The day I made my first purchase
of my first 100 shares of stocks from Energy Development Corp., it was PhP6.02
per share. But after the supertyphoon Yolanda, with international name Haiyan,
struck Philippines particularly in the part of Samar and Leyte, the price went
down to PhP4.40 per share on November 20, 2013, after just a week. The price
went -26.9%. That is huge. (In 2008, the price of an EDC stock is P1.82)
EDC plunging price is due to the
significant damage sustained by all EDC geothermal power plants in Leyte . The Leyte
geothermal power plants accounts for about 53% of EDC capacity and about 40% of
EDC revenue. Because of this, the prospect of company’s profitability was
adversely affected. EDC stockholders sold their positions because of this.
But as far as my investment is
concerned, what is happening on the price of EDC stocks is a good thing for me.
I am not worried a bit by this
sudden turn of events. I intend to keep my EDC position regardless of its
current state for a much longer time. The reasons are:
- EDC is a part of the ever important energy and power sector. Society needs power and energy EVERYDAY. It is there to stay. It will not be allowed to disintegrate. The damage caused by the catastrophe, though significant in cost, is just a short term set back. It surely went down. But surely will go up and running again.
- I am still 31 years old. It may take a long time for
EDC to rebound but I can surely wait when that rebound happens. When that
time comes, I must be sure I already have a huge position or huge number
of EDC stocks to sit on. The low EDC price today gives me an opportunity
to accumulate more.
I am a buy and hold guy when it
comes to EDC. Only news of insolvency/bankruptcy will force me to dump my EDC stocks. And that is not the case right now, and this too. Time to buy now and I will rake profits. I don’t care if it will
take 5 or 10 or even 20 more years before EDC comes back. I am still young.
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