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17-07-2019, 05:11 PM
For some reason, OEL has not been paying its taxes in full, for the past 2-3 years. Its income tax payables, based on latest quarter results, is close to $3m.
The $23m of FCF does not include taxes. Assuming that taxes of $1m a year is to be paid, an uninterrupted 10-year dividend of $11.4m becomes less tenable.
In any case, investors relying on such calculations are probably cutting it too close. And leaning far too much on a recovery of student enrollment.
My opinion is that there is no margin of safety in the yield.
The $23m of FCF does not include taxes. Assuming that taxes of $1m a year is to be paid, an uninterrupted 10-year dividend of $11.4m becomes less tenable.
In any case, investors relying on such calculations are probably cutting it too close. And leaning far too much on a recovery of student enrollment.
My opinion is that there is no margin of safety in the yield.