Issue 224, 26 September 2013

Beautiful one day, perfect the next

Yesterday I got together with Switzer Super Report CIO Paul Rickard to discuss some of the majormarket and industry issues in our Super Sessions. Paul had some very interesting things to sayaround how much longer this bull market has to run. You can watch the video below.

Also in our report today, Charlie Aitken still loves Queensland and explains why now is a good time togo looking for financial exposure, like Bank of Queensland and Suncorp, up north.

We have Roger Montgomery talking about new IPOs and why OzForex might be the best of thebunch. Our My SMSF today is AMP SMSF technical guru Peter Burgess, on why he is changing froma small APRA fund to an SMSF and in Buy, Sell, Hold - what the brokers say, SP Ausnet andMacquarie Group get upgrades.

Sincerely,

Peter Switzer

Inside this Issue

Floating the OzForex boat

by Roger Montgomery

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02 Buy BOQ for northern exposure by Charlie Aitken

04 Floating the OzForex boatby Roger Montgomery

07 Buy, Sell, Hold – what the brokers sayby Penny Pryor

08 My SMSF – Peter Burgessby Super Report Subscriber

09 The Fed spells it out - ignore political risk at your perilby Gavin Madson

11 Watch out for SMSF focus in Abbott reviewby Tony Negline

13 Changes to new contribution rules mean diligenceby Grant Abbott

15 Question of the week – Gold stock speculation by Questions of the Week

Switzer Super Report is published by Switzer Financial Group Pty Ltd AFSL No. 286 531

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Important information: This content has been prepared without taking accountof the objectives, financial situation or needs of any particular individual. It doesnot constitute formal advice. For this reason, any individual should, beforeacting, consider the appropriateness of the information, having regard to theindividual's objectives, financial situation and needs and, if necessary, seekappropriate professional advice.

Buy BOQ for northern exposure

by Charlie Aitken

I remain a major bull on Queensland under theNewman government. I feel the combination of abusiness-friendly government and macro tailwinds willdrive GDP growth outperformance from the SunshineState.

South East Queensland effectively was ‘Australia’sFlorida’ in the GFC. The residential property marketwas hit hard after years of speculative over-build, withresidential prices experiencing a deep correction. Toadd insult to injury, the actions of the US FederalReserve sent the Australian Dollar into a new orbit, allbut destroying the inbound tourism market intoQueensland, because it became bad global-relativevalue. A series of severe weather events that gotglobal coverage didn’t help either.

The right exposure

All those headwinds have now turned to tailwinds,even bellwether Noosa beachfront apartment salesare up, and I want to keep the foot to the floor onlisted Queensland exposures. The massiveGladstone LNG developments and their long-termcontribution to state GDP are also underestimated. Invery basic terms, this leads me to liking theQueensland stocks that got hit hardest in the GFC,namely the mortgage banks Suncorp (SUN) andBank of Queensland (BOQ).

Suncorp has been in my high conviction buy listsince inception and continues to deliver strong totalreturns. Bank of Queensland has been in my 20/20portfolio since inception and also continues to deliverstrong total returns. But the returns generated by bothSUN and BOQ over the last few years were simplymean reversion from near-death experiences. Whathappens from here is “normalisation of cycle P/E” asit becomes more widely accepted that Queensland isreturning to business as usual. That’s the next leg upof both SUN and BOQ.

Bank of Queensland

Today I again want to focus on the $3.3 billion marketcap Bank of Queensland. Top down, bottom up andtechnicals are all aligned for BOQ and that is a verypowerful share price combination.

BOQ: 1 year..breakout

BOQ: 5 years…breakout

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BOQ: 10 years.. breakout

Despite the recent rally, BOQ remains cheap. FY14has just commenced for BOQ. PEG ratio 1x, price tobook 1:1x, dividend yield 5.7% fully franked. Followedby more of the same in FY15.

But here’s the feature that attracts me the most toBOQ and the other regional mortgage banks: theirunderperformance of the Big Four banks. Sure, someunderperformance was warranted, but this gap is nowunjustified and too wide. It will close in favour of BOQ.

BOQ vs. ASX Bank Index (XXJ) 10 years: buy thegap

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The contrarian play

Only six out of 18 bank analysts recommend buyingBOQ. The median price target is $10.09, 88 centsbelow the current share price. Consensus EPS forFY14 is 83 cents, we are at 85 cents. ConsensusFY14 yield is 5.45%, we are at 5.70%.

