Can you please comment whether, in your opinion, TRP is a hold or sell ?
Will you recommend averaging down at this level ?
Will also appreciate any comments on the sustainability of the dividend.
Looking at the insider buying/selling information of my discount broker I do not see any substantial ownership by senior management. Can you confirm this ?
Please deduct as many credits as necessary.
Thanks
TRP has some challenges, including cost overruns and higher interest rates. Sentiment is weak. It is not exciting right now, and it may take a while for a recovery. But its issues are not fatal, and its valuation reflects a lot of concern already. At 11X earnings with a dividend approaching 8%, we see it more as a HOLD now than a sell. We do not like averaging down and would not suggest that. In the last 12 months operating cash flow was $7.3B and dividends were $2.8B. There is still a good cash flow cushion on the dividend and we do not think it is in jeopardy anytime soon. Insiders own less than 1% of the company, but it is a $48B entity. There has been net insider buying in the last six months. Lower interest rates would help the stock a lot, we think.