Purchase – Vita Group [ASX:VTG]

By | April 22, 2017

This will only be a short post as I have been sick lately, hopefully I can kick this sickness and get back to proper health and top quality posts! 😉

I bought 497 shares of Vita Group. While the share price of this has been smashed lately by rumours of Telstra (Australia’s largest telco) taking back some of it’s stores, I still believe it is a quality stock at this price. Typically, Vita has traded a lot higher but a few bad rumours have been flying around which has sunken the share price. I’ll take a gamble on them because the management are solid, have been increasing the dividend since 2012 and at the current share price produces a fully franked (tax credits) of slightly over 11%. Now you can’t tell me that people wont jump all over this (2017 is lower as only one dividend has been paid so far).

vtg dividend

VTG Dividends per year – marketindex.com.au

Vita have also been increasing all their important stats, Revenue is up, underlying EBITDA is up and more importantly the dividend was increased. Lets hope they can maintain such a dividend.

vtg info

Vita Group LTD – 1H FY17 Results Presentation

I believe that the share price has already taken into the account that some of the stores have been taken back, but here is why I jumped on board! The agreement between Vita and Telstra doesn’t expire till 2020. I have 2 and a half years to decide what my next move with these are… possibly a free hold position if the share price increases, that way I get some shares and get my money back.

I hope the share price can start to make a reverse trend and start heading upwards and then produce some nice dividends also. It is a risk, but well worth the shot.

 

You can take a look at my PORTFOLIO HERE.

8 thoughts on “Purchase – Vita Group [ASX:VTG]

    1. Buy - Hold - Long Post author

      I definitely am betting against the grain here. The long run will determine who was right, hopefully it was me. Thanks for the comment Tristan.

      Reply
  1. Undergrad Investing

    Hopefully the gamble pays off for you. Could prove a valuable asset to your portfolio. Just a heads up as well, the google drive windows on your portfolio page looks to be down. Not sure if you knew

    Reply
    1. Buy - Hold - Long Post author

      Appreciate the comment. I am hoping that it does pay off. It is a risk but I see it as a low risk with the potential for a high reward. I did notice that last night. Working to get it back up and running. Cheers

      Reply
  2. Troy

    I don’t know much about Australian stocks, but how is Tesltra holding up against competition from Optus? I feel like more and more people are using Optus nowadays especially in the cities.

    Reply
    1. Buy - Hold - Long Post author

      Telstra has been smashed lately. There is fierce competition and with the new NBN it will only get harder. For some places (like where I live) there aren’t many options other than Telstra. It just doesn’t make sense for Optus or the other carriers to try to compete.

      Reply

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