Very High Yield Shares (2)

[moorfield]

Well, well. I'm not sure what's caused the huge VOD price crash today, chatter of a break up or dividend cut on other fora.

But its yield is certainly now too high, by my benchmark. One to avoid for the forseeable future until the outlook becomes clearer.

[monabri]

Well, well. I'm not sure what's caused the huge VOD price crash today, chatter of a break up or dividend cut on other fora.

But its yield is certainly now too high, by my benchmark. One to avoid for the forseeable future until the outlook becomes clearer.

How much is the huge crash? I'm not sure if it is down 2.1% or 6.x %?

[Itsallaguess]

I'm not sure what's caused the huge VOD price crash today, chatter of a break up or dividend cut on other fora.

Just checking, but make sure you're not using the Google Finance 'drop percentage', as it's been all over the place recently for lots of share prices, and can't be relied upon with any confidence.

If you look at the following end-of-day chart, Google Finance is showing a final 'price' for Vodafone of 74.38p above the chart, with a subsequent calculated drop of 6.41% on the day, but if you look at the chart, it's actually ended the day on 77.73p, which corresponds to an actual drop of around 2.4% -



Source - https://www.google.com/finance/quote/VOD:LON

We can verify the true 2.4% drop in share price using the following Yahoo Finance page for Vodafone -

https://finance.yahoo.com/quote/VOD.L

As I say, this is a common issue with end-of-day prices at the moment on Google Finance, so it's something to be aware of if people are using it for any portfolio-management tasks...

Cheers,

Itsallaguess

[TUK020]

what was the definition of a dead cat bounce?

[moorfield]

If my login was AdmiralAckbar (it isn't) I would probably think like he does when he sees yields > 2*CTY.

It's a trap

[Itsallaguess]

If my login was AdmiralAckbar (it isn't) I would probably think like he does when he sees yields > 2*CTY.

It's a trap

'Travelling through HYP-erspace ain't like dusting crops, boy...'

https://www.youtube.com/watch?v=j0GZ3qSV9s0&t=67s

:O)

Cheers,

Itsallaguess

[GoSeigen]

Well, well. I'm not sure what's caused the huge VOD price crash today, chatter of a break up or dividend cut on other fora.

But its yield is certainly now too high, by my benchmark. One to avoid for the forseeable future until the outlook becomes clearer.

And more falls likely. Anyway a personal vindication my policy of selling (or not adding to positions) where the company is engaged in a share buyback.


GS

[Lootman]

Well, well. I'm not sure what's caused the huge VOD price crash today, chatter of a break up or dividend cut on other fora.

But its yield is certainly now too high, by my benchmark. One to avoid for the forseeable future until the outlook becomes clearer.

And more falls likely. Anyway a personal vindication my policy of selling (or not adding to positions) where the company is engaged in a share buyback.

I generally welcome share buybacks, as long as they are done from a position of strength. I certainly prefer them to special dividends, which cause a tax event.

That said why is a company that is on such a dividend high yield buying back stock?

And please tell me VOD did not borrow to buy back those shares.

[88V8]

Anyway a personal vindication my policy of selling (or not adding to positions) where the company is engaged in a share buyback.

I generally welcome share buybacks, as long as they are done from a position of strength. I certainly prefer them to special dividends, which cause a tax event.
That said why is a company that is on such a dividend high yield buying back stock?

High? You call that high?
Try Diversified Energy at 16%, and buying back stock.

V8 (my largest holding, ooer)

[Arborbridge]

I generally welcome share buybacks, as long as they are done from a position of strength. I certainly prefer them to special dividends, which cause a tax event.
That said why is a company that is on such a dividend high yield buying back stock?

High? You call that high?
Try Diversified Energy at 16%, and buying back stock.

V8 (my largest holding, ooer)

Risk ON mood V8, risk on...

[Sorcery]

If my login was AdmiralAckbar (it isn't) I would probably think like he does when he sees yields > 2*CTY.

It's a trap

Well I fell in to it. I thought I would look in here to see if VOD was being talked about or mention it if not ...
Invested(?) 2.5% of total holdings in it, yesterday. It seems a silly but good price to get in imho, but then not researched it too much other than to ask around elsewhere.

[SalvorHardin]

High? You call that high?
Try Diversified Energy at 16%, and buying back stock.

V8 (my largest holding, ooer)

I see your Diversified Energy and raise you Brandywine Realty Trust, an American REIT which currently yields 19.7% (I recently bought some of these, 2% of my portfolio)

As to Star Wars references regarding risk, the modern version comes from "The Mandalorian" (it's a very short clip) from series 1. Here The Mandalorian is being faced down by a group of Stormtroopers (and these are elite troopers, who can hit the side of a barn).

https://www.youtube.com/watch?v=7f3D9msXzAk#t=0m24s

[Lootman]

Brandywine Realty Trust, an American REIT which currently yields 19.7% (I recently bought some of these, 2% of my portfolio)

Interesting. I see it has lost 2/3 of its value in the last year. I guess the question is whether it will lose the other one third!

On the other hand if the dividend holds then you will get your money back in 5 years anyway.

