Hook Me Up to a Pengrowth DRIP
July 28th, 2007 by Grant in: Energy, Investing, Stock ThoughtsIt’s about time! The only thing making Pengrowth Energy Trust (PGH: chart, web, Yahoo!) less attractive than it’s competition was the lack of a dividend reinvestment program (DRIP).
Alas, no more. The company announced on July 25th that U.S. unitholders are now eligible to participate in the Pengrowth Distribution Reinvestment and Trust Unit Purchase Plan (the “DRIP”) which has been available to Canadian resident unitholders of Pengrowth Energy Trust since July of 1992.
But wait, it gets better!
“Pengrowth’s enhanced DRIP permits unitholders to elect to reinvest their cash distributions in additional trust units at a five percent discount to the weighted average closing price of the trust units on the Toronto Stock Exchange for each of the 20 trading days immediately preceding the cash distribution date. Additionally, unitholders may opt to purchase additional trust units for cash of up to Cdn $1000 (U.S. $900) per month under the same terms.” -Source
So your dividends are reinvested at a 5% discount to the weighted closing average over the last 20 days. Not bad!
I’ve held a ton of Provident Energy (PVX: chart, web, Yahoo!) in my retirement due to the DRIP policy, but it appears that PGH may have just played the trump card!
Currently, I’m bullish on natural gas prices, the dividend of these Canadian energy trusts looks attractive in a falling equities market, and the 5% discount on reinvested divies is the icing on the cake!
Let me know what you think.
Leave comments
Subscribe to Comments
Loading ...
July 30th, 2007 at 8:42 am
Grant,
I’ve followed this company for couple months now, and unfortunately didn’t invest at the $16 range. Although it still mystifies me how they can distribute more in dividends than they earn–unless they count the dividend as an operating cost?
Jonathan
August 9th, 2007 at 6:45 pm
Thanks for the stock. I researched it and I like it. I am going to start investing $50 a week.