ATM - A2 Milk Corporation Limited

[alex f]

Take absolutely no notice whatsoever of Sam Teeger or Citi, they have played this old trick before with A2, issue a downgrade then mop up as many cheap shares as they want for their clients and to lend to shorters and then a few weeks or so later they issue an upgrade. PS-See you at $20.

Long history of Teeger talking the price down. Last year downgraded target from $14 to $11

https://hotcopper.com.au/threads/citi-research-nestle-to-win.4573982/page-7

[Beagle]

Long history of Teeger talking the price down. Last year downgraded target from $14 to $11

https://hotcopper.com.au/threads/citi-research-nestle-to-win.4573982/page-7

Maybe so but its a little bit of an inconvenient truth that they were right and it actually well and truly overshot on the low side and went well under $10 at one point last year.
Couldn't happen again...of maybe it could now the forecast growth rate in eps is just one third the rate of what it was last year :ohmy:
Chart doesn't look good. 10780 Where's the support ? $10?

[couta1]

Maybe so but its a little bit of an inconvenient truth that they were right and it actually well and truly overshot on the low side and went well under $10 at one point last year.
Couldn't happen again...of maybe it could now the forecast growth rate in eps is just one third the rate of what it was last year :ohmy:
Chart doesn't look good. 10780 Where's the support ? $10? No they have never been right on A2 since they first started their downgrades when the stock was under $2. PS-If your long the chart is simply a picture of oscillation noise and should be viewed as such.

[ratkin]

In any event, listening to brokers, insto analysts and 'discussion groups' is a mugs game, it inevitably messes with your mind and you do things you wouldn't otherwise do if you had just ignored the whole lot of them and worked your own book.

A2M and ATM are in or entering the sweet spot buy zone, it's massively derisked (capital basis) and has a bright future. Now's the time people might want to consider progressively easing in, certainly not the time to freak out and sell!

But I'm just a 'discussion group' guy, so don't listen to me ... LOL. :eek2:

This is a discussion group, so by your own logic we shouod ignore your advice to “progressively ease in”

[ratkin]

No they have never been right on A2 since they first started their downgrades when the stock was under $2. PS-If your long the chart is simply a picture of oscillation noise and should be viewed as such.

Nobody in their right mind would buy looking at this chart.

[bull....]

hammer time today if over seas markets are any influence

[ratkin]

hammer time today if over seas markets are any influence

Invert Hammer time....Cant touch this !!

[Beagle]

Sigh....Couta1 me ol mate. Just remember when this gets smashed I tried to help, I really did... but now I am done so if you're sick of the barking you can take your ear muffs off now :p

[Sideshow Bob]

Maybe so but its a little bit of an inconvenient truth that they were right and it actually well and truly overshot on the low side and went well under $10 at one point last year.
Couldn't happen again...of maybe it could now the forecast growth rate in eps is just one third the rate of what it was last year :ohmy:
Chart doesn't look good. 10780 Where's the support ? $10?

Not quite a 200 day MA, but a 'golden cross' there when about $15-odd bucks.

[longy]

I have to wonder that, the big boys are loading up but SP is falling.

[bull....]

looks like shares are being lent to shorters by big insto's given the announcements by morgan stanley , ubs

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/341547/308394.pdf

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/341546/308393.pdf

[couta1]

Nobody in their right mind would buy looking at this chart. Why not? and besides my last big lot was bought at $17.30 on the NZX so current prices are an absolute bargin.

[couta1]

Sigh....Couta1 me ol mate. Just remember when this gets smashed I tried to help, I really did... but now I am done so if you're sick of the barking you can take your ear muffs off now :p Lol remember you described me as Incorrigible and if the shoe fits I'll wear it.

[Beagle]

Lol remember you described me as Incorrigible and if the shoe fits I'll wear it.

LOL If I bark any more you'll accuse me of being too dogmatic and besides that I might get a "horse" throat :)
incorrigible - (of a person or their behaviour) not able to be changed or reformed. It fits mate, believe me.

