ASX Shares What's looking cheap on the ASX?

Discussion in 'Shares & Funds' started by radson, 11th Jan, 2016.

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  1. cdchi1

    cdchi1 Well-Known Member

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    ANZ PE 8.8 vs sector PE 12. Yep very good value. If I wasn't resources focussed, I'd buy it for sure.

    How did you get 11% yield though? Super fund pension phase maybe?
     
    cdchi1, 21st Jan, 2016
    #101
    158 likes this.
  2. charpj

    charpj Well-Known Member

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    Look like a bloodbath today
     
    charpj, 21st Jan, 2016
    #102
  3. 158

    158 Well-Known Member

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    $1.83 dividend divided by current purchase price = 7.7%.

    7.7% divided by .7 (fully franked divisor) = 11% .

    pinkboy
     
    158, 21st Jan, 2016
    #103
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  4. willair

    willair Well-Known Member Premium Member

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    willair, 21st Jan, 2016
    #104
  5. mrdobalina

    mrdobalina Well-Known Member

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    Is that how the dividend payments are calculated? (I honestly don't know).

    From the ANZ 2015 payments:
    $1.81 dividends paid plus $0.78 franking credits. Does that equate to $2.59 dividends gross?
    ANZ AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED dividend history - Australian Company Share Dividend History, Forecasts, Ex-Dividend Dates for Share Investors
     
    mrdobalina, 21st Jan, 2016
    #105
  6. 158

    158 Well-Known Member

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    Yeah, I was just going off Commsec's estimated 2016 dividend of $1.83.

    Yes, that's how you calculate net and gross yield. Of course, if you pay above 30c/$1 in tax, you may pay slight tax on the earnings.

    Much better than silly resi investors chasing their $10/week cashflow properties......:p

    pinkboy
     
    158, 21st Jan, 2016
    #106
  7. mrdobalina

    mrdobalina Well-Known Member

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    Hhmmmm..... Interesting.

    If you could pull out a couple mil equity release at 5%, would you buy shares to generate a 10%+ gross dividend?
     
    mrdobalina, 21st Jan, 2016
    #107
  8. 158

    158 Well-Known Member

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    What if the shares value decrease, or the dividend decreases/stops?

    I guess it depends how risk adverse/reward you are.

    Personally I would not throw borrowed funds to this type of strategy.

    pinkboy
     
    158, 21st Jan, 2016
    #108
  9. The Falcon

    The Falcon Well-Known Member

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    I'm full position on ANZ unfort. Ended up adding RHC yesterday arvo.

    Hanging for more cash inflow :)
     
    The Falcon, 21st Jan, 2016
    #109
  10. Northy85

    Northy85 Well-Known Member

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    It is risky but if you loose out with the shares you only loose equity. Personally I would only do it with a quarter to a third of my usable equity to pay down some debt.
     
    Northy85, 21st Jan, 2016
    #110
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  11. cdchi1

    cdchi1 Well-Known Member

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    Ok cheers, so yeah for eg super fund pension 0% tax rate...nice.
     
    cdchi1, 21st Jan, 2016
    #111
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  12. The Falcon

    The Falcon Well-Known Member

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    Yes I would, but I would not be focussed on 10% starting yield......I'd be looking for dividend growth rather than high initial yield, which over time would become 10, 15, 20% yield on cost ;) entry yield is not a buying signal......................
     
    The Falcon, 21st Jan, 2016
    #112
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  13. kum yin lau

    kum yin lau Well-Known Member

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    Hi, my crystal ball says if you want to make money, buy today. We'll see later if the ball is cracked. If it's not, then I must be!!

    KY
     
    kum yin lau, 21st Jan, 2016
    #113
  14. 158

    158 Well-Known Member

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    Explained much more eloquently than myself. Look for dividend growth, and increased stability for dividend growth overall.

    pinkboy
     
    158, 21st Jan, 2016
    #114
  15. wombat777

    wombat777 Well-Known Member

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    Intending to buy 1 or 2 good dividend stocks to add to my portfolio. I bought some ANZ yesterday.

    Looking for others that are good value at the moment.
     
    wombat777, 21st Jan, 2016
    #115
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  16. mrdobalina

    mrdobalina Well-Known Member

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    Which means choosing companies with consistent earnings and eps growth. What companies are in your sights that would continue this in a looming recessionary period?
     
    mrdobalina, 21st Jan, 2016
    #116
  17. The Falcon

    The Falcon Well-Known Member

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    I'm not taking any macro views about a looming recessionary period but the focus is all industrials (which I believe is the way to go for long term investors - in Oz I use that term to describe everything excluding materials and energy) The type of stocks in my industrials portfolio (and watch list for it) are all moaty stocks, so reliable earnings, strong balance sheet and some EPS growth. There are 30 positions in total, and its a modified equal weight portfolio (double positions only), so its not about being right on each position, but being right on average. Note, this is to be a very long term portfolio, 20+ years buy/hold/add. Some of the positions have disappointed in recent years but its not about that, its really about putting together a diversified portfolio that can hold up over the long term, and outperform the ASX200 on a TSR basis. Backtesting post construction shows strong outperformance over the likes of AFI and ARG over 5 and 10 years (as proxies for ASX200 accumulation) even when removing top 3 positions, and removing the few new listings. Now I offer no warranties :) whatsoever, but this is what I do. This may give people some ideas or not.

    Here you go ;

    ABC / AGL / AHY / AMP / ANN / ANZ / APA / ASX / BXB / CAR / CBA / CCL / CPU / CSL / FLT
    IFL / IRE / LNK / MFG / MQG / NAB / PTM / QUB / RHC / SDF / SHL / WBC / WES / WOW/TLS

    Now, the question is what do I think is compelling today, to add to a portfolio of this type? As of right now I'd say CCL and ANZ
     
    The Falcon, 21st Jan, 2016
    #117
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  18. jafeica

    jafeica Well-Known Member

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    @The Falcon - I would be interested to know your thought on portfolio management and if/how you rebalance to maintain the equal weight, i.e do you sell to realise some profit on those have done well to buy those that are underperforming?
     
    jafeica, 21st Jan, 2016
    #118
  19. The Falcon

    The Falcon Well-Known Member

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    Its a pretty new portfolio, but rebalance will happen with inflows, any trimming would be case by case but would generally be avoided. The simple rule is that no position can remain below 1.5% of portfolio - this allows some double positions but also forces buying of beaten up stuff. Based on the holdings turnover is expected to be very low, perhaps one position every few years, if that. Broker takes care of portfolio admin.
     
    The Falcon, 21st Jan, 2016
    #119
  20. johnpendlebury

    johnpendlebury Well-Known Member

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    How come ANZ is out of favour compared with their competitors?
     
    johnpendlebury, 21st Jan, 2016
    #120
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