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No way.... ENIC

OK, so: I would have been luckier (?) if I'd waited to buy. Big players are using arbitrage, and this stock has been shorted until it's no taller than the width of a dime. It DOES pay a dividend. Some big investment banks have lately begun rating it, and giving it an Overweight grade. (Goldman, JPM.) ...But since this stock has been played like a yo-yo (or a violin) by "investors" whom I suspect of criminal shit--- driving the price down and down and down--- I can hardly believe my eyes when I see the Bloomberg webpage saying the Beta on ENIC is only 0.65. I mean, WTF.

Comments

  • ENIC = Enel Chile SA - ADR

    Is this what you are buying?
  • I think Crash mentioned a Chilean utility he had bought in the past-this may be it.
  • Yes, that's it. I bought at $2.97. (ADR.) Don't panic on my account, it is a rather small bet. Missed the May div, I understand that there is to be a smaller dose in Dec. ... Yup.
  • Part of investing. Individual stocks can really get knocked around.

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  • but, so... that chart makes it clear: how in the world can the beta on ENIC be 0.65? That's absurd.
  • edited October 17
    Crash said:

    but, so... that chart makes it clear: how in the world can the beta on ENIC be 0.65? That's absurd.

    Point taken.

    Terrible confession here - I don’t look at beta and couldn’t have told you what it was without reading this link. What is beta?.

    Being a utility, one would expect a low beta. If this is domiciled in Chili, that’s another matter. Personally, charts are where I look before buying anything. That and things like PEs / balance sheets / prospects for type of fund or industry.

    @Crash - Your entry point of $2.97 sounds reasonable looking at the chart. The stock peaked out at near $4.50 within the past year.

    ENIC Group Wikipedia https://en.wikipedia.org/wiki/ENIC_Group

    Enel Chili Wikipedia https://en.wikipedia.org/wiki/Enel_Generación_Chile

    I’m not sure that .65 beta pertained to the Chilean utility. See above links. Appear to be two different companies.

    Wondering if these are listed under two different stock exchanges and the “ENIC” symbol is perhaps leading to confusion?

  • Are you asking why the beta is so low in magnitude (since the price moves sharply, one might expect the beta to be higher), or why it's that high, or even why it isn't negative (since the US market has trended up in the past few months while ENIC has trended down)? I really can't tell what you're expecting from this chart.

    One can take the data from the past 12 months and smooth it by looking at monthly returns. In seven months (Oct, Nov and Dec 2020, Jan, March, Aug and Sept 2021) it moved in the same direction as the US equity market; in the other five months it moved in the opposite direction. Consequently one might expect a relatively flat (small slope, i.e. beta) regression line.

    See this PortfolioVisualizer chart comparing ENIC and VFIAX. Clicking on the Metrics shows a beta for ENIC of 0.84, but with a small R² of just 21%.

    Regardless of what value the calculation produces for beta, it's pretty much meaningless because of the low correlation.

    Of course I'm assuming that your beta is relative to the US market. If you're using a different (and hopefully better) benchmark, that could make the beta value meaningful.

  • Thank you a lot for your thoughts, guys. With my limited Spanish, I had just lately sent an inquiry to their Investor Relations office. I actually received a rather prompt reply from them, from Santiago. I actually was able to make sense of it. She even offered to arrange a phone call between us. I don't think I'll be needing that, even in English. By the way, some financial news sources have not updated, and still refer to ENIC as "Enersis Chile."
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