KD price has collapsed by 55% and I am unsure if I should continue holding it or just take my lumps and sell? Is it do to the new CEO or the poor earnings report at (-11.75%) 8 cents lower than expected?
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Booms,
Youâre not going to want to hear this. But you are late getting out.
OTHO, itâs a 100% certainty that âthe marketâ is overreacting, as it always does, because some of KDâs fundamentals are quite decent.
By and large, averaging down is a No-No , for being thought of as throwing good money after bad. But if the reasons you bought the stock are still valid, then todayâs price simply creates a better entry than yesterdayâs.
Also, you need to consult your investing plan to see how much money you intended to put at risk on how many positions spread across however many asset classes. If KD is 2% or less of AUM (assets under management), then what you do doesnât make much difference. If KD is 10% (or more), then you should have been on top of this weeks ago. (IMHO, 'natch.)
Will KD recover somewhat and soon? That is a reasonable assumption. So thereâs no reason to panic and sell.
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Thanks for your response, fortunately I only invested roughly 2% of my portfolio in KD but, it still hurts when there were several recommendations to buy in Aug. 2025.
Hopefully it will recover but, 55% is a huge drop and doesnât make it comfortable to reinvest.
Booms,
Your 2% allocation puts you in the cat birdâs seat. Do nothing yet. Just sit tight and wait for the inevitable price recovery, which might not be back to even. But itâs going to be a whole lot better than present.
One reality of investing you need to take to heart is that not every investment is going to offer a positive return. There are going to be losses. How many you will tolerate and how large you let them become is a function of your investing plan.
Some people cut their losses at a small, fixed percentage such as 7% or 8%. Some people tolerate losses as large as 20%, 30% (or more). It all depends on their tolerance for âriskâ and their forecast as to what waiting things out might bring. Any system of loss management can be made to work. But âworkableâ doesnât mean âemotionally comfortableâ. Hence, this proverb:
âSell down to your sleeping point.â
Frankly, were it me who had been holding KD at a 2% weighting, Iâd have been in there buying today.
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I donât have that big of a pain tolerance. Maybe I would put another 33% of the current value to make up for some of the losses if it has enough investors to rebound. But, at the huge loss is it worth the risk? Or is there something better to invest in?
Booms,
Self-awareness is the key to investing success. What one person can tolerate and make a success of wonât work for another. Also, it makes much more sense to score oneâs success across the whole basket of holdings, not just individual positions.
There are going to be losses. If there werenât, thereâd also be no wins. Thatâs the other side of the coin thatâs flipped each time an investment is made. Someone will be right about the price and the timing, and someone will be wrong. Also, however rational markets can be at times, there are also plenty of times when crazy things happen, and often enough they happen out of the blue. Itâs no different than heading out on a bike on what seems like a fair weather day and then getting caught in a downpour and pedaling home soaked and chilled.
If you want to do some reading that addresses the emotional side of investing, try Ben Grahamâs, The Intelligent Investor, or Justin Mamisâ, The Nature of Risk.
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Booms,
I put on a position yesterday, getting in a $10.53, because I trusted the info on KDâs fundamentals that I could find. Today, however, when I re-read FinVizâs summary of the marketâs reaction to the Feb 9 earnings report (below), it finally dawned on me why the stock was being sold down. The company had been cooking its books.
âKyndryl slashed its FY26 revenue, pretax income and freeâcashâflow outlook citing slower sales cycles and an IBM headwind, reaffirmed FY28 targets, disclosed expected material internalâcontrol weaknesses rendering prior assessments unreliable, and announced its CFOâs departure amid an SECârelated accounting review that delayed the 10âQâ
So I dumped the position just now at 11.29. Not the best of trades, but a one-day, 3.4% profit nonetheless, and more importantly, a lesson learned: Figure out why stock is being dumped before jumping in.
How long will it take for the company to get itself straightened out? Who knows?
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