[moorfield]

Well I fell in to it. I thought I would look in here to see if VOD was being talked about or mention it if not ...
Invested(?) 2.5% of total holdings in it, yesterday. It seems a silly but good price to get in imho, but then not researched it too much other than to ask around elsewhere.

Q. How to you make a million from Vodafone shares ?
A. Start with two million.

Q. Why is investing in Vodafone is worse than a divorce ?
A. You lose half your money, but you're still married.


And so on. I'm here all day.

[SalvorHardin]

Brandywine Realty Trust, an American REIT which currently yields 19.7% (I recently bought some of these, 2% of my portfolio)

Interesting. I see it has lost 2/3 of its value in the last year. I guess the question is whether it will lose the other one third!

On the other hand if the dividend holds then you will get your money back in 5 years anyway.

Agreed. American REITs have been hammered in the last few years, particularly those whose business is offices. I'm taking the view that the fears that work from home (WFH) will destroy the market for offices are overblown, with lots of American companies now insisting on a return to work as the loss of productivity caused by WFH becomes clear. Also WFH staff are realising that they are first in the line to be made redundant and last to be considered for promotion.

I've invested a further 4% split between two other very high yielding American REITs. SL Green Realty Corp. is the largest office landlord in Manhattan, with a mere 14.4% yield. Highwoods Properties mostly owns offices, in more sensible parts of America (Texas, Georgia, Florida and the Carolinas), which is reflected in its much smaller yield of 9.9%. Brandywine is mostly in Philadelphia and Austin, Texas, with a portfolio that is mostly residential (31%) and life science facilities (41%). A major concern for all REITs is the need to refinance in the next few years at much higher interest rates (but if this wasn't the case, the shares would yield a lot less).

Brandywine
https://seekingalpha.com/symbol/BDN

Highwoods
https://seekingalpha.com/symbol/HIW

SL Green
https://seekingalpha.com/symbol/SLG

For a real basket case, look at Hudson Pacific Properties. West Coast offices and film studios, with a lot in San Francisco where the local authorities have mostly given up on law enforcement and where the city centre now hosts open air drug markets and roadside homeless encampments. Hudson Pacific's shares currently yield 21.8% even after the dividend was cut by 50% last month. I might buy a few if the share price halves from its current level, purely as a punt on the citizens of San Francisco and Los Angeles getting their act together and demanding that the authorities take their side rather than that of the criminals and wasters.

https://seekingalpha.com/symbol/HPP

[Sorcery]

Impressive yields Salvor,
Do you have to pay US with-holding tax on that? I have not found a way out of them for dividends at least.

[SalvorHardin]

Impressive yields Salvor,
Do you have to pay US with-holding tax on that? I have not found a way out of them for dividends at least.

Yes, 15% withholding tax as I have completed the W-8BEN form. The American withholding tax can be set off against the dividend tax that you have to pay on UK dividends (most of my portfolio is held outside ISAs).

There is a limit as to how much withholding tax you can offset. If the withholding tax rate exceeds the UK dividend tax rate then the excess is ignored. I have some French, German and Italian shares with much higher withholding tax rates than UK dividend tax, but the dividends on these are small so it's not worth getting worked up about.

I should point out that none of the shares that I've mentioned in this thread are remotely stable "widows and orphans" investments. All are very high risk (Hudson Pacific is even riskier, which is why I don't own any). SL Green is a bet on conditions improving in New York its properties are in prime locations and the demand for top locations in New York seems to be holding up as it is in London, whereas the secondary and tertiary locations are getting hammered. Highwoods' properties are in cities where work from home hasn't been as big an issue whilst Brandywine IMHO has been treated as owning mostly offices (which it doesn't).

[Sorcery]

Well I fell in to it. I thought I would look in here to see if VOD was being talked about or mention it if not ...
Invested(?) 2.5% of total holdings in it, yesterday. It seems a silly but good price to get in imho, but then not researched it too much other than to ask around elsewhere.

Q. How to you make a million from Vodafone shares ?
A. Start with two million.

Q. Why is investing in Vodafone is worse than a divorce ?
A. You lose half your money, but you're still married.


And so on. I'm here all day.

Seems to be rallying today though which is a comfort. Falling knives and all that may cut the catcher. However VOD is huge and on a PE of 2. At some point it's got to be cheap enough to buy and hold, it might be now, it might not.

[Sorcery]

Yes, 15% withholding tax as I have completed the W-8BEN form. The American withholding tax can be set off against the dividend tax that you have to pay on UK dividends (most of my portfolio is held outside ISAs).

Thanks for the info Salvor. 25% for me where I live and less chance of being able to claim it back.

Sometimes I think something looks so cheap I just live with the tax e.g. https://finance.yahoo.com/quote/ZIM?p=ZIM
It's been paying a very high dividends for a couple of years, even after with-holding tax have had $12.16 per share in dividends. The problem with it is the SP collapse has created capital losses which exceeds the dividend total. It might come good eventually ...

Edited to insert "per share"

[moorfield]

High? You call that high?
Try Diversified Energy at 16%, and buying back stock.

V8 (my largest holding, ooer)

DEC appears to be a hedge fund which owns some second hand oil wells, I'm not sure I really understand how it works. I think they have also been diluting shareholders for a while.