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MIND C.T.I., Ltd. Message Board

  • incompetent98 incompetent98 Oct 26, 2010 12:02 PM Flag

    New Dividend

    Based on what was said today, does anyone have an idea as to what the dividend will be?
    Thanks,

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    • MNDO announced that the dividend should equal net profit. Net profit has been running $0.07 per quarter. So, $0.28 is a likely dividend. If net profit is higher in the upcoming quarterly report we could see a slightly higher dividend.

      Reasoning from the possible maximum, MNDO said they would seek court permission for a dividend of up to $6 million. Dividing this by 18.45 million shares gives $0.325 per share.

      So, the dividend should be in the range of 0.28 to $0.32 per share.

      WIN is in the telephone business. Its price rose so that it is paying 7.5%/year. Based on this, with a dividend of $0.30/year MNDO should sell for $4 per share. At $4 MNDO would be fully priced. Sure WIN is not in the same kind of telephone business as MNDO, but it is clear enough that $2.50/share for MNDO is a discount in the present stockmarket.

    • Incompetent98,

      You asked: 'Based on what was said today, does anyone have an idea as to what the dividend will be?'

      I read the (new) formula to be: Dividend = Max($6M, EBITDA + FinancialIncome - taxes)

      (From memory,) I think that EBITDA + FinancialIncome for the first 6 months was $2.7 million and taxes were marginal (less than $50,000.)

      Assuming that my recollection of these numbers is right, that the company can keep the same earnings clip in the remaining months, and that there is no escalation in taxes, then dividend could clock in at $5.3 million.

      If so, with 18.5 million shares outstanding (again from memory), the dividend could/would/should be in the range of $0.25 - $0.30 per share (or ~10% based on a per share price of $2.50 per share (which is where the share price should probably be from a value perspective, irrespective of the dividend announcement))

      If they blow the remaining quarters, we could be looking at a dividend of +$0.30 per share.

      Paid out dividend, of course, will be net of 20% (or so) taxes.

      Best,

      pajacobsen

      • 3 Replies to pajacobsen
      • Agree. It is very likely that 2011 dividend payment will be higher than current $0.20 level. However, the signal sent by this release is not the increasing of dividend, but the management believe the company has more than enough cash and they are eager to distribute it.

        From yesterday's release, there is another important number that the cash position at Sept. 30 is $19.6m Which indicates the Q3 cash flow is $3.1m(based on June 30 number $16.5m). We can reasonably expect Q3 is a good quarter. My guess of Q3 income be around $0.10-$0.15 per share. Plus Q1 and Q2 0.14 per share. This year is not bad for MNDO so far.

      • If it goes up and then falls again after the dividend, I will buy more then. This stock seems to have a pattern.

      • In my response to Incompetent98, referring to MNDO's management, I wrote: "If they blow the remaining quarters, we could be looking at a dividend of +$0.30 per share."

        By blow, I meant, of course, to refer to a situation where the management of MNDO surpasses or exceeds last quarters' numbers.

        Sorry about any inconvenience the lack of clarity may have caused.

        Best,

        pajacobsen

 
MNDO
2.37-0.03(-1.25%)Aug 1 3:53 PMEDT

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