Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
NIC reported the following – completion of $US150million issuance of senior unsecured notes. What does this mean? Why is the share price of this company struggling when the nickel price is reasonably high?
Thanking you
Indran
Hi Indran,
NIC simply issued debt to run their business, in this case at the relatively high interest rate of 6.5% via a bond offer because the money is unsecured. The stock has recently been under pressure because when they reported their 1H21 earnings they showed a big escalation in costs pushing down profit. High coal & energy prices are an issue for NIC. However I would point out that the stock has enjoyed a phenomenal run over the last 18-months and its performance is relative depending on the time frame considered. At this stage the $1 area is providing excellent support.
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