Thursday, June 19, 2014

PGG Wrightson purchased

This morning I added shares in PGG Wrightson (NZX: PGW) to the portfolio. PGW is one of New Zealand's leading suppliers of products to the rural economy. Given the increasing demand for agricultural and dairy products, the company should have reasonably secure long term prospects. The negative is the gearing ration which, at around 50% debt to equity (slightly unclear due to a recent acquisition of some real estate) is a bit higher than I am genuinely comfortable with. The trailing yield is 7.3%.

I paid NZD0.41 per share.


Troy said...

I bought a few of these this month as well. The share price seems to have largely stabilised and the yield is hard to ignore compared to bank term deposit rates in NZ.

I hadn't really considered the debt but the price guidance out today suggests that earnings will be higher than forecast. Always a good thing.

traineeinvestor said...

Hi Troy

Thanks for dropping by.

Yes - the guidance was good so I am reasonably optimistic despite the debt and despite the competition from the co-op.