Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
The price of KLS has fallen significantly in the past year and is now back around the levels in 2020. The business has some significant capex issues at present. There are some asset sales in progress to sure up the balance sheet. This appears to be a solid business in an essential infrastructure like space with decent long-term prospects. Do you have a view.?
Hi James,
The previously named Sealink is an Australian-based public transport service provider operateing over 5,800 buses, 115 vessels and 24 light rail vehicles, and it has fallen ~70% from its 2021 high. Last month’s 1H results initially shocked & disappointed the market sending the stock down almost 30% before it bounced back above $3, still ~20% from its 2025 high:
The shares were hammered on the big earnings miss which was accompanied by a deluge of broker downgrades. We wouldn’t call it an infrastructure play per se, though it’s certainly diversified:
While the result was soft, we were happy to see more realistic targets set, with net sustaining CAPEX of $85m/pa along with return targets and lower target gearing. They’ve had a few operational missteps though, so the market will need to see them deliver before bidding up the stock.
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