CLO 0.00% $1.46 clough limited

Thoughts on Clough

  1. 708 Posts.
    CLO's share price seems to have stabilized, with quite a few buyers appearing around 50c. Also, the selling seems to have eased a bit.

    This is a profitable company and has a history of both solid profits and dividends. (I've also written a bit about the industry in which it operates and the cyclical low it is in atm). So it possible to take a longer-term approach to CLO, which might show it up as rather undervalued at these prices. For example, if CLO manages to sustain its dividend at the rate it has during the last 5 years (at 4.5-5cps), patient investors should return about half of their investment from dividends alone during the next 5 years.

    The thing that worries me about CLO is that during this period (last 5yrs), revenues have doubled and more and yet net profit has gone sideways (and now down). Are there more nasty, structural things wrong with CLO and why aren't they focused on the bottom line? Harold Clough suggested, in a recent newspaper article, that after years of being a private company, it is difficult to get management thinking about maximising net profits instead of minimising them for tax reasons.

    Any thoughts about Clough as a possible long term investment?

    J.
 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.