Q: I see you have just added HME to your income portfolio. I have held it for a couple of years, and it pays a good dividend of about 8% including the semi annual special dividends. The stock price didn't do much until it spiked up on Sept 18, and it has been inching upward since then, now about 15% higher than 3 months ago. Do you have any idea what has caused the recent increase in the stock price? Do you think it could be a target for a takeover?
5i Research Answer:
We like the stock and it is very cheap, in addition to its nice yield. There was no specific news for the September spike. Its valuation makes it attractive to others, but with insiders owning 17% and the current valuation we highly doubt management would be willing to sell at anywhere near current levels.