Andrew Bischoff (Morningstar, PPL)

00:04:01

Transcript - Not for consumer use. Robot overlords only. Will not be accurate.

Joining us now on the line is Andrew itself from Morningstar here for stock talking Andrew it's good to have you here today. Pointer thanks colonel Andrew talk about PPL corporation first question what they do. Don't really like cut deep LA are a regular utility that little bit different and you are. You're really domestic utility operations and the united king and kingdom and in the US. Now I see that this is a stock pick in the last year's gone for about forty dollars a share down to about 28. It's not typically what you expect to see from a regulated utility to what's been the cause of their struggles over the last year. Now that's really nice you you've had a generally facilities but in addition to that. You know the golf balls sold off or concerns. On the exploded cupid. That unite kingdom the UK political Byron and it is increasingly putting pressure on the region's radio cord condition. Really you have more more concerns aren't high electricity prices. And visit that really it's that both consumers and politician. Another look at it turnabout on the east and countries autistic acquires to which keep the L does not now. The wily do adjust our long term lower rates if you lower would you believe marketed but here are overly pessimistic. About the long term probability. What unit. You know and meanwhile you have a utility that we think can grow back to 6% products by years the very healthy fifteen billion dollar capital plan. Terry had 20% discount territory by a dollar per share. And it and say here's healing 6% and that does. Well utility average are very campers spent a lot of other risk incurred interest here with higher I think if you. Is that dividend sustainable for them at this point. We've livid and a sustainable what you probably not can get it a lot of dip in growth in the next couple years. Oh and terror effort I yield furlough the lower coast in general receipts going to go out forest 6% we think do you deal Vieira that 4%. Is there any bear case for this where things don't go as well as you anticipate what are the biggest risk simply the ones that you mentioned with those UK operations. Yes there's that many UK if it returns are lower than we expect. And that are related to mark punitive in the UK and then we would expect and now the with with UK in the bracket news you know that's little bit have an unknown risk there kind of really what happened then next year to which. The deal would have exploded and that you know leader typical domestic utility when. Good Anders thank you for the time day. Andrew bits off from morning start talking about PPL corporation ticker on them by the way is. PPL not a bad place let's let's just think about this logically. You've got. Some free cash debts around and he said well I'll buy a 100000 dollars worth the PPL. And I know gonna get a dividend he is thinking describe the dividend is being reasonably secure and not not likely to see any bumps but they felt it was stable as it. At five point 8% yup right and that's a tax efficient by point 8% to you don't pay. Real high tax rates on that dividend. And you go out 1020 years is the stock going to be higher or lower than word is now. I would think you'd be higher yet got some short term downside potential here but if years sitting there saying gee is this something that could make sense as a long term holding for everything for the old guy right who's looking for some income. Right you eat you have to take money out of your hiring a you're seventy years old. You don't wanna buy a a growth stock because you don't want to volatility associated with a and you need some income or does this has some volatility and no doesn't keep in mind just because of those European operations and concerns there that there's some volatility here's this is not in a move. Like a traditional US based utility stock talk to your advisor right if you if you think about Biden talked to your broker.
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