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Hawaiian Electric Industries Inc. Message Board

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  • igurumo igurumo Apr 2, 2006 9:00 AM Flag

    HE vs the Interest rate skeptics

    hei4me: I guess we must agree to disagree. I do not disagree that holding a utility (yes, even with a bank subsidiary) will work out fine. Rising interest rates are a NEGATIVE for BOTH utilities (money goes elsewhere) and banks (margin on loans outstanding declines). DECLINING interest rates are a positive to both utilities and banks. My agrument is this: Do be invested in utilities and banks during flat or declining interest rates and be OUT of utilities and banks during periods of rising rates. It will payoff a great majority of the time. In other words, you would have done MUCH better had you been OUT of HE for the past year (actually two years because the market was anticipating higher rates). The market indexs are making multi year highs now. HE has been flat for two years. I love HE as a holding and will buy it as soon as I think rates will be turning down. I know when to be in and when to be out. It has worked for me for years. HEi4me, I wish we could set down sometime and have a cup of that good Kona Coffee you have in Hawaii. You are a good thinker (except on this issue). Have a good day in paradise. Wish I was over there now.

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    • One last time a stock such as HE is not a stock that is in play like you would have everyone to believe. it is a buy and hold stock that generates revenue for you even if it is falling on the growth side. That is why income funds buy and hold HE to generate income for their funds not to see spectacular growth.

      One other point if you follow Cramer then HE would be a dog since, like you have pointed out it has underperformed for the last two years but that is due of course to the higher than normal gains of the early 2005, I do not follow Cramers late advice to the general public and I would not follow your advice since for the time you have been here, since all this time we have discussed HE not once have you mentioned taking that same two year period you would have on top of HE performance recieved $2.48 in addition to what ever the stock price is today meaning instead of being at todays price it would with dividend be close to or over its historical high. if you go back even further and add dividends for 10 yrs price you would have a stock price close to $40 this may not sound like much to some but taking the split out that occured a some years ago that $40 changes to $80 a share so infact HE has been a good foundation income stock for me.

      Igurumo, if you feel the need to be a stock analist why not try another stock such as AMD where those investors live or die on every word that has to do with the correct timing of buy and sell.

      Of course you would leave out the tremendouse housing boom that was created in Hawaii bringing tons of revenue for ASB in your analyzing and the fact that ASB net revenue almost matches the Utility side. Good grief man How did ASB catch up to the utilities if they wher not makin money during this time period?

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