Up nearly $2, more that 20% in one day just because the Q4 dividend is a lot like what company guidance said it would be. I can't explain why the price was ever allowed to be under $10 in the first place, but here are a couple ideas:
- Any reliable operating company with a double digit yield in a stable country ought to be an interesting investment valued in accordance with its yield.
- World stock markets have been soft.
- Margin positions exist in all markets. As markets fall, there are margin calls, and margin calls force people to sell whatever they hold, good or bad. The same tides sink all the boats, both close to home and far away.
- Everything in the oil patch tends to get tarred with the same brush, regardless of the business situations involved.
- Many of these partnerships and high dividend stocks are a little hard to evaluate, and are therefore misunderstood by the investment community.
A company whose business is compressing invisible flammable gas, measures it's productivity in horsepower, and operates where most people don't know what they do or where they do it has a certain marketing problem with investors, who are easily stuck on more basic questions like "Why are you doing that?" and "With oil prices so low, won't you be out of business soon like all those other people?"
A friend once advised that everyone should put at least as much time into choosing to invest in a company as they would into buying a refrigerator. I keep thinking that's real good advice.