[whatsup]

Looks like we are headed for sub $13 today, I wonder if that snippet of a comment in the financial page of the Herald has people thinking , its re BAL in Aust?

[couta1]

Holders of this stock are basically caught up in a Game if Thrones currently, UBS/Morgans/Citi are pulling down the SP for their own purposes and it has nothing whatsoever to do with fundamentals it's all about mopping up as many cheap shares as they can from weak hands.

[sb9]

Not sure how we all missed this but thanks to JBinvest from HC for posting the link re conf call following FY results this year in Aug. Almost an hour long so set some time aside and listen for those that're keen.


https://thea2milkcompany.com/wp-content/uploads/a2m_cc_210819.mp3

(https://thea2milkcompany.com/wp-content/uploads/a2m_cc_210819.mp3)

[allfromacell]

Beagle has laid out the bearish case very well and there is definitely been a change in the fundamentals which shouldn’t be ignored. The fundamental change is Jayne doubling down on marketing and sacrificing EPS growth for revenue growth, something very common in high growth stocks and imo not a bad thing.

The marketing team at ATM have always been praised as they’ve done an exceptional job so far, I think once again doubling their budget will pay off and it’s not like there’s a shortage of $s to push harder with a proven strategy. I don’t think all the low hanging fruit has been picked or that sales growth will drop off as fast as some believe. I suspect Jayne’s wording was used to lower the market expectations as things were getting a bit stupid at $18 but 10% market share is very much on the cards over the next 5 years.

I bought back the all the shares that I sold at $17.94 + some at the close yesterday, catching the falling knife when the RSI hits 30 has worked very well for me in the past with this stock.

[Balance]

Market will do what the market does - we are but minnows against the big boys in the short term when it comes to them influencing the sp.

But what we can do is manage our own emotions and reactions to the price movements and fluctuations.

Being a high PER stock, ATM is unquestionably also a high risk stock - it cannot fail to deliver on the high expectations built into the sp.

We have seen what happens when it misses expectations by just a bit in the last results - it is called PER contraction.

W69 and I have always talk about downgrades coming in threes - hope ATM is an exception rather than the norm.

Meanwhile, pays to keep safe by not being over-exposed.

[sb9]

Not sure how we all missed this but thanks to JBinvest from HC for posting the link re conf call following FY results this year in Aug. Almost an hour long so set some time aside and listen for those that're keen.
https://thea2milkcompany.com/wp-content/uploads/a2m_cc_210819.mp3

(https://thea2milkcompany.com/wp-content/uploads/a2m_cc_210819.mp3)



Just finished listening to earnings conf call. For a start, it was done very professionally and articulated well both by Jayne and Craig (CF0) and Peter Nathan.

Only first 10 or 15 min was re numbers and other bits and pieces relating to FY results and remainder was all Q&As from Analysts. Very informative and clears all short term noise from various online posters on different forums. The way I see it is that couple of Instos (like UBS) and shorters miking it in the short term on perceived weakness of fundamentals, which is not case at all once you listen to whole transcript.

In summary, if you're in for long term nothing to fear about day to day price movements. They've very clear strategy ahead and are investing accordingly to execute that both in China and USA.

Will try and attend ASM in Nov as its being held in Akl this year.

[Leftfield]

Thanks for the update sb9. Much appreciated.

[see weed]

Thanks for the update sb9. Much appreciated.
Ditto. And still buying on the lows.

[Balance]

For the benefit of someone who asked me on the Plexure thread about how the shorts are doing - ‘are they burning?’ - here’s my view as articulated since I sold 2/3 of my shares when ATM reported.

The story on ATM is still a great one but the risk profile on the company has changed - it’s now in a higher risk category necessitating a more cautious investment approach imo.

Downgrades come in 3s and ATM has just had one, albeit a small one in the last results. Hence, the PE contraction from the high 30s.

