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Strategies & Market Trends : Value Investing

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To: Grommit who wrote (56546)	1/3/2016 10:35:44 PM
From: Spekulatius	Read Replies (1) of 78774

Re SE - I think that SE is undervalued as a going concern. I am not sure it is undervalued based in the NAV of the current assets. SE has a huge backlog of projects where they can invest capital in FERC approved projects with a 12% cash yield unlevered. When those projects are executed on budged and financed with 50% equity and 50% debt at let's say 5-6% interest, then the returns for the incremental investment should be rather satisfactory. This means that SE should be able to grow their dividend for the foreseeable future in the mid to high single digits for at least 5 years and most likely longer, if they can add to the current backlog. That is how I see SE currently - I think it is a bit more like a GAARP stock than a value stock, even though the lines between the two are a bit blurry.

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