Blogger Joe Monahan says,"An investor buying a share today would get a dividend yield of nearly 10%, clearly an unsustainable level. Cutting the dividend in half would give the company over $25 million in additional annual cash"
Whoa, Joe. The high dividend, actually closer to 8%, is a symptom of a bad Rx issued by the PSC, not the disease. Using Yahoo numbers for PNM and the average of diversified utilities(DU)- Div. PNM 8.01%, DU 3.71% P/B PNM .42, DU 2.82 P/S PNM .37 DU .85 P/E PNM 9.71 DU 17.2 If investors had more confidence in the New Mexico investment climate, PNM's Prices to book, sales and earnings would be more in line with other utilities and the dividend would fall in line. If other utilities were dealt the same blow by their states' PSC's, their dividends would also skyrocket.
Frankinvestor, Thank you for the local link. It sounds like Gov. Richardson is starting to drop hints. If there are any New Mexico commisioners reading this, I think that you would be happy finding real jobs in the private sector if you don't think want thriving prosperous utilities expanding their infrastuctures in New Mexico.
I used to work for a large regulatory commission. Few things got us moving off our normal routines, but one of them was a letter or call from the governor or legislature to look into things. Out commission was appointed, but the legislature and governor controlled the purse strings of the commission.
PSC commissioners have close ties to Gov. Richardson. These ties create a mess involving Gov. Richardson who is trying to keep his Hillary vice-presidential bid alive. Destroying the viability of his State's electrical infrastructure does nothing for a guy who wants to be seen as an energy expert.
PSC Chairperson Lujan was appointed by Governor Richardson to the New Mexico Telehealth Commission. Commissioner King has served in the Planning, General Services and Finance Secretary agencies of three gubernatorial cabinets. Commissioner Carol Sloan is working to increase and enhance the relationships between tribes in New Mexico, and the New Mexico Public Regulation Commission. Her first proposal on the Commission was a proclamation calling for stronger relationships at the government-to-government level, and tribal sovereignty. Current PSC Commission Chairperson Marks earned a B.A. in sociology from uber-liberal Reed College before becoming an attorney. The other Commissioner actually has ties to commerce. Learn more about these fine Commissioners at http://www.nmprc.state.nm.us/commissioner1.htm
Although these four commissioners are elected officials, Gov. Richardson will have to assert himself to remove the cloud now covering his energy policy credentials. Perhaps, he will use his influence to positively effect New Mexico's energy viability and PNM's stock price.