SMRT

[NTL]

If I am in your situation, I will cut loss and move on. Reason is simple: It no longer meet the objective of investing in it at 1st place.

In my short 6yrs of investing, I had learnt to cut loss and move the funds to something else that has a higher probability to go up, or better dividend. Even when the price of a share that I am holding is going too high for my comfort, I will also sell off and move on. If there nothing to buy, I will hold cash until I find something for myself. After the sale, whether it goes up from there, or go down, it no longer my concern. So far, this "trick" had been working. Until a point in time when this no longer work, then I will have to think of another "strategy"...

Congratulations!
i know of a stock remisier who favours your practice. She calls it like the art of "Bonsai Pruning". It's really not easy to cut loss and move on due to our psychology of afraid to admit we are wrong. i am guilty too. i am a little "better" at taking profit only and collect all the rubbish.

That's why once you are in the stock markets for some years, it's very hard for most of us to sell everything and start from scratch again. Start a brand new portfolio that is. Anyone has done it?

My portfolio is very different from what I started off. The only one company that I been holding for 6yrs is M1. The rest are dropped, swapped or added. Had paid alot for my "education"....

[Temperament]

If I am in your situation, I will cut loss and move on. Reason is simple: It no longer meet the objective of investing in it at 1st place.

In my short 6yrs of investing, I had learnt to cut loss and move the funds to something else that has a higher probability to go up, or better dividend. Even when the price of a share that I am holding is going too high for my comfort, I will also sell off and move on. If there nothing to buy, I will hold cash until I find something for myself. After the sale, whether it goes up from there, or go down, it no longer my concern. So far, this "trick" had been working. Until a point in time when this no longer work, then I will have to think of another "strategy"...

Congratulations!
i know of a stock remisier who favours your practice. She calls it like the art of "Bonsai Pruning". It's really not easy to cut loss and move on due to our psychology of afraid to admit we are wrong. i am guilty too. i am a little "better" at taking profit only and collect all the rubbish.

That's why once you are in the stock markets for some years, it's very hard for most of us to sell everything and start from scratch again. Start a brand new portfolio that is. Anyone has done it?

My portfolio is very different from what I started off. The only one company that I been holding for 6yrs is M1. The rest are dropped, swapped or added. Had paid alot for my "education"....

And why you are holding to M1?

[Jacmar]

Seeking for some advices here.

As mentioned previously, I have 15 lots @1.88 using my CPF funds. Although the price drop quite badly and hovering around the 1.6 region since last year, I am able to justify holding the shares as at least the dividend is paying me more than what CPF is paying me @2.5%. I can continue holding as the cost price will get cheaper over time and hopefully, the price can slowly crawl its way up to the breakeven point.

With the drastic cut of the dividend, the reason do not hold anymore. I cannot even justify additional purchase to average down as the dividend pay much lesser than what CPF is paying me. Of course unless I am hoping for capital gain... But that is not my purpose when I purchased using my CPF. I'm looking for something that is safe and also pays better than CPF.

I know my choice of choosing SMRT might not be correct as a safe yield stock. The increased in ridership/train revenues, rental over the past years made me believed it was safe... But I also know the due diligence I did for this purchase is very lacking.

As such, I have hope to rethink the current situation more seriously. Currently I am comtemplating on the actions (or non-actions).
1) Continued to hold and just hope for some events (fare increase? other sources of revenues?) to increase its share price again?
2) Average down another 15-20k when the price seems to reach its bottom?
3) Sell off and registered the loss (around 6K, 20%)


For 1), the dividends is paying lesser than CPF so basically the cost of holding is increasing as time goes by. Of course, dividends might go up in the future...
For 2), the above reason to preventing me from averaging down, unless the price dropped to $1 which means the yield will be 2.5% which is the same as CPF... provided the dividend don't drop also in the future...
For 3), it is painful but if that must be done to stem further loss... I shall do it.

At a crossroad now... Hoping to hear some advices from the more experienced people here before making a decision...

I have learnt a lot by reading the kind contributions made in the forum. I hoped sometime in the future, I will be knowledgeable enough to contribute back to this forum. Thank you very much in advance for you kind advices.

