@MissLissy. Wise questions...... and
@davidmorr. Wise answers.
Lissy, in buying a share, you are buying part of a business. It doesn’t pay to overpay for a business that has already run hard and fast in the hope that it will go higher, but you must pay a fair price. If you understand the business, you can see public and user recognition for the product and you believe that the business is satisfying user wants, (similar to Afterpay in the early days) then it probably deserves your attention. Don’t forget that ABB is trying to take business away from Telstra and other operators, and at the moment, it doesn’t make a profit. Having said that, if it is well run, and is satisfying customer wants, then it is highly likely to. It is good that you are asking advice as any answer for or against is going to increase your knowledge in this area. As well as ABB, others in this space that I either have or are watching is ST1 Spirit Telecom and also UWL. Uniti. I believe that there is room for all 3 but I wouldn’t be surprised if there is a degree of cannabilism in this market and one initiates a takeover for the other. This can increase the Share Price of the victim, if this is what you want. The Share Price (SP) doesn’t seem to have increased significantly since Motley Fool recommended it, and if you are going to be a holder for a “fair while” then the SP hasn’t really taken off and it would be a reasonable buy at today’s prices.... given as I said, it doesn’t make a profit... yet !
david, your points about chasing lower prices is well made. I also looked at Macquarie at about the same price and missed the boat. I often look at the market depth where the difference is perhaps 2 cents and ask myself, if I really like the company and if it’s prospects are that good, then is it worth deliberating over 2 cents ? Sometimes I kick myself when it goes down 2 cents after I bought it, but the point about being a long term holder versus a trader is also relevant.
re Motley Fool, I have seen more recommendations that have NOT worked out, than have with them. It rather depends on IF you buy EVERY single recommendation and IF the winners outnumber the losers.
I bought ABB the day BEFORE MF recommended it and I remember MF recommending RFG Retail Food Group at near $2.00 as a good dividend stock. it’s now closer to 20c.
@MissLissy, it all depends too if you are after a growth stock with a small amount of dividend, or after a dividend stock with some growth. Each has its place in a portfolio. If you are after suggestions for one or the other, I would be happy to give you some names to research (of course not knowing your personal circumstances or your budget). Don’t forget to read my disclaimer at the bottom.
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