Via percentage of Queensland-based lending of thetotal portfolio BOQ is the purest play you can buy onmy pro-Queensland growth theme.

We believe the FY13 result, due 10 October, will passmarket expectations and we can collect a final 28cents fully franked dividend. That result should alsodrive consensus FY14 upgrades as the market startsto believe in Stuart Grimshaw’s execution.

BOQ remains a standout buy from a trading andinvestment perspective. I am thumping the table onthis one because it fits every strong domestic theme Ibelieve in. Also, I like the fact nobody else in brokerland ever seems to mention the stock.

Foreign investors who have been caughtunderexposed to the Big Four Australian banksshould be looking at the cheaper regional namessuch as BOQ.

Important: This content has been prepared withouttaking account of the objectives, financial situation orneeds of any particular individual. It does notconstitute formal advice. Consider theappropriateness of the information in regards to yourcircumstances.

Floating the OzForex boat

by Roger Montgomery

Despite the buoyancy in the stock market over thepast 12 months, we have been surprised to see sofew new businesses apply for listing on the AustralianSecurities Exchange.

Rising markets, maturing term deposits and low cashrates are a good recipe for companies with IPO plans.Investors, who are likely to be more open aboutputting their hard-earned savings to work, rather thanreinvesting them in low yielding term deposits, maybe keen to take on a little more by investing incompanies that are angling to take the IPO plunge.

On the other side of the fence sit the investmentmanagers. Having watched a rising market lift all the“boats” in their portfolios, they are now finding itmuch more difficult to generate new ideas, and theywould certainly be receptive to new opportunities.

More market entrants

Despite this, few IPOs have measured up to what weconsider quality, are of decent size, have bright futureprospects, and are being offered at a discount to ourestimate of their intrinsic value. The exception to thisis Virtus Health Limited (ASX: VRT), the only recentfloat we have participated in.

This lack of attractive new IPOs may be about to shift.Over the past few weeks, we have been told toprepare for a number of new floats – with anestimated combined value of $11 billion. Many are setto arrive by the end of 2013, and these aresummarised below.

For context, so far this calendar year, new floats havetotalled approximately $1.1 billion. In 2012, that figurewas just $900 million. The last time the market sawan excess of $6 billion in value was just prior to theGFC.

We are actively looking for any opportunities in thislist of 28 names. To answer this, let’s start with somespeculation.

Firstly, we are inclined to eliminate companies thatare involved in exploration activities, given their highrisk/high reward dynamics. Explorers are generallycapital intensive businesses and our guess as towhether they will find something before their cashruns out is as good as anyone’s.

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Of the IPOs remaining, many are very small, and anumber are only marked as “possibilities”. Thatleaves Genworth Australia, ACM Group, OzForex,Pacific Retail, Fife Capital and McAleese Transport.

Whose best interest?

Before we dig a little deeper, it’s worth consideringsome words of wisdom from Warren Buffett. Heexpressed his cynicism towards IPOs thus: “It’salmost a mathematical impossibility to imagine that,out of the thousands of things for sale on a given day,the most attractively priced is the one being sold by aknowledgeable seller to a less-knowledgeablebuyer.”

We would tend to agree. In our experience, bymaking a decision to float, a business generally hasits own interests at heart, not yours. IPOs for Myer,iSelect and Collins Foods serve as recent warnings topotential investors that while floats can representgood opportunities, some of them can be detrimentalto your wealth if you do not understand what you arebuying.

The trick is not to get sucked into buying overpricedand over marketed companies that have questionableor less than inspiring growth projections.

By applying these basic principles, we can quicklyrule out Genworth Australia, Pacific Retail, FifeCapital and McAleese transport. That leaves ACMGroup and OzForex.

When considering ACM Group, it is worth reading anarticle we recently wrote on Credit Corp Limited here.We prefer to own the market leader if we can, and interms of Australian debt collection businesses, wewould consider ACM Group to be a tier two player.

For this reason, we would be unlikely to add ACMGroup to our portfolios. It may lead to portfolio“diworsification”, as by our measures, it would be alower quality investment opportunity.

The pick of the bunch

It’s clear therefore that OzForex is the standout inthis IPO float pack. Many market participants havealso marked this company, which focuses on foreign

exchange transactions, as of “white hot” interest.

If you have ever converted currencies or transferredmoney overseas, you may have been shocked todiscover how much you were charged by your friendlybank to move your money.