The need to ramp up marketing and promotional spend to maintain sales momentum with associated lower margins - easy gains are indeed behind the company and it’s going to get harder from here.

The US expansion and associated losses to date is a worry for some of us as the US is no cake walk as many NZ companies have found.

Overall, the shorts are still out of the money but those shorting recently at the higher prices are obviously not burning.

[limmy]

UBS Group AG and its related bodies corporate have been quite active in ATM lately. Their announcements aren't also easy to follow but I gather that they've been over and under the 5% SSH threshold and now they've gone over again.

They must be making money shorting and buying back on the cheap ?

[couta1]

UBS Group AG and its related bodies corporate have been quite active in ATM lately. Their announcements aren't also easy to follow but I gather that they've been over and under the 5% SSH threshold and now they've gone over again.

They must be making money shorting and buying back on the cheap ? Its all about game playing and mopping up as many cheap shares as possible right now plus collecting shorting fees, I dont see PE contraction as a reason for the fall, just wait until these players take their pedal of the gas or a bigger player starts buying and watch what happens to the SP not to mention any good announcements which may come out. PS-Theres also a takeover possibility but I highly doubt it would be successful.

[Oberon]

Its all about game playing and mopping up as many cheap shares as possible right now plus collecting shorting fees, I dont see PE contraction as a reason for the fall, just wait until these players take their pedal of the gas or a bigger player starts buying and watch what happens to the SP not to mention any good announcements which may come out. PS-Theres also a takeover possibility but I highly doubt it would be successful.

I think this aspect of the SP drop is often overlooked. The likes of me who recently went all in at $15.10 (after a very good week trading in and out of the stock - decided to hold over the weekend before the SP started it's merry tumble - nice move... *face palm*), have to sit out this raid on lower prices by the big guns. I'm sure as hell not getting whacked with a huge loss to satisfy their games. As you say, eventually the foot will come off the pedal and give the SP a chance to come out from under this downward pressure. Of course, a bit of positive news from TPTB @ A2 would help give the SP a decent spike (not to say the news hasn't been positive, IMO).

[Bobdn]

https://www.youtube.com/watch?v=EGlGhrbYuxo
Interview on Bloomberg with the CEO.

[whatsup]

https://www.youtube.com/watch?v=EGlGhrbYuxo
Interview on Bloomberg with the CEO.

Very good interview, imo they once again are on the right track despite what Citi says with their short selling advice ( maggots ! ).

[allfromacell]

https://www.youtube.com/watch?v=EGlGhrbYuxo
Interview on Bloomberg with the CEO.




Another good interview, I like this one because you can see how Jayne's approach to growth is a lot more ambitious to a more conservative Geoffrey. When Jayne was asked when the business will become break-even in the US she was clear that the number one agenda is to grow the brand and market share first, she said she has no plans to cut back on marketing to become profitable sooner. This is very different to Geoffrey's more conservative approach of becoming profitable in the US quickly, and having the sales contribute to EPS which Jayne obviously doesn't agree is the best way to maximise shareholders long term earnings potential.

I like Jayne's courage here and suspect the board is in agreement with her, grow sales and worry about EPS later. The market wants to continue using the PE ratio to value this business and give it a lower multiple due to slower EPS growth but in my view as long as sales growth continues at a fast clip if anything it deserves a higher multiple as earnings are put on the back-burner.

By all metrics I can't see and evidence of growth slumping much, the commerce data from Goldman, port data and sales results direct from the company are all still showing excellent growth. If and when sales growth really starts to slow then a think it's fair to punish the share with a lower multiple.

F19 Half 613M PCP = 41%
F19 Second half 687M = PCP 40.7%
F19 full 1300M = PCP 40.8%
US second half revenue growth = 200%.

Good luck all holders, the business has a long road ahead.

