Comments on: Inegrys Energy Group (TEG): Things That Make You Go Hmmm… *

By: Dividends4Life

Dividends4Life — Sat, 28 Feb 2009 02:27:50 +0000

Red Dog: You are dead on. I saw Aristocrat and Utility and read “low risk”. Our mistakes makes us better investors.

Best Wishes,
D4L

By: Red Dog

Red Dog — Sat, 28 Feb 2009 02:09:41 +0000

Sometimes (and we all do it) we “see what we want to see” and with TEG all I saw was “dividend aristocrat” so it must be good. You gloss over the figures more as an afterthought. The mind has already been made up. That’s how I bought TEG last year.

It brings to bear though the pressure this “Aristocrat” label brings to some companies. It seams TEG was hell bent on raising that dividend at too great an eventual cost.

By: kewgardens

kewgardens — Fri, 27 Feb 2009 18:47:43 +0000

So now what? Should we dump the stock, given its dividend shenanigans, lowered earnings projections and free cash flow problems? Or does the horrific haircut warrant holding on? Right now, the stock would yield well over 6% even if the company cut the payout to $1.68 (about 65% of projected earnings). And the lowered earnings projections are now (unfortunately) baked into the cake.

If you think selling is appropriate, what is the best utility to swap into?

By: ghandy

ghandy — Fri, 27 Feb 2009 17:51:27 +0000

thanks for the interesting analysis