Let me share with you a story. my son just started his investment journey. Despite my good advise not to buy SMRT(at $1.74 then) he went ahead and I let him go ahead. He bought it base on emotional grounds(work briefly worked at SMRT!) Why I let him go ahead is that he needs to learn what's like to suffer a lost while it is still small. recently he cut loss at $1.55. For a small amt of tuition fees he has learn 2 lessons. Have you learn yours?

[NTL]

If I am in your situation, I will cut loss and move on. Reason is simple: It no longer meet the objective of investing in it at 1st place.

In my short 6yrs of investing, I had learnt to cut loss and move the funds to something else that has a higher probability to go up, or better dividend. Even when the price of a share that I am holding is going too high for my comfort, I will also sell off and move on. If there nothing to buy, I will hold cash until I find something for myself. After the sale, whether it goes up from there, or go down, it no longer my concern. So far, this "trick" had been working. Until a point in time when this no longer work, then I will have to think of another "strategy"...

Congratulations!
i know of a stock remisier who favours your practice. She calls it like the art of "Bonsai Pruning". It's really not easy to cut loss and move on due to our psychology of afraid to admit we are wrong. i am guilty too. i am a little "better" at taking profit only and collect all the rubbish.

That's why once you are in the stock markets for some years, it's very hard for most of us to sell everything and start from scratch again. Start a brand new portfolio that is. Anyone has done it?

My portfolio is very different from what I started off. The only one company that I been holding for 6yrs is M1. The rest are dropped, swapped or added. Had paid alot for my "education"....

And why you are holding to M1?

Coz as a mid cap, it is still paying me a good enough dividend. I don't really analyze the companies as detail as the others here...

[KopiKat]

IMHO.....

- The price will continue to drop
- There might be further dividend cuts next year (if losses persist quarter after quarter)
- The coming fare hike (if any) will not be huge bcos they dun wanna anger the public

Based on the above 3 points, I think SMRT does not meet your investment objective anymore. Whether to sell or not, final decision is yours.

My comments on the part I highlighted above in red.
If losses persist quarter after quarter, there will be no dividend....

Another point to take note is the Q4 losses were due to the $17M impairment. Altho' expenses was going up, if we were to remove the impairment component, there'd have been an EPS ~0.3ct.

Going forward, unless expenses go up a lot more or there're more impairments, we'll likely just see lower earnings rather than losses Q after Q. SBSTransit would be good as a reference and IIRC, SMRT do have a larger contribution (compared o SBS) from their profitable Retail segment.

Lastly, since the mgmt seems to be keeping mum on their Dividend Policy, the DPS & Yield will remain an unknown. Can drop to zero, even if they do remain profitable..

[Dividend Warrior]

Let me share with you a story. my son just started his investment journey. Despite my good advise not to buy SMRT(at $1.74 then) he went ahead and I let him go ahead. He bought it base on emotional grounds(work briefly worked at SMRT!) Why I let him go ahead is that he needs to learn what's like to suffer a lost while it is still small. recently he cut loss at $1.55. For a small amt of tuition fees he has learn 2 lessons. Have you learn yours?

That is a good lesson!

[Porkbelly]

SMRT as a company must be able to produce profits and dividends.
Viewed as such, their balance sheets, Earnings per Share can be used as performance yardsticks to determine if it is a company worth owning.
That is one perspective.

Another perspective is:
SMRT is the custodian of a rail network and also bus operations that serves the public. Viewed as such, it seems unlikely they will be allowed to sink and
be delisted.

It can also be reformed into another company with new mandates etc or it can be dissolved and the rail system nationalised.

I personally do not think ( not empirical ) SMRT will disappear. In any investment there are risks. I own some shares which I bought at $1.80 about 2 years ago. I have not sold out. The returns are horrid. Yet I intend to keep them for the next 10 years.

Why? because I can afford to. I bought them with CPF too and since I cannot do anything else with the CPF ( not enough to buy another property) might as well leave it there. If you do not sell, you lose nothing.
Its book entry only. If you have plans and the money is needed, then decide if the money will help with your plans.

You will have to decide. Did you ask anyone for their opinions about buying SMRT?? Do those opinions still hold? Do you still believe in those reasons? Despite the hard numbers from the balance sheets and EPS?

There are no guarantees in life. Risk is everywhere.

