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Anonymous
I bought 200 shares into SIA C6L at 4.35. Is it a bad buy? Should I sell it?
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Chris
19 Jan 2021
Owner and Writer at Tortoisemoney.com
Depends on why you bought it. If you're in for trade, your timeframe is important to evaluate whether it is still worth holding now.
If you bought it for a long term hold, ask yourself if the fundementals still hold. Personally, I don't like SIA's business. In simple points, here's why:
Their revenue is not stable. Revenue is affected by external economy and macro factors such as jet fuel cost etc.
Asset heavy business. They need to keep maintaining their fleet of planes even when grounded (such as now).
Linked to previous points, but, likely to have second dilution of shares if the coronavirus situation drags on further as their expenditure will continue to burn cash.
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I think Chris has perfectly summed up the gist of it. But it is indeed important to ask yourself instead, why you have bought it in the first place. Is it cause it was recommeded by someone? Or did you speculate and believed SIA will improve once we are able to travel again?
At the end of the day, the fundamentals are more important to me. SIA is both asset and debt heavy which I don't like at all. I would prefer to look at companies with high growth instead.