Share tips thread (Vol 2)

[g4ry13]

Anyone in Tesco shares?

I got an email from HL that Tesco are going to pay a one off special dividend of 50.93p for each share held at the end of 12 February 2021.

However, as the price usually drops after a dividend payment, Tesco want to reduce the number of shares every shareholder owns. Shareholders will get 15 new shares for every 19 shares held.

Financially, the shareholders are no better off with this deal. In fact, worse?

Yes, the shares will be slightly more scarce but really will be no better off going along with this?

Edited by g4ry13 on Thursday 28th January 17:31

[bad company]

g4ry13 said:

Anyone in Tesco shares?

I got an email from HL that Tesco are going to pay a one off special dividend of 50.93p for each share held at the end of 12 February 2021.

However, as the price usually drops after a dividend payment, Tesco want to reduce the number of shares every shareholder owns. Shareholders will get 15 new shares for every 19 shares held.

Financially, the shareholders are no better off with this deal.

Yes, the shares will be slightly more scarce but really will be no better off going along with this?

Tesco returns £4.99bn to shareholders

Following on from the disposal of its shareholding in Tesco Stores (Thailand) Limited and Tesco Stores (Malaysia) Sdn Bhd, Tesco (TSCO) has confirmed that it will return £4.99bn to shareholders through a special dividend of 50.93p per ordinary share. It will be payable to shareholders on the register at 12 February 2021, and to ADR holders on the register as at 5.00 p.m. (New York time) on the same day.

The one-off payment will be accompanied by a consolidation of the group’s ordinary share capital on the basis of 15 new ordinary shares (with nominal value of 6 1/3 pence) for every 19 existing shares. This will reduce the number of shares in issue by approximately the same proportion of market capitalisation returned via the special dividend, therefore the market price of each share should remain at a broadly similar level following the pay-out and share consolidation. MR

[g4ry13]

bad company said:

g4ry13 said:

Anyone in Tesco shares?

I got an email from HL that Tesco are going to pay a one off special dividend of 50.93p for each share held at the end of 12 February 2021.

However, as the price usually drops after a dividend payment, Tesco want to reduce the number of shares every shareholder owns. Shareholders will get 15 new shares for every 19 shares held.

Financially, the shareholders are no better off with this deal.

Yes, the shares will be slightly more scarce but really will be no better off going along with this?

Tesco returns £4.99bn to shareholders

Following on from the disposal of its shareholding in Tesco Stores (Thailand) Limited and Tesco Stores (Malaysia) Sdn Bhd, Tesco (TSCO) has confirmed that it will return £4.99bn to shareholders through a special dividend of 50.93p per ordinary share. It will be payable to shareholders on the register at 12 February 2021, and to ADR holders on the register as at 5.00 p.m. (New York time) on the same day.

The one-off payment will be accompanied by a consolidation of the group’s ordinary share capital on the basis of 15 new ordinary shares (with nominal value of 6 1/3 pence) for every 19 existing shares. This will reduce the number of shares in issue by approximately the same proportion of market capitalisation returned via the special dividend, therefore the market price of each share should remain at a broadly similar level following the pay-out and share consolidation. MR

Yes. But i'm no better off.

In fact, worse from a tax perspective as the dividend will be taxable!

[bad company]

g4ry13 said:

Yes. But i'm no better off.

In fact, worse from a tax perspective as the dividend will be taxable!

I don’t understand. You’ll get the dividend which is obviously taxable but still income. Can’t see how the consolidation will make much difference to the value.

[g4ry13]

bad company said:

g4ry13 said:

Yes. But i'm no better off.

In fact, worse from a tax perspective as the dividend will be taxable!

I don’t understand. You’ll get the dividend which is obviously taxable but still income. Can’t see how the consolidation will make much difference to the value.

If share price increases then i'm eligible for capital gains. If i'm paid a dividend then that's no longer a capital gain and now eligible for income tax.

The price of the share may not have moved from where I initially purchased it but now that a dividend is being paid then i'm on the hook for income tax for any dividends over £2k

[vulture1]

g4ry13 said:

bad company said:

g4ry13 said:

Yes. But i'm no better off.

In fact, worse from a tax perspective as the dividend will be taxable!

I don’t understand. You’ll get the dividend which is obviously taxable but still income. Can’t see how the consolidation will make much difference to the value.

If share price increases then i'm eligible for capital gains. If i'm paid a dividend then that's no longer a capital gain and now eligible for income tax.

The price of the share may not have moved from where I initially purchased it but now that a dividend is being paid then i'm on the hook for income tax for any dividends over £2k

I'm trying to work out how this effects my says for the company, I dont get dividends in it as it isnt share yet just funds that can buy shares at the end of the period for a lesser price.

