post) of posts I have looked at stocks listed on the NZX in relation to their returns to shareholders over the life of their listing -what shareholders would now see in their back pockets if they had invested in the company IPO. The calculation of returns included dividends and tax credits and other relevant details.

The calculation of return is based on available data and may vary from stock to stock. An absence of data usually means a better return than I have calculated will be the case.

In each individual post the differences will be pointed out.

I have been surprised by the spectacular returns from some and not so surprised by the dismal returns of others but have learnt, once again, that the best returns come from holding good stocks for a long period.

My ideas on stocks as one of the better long-term investments have been reinforced by this series.

Below are rankings in the series from number one down to the bottom in terms of annual returns. Click on company name for more detail on returns.


Long Term View Series Ranking


1. New Zealand Refining Ltd [NZR.NZ] Over 21 years of available data NZR has returned 7800%, an annual return of just over 371%.

2. Port of Tauranga Ltd [POT.NZ] Over 18 years of available data POT has returned over 1475%, an annual return of just over 81%.

3. = Ryman Healthcare Ltd [RYM.NZ] Over 11 years of available data RYM has returned over 680%, an annual return of just over 60%.

3. = Mainfreight Ltd [MFT.NZ] Over 14 years of available data MFT has returned over 830%, an annual return of just over 60%.

5. Sanford Ltd [SAN.NZ] Over 22 years of available data NZR has returned over 895%, an annual return of just over 40%.

6. Sky City Entertainment Group Ltd [SKC.NZ] Over 14 years of available data SKC has returned over 540%, an annual return of just over 38%.

7. Auckland International Airport [AIA.NZ] Over 11 years of available data AIA has returned over 400%, an annual return of just over 36%.

8. Ebos Ltd [EBO.NZ] Over 13 years of available data EBO has returned over 455%, an annual return of just over 35%.

9. Freightways Ltd [FRE.NZ] Over 6 years of available data FRE has returned over 190%, an annual return of just over 31%.

10. The Warehouse Group Ltd [WHS.NZ] Over 16 years of available data WHS has returned over 500%, an annual return of just over 30%.

11. = Telecom New Zealand Ltd [TEL.NZ] Over 18 years of available data TEL has returned over 450%, an annual return of just over 25%.

11. = Telstra Corp Ltd [TLS.NZ] Over 12 years of available data TLS has returned over 300%, an annual return of just over 25%.

13. Pumpkin Patch Ltd [PPL.NZ] Over 6 years of available data PPL has returned over 125%, an annual return of just over 20%.

14. Contact Energy Ltd [CEN.NZ] Over 11 years of available data CEN has returned over 200%, an annual return of just over 18%.

15. Sky Network Television Ltd [SKT.NZ] Over 13 years of available data SKT has returned over 215%, an annual return of just over 16%.

16. Metlifecare Ltd [MET.NZ] Over 16 years of available data MET has returned over 540%, an annual return of just under 16%.

17. Delegats Group Ltd [DGL.NZ] Over 4 years of available data DGL has returned 50% an annual return of 12.5%.

18. Fisher & Paykel Healthcare Ltd [FPH.NZ] Over 8 years of available data FPH has returned over 93%, an annual return of just over 11%.

19. = Goodman Fielder Ltd [GFF.NZ] Over 4 years of available data GFF has returned over 30%, an annual return of just under 7%.

19. = Hellaby Holdings Ltd [HBY.NZ] Over 16 years of available data HBY has returned over 30%, an annual return of just under 7%.

21. Restaurant Brands Ltd [RBD.NZ] Over 13 years of available data RBD has returned over 60%, an annual return of just under 4.5%.

22. Briscoe Group Ltd [BGR.NZ] Over 9 years of available data BGR has returned over 21%, an annual return of just over 2.33%.

23. Fisher & Paykel Appliances Ltd [FPA.NZ] Over 8 years of available data FPA has returned over 11%, an annual return of just over 1.37%.

24. Air New Zealand Ltd [AIR.NZ] Over 8 years of available data AIR has returned over 6%, an annual return of just over 0.75%.

25. AMP Ltd [AMP.NZ] Over 12 years of available data AMP has returned minus 50%, an annual return of just over minus 4%.


Disc I own AIA, BGR, FPH, FRE, GFF, MFT, PPL, RYM, SKC, WHS shares in the Share Investor Portfolio


Download Company Reports from the Long Term View series






c Share Investor 2010

Market Quickie: Sky TV Worth Watching

I have given Sky Network Television [SKT.NZ] a very wide birth over the years, I have never really understood a company that spent more than 10 years losing money and has only been making it for the last 3 or 4.

I guess they were building up a business?

I don't like its business model; a company that relies on continuous large amounts of capital to keep competition at bay doesn't make for a good long term return.

Sky is also at the mercy of Government regulation, currency fluctuation, product quality and large capital depreciation.

What I do like though (I am such a negative bugger) is that it is a virtual monopoly-in Pay TV terms -but even that is under threat by new technology (which SKY is trying to take a punt on) via the Internet and satellite TV and product.

It hasn't done well over the last year, with a more than 16% drop in profit to just over $NZ42 million in the half year to 31 Dec 2008 on higher revenue of nearly $350 million. This is due to higher capital costs, which I outlined above.

Why the hell then do I mention the company today if I see little redeeming about it in its day to day operations?

I kinda like its share price.

The shares are well off their low of $3.15 during the last 52 weeks but the corollary to that is that they are off their 52 week high of $5.10 and well off their all-time high of $6.75 in late 2006 (see 5 year chart above)

I reckon this company is worth a good short-term to medium term punt.



Sky Network Television @ Share Investor

Watching Sky Television
Market Quickie: Sky TV Worth Watching

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Download SKT Company Reports




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c Share Investor 2009