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PT United Tractors Tbk (PUTKY) is one of the largest distributors of heavy equipment in Indonesia. It manufactures construction machinery and provides mining services to help customers tap natural resources.

The machinery is distributed under various brands and works in the mining, construction, forestry, material handling, and transportation sectors.

The company operates contact centers to deliver spare parts, mechanics support, and repair machines for customers. United Tractors operates five business segments: (1) construction machinery, (2) mining contracting (a majority of total revenues), (3)coal mining, (4) gold mining, and (5) construction industry.

Mining services pertain to mine design, exploration, extracting, and hauling commodities. The majority of total sales are generated in Indonesia.

The company was founded in 1972 and is headquartered in Jakarta Timur, Indonesia.

PT United Tractors Tbk is a subsidiary of PT Astra International Tbk.

Three key data points gauge PT United Tractors, or any dividend-paying firm.

The key three are:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money.
 

PTUKY Price

Over the past year, PT United’s share price dropped over 13% from $40.26 to $34.86 as of Thursday’s market close.

If PT United’s stock trades in the range of $30.00 to $50.00 this next year, its recent $34.86 share price might rise to $36.60 by next year. Of course, PT United’s price could drop about the same $1.74 amount, or more.

My upside estimate of $1.74, however, is equal to the average annual gains over the past three years.
 

PUTKY Dividend

PT United’s most recent variable dividends paid semi-annually on May 30th to shareholders of record on April 28th, average out to about $4.00 annually to throw a yield of 11.47% as of Wednesday’s closing price.  PUTKY’s SA dividend has varied between $0.23 and $8.31 in the past four years.
 

PUTKY Returns

Adding the $4.00 anticipated annual dividend to PT United’s estimated $1.74 price upside reveals a $5.74 potential gross gain per share for the coming year.

At Thursday’s $34.86 closing price, a little over $1000 would buy 29 shares.

A $10 broker fee (if charged), paid half at purchase and half at sale, might cost us about $0.345 per share.

Subtracting that maybe $0.345 brokerage cost from my estimated $5.74 gross gain per share makes a net gain amounting to $5.395 X 29 shares = $156.46 for about a 15.5% net gain.

This may be the time to pounce on PT United Tractors Tbk. But beware, PUTKY’s SA dividend is variable, and its price is recovering from a recent low of $16.28 as of March 19, 2020, after achieving an all-time high of  $72.06 high March 30, 2012. So, expect volatility in both price and dividend from PUTKY.

The foregoing article is based on past history of PT United Tractors Tbk. The only accurate measure of future performance is from active investment in the company.

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