I think I will benefit as the dividend doesnt mean anything to me but the price being kept higher means I should get to buy the share at lesser price and there are less of them available to the market. is that right?

[Skyedriver]

Tesco:

Is there a reduced cost if you have a Clubcard?


I'll get my coat.....

[bad company]

Skyedriver said:

Tesco:

Is there a reduced cost if you have a Clubcard?


I'll get my coat.....

[ferrisbueller]

g4ry13 said:

bad company said:

g4ry13 said:

Yes. But i'm no better off.

In fact, worse from a tax perspective as the dividend will be taxable!

I don’t understand. You’ll get the dividend which is obviously taxable but still income. Can’t see how the consolidation will make much difference to the value.

If share price increases then i'm eligible for capital gains. If i'm paid a dividend then that's no longer a capital gain and now eligible for income tax.

The price of the share may not have moved from where I initially purchased it but now that a dividend is being paid then i'm on the hook for income tax for any dividends over £2k

I'd always assumed the special dividend would be a dividend.

[g4ry13]

Screw it....i'm voting against (even though it won't make a difference).

I've been meaning to sell anyway and will do so if they move up prior to this.

[JustinF]

g4ry13 said:

bad company said:

g4ry13 said:

Yes. But i'm no better off.

In fact, worse from a tax perspective as the dividend will be taxable!

I don’t understand. You’ll get the dividend which is obviously taxable but still income. Can’t see how the consolidation will make much difference to the value.

If share price increases then i'm eligible for capital gains. If i'm paid a dividend then that's no longer a capital gain and now eligible for income tax.

The price of the share may not have moved from where I initially purchased it but now that a dividend is being paid then i'm on the hook for income tax for any dividends over £2k

when the share price increases due to the 19:15 consolidation that will have 0 effect on your investment profit/loss, think about teslas recent stock split, it didn't change the value of people's investment, just divided it into more bits, people who owned whole pizzas now they own pizza slices, each comunsurate at the time of the split or consolidation to the original holding/slices.

If you're already over the 2k divedend extra allowance and it's taxable you'll stilll be seeing a profit less your income tax band.

[chinnyman]

Can anyone with a telegraph subscription tell us more about this stock?

https://www.londonstockexchange.com/stock/TLY/tota...


I saw it in Twitter. Apparently a profitable AIM company who delivers services to the NHS.

[eps]

chinnyman said:

Can anyone with a telegraph subscription tell us more about this stock?

https://www.londonstockexchange.com/stock/TLY/tota...


I saw it in Twitter. Apparently a profitable AIM company who delivers services to the NHS.

Check advfn - there will be some news on there and financials, all freely available and impartial + chat - mostly biased.

5 year chart looks interesting and...

It's up 7.5% today already.

AIM is always a funny one, most stocks on there have a tendency to move massively - take profits where you can! (see the 5 year chart for where it has come from and to)

This was announced https://uk.advfn.com/stock-market/london/totally-T...

Recent financials here - looks like a fund raising or injection of cash in the past couple of years.. https://uk.advfn.com/p.php?pid=financials&symb...

Edited by eps on Friday 29th January 08:57

[g4ry13]

JustinF said:

g4ry13 said:

bad company said:

g4ry13 said:

Yes. But i'm no better off.

In fact, worse from a tax perspective as the dividend will be taxable!

I don’t understand. You’ll get the dividend which is obviously taxable but still income. Can’t see how the consolidation will make much difference to the value.

If share price increases then i'm eligible for capital gains. If i'm paid a dividend then that's no longer a capital gain and now eligible for income tax.

The price of the share may not have moved from where I initially purchased it but now that a dividend is being paid then i'm on the hook for income tax for any dividends over £2k

when the share price increases due to the 19:15 consolidation that will have 0 effect on your investment profit/loss, think about teslas recent stock split, it didn't change the value of people's investment, just divided it into more bits, people who owned whole pizzas now they own pizza slices, each comunsurate at the time of the split or consolidation to the original holding/slices.

If you're already over the 2k divedend extra allowance and it's taxable you'll stilll be seeing a profit less your income tax band.

Without going into my finances too much, my portfolio does not generally yield £2k in dividends / year. With the "special dividend" I will be exceeding that £2k allowance by some margin. Whereas if the price increases then at least I have the CGT allowance and scope to write off previous losses against the gain. From a tax perspective: it's a bad deal for me.

[bad company]

g4ry13 said:

Without going into my finances too much, my portfolio does not generally yield £2k in dividends / year. With the "special dividend" I will be exceeding that £2k allowance by some margin. Whereas if the price increases then at least I have the CGT allowance and scope to write off previous losses against the gain. From a tax perspective: it's a bad deal for me.

