Q: If natural gas averages $2 for the entirety of 2024, could $pne choice there almost 10% dividend?
5i Research Answer:
At last quater PNE has $50M cash, and payout ratio was less than 60%. But, we think if gas goes below $2 the company would still very much consider cutting the dividend to be conservative. We have seen other gas companies cut already (BIR). It has lost money in past cycles and would likely take the conservative approach here. It may not HAVE to cut, but still might to ensure a more-solid financial outlook for the next cycle.