The Otago Daily Times earlier reported Origin was about to quit its 53% stake in Contact (CEN) but the company later issued a denial, saying it was not contemplating a sale.
However, the markets still believe Origin is looking for a buyer for its stake in Contact.
Craigs Investment Partners broker Chris Timms said the special dividend was being paid after CEN decided not to invest in overseas geothermal opportunities as was announced earlier in the year.
''Contact remains one of our preferred electricity sector exposures and is trading below our fair value assessment. CEN's change of tack substantially removes risks from the business and we expect CEN's share price to recover further.''
An increased dividend payout to 100% of earnings and possible share buybacks should also increase shareholder returns, he said.
Craigs had released a list of five ''compelling'' investment opportunities it had identified in New Zealand, Mr Timms said.
They were:Fisher & Paykel Healthcare (FPH) a market leader in its field with a proven strategy and strong growth potential.
Recent results had been outstanding, with FPH recording three consecutive years of double-digit profit growth and demonstrating that its products were continuing to gain traction and market share.
''While the stock is trading at all-time highs, we remain positive as FPH has opportunities to move into new geographies and product areas, and the decision to move to direct distribution in the United States has the potential to boost margins and set the business up for long-term growth.''
Metro Performance Glass (MPG) was likely to benefit while the New Zealand housing and construction sectors remained buoyant, Mr Timms said.
While the construction cycle was well developed, there was still growth available in the low interest rate environment and capacity constraints causing a lag between permits being issued and the building work being carried out.
The low responsiveness of supply to demand would mean the current cycle would be longer than the previous cycles and have a flatter peak, he said.
Management comments relating to capacity constraints continuing into next year had seen the stock sell off sharply but Craigs viewed the weakness as a buying opportunity.
Metlifecare (MET) was the second-largest operator in the New Zealand retirement and aged-care sector and operated a similar business model to Ryman and Summerset which was attractive to investors, Mr Timms said.
MET was positioned in an industry with defensive characteristics and strong long-term growth prospects underpinned by an ageing population and increased healthcare spending.
''After a period of underperformance following the global financial crisis, we believe MET has turned a corner and is now well positioned in the sector.
"It currently offers better value than its peers and provides a greater degree of exposure to the Auckland housing market, with 59% of its portfolio there.''
Refining New Zealand (NZR) had struggled in recent years due to high oil prices and unfavourable currency movements, Mr Timms said.
Also, NZR had embarked on a significant capital expenditure programme.
All of that meant NZR had not paid a dividend for three years.
NZR now appeared to be back on track, profitability had returned, debt levels were falling, the capital expenditure programme was nearing an end and there was a strong possibility of the dividend being reinstated - potentially within the next six months.
If it was reinstated, NZR would likely be trading on a gross dividend yield of more than 12%, which would see the stock re-rated by the market.
Despite the cyclical nature of the business, NZR represented a compelling opportunity on a 12-month view.
Trustpower (TPW) was Craigs' favoured gentailer (generator-retailer) and the company was making significant gains in the New Zealand market through its multi-product offering - bundling electricity, gas and broadband while expanding into additional metropolitan areas, he said.
The focus on customer acquisition had suppressed margins but the strategy was positioning TPW well for long-term growth.
''We believe TPW has a sustainable competitive advantage with its multi-product offering. It would be difficult for another gentailer to develop the competency to enter the broadband market while a telco would struggle to enter the electricity market, as it is more difficult to manage risk without your own generation.''