Recently, a friend of mine was preparing to transferAUD$200,000 overseas. I asked him if he would splitthe transaction into two lots, in order to try OzForex.

After signing up to their online platform, hetransferred AUD$100,000 through one of Australia’sbig four banks and the other AUD$100,000 throughOzForex.

The resulting conversions after fees wereUSD$90,500 and USD$93,500, via the bank andOzForex respectively.

That’s a $3,000 or 3% difference for the same simpleservice. I think I can guess which one my friend willbe using next time!

He came away from this experience “thoroughlyrecommending OzForex for a great rate, ease of useand secure platform”. He wondered why he had notlooked beyond the banks for currency conversionspreviously.

Over time, experiences like this and the resultingword of mouth may put pressure on large financialinstitutions to revise the exorbitant fees they charge.

OzForex spotted this opportunity back in the late1990s, and therefore has first mover-advantage.Since then it has grown to employ over 170 staff inSydney, London, Toronto, San Francisco, HongKong, and Auckland, and conducts 460,000 transferswith a combined value of $9.1 billion a year.

This business certainly floats our boat in terms of itsquality, brand awareness, size, and exciting growthoutlook.

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Perhaps the only issue is its pricing. On 21.7 timesforecast 2014 earnings per share, it is by all accountshot. If, however, the business is able to continuegrowing at 30% (as forecast in its prospectus) this PEmultiple will soon look attractive, and it’s certainlyone we think worthy of further investigation.

Important: This content has been prepared withouttaking account of the objectives, financial situation orneeds of any particular individual. It does notconstitute formal advice. Consider theappropriateness of the information in regards to yourcircumstances.

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Buy, Sell, Hold – what the brokers say

by Penny Pryor

It’s been a slow start to the week for brokers, butmost of the movement was on the positive side of theequation as analysts acted after companyannouncements, such as Macquarie Group’s outlookupdate.

In the good books

JP Morgan upgraded SP Ausnet (SPN) to Overweightfrom Neutral. Declines have been exacerbated by amild winter but SP AusNet’s transmission revenueremains unaffected by demand. Moreover, higherbond rates look set to improve regulatory returns fromthe Victorian electricity transmission.

Deutsche Bank upgraded Pharmaxis (PXS) to Holdfrom Sell. The company is facing considerablechallenges including slow sales and the risk thatcompeting therapies could reduce the marketopportunity. Deutsche Bank has scaled back salesexpectations in Europe and removed further US salesestimates and expected trial costs. It now thinks thestock is trading near fair value.

Citi upgraded Resolute Mining (RSG) to Buy fromSell. Citi has upgraded gold price forecasts andearnings across the sector and, as a result, Resolutehas been upgraded to Buy from Sell and the pricetarget is raised to $1.00 from 80 cents.

JP Morgan upgraded Macquarie Group (MQG) toNeutral from Underweight as four other brokers leftratings on hold, (two neutrals and two outperforms oroverweights) following an outlook update on Mondaythat suggests first half earnings will be in line with thelast half, and second half earnings will be better.

In the not-so-good books

Deustche Bank downgraded Cochlear (COH) to Sellfrom Hold. Cochlear missed out on the important

Chinese government tender and Deutsche Bankthinks this is a symptom of the increased competition.

The above was compiled from reports on theFNArena database, which tabulates the views of eightmajor Australian and international stock brokers:BA-Merrill Lynch, CIMB, Citi, Credit Suisse, DeutscheBank, JP Morgan, Macquarie and UBS.

Important: This content has been prepared withouttaking account of the objectives, financial situation orneeds of any particular individual. It does notconstitute formal advice. Consider theappropriateness of the information in regards to yourcircumstances.

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My SMSFby Peter Burgess

Name: Peter BurgessAge: 47Other members of the SMSF: My wife

How long have you had your SMSF?

My wife and I established a small APRA fund (SAF) in2005 and we are currently in the process ofconverting the fund to an SMSF and appointingCavendish as the administration manager.

Why did you start it up?

We wanted to invest in a broader range of listed andunlisted investments including some smaller capstocks, which are not typically available in otherfunds. We also wanted to feel more in touch with oursuper and be able to engage directly with ourinvestment adviser. We opted for a SAF as we weretime poor but wanted a structure that could provideSMSF-like features without the need to take on therole of a super fund trustee.

For cost reasons, as well as now having more time onour hands to manage the fund, we are nowconverting our fund to an SMSF.