[natnavi]

One of the first few stocks that I owned was Citigroup. I bought it at $19 after my friend was bragging to others that he bought it cheap at $25. Being naive, and inexperience, I went ahead and bought it, thinking that my friend is such a sucker for buying it so "high". Little did I know, I was catching a falling knife. the price just kept going lower and lower. Day and night I was thinking about whether I should sell or hold. At the end I sold it at $4, even though in my head I was like, man, I am sure the price will go up eventually. And boy was i right. The price went back up a few months later only after it dropped to a low of $1, and it only went back up to $4. The price went up to $40 but that is because they did a reverse stock split (10 to 1). Effectively, their stock was still worth $4, the last I checked.

IMO, and what I have learned from the master is to sell the stock if you are losing sleep over it.

Nowadays, although I do check my stocks once in while, I do so to see if I can buy it at a lower cost.

The only time I would sell my stocks, is when there is a change in the company's story.

I think I am considered one of the lucky few in this forum. After a few months of learning from the school of hard knocks, I learned to do my homework diligently before I decide to invest my money. So much so, I am a proud partially owner of a few companies. An example would be if I noticed that my friend has a Vicom sticker at their car, I will my friend that he/she made a right choice. If I see a competitor's sticker, I would ask why the hell would you go such a lousy service provider.

For companies that I had done my homework but I had divested from, I still remember what sort of businesses they are in, and once in a blue moon, I do take a look at them.

Dude, learn to let go if you cannot sleep over the losses. If you can stomach it, and the company's story is still good, get more of it when the price goes down further. I think the other members in this forum can give you advise on whether to buy/sell/hold. At the end of the day, you need to learn to do your due diligence, and make the right call for yourself. The money belongs to you and yours alone. The other members can give you advise but if you sell it, and lose the chance to make money, will they give you back the profit that could have been yours? If you buy more or hold, will they give you back the loses?

One thing I am glad to say is that it seems that you do know that you did not do much research on the company before investing in it. Lesson learned so move on to the next chapter and start being a proud (partial) owner of companies.

(not vested)

[lanoitar]

With the drastic cut of the dividend, the reason do not hold anymore. I cannot even justify additional purchase to average down as the dividend pay much lesser than what CPF is paying me. Of course unless I am hoping for capital gain... But that is not my purpose when I purchased using my CPF. I'm looking for something that is safe and also pays better than CPF.

Re-read your own writing above. U already know the answer. It's just loss aversion leading to your indecisiveness.

[Temperament]

If I am in your situation, I will cut loss and move on. Reason is simple: It no longer meet the objective of investing in it at 1st place.

In my short 6yrs of investing, I had learnt to cut loss and move the funds to something else that has a higher probability to go up, or better dividend. Even when the price of a share that I am holding is going too high for my comfort, I will also sell off and move on. If there nothing to buy, I will hold cash until I find something for myself. After the sale, whether it goes up from there, or go down, it no longer my concern. So far, this "trick" had been working. Until a point in time when this no longer work, then I will have to think of another "strategy"...

Congratulations!
i know of a stock remisier who favours your practice. She calls it like the art of "Bonsai Pruning". It's really not easy to cut loss and move on due to our psychology of afraid to admit we are wrong. i am guilty too. i am a little "better" at taking profit only and collect all the rubbish.

That's why once you are in the stock markets for some years, it's very hard for most of us to sell everything and start from scratch again. Start a brand new portfolio that is. Anyone has done it?

My portfolio is very different from what I started off. The only one company that I been holding for 6yrs is M1. The rest are dropped, swapped or added. Had paid alot for my "education"....

And why you are holding to M1?

Coz as a mid cap, it is still paying me a good enough dividend. I don't really analyze the companies as detail as the others here...

Yes! At times, if you analyse too much, you will see for every pro in colunm A, there is a con in column B. And if column A balances column B, you will get a headache. Also don't forget what you analyse are all past data which are avaliable to the market. Analyse a bit is also enough for me.
But a company is dynamic. Example SMRT now in the news alone is not a good example to buy but who knows in 5, 3, and even 2 years time? And if you ask me will you buy now to keep for 10 years, my answer is no. But i may buy it one fine day (when i think the price to yield is attractive again) as it's our economic life-blood for National transportation. Or i might buy it if the market price has reached "low enough" for me to make a profit in the future, i think only.
Do you think we will have hoover crafts flying in the air (just like in the movie) in the future?