[whatsup]

Another good interview, I like this one because you can see how Jayne's approach to growth is a lot more ambitious to a more conservative Geoffrey. When Jayne was asked when the business will become break-even in the US she was clear that the number one agenda is to grow the brand and market share first, she said she has no plans to cut back on marketing to become profitable sooner. This is very different to Geoffrey's more conservative approach of becoming profitable in the US quickly, and having the sales contribute to EPS which Jayne obviously doesn't agree is the best way to maximise shareholders long term earnings potential.

I like Jayne's courage here and suspect the board is in agreement with her, grow sales and worry about EPS later. The market wants to continue using the PE ratio to value this business and give it a lower multiple due to slower EPS growth but in my view as long as sales growth continues at a fast clip if anything it deserves a higher multiple as earnings are put on the back-burner.

By all metrics I can't see and evidence of growth slumping much, the commerce data from Goldman, port data and sales results direct from the company are all still showing excellent growth. If and when sales growth really starts to slow then a think it's fair to punish the share with a lower multiple.

F19 Half 613M PCP = 41%
F19 Second half 687M = PCP 40.7%
F19 full 1300M = PCP 40.8%
US second half revenue growth = 200%.

Good luck all holders, the business has a long road ahead.





allfrom, bit harsh on Geoffery as he didn't have the luxury of the cash in the bank that she now has, he was more interested in growing the brand in China and Aust which laid the ground for her to be able to spend on what she wants to grow the brand in her way, I do hope that she gets that right !

[allfromacell]

allfrom, bit harsh on Geoffery as he didn't have the luxury of the cash in the bank that she now has, he was more interested in growing the brand in China and Aust which laid the ground for her to be able to spend on what she wants to grow the brand in her way, I do hope that she gets that right !

That's fair, I didn't mean to criticise Geoffrey as he did an outstanding job and have a lot to thank him for. I'm just impressed with Jaynes direction and reckon she's doing and saying all the right things (please Jayne, don't dump all your shares again though).

[horus1]

I have some and are starting to add .Risky but good share.

[couta1]

I have some and are starting to add .Risky but good share. Less risky than you may initially think, babies gotta drink milk and mums want the best variety for their precious ones and A2 is the best.

[Beagle]

Breast is best + much better emotional bonding. A2M infant formula, second best.

[couta1]

Breast is best. A2M infant formula, second best. Mate your stating the obvious but Chinese and many other mums these days dont use them.

[BlackPeter]

Less risky than you may initially think, babies gotta drink milk and mums want the best variety for their precious ones and A2 is the best.

Holding a small parcel myself, but we still should stay to the facts.

There is a certain percentage of the population (from memory I think up to 45% in the Asian population and something like 15% in the Caucasian population - the numbers sort of move depending on who paid for the relevant article, and authors often mix up A1 intolerance and lactose intolerance) who have problems to digest A1 milk.

For anybody with A1 intolerance A2-milk is "better" though obviously breast milk would be best for infants (which would be A2 as well). Obviously - there are a number of other sources of A2-milk: goat milk, sheep-milk and there are as well some other specialty cow milk suppliers (unrelated to the A2 company) offering A2-milk. All good.

For anybody without A1 intolerance it does not matter at all, whether they buy A2 or drink instead the cheaper A1 milk (or more likely the typical A1/A2-mix) . Pure A2 milk just helps them to relieve their wallets, which may or may not be seen as beneficial by the consumer ;);

[Beagle]

Mate your stating the obvious but Chinese and many other mums these days dont use them.

Shows you how stuffed in the head many people are, considering all the evidence of emotional bonding and the nurturing that leads to far better outcomes.
Herdlicka's experiment with gargantuan sized marketing has got no better than a 50/50 chance of success in my opinion. This isn't the slam dunk winner many think it is and reality bites, has actually lost $1.50 in value in the last 19 months. Maybe the game has changed and all the low hanging fruit has gone...

