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Enterprise Inns

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Quite a few years ago, when I was making my first tentative steps from tracker funds into buying my own shares, I bought some shares in Enterprise Inns. I read the Motley Fool's advice on investing (it was better than it is now) but nevertheless skimped a bit on my due diligence in favour of the subjective experience of a couple of local Enterprise Inns pubs. They seemed busy and well run so I bought. The price went up a little and I congratulated myself. Then the crash happened and I realised that it was a 'zombie' company with massive debts, sustained only by exceptionally low interest rates and doomed when those rates rose.

I hung onto the shares out of inertia. The price has crawled back from its lows but in my view the company is fundamentally stuffed, especially if the events necessary for an HPC occur. I plan to sell them before the end of this tax year and write the losses off against Capital Gains Tax. I'm around 85% down on my original investment (although I never gamble more than I'm willing to lose).

Does anyone else have any stories of learning the hard way?

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Quite a few years ago, when I was making my first tentative steps from tracker funds into buying my own shares, I bought some shares in Enterprise Inns. I read the Motley Fool's advice on investing (it was better than it is now) but nevertheless skimped a bit on my due diligence in favour of the subjective experience of a couple of local Enterprise Inns pubs. They seemed busy and well run so I bought. The price went up a little and I congratulated myself. Then the crash happened and I realised that it was a 'zombie' company with massive debts, sustained only by exceptionally low interest rates and doomed when those rates rose.

I hung onto the shares out of inertia. The price has crawled back from its lows but in my view the company is fundamentally stuffed, especially if the events necessary for an HPC occur. I plan to sell them before the end of this tax year and write the losses off against Capital Gains Tax. I'm around 85% down on my original investment (although I never gamble more than I'm willing to lose).

Does anyone else have any stories of learning the hard way?

Yeah...i brought a house once...couldn't sell it...lost money on it...the stress was terrible...had to move for work...was stuck...buying is a dead weight.

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Quite a few years ago, when I was making my first tentative steps from tracker funds into buying my own shares, I bought some shares in Enterprise Inns. I read the Motley Fool's advice on investing (it was better than it is now) but nevertheless skimped a bit on my due diligence in favour of the subjective experience of a couple of local Enterprise Inns pubs. They seemed busy and well run so I bought. The price went up a little and I congratulated myself. Then the crash happened and I realised that it was a 'zombie' company with massive debts, sustained only by exceptionally low interest rates and doomed when those rates rose.

I hung onto the shares out of inertia. The price has crawled back from its lows but in my view the company is fundamentally stuffed, especially if the events necessary for an HPC occur. I plan to sell them before the end of this tax year and write the losses off against Capital Gains Tax. I'm around 85% down on my original investment (although I never gamble more than I'm willing to lose).

Does anyone else have any stories of learning the hard way?

PVCS 95% loss

ASTERAND 100% loss on delist.

Never trust the ramping of alternative energy and biotech shares....

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PVCS 95% loss

What, even now they've risen and returned cash to shareholders?

I'm sitting on a loss on them overall, but the ones I bought at <5p are showing a big profit ;)

Never trust the ramping of alternative energy and biotech shares....

PVCS goes back to an era before any such thing turned mainstream: they were producing solar wafers back in the '80s. Would probably be doing a lot better if it wasn't for the hype bringing in so may new kids, then turning the tap off leaving overcapacity, and then finally we get Obama bailouts so overcapacity lives on in a zombified state.

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Then the crash happened and I realised that it was a 'zombie' company with massive debts, sustained only by exceptionally low interest rates and doomed when those rates rose.

Don't beat yourself up about it. Debt isn't necessarily bad: so long as you can make a return that exceeds the cost of servicing the debt, it's a good thing. What it does is to magnify changes in the market. If a company with no debt loses 5% of its value, the shares are 5% down. If you have a 95% mortgage you've lost all your equity: shares are 100% down. AIUI Enterprises's debt was basically tied up in property, so in effect those shares represented mortgaged property.

You suffered the losses that householders did in the US and many European countries, but that the long-suffering taxpayer bailed out in the UK. But when you bought those shares, they must've been a hedge against HPI. And you can offset your loss against HPC: even with the bailouts, you can buy much cheaper today than in the Northern Rock era.

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What, even now they've risen and returned cash to shareholders?Haven't bothered to calc, but I expect it makes it more like an 80% loss.

I bought above 70p!

I'm sitting on a loss on them overall, but the ones I bought at <5p are showing a big profit ;)

PVCS goes back to an era before any such thing turned mainstream: they were producing solar wafers back in the '80s. Would probably be doing a lot better if it wasn't for the hype bringing in so may new kids, then turning the tap off leaving overcapacity, and then finally we get Obama bailouts so overcapacity lives on in a zombified state.

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PVCS 95% loss

ASTERAND 100% loss on delist.

Never trust the ramping of alternative energy and biotech shares....

What, even now they've risen and returned cash to shareholders?