How big is it?

Around $300,000

Is it more or less difficult to manage than youthought it would be?

I would say less difficult.

Do you enjoy managing it?

Yes, we enjoy being able to engage directly with ourinvestment adviser. We also enjoy the investmenttransparency of having our own fund. We know

exactly where our super is invested at all times.

Are you pleased with its performance?

Overall, yes. Given our growth investment strategy,and our relative over exposure to speculative stocks,our fund performed poorly during the GFC but hasrecovered reasonably well over the past few years.

Can you give us some numbers aroundperformance over the last one, three and fiveyears?

It has pretty much been in line with the performanceof the All Ords index over those periods.

What is your asset allocation?

Currently, around 60% of our fund is invested in listedAustralian equities, 10% in international shares, 30%in cash and fixed income.

What investments do you have outside ofsuperannuation?

A few investment properties.

Do you use an advisor or any kind of serviceprovider?

Investment adviser/stockbroker.

Important: This content has been prepared withouttaking account of the objectives, financial situation orneeds of any particular individual. It does notconstitute formal advice. Consider theappropriateness of the information in regards to yourcircumstances.

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The Fed spells it out - ignore political risk at your

peril

by Gavin Madson

Political risk will continue to come to the fore inmarkets this week, with “midnight Monday” (the endof September) looming. In this recent bull run, somemarkets have continued to ignore the underling risksto their peril. Here we look at the (very) short-termrisk and what the Fed is telling us.

Recently, the Federal Open Markets Committee ofthe US Federal Reserve Board (FOMC) highlightedthe prospect of political risk as well as its continueddampening of growth expectations, which are beingpriced into markets. Investors should take note.

In many ways, the decision by the FOMC to delaytapering took a lot of courage. Generally, the FOMCand their expectations remain in the middle groundbetween a financial market that remains wildlyoptimistic, in terms of growth expectations, andeconomic reality, which just keeps failing to live up tothese expectations.

The FOMC refrained from tapering for three mainreasons:

1. Growth and unemployment are “yet toprovide sufficient confirmation” that thebaseline assumptions about growth,unemployment, and inflation will be hit.

2. The “rapid tightening of fiscal conditions”threatens the baseline forecasts, whichmeans that higher longer-term interest ratesare crimping growth in the housing market,among other markets.

3. The debt ceiling debate may impactperceptions about baseline forecasts as well.

While the market wants certainty on the issue oftapering, the fact is that there is no certainty.Economic recovery remains fragile, and the return to“normality” is far from assured. In terms of futureexpectations, we expect more of the same; current

growth estimates will fall yet again in December, andcurrent expectations of tightening should bemoderated again and pushed further into 2016 from2015.

Political risk to the fore

In the press conference accompanying the continuedQE path, Chairman Bernanke noted two hurdlesarising from domestic political risk:

1. The government appropriations approval thatneeds to be approved before midnight onSeptember 30.

2. There is the debt ceiling issue that needs tobe approved by mid to late October.

The main issue remains what the Republicans referto as “ObamaCare”, where Republicans do not wantthe reform to be implemented, nor funded by the USgovernment, or both. This leads to either a shutdown, or threat of a shut down, of the USgovernment. The same threat in 2011 had asignificant effect on the US equity market andmarkets will increasingly prepare (i.e. sell off) inpreparation for a similar threat heading into nextweek. The threat of the shut down impacts themarkets perceptions of growth, and it is for thisreason that the FOMC mentioned it. The FOMCofficials rarely waste time by mentioning irrelevantfacts.

Summers out, Yellen to the fore

The other big news from the Fed has been thewithdrawal of Larry Summers from the running fornext Federal Reserve Chairman, which has pushedJanet Yellen to the fore as the most likely candidate.This is of interest as Yellen has a far more pessimisticview of the US recovery than Summers. Summers’withdrawal saw Australian 10-year bond prices jump

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(lower yields).

Yellen has consistently pointed to the lower housingcontribution to the current ‘recovery’ and thestubbornly high unemployment rates as a concern.

Conclusion

The Fed believes growth is slower than the marketsare factoring in, and political risk remains present,and undervalued.

Important: This content has been prepared withouttaking account of the objectives, financial situation orneeds of any particular individual. It does notconstitute formal advice. Consider theappropriateness of the information in regards to yourcircumstances.

