Both $EC and $CIB pay pretty good dividends and are very liquid on NYSE. The dividend can be a partial play of USD/COP exchange rate. As the top two stocks in Colombia, any significant capital inflow will likely push up stock price (along COP). However, the worry of recession is an overhang on EM in next few months.
Does $EC have a strategic attribute or some sort of catalyst? I like the idea but I don't want to go long for diversification sake.
If a portfolio manager says "buy Colombia", I assume CIB gets the inflows. But who's going to say buy Colombia before they say buy Brazil? Mexico is already on the move and Brazil seems ahead of Colombia. So maybe it's time but it's not an easy call.
I do not know any near term catalyst (which, by definition, is nearly always something unexpected). In the case of EC, the 2nd and 3rd installment of dividend of this year, to be paid in October and December, amounts to ~$0.923 each at the current USD/COP exchange rate of 4280. They give you a nearly 19% of yield if you hold it until December 20.
If Q2, Q3 and Q4 of 2023 work out similarly to Q1, the next year's dividend (which is based on 2023 performance) for EC is probably ~$1.5 per share. Since oil price in Q2 has been weaker than Q1, I guess a more realistic estimate is ~$1 dividend for next year. A total dividend of ~$2.85 (~29%) in next 18 months seems to be a pretty good deal to wait for a catalyst to occur.
Spot on post. Why own EC when you can be concentrated in PBR is my thinking.
Colombian banks and brazil oil is fun, just have to stomach the volatility
Both $EC and $CIB pay pretty good dividends and are very liquid on NYSE. The dividend can be a partial play of USD/COP exchange rate. As the top two stocks in Colombia, any significant capital inflow will likely push up stock price (along COP). However, the worry of recession is an overhang on EM in next few months.
Does $EC have a strategic attribute or some sort of catalyst? I like the idea but I don't want to go long for diversification sake.
If a portfolio manager says "buy Colombia", I assume CIB gets the inflows. But who's going to say buy Colombia before they say buy Brazil? Mexico is already on the move and Brazil seems ahead of Colombia. So maybe it's time but it's not an easy call.
I do not know any near term catalyst (which, by definition, is nearly always something unexpected). In the case of EC, the 2nd and 3rd installment of dividend of this year, to be paid in October and December, amounts to ~$0.923 each at the current USD/COP exchange rate of 4280. They give you a nearly 19% of yield if you hold it until December 20.
If Q2, Q3 and Q4 of 2023 work out similarly to Q1, the next year's dividend (which is based on 2023 performance) for EC is probably ~$1.5 per share. Since oil price in Q2 has been weaker than Q1, I guess a more realistic estimate is ~$1 dividend for next year. A total dividend of ~$2.85 (~29%) in next 18 months seems to be a pretty good deal to wait for a catalyst to occur.