Posts
AK likes buying things on the cheap.
What is cheap?
If we can easily afford something, is it cheap?
Well, it simply means that it is affordable.
It might not be cheap.
Cheap to me means value for money.
Cheap to me means value for money.
Affordability and value for money.
So, AK likes buying things which are value for money.
If I can tell something is definitely value for money, I will buy some and, sometimes, I will buy a lot of it.
This is the same for anything in life whether it is for consumption (especially if it is a need) or for investment.
"Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down." - Warren Buffett
Good old Warren Buffett.
Now, I bolded one word in that quotation.
The word is "quality".
When Eagle Hospitality Trust's unit price crashed last year, many readers as well as some friends of mine thought I would be interested in buying.
After all, many respectable financial bloggers also invested in the Trust then.
Many people thought Mr. Market was overly pessimistic on Eagle Hospitality Trust.
Well, AK is growing older and as he grows older, he grows more timid.
AK wasn't pessimistic about Eagle Hospitality Trust.
AK was afraid, very afraid.
I thought Eagle Hospitality Trust was a risky investment and I didn't feel like taking on more risk in retirement.
What really steered me away from investing in the Trust was the fact that the Trust was imploding as insiders sold at ridiculously low prices, willing to take hefty losses in the process.
This is something that is still happening!
In their latest announcement, the manager of Eagle Hospitality Trust said that "the Security Price meaningfully under-represents the underlying value of EHT’s portfolio."
See recent announcement #4 at the end of this blog.
If that's the case, perhaps, insiders should be buying more or maybe make an offer to take the Trust private.
Why isn't this happening?
Why, indeed, is the opposite, more or less, happening instead?
Why is the manager thinking of an asset sale now?
Wouldn't this be a really bad time to be selling their hotels?
It is basically going to be a fire sale.
In my first blog on Eagle Hospitality Trust, I said:
"Insiders probably know something retail investors or outsiders don't.
"If Eagle Hospitality Trust is a good investment for income, after a huge decline in unit price, insiders should be buying more.
"Even if they don't buy more, they should be holding on to their investments.
"They should not be selling."
It isn't rocket science.
It is common sense.
See related post #1.
My series of blogs on Eagle Hospitality Trust seems to have done something good as a reader who wrote to me late last year just told me that he cut losses after reading my blog in reply to his plight.
See related post #3.
He wrote and told me this after the trading halt in Eagle Hospitality Trust was announced.
He might have lost a big sum of money but in exchange, now, he has peace of mind.
Priceless.
Remember,
"Never risk what we have and need for what we don't have and don't need." - Warren Buffett
Eagle Hospitality Trust looks like it could be going extinct.
If we cannot trust it, we cannot invest in it.
When in doubt, it is better to stay out.
See related posts and recent announcements at the end of this blog to form your own conclusion.
AK is just talking to himself, as usual.
Related posts:
1. Is Eagle Hospitality Trust worth it?
2. Eagle Hospitality Trust: Financial engineering.
3. Eagle Hospitality Trust: His plight.
Some recent announcements:
1. Eagle Hospitality Trust: Resignation of CFO.
2. Eagle Hospitality Trust: Cessation of Substantial Shareholder.
3. Eagle Hospitality Trust: Resignation of Independent Director.
4. Eagle Hospitality Trust: Business Strategic Review and Update.
Bloggy Award