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How waiting for a good price resulted in me missing out on great company in Thomson Medical

Yesterday I came back home to received a news that Peter Lim, after failing to secure Liverpool decided to buy a hospital – Thomson Medical

He made the general offer worth $513 million after his private firm Sasteria bought a 39.34 per cent stake in the company from its founder and largest shareholder, Dr Cheng Wei Chen and his family. Dr Cheng and his family sold their shares at $1.75 apiece for about $202 million.

This represents a 62% premium above the last traded price. I think those people that have been queuing 1 cent below to get the right price should be kicking themselves now.

I have reasons to be sad as well. I blogged about Thomson Medical having a good businss and a likely appreciating dividend. The problem  is that I waited too long to buy into the stock and the price jumped to $1.

By then I was waiting for the stock to fall back from its highs to get in again, but it just never came. If not I will be sitting on a nice profit now.

A lot of friends told me don’t cry over this and really I think I got past that stage already. Its important to see if there is some lesson learnt:

  1. Value investing revolves around uncovering good companies at value prices and it is difficult to discern what is undervalued and how strong the economic moat of the business is. But it is nevertheless fruitful if you manage to find such gems.
  2. Why fret over 1 cent or 2 cent to get the right price if you know that at both prices, it is still undervalue? The problem with that is whether it really is undervalue, that’s where good skills comes in.
  3. Technical Analysis provides you with a good entry point but at times like this you get suck into a psychological zone that you are buying something overpriced but you fail to realise that price have reached a whole new level and previous price targets and support do not matter anymore. When the grounds change you need to change with that as well.

I would probably spend my weekends sulking about this. But really congrats to the folks who bought at 50-60cents!


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Monday 1st of November 2010

Drizzt, this is part and parcel of life!

The same goes for me waiting too long to buy SPH at $3.50 when it was hovering at $3.51 after the clementi mall purchase! :X

Remember... it's just money... Our health and happiness takes priority!


Monday 1st of November 2010

its no good if u manage to do this time and again. something is wrong with the way my brain works likely.

its ok to miss out on SPH, i think hard on the business and future of publishing recently and still feel they are not giving investors the bang for the buck. its advertising model might not die tomorrow, but as a tech geek blogging for, i do find that there will be a shift towards digital prints in a large way. how will SPH handle that. will it make up enough to be a viable dividend play?


Saturday 30th of October 2010

Hi Drizzt,

Not quite sure I understand the deal...does it mean that Peter Lim is taking Thomson Medical private?



Saturday 30th of October 2010

he might keep it listed but he is extending the 1.75 offer to public investors as well.


Saturday 30th of October 2010

Hi Drizzt,

I know how you feel and I know it takes time for you to get over it but hey, it's only money. Go out, take a walk, the air is cool today and, maybe, catch a movie. Don't waste the weekend. :)

Have tea with me. This was my first "Tea with AK71" blog post:

What to do? ;)


Saturday 30th of October 2010

We cannot win every time lah!

Win some lose some.. count the times that we won and compare to the ones we lost.... even or odds?

Technicals will give some insights, but yes, look at the pricing.. if its within your price range, I say go for it!

This is my motto.. believe, buy, keep and reap.. sell when you need!

There will be another opportunity.. all bell curves have the same shape.. one peak, two chances to buy or sell.

Great blog.. thanks for all the sharing.. appreciate it


Saturday 30th of October 2010

hi bet, thanks for cheering me up.

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