[Balance]

Shows you how stuffed in the head many people are, considering all the evidence of emotional bonding and the nurturing that leads to far better outcomes.
Herdlicka's experiment with gargantuan sized marketing has got no better than a 50/50 chance of success in my opinion. This isn't the slam dunk winner many think it is and reality bites, has actually lost $1.50 in value in the last 19 months. Maybe the game has changed and all the low hanging fruit has gone...

Better that ATM recognises that reality and increase promotional & marketing spending now to maintain sales growth & momentum.

My discomfort is that there are several risk factors at play now with ATM - so prudent not to be over-exposed.

[Beagle]

Better that ATM recognises that reality and increase promotional & marketing spending now to maintain sales growth & momentum.

My discomfort is that there are several risk factors at play now with ATM - so prudent not to be over-exposed.

They're not forecast to maintain it despite the dramatic increase in spend.
Based on average analyst expectations, despite the gargantuan increase in marketing, sales growth is forecast to slow considerably from FY19 and dramatically from the rate achieved in FY18. The slowing in EPS growth is even more dramatic with only mid teens (percent per annum) forecast for FY20.
Despite the obvious slowing the PE has not contracted to more realistic level's. I think this grinds lower as the reality of much lower growth rates slowly becomes more widely understood. The reality is once the low hanging fruit is all gone its much slower and more expensive to grow further from there.

[couta1]

Better that ATM recognises that reality and increase promotional & marketing spending now to maintain sales growth & momentum.

My discomfort is that there are several risk factors at play now with ATM - so prudent not to be over-exposed. Overexposed and proud, follow your Gutometer not analysts or naysayers or anyone on an internet forum for that matter.

[Balance]

Overexposed and proud, follow your Gutometer not analysts or naysayers or anyone on an internet forum for that matter.

Wonderful thing - the sharemarket.

[sb9]

Due to daylight savings kicked in here, we've an extra hour to negotiate before being influenced by ASX which starts at 1pm our time. Its only for this week, from next week business as usual.

[see weed]

Due to daylight savings kicked in here, we've an extra hour to negotiate before being influenced by ASX which starts at 1pm out time. Its only for this week, from next week business as usual.
Thanks sb9. Forgot about that.

[RGR367]

Just another bit on that marketing expense so we don't worry about it? https://www.nutraingredients-asia.com/Article/2019/09/26/a2-Milk-company-benefiting-from-China-s-premiumisation-drive-on-back-of-JD-partnership

[Leftfield]

Just another bit on that marketing expense so we don't worry about it? https://www.nutraingredients-asia.com/Article/2019/09/26/a2-Milk-company-benefiting-from-China-s-premiumisation-drive-on-back-of-JD-partnership

No Worries - especially if it leads to a 210% plus increase in A2 sales over the prior period as reported.

Thanks for posting.

[sb9]

No Worries - especially if it leads to a 210% plus increase in A2 sales over the prior period as reported.

Thanks for posting.

That's good isn't it.

Well, we're into last quarter for this CY. Let's see what it might bring.
Don't wanna jinx it, but haven't seen the CEO share sale happen yet, which I tht would've been done post strategic presentation in China. May be she has decided to hold onto them bit longer until 4M update at ASM time in Nov.

[see weed]

Wow, 2 up days in a row. Are we there yet? Is this the start of the next........:t_up:

[Oberon]

Wow, 2 up days in a row. Are we there yet? Is this the start of the next........:t_up:

Good day on the ASX. I live in hope, but after the past 3 weeks I'm not holding my breath. I'm not breaking even until $15.17, in any event.

Maybe the shorters are finally covering.

[bull....]

Good day on the ASX. I live in hope, but after the past 3 weeks I'm not holding my breath. I'm not breaking even until $15.17, in any event.

Maybe the shorters are finally covering.

haha under 13 today maybe?

[see weed]

haha under 13 today maybe?
If that's the case, then top up time again;). My break even is $9 or less if sell the later buys.

