Proxy and Proposal No. 7, Incr. Common shares from 225K to 450K.
In the text "for reasons for the proposed amendment" OGE said a split would be considered at the May 16 board meeting. Later they said that the split would not be considered at this time. Sort of confusing.
Generally I am neutral on splits; however, the stock has now traded over 71 for three days in a row and it is getting a little pricey for a utility, where a pretty decent percent of the owners are not institutions. I know Colgate is splitting there stock and the reason given was to make the actual price (as opposed to the value) more attractive to individual shareholders.
I live in Indiana, but i am guessing that a lot of folks in Oklahoma own this equity and gives the company a base of investors who I would think like the company. Splits have been pretty rare since 2000 due to this long secular bear market. Commodity prices have been easing of late and not just due to demand falling. Could be the signal for a new secular bull market in stocks. Something to keep an eye on.
Yes I noticed this proposal on the ballot. If I recall correctly, OGE had a similar proposal 2-3 years ago that was discussed here on the board when it was in high 40s, low 50s. The end result was to satisfy employee stock plans? Or to issue shares for any potential deal making plans. In either case, the argument for a spilt can be made. I personally would like to see more dividend growth. The yield on original money from 11/05 is only 6.21% and currently 2.32%. Yahoo has a payout ratio of 44%. Should be more like 60%.
You can buy CL today and get the same yield that OGE pays. 2.3%
As far as the dividend, maybe something will happen after the Centerpoint MLP. As the company is currently configured, there have been some earnings issues with midstream due to ethane rejection. Although it does not effect % of revenue the dividend yield has been driven down by the expectations generated by this new JV. I hope they continue to see themselves as a utility and up the payout based on a utility with predictable earnings. I also own WEC, which also had a low payout ratio for many years. WEC over a 2 - 3 year period is raising their % payout to about 65%.