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- Did You Listen to the Honeybees and Make Some Serious Cash?
Did You Listen to the Honeybees and Make Some Serious Cash?
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In January of 2023, Mary and I published What Grandpa Learned From His Honeybees. In this book, we discuss the principles of investing as taught by Honeybees and select three publicly traded stocks that fit the winning formula.
Our first Reliq Health Technologies was a glaring mistake. In October 2023, we sold all but only a few shares because of what I felt was less than honest behaviour. I explained this in the October 20, 2023, podcast at Bee Money Simple. Why I Just Sold all of my Reliq Healthcare Stock
Those funds realized from the sale and much more were then invested in Vital Hub, a healthcare management company whose stock has risen just over 100% since our initial purchase. I discussed that purchase in the podcast of January 15, 2024. Why I Love this New Healthcare Stock
Goodfellow Lumber, our second pick, continues to plod along primarily with a dividend return of 7%.
Our third stock featured in the book and one that we have invested heavily in, European Residential Reit, just announced that it had sold 50% of its apartments and would be paying shareholders a special payment of just over $1 a share. The stock we started buying at $2.15 per share is now at $3.17 per share and continues to pay a 5.6% dividend.
There continue to be strange things regarding understanding the company's value.
According to my calculations, using the honeybee rules, as discussed in our book, the stock's current price is about 50% below its actual value.
Here is what I think is happening now.
When the sale goes through, the company will be left with 3,100 apartment units. The value of those apartments is now 830 million dollars, with mortgages of 300 million dollars, leaving a net cash value of 530 million dollars. Buying all of the company's shares would cost 298 million dollars, leaving approximately 230 million dollars above the current price. Am I missing something, or is this a screaming value purchase even today?
There is some risk that these deals won’t close.
There is some risk that future sales of the remaining apartments or their appraised value will not equal what was realized in the current sale.
The honeybees teach us that the first rule is survival. What is the risk that the shares of ERE.UN will go to zero? I believe less than 1%.
What is the chance that the return will be greater than what I invest, even at the current price of $3.17 a share? I believe the chance of that is at least 95%.
That’s why I continued to load up on the shares even after the announcement so that ERE.UN is over 50% of our holdings.
We haven’t been told yet when you would need to be an owner of the shares to receive the $1 special payout per share. That is also strange and increases the risk that once announced, the shares could drop by $1. If that happens, I’m ready to load up on some more stock.
The honeybee strategies worked as they have for the other stocks in our portfolio. I have to listen.
How do you calculate the risks of loading up on this stock?
Wildflowers and Bees: A Stress-Relieving Coloring Book
-Different levels of detail
-Themes of Nature from our Wildflower Bee Farm
-For all Skill Levels
-Great way to relieve Stress and Anxiety
-Prints are directly from High-Quality Pictures from the Farm
-Great for Crayons, Gel Pens, Colored Pencils or Markers
-Each page is on one side only, so there is no bleeding of colours
-A perfect gift for young and old
-Deluxe Version has the actual Pictures included with each Coloring Book Page
-The Front Cover Picture of this Book is the first Picture to Color
This Adult Coloring Book, by Dr. Henry Svec (retired psychologist) and Mary Svec (Farm Photographer), uses 30 pictures from our 50-acre farm, which we are converting into nature and a honeybee sanctuary. Various wild and traditional pollinators are featured in this book while they frolic on our wildflowers. Studies have supported the notion that colouring can be a better treatment for Generalized Anxiety and Stress than conventional therapy.
For extra fun and a challenge, go to our farm site, wildflowerbeefarm.com, click on Coloring Pages and find the picture of what you are about to colour. Our deluxe edition has a picture beside each colouring page in the book to save that step.
Mary and Dr. Svec also recently published “What Grandpa Learned from His Honeybees: The Little Book to Be Smart with Your Money and Help the Environment.” Available on amazon.ca
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