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Watch out for SMSF focus in Abbott review

by Tony Negline

At some time in the next 12 months, the AbbottGovernment will announce a review into the financialservices industry. It may be that the review’s terms ofreference will give it scope to look at how SMSFs areregulated and decide that some changes should bemade.

Unless the ATO significantly alters its approach toregulating the super laws, I believe that at this point intime moving away from the Tax Office would bemaking change for change’s sake.

Everyone involved in SMSFs should keep a close eyeon the new inquiry into financial services. You’d beamazed how important changes can happenaccidentally, particularly given recent noise made byone of the regulators – the Australian Securities andInvestments Commission (ASIC).

ASIC research

ASIC recently released another paper about theSMSF sector, which sends a clear and unambiguoussignal that it intends to be involved in the regulation ofself managed funds.

At present, ASIC’s role is limited to regulating thegatekeepers – that is, anyone who recommends aninvestor uses an SMSF or invests SMSF money inparticular financial products such as insurance,shares and managed funds.

Under the super laws, APRA’s job is to be aprudential regulator. That is, its job is to make sureinvestors’ money is as safe as possible. Its job is notto provide 100% guaranteed protection but to put inplace systems and processes to minimise thepotential for loss.

The Tax Office’s regulatory job under the super lawsisn’t to be a prudential regulator but to make sure

SMSF trustees adhere to all the various super lawsand regulations.

From time to time, there is discussion about whetherthe ATO should be the SMSF regulator as well as thetax collector. The concern about the ATO’s potentialconflict of interest between its super lawresponsibilities and its tax collection obligationsassumes ATO personnel will always prioritisecollecting tax rather than giving equal weight to bothlegislative responsibilities.

In the 14 years that the ATO has been regulator ofSMSFs, I have rarely seen any actual justification forthis negative view.

Those who believe the Tax Office is conflictedspeculate about whether we need a specific SMSFregulator or perhaps ASIC should take over the job.

ASIC’s interest in the SMSF sector stems from theTrio saga that saw many Australian investors –including a small number of SMSF investors – losemoney because of fraud.

ASIC has reviewed how well licensed financialplanners provide advice when recommendingSMSFs. Overall they found there’s room for a greatdeal of improvement.

It also now conducts fit and proper assessments onSMSF auditors and holds a register of all the auditorsit has issued an SMSF auditor number (or SAN) to.Each year your fund needs to formally appoint anSMSF auditor. From 1 July 2013, you can onlyappoint auditors who have an SAN. I suggest youcheck the ASIC SAN register on its website – www.asic.gov.au. (At the moment, you need tosearch for the full name of the auditor to make thesearch engine work correctly.)

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ASIC’s SMSF cost research

Earlier this year, ASIC commissioned an actuarialfirm (Rice Warner) to research the costs of runningSMSFs. This is designed to help prospective SMSFinvestors work out if an SMSF will be cheaper thanother super funds. And as Paul Rickard found onMonday, most SMSFs do a lot better than themainstream funds.

But I think the ASIC paper is really useful for adifferent reason. I compared the costs we pay to runour SMSF with what’s available in the marketplace.I’m pleased to say I’m happy that my costs are verylow!

I’m glad I did this work because it confirmed what Iexpected.

I suggest all existing SMSF investors should use thisdocument in the same way.

Important: This content has been prepared withouttaking account of the objectives, financial situation orneeds of any particular individual. It does notconstitute formal advice. Consider theappropriateness of the information in regards to yourcircumstances.

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Changes to new contribution rules mean diligence

by Grant Abbott

In 2007, the government made superannuationwithdrawals after age 60 free from tax (what a greatbenefit that has been to all self-funded retirees).However, it also limited the amount of contributionsthat could be made into a super fund.

Briefly, the types of contributions and the rules thatapplied to contributions made pre 30 June 2013 were:

i) Concessional contributions

These are contributions made by an employerincluding super guarantee contributions and salarysacrifice contributions, where the employee divertstheir salary from the PAYG tax net intosuperannuation. It also includes contributions madeby self-employed persons, business owners using afamily trust who are not employed but rely on trustdistributions for income, and retirees who are able tocontribute and seek to claim a tax deduction on theircontributions.

All concessional contributions are included in thefund’s assessable income and after setting offagainst any deductions, taxed at a rate of 15%. Taxpayable can be reduced by rebates, such asimputation credits.

