Rudi’s Response: What’s Happening With Codan Shares?

This story features CODAN LIMITED. For more info SHARE ANALYSIS: CDA

FNArena receives on irregular basis questions from subscribers and investors. In some cases we decide there's value in sharing our thoughts with a wider audience, like the response from FNArena Editor Rudi Filapek-Vandyck below.

QUESTION:  Hi Rudi, if you have a moment could you please comment on CDA's drop in price. I like it as a stock and would appreciate your thoughts. Thank you

RESPONSE:

Codan ((CDA)) is one of those stocks that is on my radar, but not on a permanent basis.

What I do know is their sales in Africa for the artisanal gold detection product are being impacted due to local unrest. As a result, net profits are expected to take quite a big hit in the current financial year.

I think this stock has simply become another dividend yield story. At present the yield is around 7% and it looks sustainable (Codan pays 13c each year).

This suggests further weakness from here is likely to remain limited, but any sustainable upside probably requires a better environment in Africa.

I hope this helps.

Your Editor

(Do note that, in line with all my analyses, appearances and presentations, all of the above names and calculations are provided for educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions.)  

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