Quiet Contrarian. Ep42: Trades for April 2023

Sells

Kalium Lakes Ltd – KLL.ASX – They have repeatedly failed to meet targets since the last update. Their update this month had them producing 1.7kt of SOP, which is a loooooong way from their 60ktpa target. They pushed the target back a month. I don’t believe they can achieve this, even if they have set a new “inched out” target. This is good practice for me to improve my loss taking when my investment thesis hasn’t come through (rather than just adjusting the thesis in order to not realise the pain – know why you’re in, and know what your conditions of getting out are).

KMD Brands – KMD.ASX – Bought back in August of 2020 with the expectation that there would be a post-Covid bounce and a return to normalcy, which would result in significant gains once their newly-acquired RipCurl subsidiary was fully operational. Unfortunately, the company has been hit with one obstacle after another, such as travel reopening later than expected and customers spending their money elsewhere. As covid savings dwindle and the travel bubble finishes, I personally feel like purse strings will tighten for the next year or two, resulting in a decrease in EPS for all discretionary retail stocks. My initial target was an EPS of 10c by FY23, but it seems highly unlikely that they will reach that.