Is it safe to invest in trump Entertainment Resorts Inc?

Question

I was thinking that it would be a safe investment because Donald Trump owns it. The stock price is at around $2 right now.

Why is the price so low and is it safe to invest in it?

Answer 1

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Answer 2

I would argue that it is definitely not safe, and it is arguably considered, "highly speculative."

They are losing money hand over fist. Expecting -$6.38 loss in upcoming earnings estimates

http://finance.yahoo.com/q?s=TRMP

2 years of negative net income

http://finance.yahoo.com/q/is?s=TRMP&ann...

3 years of consecutive negative balance sheet

http://finance.yahoo.com/q/bs?s=TRMP&ann...

Hotel/ Casino ops (operators) are in a bad space right now due to the US economy. People don't have money to loose (gambling). Gas costs too much to drive far; airlines are charging to check in bags; fuel prices are driving airline tickets, and real estate (hotels) are plummeting.

Hence, this is why the stock is under $2.00.

Watch, I bet it gets D-Listed.

I'd avoid. Worse case is you loose your entire investment in a BK filing.

Note. Trump doesn't own the hotel. He is not even a major shareholder.

http://finance.yahoo.com/q/mh?s=TRMP

Donald,

I like you. You've made a lot of money and have a beautiful and very bright family. When it comes to this particular business, this was a hard decision......

Donald.... Your fired.

Answer 3

I do not follow the trump stock but I would invest  in it if I were you. The resort industry is doing well, even in the economic downturn, because there will always be the retired folk going on there random excursions and around the holidays the resorts are always filled up. Anything with the trump name on it deos well. Were trump is, there is a certain class and elegance about it.

Answer 4

NO it is not.  They have a great amount of debt.  Trump had to sell one of his Atlantic City resorts to help pay it off.  The rest of the ones he owns are not known as "first class" resorts because lack of money = lack of maintenance/improvements.  He does own some very nice places in Manhattan.  But, many of the "first class" hotels/apartment houses around the country with his name on it are owned and operated by others.  They just put his name on it for the recognition factor.  They know people have a short memory and don't remember Trump defaulting on many of his bonds, leaving holders holding the investing version of "Your fired."