Why would you short Tassals *now*?, page-40

I saw the ****** Call from November 25th that included Tassals as one of their ten stocks in review. Not sure if I can post the link here, but you can easily search the date on their website and find it. Kochie was moderating, and they had Andrew Wielandt from DP Wealth Advisory and Michael Wayne from Medallion Financial. Neither were bullish on TGR, but what was interesting is to hear why.

Both of them described TGR as a cyclical agriculture type business. Not sure if I agree that aquaculture really fits into that mould, and in fact their prawns are specifically all year round. But their argument is that the low PE ratio is based on being a cyclical stock, and Michael talked about risks in aquaculture generally with sanitary and phytosanitary issues (e.g fish disease). The other negative they flagged is a perceived reliance on China and potential trade issues, referencing the lobster cargo being left on the tarmac. On the positive side, they talked about the insider buying (we saw more of it this week too).

Overall, as I have mentioned previously, for the stock price to really move, they need to be ahead of the sentiment. You aren't going to get fundies buying Tassals because of low PE or even increased earnings until they see it with their own eyes. The non-agricultural specialists out there (I reckon that's most fundies by the way!) just think anything to do with natural resources is risky and not their circle of competence so they steer clear. A few good reports of increased earnings will douse those beliefs though, and then they'll become the next A2M darling of the ASX.