I'm sitting on a loss on them overall, but the ones I bought at <5p are showing a big profit ;)

PVCS goes back to an era before any such thing turned mainstream: they were producing solar wafers back in the '80s. Would probably be doing a lot better if it wasn't for the hype bringing in so may new kids, then turning the tap off leaving overcapacity, and then finally we get Obama bailouts so overcapacity lives on in a zombified state.

Indeed, a rising tide of hype lifts all boats and makes it difficult to find value even in fundamentally sound businesses. I'm looking at a pub co subscription offer right now, but I can't help feeling that at least 20% of the valuation is QE froth that will disappear if / when a chill wind blows in from China.

Don't beat yourself up about it. Debt isn't necessarily bad: so long as you can make a return that exceeds the cost of servicing the debt, it's a good thing. What it does is to magnify changes in the market. If a company with no debt loses 5% of its value, the shares are 5% down. If you have a 95% mortgage you've lost all your equity: shares are 100% down. AIUI Enterprises's debt was basically tied up in property, so in effect those shares represented mortgaged property.

You suffered the losses that householders did in the US and many European countries, but that the long-suffering taxpayer bailed out in the UK. But when you bought those shares, they must've been a hedge against HPI. And you can offset your loss against HPC: even with the bailouts, you can buy much cheaper today than in the Northern Rock era.

That's it in a nutshell. I'll certainly save more because of the crash when I eventually buy a house than I lost on those shares and the lesson I learned was cheap at the price.

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Indeed, a rising tide of hype lifts all boats and makes it difficult to find value even in fundamentally sound businesses. I'm looking at a pub co subscription offer right now, but I can't help feeling that at least 20% of the valuation is QE froth that will disappear if / when a chill wind blows in from China.

That's it in a nutshell. I'll certainly save more because of the crash when I eventually buy a house than I lost on those shares and the lesson I learned was cheap at the price.

This is why I'm 15% in cash at the mo. Just can't see much value. Although I had a small punt on Rotork recovery when dipped a bit last week.

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This is why I'm 15% in cash at the mo. Just can't see much value. Although I had a small punt on Rotork recovery when dipped a bit last week.

I bought IMG recently when it dipped a long, long way. A stock for Schrödinger's feline portfolio, but currently showing a healthy profit B)

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I bought newcrest mining just before some very bad announcements came out re their position. Had done due diligence, looked like an OK little Aussie company.

Lost over 50%.

Lesson learned? Well, that the market is still rigged against the little guy. There is a possible class action in the wings as it's claimed some of the large houses were forewarned of the problems..... :(

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Ionica (anyone remember them?) - lost the lot. That was the lesson that taught me about diversification. I bought a copy of a Random Walk Down Wall Street after that experience and have invested only via low cost trackers and the like ever since. It's slightly hard to be certain as I haven't kept full track of dividends but I reckon I've averaged inflation plus 3 or 4 percent (after tax) over the last twenty years or so with pretty low volatility. Not Warren Buffet by any stretch but respectable.

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I bought newcrest mining just before some very bad announcements came out re their position. Had done due diligence, looked like an OK little Aussie company.

Lost over 50%.

Lesson learned? Well, that the market is still rigged against the little guy. There is a possible class action in the wings as it's claimed some of the large houses were forewarned of the problems..... :(

As I said on the mining thread. I looked at KAZ years ago and then regretted not buying when they went up, was it 500%(?). Then when they crashed I counted myself lucky. I've tried to stay out of commodity plays apart from oil, but then I got tempted by Fenner, and FXPO but on reflection I wouldn't buy these again even though I'm overall up on these kinds of stocks. They are too volatile for my liking.

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I recently put in for some shares in City Pub Cos. Just waiting to hear how many I'll get.

I bought IMG recently when it dipped a long, long way. A stock for Schrödinger's feline portfolio, but currently showing a healthy profit B)

Personally I wouldn't buy Imaginary Technologies for the long-term; I think ARM will crush them.

Ionica (anyone remember them?) - lost the lot.

If memory serves Ionica's main problem was that the maximum number of customers their technology could handle was less than the minimum number of customers they needed to be financially viable. This point was lost in the overall cleverness of their technology.

As I said on the mining thread. I looked at KAZ years ago and then regretted not buying when they went up, was it 500%(?). Then when they crashed I counted myself lucky. I've tried to stay out of commodity plays apart from oil, but then I got tempted by Fenner, and FXPO but on reflection I wouldn't buy these again even though I'm overall up on these kinds of stocks. They are too volatile for my liking.

Indeed, but you have to have a few small high-risk bets, don't you?

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have invested only via low cost trackers and the like ever since. It's slightly hard to be certain as I haven't kept full track of dividends but I reckon I've averaged inflation plus 3 or 4 percent (after tax) over the last twenty years or so with pretty low volatility. Not Warren Buffet by any stretch but respectable.

What trackers do you use? I've got £100k sitting doing nothing and would be very happy with inflation + 4%.

Was considering Vanguard as they seem to have the lowest charges I the industry.

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I've just bought some shares in The City Pub Company.  It's founded by the same people who founded the Capital Pub Company, which was bought by Greene King, so I think it's worth a punt.

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