There is a cap on the amount of concessionalcontributions that may be made by a member. As at30 June 2013, the concessional contributions cap formembers is $25,000 – a decrease from a $50,000cap some years earlier. Any concessionalcontribution in excess of $25,000 becomes an“excess concessional contribution” (ECC).

Prior to 30 June 2013, any ECC was taxed at a rateof 31.5%. With the potential of a 15% tax onconcessional contributions inside the fund – the totaltax payable was 46.5% – a real deterrent forexceeding the caps except for those earning income

above the top marginal tax rate – equal to $180,000plus for an income year.

ii) Non-concessional contributions

These are contributions made by an individual or onbehalf of a spouse where no tax deduction is claimed.

A non-concessional contribution of up to $150,000may be made in any year. Any amount in excess ofthis will be an excess non-concessional contribution(ENCC).

However, there is also the ability to use a three-yearrule, where non-concessional contributions of$450,000 may be made over a three-year period –including $450,000 in year one. Any amount over$450,000 in the three-year period is an ENCC. Thethree-year rule only applies to members under theage of 65. Excess concessional contributions are alsonon-concessional contributions.

For an ENCC, the excess tax rate is 46.5%.

New concessional contribution rules – Post 30June 2013

The old ECC tax of 31.5% has been abolished from 1July 2013. In its place, a member will have theirexcess concessional contributions taxed at theirmarginal tax rate.

For example, Terry is on a salary package of$105,000 with a marginal tax rate of 38.5% (includingMedicare Levy). He has a concessional contributionscap of $25,000 for the 2013-14 financial year. Hisconcessional contributions for the financial year,inclusive of super guarantee and salary sacrifice fromhis employer, total $50,000.

As a result, his salary package is reduced to $55,000

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for PAYG purposes, an effective 34.0% marginal taxrate. However, after he receives his assessment, all$25,000 of the excess concessional contributions areincluded in Terry’s assessable income for 2013-14.This ensures that they are taxed at his marginal taxrate.

The tax payable on the $25,000 of ECC will be$8,500, however Terry is also entitled to a tax offsetequal to 15% of his excess concessionalcontributions for tax paid by the fund on theconcessional contribution — $3,750. As a result, Terrywill pay tax on the excess concessional contributionof $4,750 – an effective marginal tax rate of 19.0%.

Some more important points

In transferring pre-tax salary into superannuation andoutside of the PAYG system, there is a timeadvantage when it comes to paying tax. In recognitionof this, an excess concessional contributions chargeis also being introduced. This charge is effectively aninterest cost on the tax payable on the excesscontributions, and is currently set at a rate of 5.7%per annum.

Finally, the ECC tax at marginal tax rates plus theECC charge will be assessed to the individual.However, the individual may elect to have up to 85%of any excess concessional contributions releasedfrom the superannuation fund to assist in paying theEEC tax and the ECC charge.

Important: This content has been prepared withouttaking account of the objectives, financial situation orneeds of any particular individual. It does notconstitute formal advice. Consider theappropriateness of the information in regards to yourcircumstances.

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Question of the week – Gold stock speculation

by Questions of the Week

Question: My financial advisor has purchased sharesin Linc Energy and Northern Star Resources for meon behalf of my SMSF. To date both stocks areshowing a loss on paper. I would appreciate yourthoughts on these stocks.

Answer (By Paul Rickard): They are “interestingstocks” for an SMSF portfolio – so I hope that theyare part of a more diversified portfolio and consistentwith your investment objectives. If they are not, get anew adviser.

I don’t like gold, so only in exceptional circumstanceswould I contemplate buying a second tier goldproducer. Northern Star is not well covered by theanalysts – Macquarie recently instigated research onit, rating Northern Star as an “outperform” with a

target price of $0.93. This is not that far from itscurrent price of $0.86 – although a fair way from its52-week high of $1.53. The company is forecasting togenerate net cash this year, and pay a fully frankeddividend of 3.5cents – so maybe this puts a floor onthe price.

None of the major brokers research Linc Energy –which says something about the stock. I also can’tshed any light, apart from noting that it is prettyvolatile. It is certainly in the ‘speculative’ category.

Important: This content has been prepared withouttaking account of the objectives, financial situation orneeds of any particular individual. It does notconstitute formal advice. Consider theappropriateness of the information in regards to yourcircumstances.

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Did you know?

This week, Paul Rickard and I got together for another Super Sessions, where we discussed important issuessuch as how long this bull market has got to go and what might change under an Abbott Government. 'Bubbles'also got a mention. Watch it here.