RE:Donville-Kent Donnville-Kent October , 2023 newsletter
RediShred (KUT)
RediShred reported a record quarter at the end of August. They then
announced two more acquisitions and guided to completing more before year-
end. The stock on the other hand declined quite a bit. The stated financials,
with forex and a fluctuating paper price, may hide the true profitability, but the
company continues to reinvest at high rates of return. The profitability of
shredding trucks is much higher than one might expect. We continue to believe
in this management as they execute like they say they are going to.
For both CTS & KUT, we focus on cash earnings versus other metrics like free
cashflow or EBITDA etc. We believe both companies are investing in growth
CAPEX at high rates of return, which is what you want to see. These are two
investments that we expect to jump considerably as the cycle turns.