In this series of posts I am going to be looking 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 includes dividends and tax credits.
Goodman Fielder Ltd [GFF.NZ] has been OK to its shareholders in terms of returns since its IPO in December 2005 at $NZ2.13 . With $NZ 49 cents in net dividends (see chart above) paid and another 20% average of that figure gained for those eligible for associated tax credits (GFF have never had full tax credits), a slightly less than 30% return (see chart below for the share price percentage gain against the average of all NZX indexes) and over the 4.3 year listing an approximate annual net return of just under 7%.
This is approximately double the return compared to the average of all NZX indexes.
Disclosure I own GFF shares in the Share Investor Portfolio
Long Term View Series
Auckland International Airport
Air New Zealand
AMP Ltd
Briscoe Group Ltd
Contact Energy Ltd
Delegats Group Ltd
EBOS Group Ltd
Fletcher Building Ltd
Fisher & Paykel Appliances
Fisher & Paykel Healthcare
Freightways Ltd
Goodman Fielder Ltd
Hellaby Holdings Ltd
Mainfreight Ltd
Metlifecare Ltd
New Zealand Refining Ltd
Port Of Tauranga Ltd
Pumpkin Patch Ltd
Restaurant Brands Ltd
Ryman Healthcare Ltd
Sanford Ltd
Sky City Entertainment Group Ltd
Sky Network Television Ltd
Telecom NZ Ltd
Telstra Corp Ltd
The Warehouse Group Ltd
Goodman Fielder @ Share Investor
Goodman Fielder turning on the DRIP
Goodman Fielder to improve bottom line in 2009
Why did you buy that stock? Goodman Fielder
Goodman Fielder hit by high commodity prices
Goodman Fielder a Hedge against an economic slump
Goodman Fielder pie gets bigger
Discuss GFF @ Share Investor Forum
Download GFF company Reports
Recommended Amazon Reading
The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition) by Benjamin Graham
Buy new: $14.95 / Used from: $7.50
Usually ships in 24 hours
Buy The Intelligent Investor & more @ Fishpond.co.nz
c Share Investor 2010
Hi Darren,
ReplyDeleteI recently saw GFF in the news again with their debt facility being assured for another year. I have GFF shares but one thing that has always bothered me is why this company which has agreat business needs such a large debt facility. That must be costing a bit in fees and interest payments. Do you think they could better manage their cash flow so that a much smaller debt facility might be needed?
Cheers
Hi RJ, what I think is that because of stable high cashflows management is taking advantage of that to gear up as much as possible.
ReplyDeleteThe debt kicked off after Graeme Hart sold down during the IPO a few years back and management seem to like to have it on the balance sheet.
I don't and it is dragging down profit year by year.