Q: I trimmed PNG in early Jan. and added to HME thinking I would increase my dividends. With the increase in oil prices HME has run up to be a 5% position. I have been trying to figure out what to do take the quick gains and trim the recent add or hang in there for the dividends as I first thought with the belief that after the war is over the capital gain will shrink on its own. I see HME has announced another special dividend. Not looking for personnel advise but your thoughts of the different options.
5i Research Answer:
We like HME but it is quite small, and as noted, cyclical. We cannot comment on position sizes but think 5% should be a cap for such a name. The stock is now up 72% in the past year.