Those of you aware of my chunky $RKLB position may be interested to learn where I reallocated the proceeds of my one trim. Half of the answer is $KLAR It shares many of the hallmarks of a future compounder: Huge sales growth, founder led, heavy on the tech, and a hyper-aggressive expansion plan. It is also relatively unprofitable, for the time being. However, the fact is that we're on the hunt for future compounders to try and beat the market. You can't do that unless you seek out the 10X growth stocks before they 10X, which is when the perceived risk is at its highest. We're looking for ugly ducklings that have the potential to turn into portfolio growth beasts. $KLAR fits the bill. It is down heavily since it's IPO, which is understandable since you had 20 years of early employees and investors eager to cash out. With that said, we are now well above all-time lows and it seems like the market is finally waking up to $KLAR's long term potential. It is founder led since 2005, so despite the fact that the risk of credit losses is real, I am confident that management is in this game for the long haul. Recent momentum also shows that Klarna's actual customers (retail partners) continue to put faith in Klarna. I've highlighted a few in the graphic below, but the biggest recent name is Apple, who I doubt would become a partner with Klarna unless they were confident in their ability to persist long term. Another point in favor of Klarna, relative to its competitors, is the geographic diversity of its revenue. It's US business is growing at a breakneck pace, which is awesome, but the company was actually founded in Sweden. It operates across Europe, North America, and several other regions. With all this in mind, remember that you invest at your own risk. One of Klarna's biggest competitors, $SEZL, didn't impress in their recent earnings and was down 33% overnight. If you can't stomach a single day swing that large then you should steer clear as this is a very volatile niche. For me, however, it is a bet that I am willing to take. Let's hope that I can hit another compounding machine similar to $RKLB... If not, you can all laugh at me as I lose money.
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4 Comments
Zingy @zingy · 5d
Some data for the data nerds.
Jojo Wang@jojo84072 · 4d
I’m still amazed by how much you made from RKLB 🥹🥹
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