Addendum:Not wanting to grab the classic falling knife, I held off on my purchase of CET. The stock hit a low, as of now, of 3.69 today. I never imagined such a collapse in price. But CET released its earnings report, or lack of earnings report, and the market took notice.
I still like CET and decided to get off the sidelines and get into play. I bought 600 shares. I picked up some for $3.90, more at $3.75 and I had to settle for $4.00 for the last purchase. From everything I know about the company it still seems a good bet at the right price. The question is: What is the right price? Only time will tell if I have acted wisely.
I like Cathedral Energy. I picked up a little at $5.15 some months ago and now with CET almost back to my entry point, I may buy some more. Let me tell you why.
- It has a nice dividend of almost six percent which seems fairly secure at this time.
- Some analysts see CET hitting a target price of $7.00 within a year.
- I can pick up a hundred shares for just more than $500.
- Scotia McLeod rates CET a focus stock, albeit carrying high risk.
- A Google search turned up no big red flag warnings but the stuff I found told me caution is warranted.
If you haven't come across the term "focus stock" before, here is how Scotia McLeod defines a focus stock:
The stock represents an analyst’s best idea(s); stocks in this category are expected to significantly outperform the average 12-month total return of the analyst’s coverage universe or an index identified by the analyst that includes, but is not limited to, stocks covered by the analyst.
If CET continues to lose value, I will probably try and pick up a few shares next week. I won't pick up too many though, I don't want to be overexposed to this technically high risk investment.