Thoughts on buying APA group Ltd (APA)
Hi MM, I've been considering APA for awhile. With the share price down is now a good time to buy or is it better to wait for further clarity on pending decisions? Thanks Trish
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Answer
Hi Trish,
We believe APA is great value below $7 but unfortunately we have been too early to this particular party through 2024 – we hold APA in both our Active Growth and Active Income Portfolios.
On a current yield above 8% which is underpinned by a regulated asset base, we continue to think APA is a highly attractive income stock which is poised for capital appreciation/growth with the RBA set to commence on a rate cutting journey next month – hopefully one that has some longevity. We are initially targeting the $8 area, but further upside wouldn’t surprise.
Importantly APA has consistently grown in its dividend over recent years and is forecast to do so over the next five, again adding a tailwind to this out of favour utility stock.