There really is no pleasing some people.

You could sell the shares or give them to me.

Edited by bad company on Friday 29th January 10:32

[Chilly for June]

bad company said:

g4ry13 said:

Without going into my finances too much, my portfolio does not generally yield £2k in dividends / year. With the "special dividend" I will be exceeding that £2k allowance by some margin. Whereas if the price increases then at least I have the CGT allowance and scope to write off previous losses against the gain. From a tax perspective: it's a bad deal for me.

There really is no pleasing some people.

You could sell the shares or give them to me.

Edited by bad company on Friday 29th January 10:32

One for the first world problems thread....

[g4ry13]

bad company said:

g4ry13 said:

Without going into my finances too much, my portfolio does not generally yield £2k in dividends / year. With the "special dividend" I will be exceeding that £2k allowance by some margin. Whereas if the price increases then at least I have the CGT allowance and scope to write off previous losses against the gain. From a tax perspective: it's a bad deal for me.

There really is no pleasing some people.

You could sell the shares or give them to me.

Edited by bad company on Friday 29th January 10:32

Why should I be pleased though? I'm not going to be any better off even though next month i'm going to have £x thousand dumped into my trading account.

Selling the shares is what i'm leaning towards, i'm just waiting to see if £2.50-£2.60 is possible.

[ferrisbueller]

g4ry13 said:

bad company said:

g4ry13 said:

Without going into my finances too much, my portfolio does not generally yield £2k in dividends / year. With the "special dividend" I will be exceeding that £2k allowance by some margin. Whereas if the price increases then at least I have the CGT allowance and scope to write off previous losses against the gain. From a tax perspective: it's a bad deal for me.

There really is no pleasing some people.

You could sell the shares or give them to me.

Edited by bad company on Friday 29th January 10:32

Why should I be pleased though? I'm not going to be any better off even though next month i'm going to have £x thousand dumped into my trading account.

Selling the shares is what i'm leaning towards, i'm just waiting to see if £2.50-£2.60 is possible.

I don't understand this. You're going to be given 50p a share. You can't be taxed more than 50p. In fact, you can't be taxed more than 50%, can you?

[g4ry13]

ferrisbueller said:

g4ry13 said:

bad company said:

g4ry13 said:

Without going into my finances too much, my portfolio does not generally yield £2k in dividends / year. With the "special dividend" I will be exceeding that £2k allowance by some margin. Whereas if the price increases then at least I have the CGT allowance and scope to write off previous losses against the gain. From a tax perspective: it's a bad deal for me.

There really is no pleasing some people.

You could sell the shares or give them to me.

Edited by bad company on Friday 29th January 10:32

Why should I be pleased though? I'm not going to be any better off even though next month i'm going to have £x thousand dumped into my trading account.

Selling the shares is what i'm leaning towards, i'm just waiting to see if £2.50-£2.60 is possible.

I don't understand this. You're going to be given 50p a share. You can't be taxed more than 50p. In fact, you can't be taxed more than 50%, can you?

Given 50p/share but also losing 4 shares in the process.

Max income tax rate is 45% and fortunately (or unfortunately) that will not apply to me.

Either way, I have voted against this and had been intending to bail out of Tesco as the capital is wasted tied up in them. This just helps to make the decision a bit easier.

[ferrisbueller]

g4ry13 said:

ferrisbueller said:

g4ry13 said:

bad company said:

g4ry13 said:

Without going into my finances too much, my portfolio does not generally yield £2k in dividends / year. With the "special dividend" I will be exceeding that £2k allowance by some margin. Whereas if the price increases then at least I have the CGT allowance and scope to write off previous losses against the gain. From a tax perspective: it's a bad deal for me.

There really is no pleasing some people.

You could sell the shares or give them to me.

Edited by bad company on Friday 29th January 10:32

Why should I be pleased though? I'm not going to be any better off even though next month i'm going to have £x thousand dumped into my trading account.

Selling the shares is what i'm leaning towards, i'm just waiting to see if £2.50-£2.60 is possible.

I don't understand this. You're going to be given 50p a share. You can't be taxed more than 50p. In fact, you can't be taxed more than 50%, can you?

Given 50p/share but also losing 4 shares in the process.

Max income tax rate is 45% and fortunately (or unfortunately) that will not apply to me.

Either way, I have voted against this and had been intending to bail out of Tesco as the capital is wasted tied up in them. This just helps to make the decision a bit easier.

There's that window where they erode your allowance which makes it worse.

Div tax tops out at 38%

Once you're outside a tax wrapper and the allowance, I'm not sure I know how I could receive that dividend without paying tax whether it's in shares or cash. I'll gratefully receive the dividend and any advice on tax efficiency.