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Author Topic: ZNCM $1.60 with a $0.80 cash dividend
PCola77
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Not sure how many of you check out the Free for all board, but there's a thread there about ZNCM.

It's giving an $0.80 cash dividend. The record date was Friday, so a lot of people are selling today, thinking that they still get the dividend. In reality, if you sell any time between now and March 27th, you sell the dividend with it.

You can buy any time between now and the 26th and get the dividend, but today's probably the day to buy if you're going to, since I expect it to trend back up leading up to the ex-date. today's sell off is due to confusion, not due to anythign wrong with the stock or the dividend (in my opinion, of course).

check out the thread on hot stocks or ask me here if you have any questions.

good luck.

Posts: 5508 | From: Southeastern PA | Registered: Jan 2006  |  IP: Logged | Report this post to a Moderator
netguy81
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i do have ZNCM stock and i got it when the dividend news came out ....
anyway, i have a lot of confusion regarding dividend and the ex-divy date and the payable date.

i have read on different sites that the ex-divy date is usually 3 days before the date of record. so i can sell anytime on or after the ex-divy date and still get the dividend. The payable date is just the date i get the dividend

so in ZNCM's case how come the ex-divy date is March 27'th and record date is March 9'th .. is this possible ...

thanks in advance ...

p.s.: Sorry for being such a newbie !!

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Market Correction - The value of the stock always decreases after i buy it

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PCola77
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Here's the deal:

In situations like this, where it's a special dividend (as opposed to recurring quarterly or whatever) when the dividend is valued at over 25% of the share price, the rules are a bit different.

Basically here's how it works.

the 9th was the record date. What that means is just that that's when the company pulls the list of shareholders. But in reality, the date of the 9th is totally meaningless. the important date is the ex-date, which is the first date that you can sell the stock without selilng the diviend with it.

To put it simply say person 1 bought shares last Thursday for $1.90. they held on the record date, so they thought they got the dividend. they sold this morning for $1.60, thinking "Sweet, I bought for $1.90, sold for $1.60 and got a $.80 dividend, for a nice $.50 gain, or about 25%"

In reality, the person sold the right to the dividend, so they bought for $1.90, sold for $1.60 and get NO dividend, or 15% or so loss.

if you buy today, tomorrow, or any day through the 26th, you get the dividend. You can sell on the 27th but the price *should* adjust downward .80 that day.

So at this point you're playing two things if you buy. First, I think the stock will go back up to the $2 range where it was last week, because today's selloff was based on misinformation. And second, many of these plays go right back up after the dividend is paid out. Foe example if this closes at $2 on the 26th it *should* open at $1.20, but within a few days it will probably be back up to $1.60 or more.

This info is based on my experience with 5 or 6 similar plays, so obviously nothing is guaranteed, but I don't throw out recommendations lightly. I thnk this is a good chance to make a good 40%+ with very little downside risk.

Good luck!

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netguy81
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thanks a lot ... i did read about this in the original thread under Free Stocks board

but then when i read more about the rules of dividend and the various dates etc ... i got super confused ...

so when there is a dividend of 25% more then the rules are bit different ... if not there are different sets of rules (which i have been reading upon)

i think i got it now !!

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Market Correction - The value of the stock always decreases after i buy it

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T e x
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good post, PC...some folks who wait till near x-date might wanna check with their broker's compliance dept re settled funds on a cash divvy...

What's funny here is, the company tried to fix their pay date...then reset it for a day before the x-date... oh well [Roll Eyes]

Anyways, nice catch...

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Nashoba Holba Chepulechi
Adventures in microcapitalism...

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juice
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yep i bought a bunch of zncm today!! this will be a nice play!
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juice
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Zunicom Announces Clarification on Dividend: Stock Will Trade ''Ex-Dividend'' Beginning March 27, 2007
Tuesday March 13, 10:12 am ET


CARROLLTON, Texas--(BUSINESS WIRE)--Zunicom, Inc. (OTCBB:ZNCM - News) announced today that, in accordance with NASD rules, its stock will trade "ex-dividend" beginning March 27, 2007. Thus, purchasers of Zunicom common stock on the OTC Bulletin Board on or before the payment date will be entitled to receipt of the dividend and persons who sell Zunicom shares on the OTC Bulletin Board after the record date but on or before the payment date will not be entitled to receipt of the dividend.

Zunicom had previously announced that its Board of Directors had declared a dividend of $0.80 per common share payable on March 26, 2007 to shareholders of record as of March 9, 2007. Since the dividend exceeds 25% of the value of a share of Zunicom common stock, under applicable NASD rules, the first "ex-dividend" date will be the first business day following the payment date.

About Zunicom, Inc.

Zunicom, Inc. (www.zunicom.com) through its wholly owned subsidiary, AlphaNet Hospitality Systems, Inc. (www.alphanet.net), provides business communication services to the hospitality industry. Zunicom owns 2,000,000 shares of the common stock of Universal Power Group, Inc. (AMEX:UPG - News) that represents 40% of the issued and outstanding shares of UPG common stock as of this date.

Forward-Looking Statement Disclaimer

This release contains a number of forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Statements in this press release that are not statements of historical or current fact constitute "forward-looking statements." Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause the Company's actual operating results to be materially different from any historical results or from any future results expresses or implied by such forward-looking statements. In addition to statements that explicitly describe these risks and uncertainties, readers are urged to consider statements that contain terms such as "believes," "belief," "expects," "expect," "intends," "intend," "anticipate," "anticipates," "plans," "plan," to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in the Company's filings with Securities and Exchange Commission.


Contact:
Zunicom, Inc.
Carl A. Generes, 214-352-8674
972-715-5700 fax
cgeneres*genereslaw.com

--------------------------------------------------------------------------------
Source: Zunicom, Inc.

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netguy81
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I'm glad i didn't sell my shares and bought more when it went down yesterday !! [Big Grin] [Big Grin] [Big Grin]

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Market Correction - The value of the stock always decreases after i buy it

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juice
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1.77 barely any volume, but thats jus thow this one goes. I expect another .20-.30 cent move before the divy... watch close:) GL
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juice
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1.83... [Big Grin]
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