[see weed]

haha under 13 today maybe?
Couldn't wait for Aus to open or for $13, jumped in at 13.24, but will buy more on any drips under that price:).

[bull....]

Couldn't wait for Aus to open or for $13, jumped in at 13.24, but will buy more on any drips under that price:).

charts dont look very positive trend wise?

[see weed]

charts dont look very positive trend wise?
I agree. The trend always comes to an end. I tend to start buying back in before the end of the trend. ATM moves to fast to miss out. Did the same with AIR a few years ago, and rode it from $1.20 odd down 0.845c. with steel gloves:cool:.

[Sideshow Bob]

I'm sure there is a thread somewhere about buying in a downtrend......

Wasn't it someone's little tagline that said "Never drink and buy in a downtrend"??

[see weed]

I'm sure there is a thread somewhere about buying in a downtrend......

Wasn't it someone's little tagline that said "Never drink and buy in a downtrend"??
I do both, that's why I have not much hair:).

[allfromacell]

I'm sure there is a thread somewhere about buying in a downtrend......

Wasn't it someone's little tagline that said "Never drink and buy in a downtrend"??


Buying good companies in deep downtrends always seems to be where I've made the most money.

[dobby41]

I tend to start buying back in before the end of the trend.

How do you know when this is going to happen?

[couta1]

Buying good companies in deep downtrends always seems to be where I've made the most money. Yep and I buy good companies in all trends.

[see weed]

How do you know when this is going to happen?
Gut feeling. It always happens. You can start buying in a couple of dollars in this case, before it hits the bottom.eg If it was a $1.20 share you could start buying in at $1.20 and ride it down to 90c;).

[limmy]

How do you know when this is going to happen?
The answer is charting or Technical analysis. There are lots of books and or articles written about this subject.

[bull....]

Couldn't wait for Aus to open or for $13, jumped in at 13.24, but will buy more on any drips under that price:).

not looking good today

[couta1]

not looking good today You really love to state the obvious. PS-A falling tide lowers all boats.

[percy]

You really love to state the obvious. PS-A falling tide lowers all boats.


TRA are up............[at present]...lol.

[couta1]

TRA are up............[at present]...lol. So is FCG so that doesnt say much. Lol

[see weed]

not looking good today a
Yes, and last year about Oct. it went down to 8.67 but was only there for about 10 sec. By end of day it was well over $9. My buy ins last Oct....3/10/18 to 1/11/18.....11.26, 10.78, 9.71, 9.72, 9.80 and 10.69. it moved so fast from 8.67 back to the mid 9s within a few hours, just couldn't catch it. See where it gets to this year:).

[allfromacell]

Does anyone find it unusual that we’ve still haven't had our regular senior management share sell off yet? I notice the chief of marketing exercising 200K options perhaps getting ready to sell them as she usually does. One might speculate we’re the cusp of a big announcement or maybe management see the current price as grossly undervalued and prefer to wait for a better price after the next market update in November.

[couta1]

Does anyone find it unusual that we’ve still haven't had our regular senior management share sell off yet? I notice the chief of marketing exercising 200K options perhaps getting ready to sell them as she usually does. One might speculate we’re the cusp of a big announcement or maybe management see the current price as grossly undervalued and prefer to wait for a better price after the next market update in November. I reckon anything bar the likes of the outbreak of war are priced in at current levels, any sale by senior management could be viewed as chump change in light of the games UBS have been playing for quite some time now.

[couta1]

TRA are up............[at present]...lol. Hey percy I regret to inform you that TRA is now down. Lol

[BlackPeter]

not looking good today

Typical bull ... ;

Risky to crow before the Australian market opens ;); SP looks pretty steady to me;

[sb9]

Holding exceptionally well, looks as though $13 or there about is the floor.

[dompf]

Holding exceptionally well, looks as though $13 or there about is the floor.


Right now out of the 100 stocks on the ASX100 only 6 are in the green - A2 being one of them. Perhaps it really has hit its bottom lets not count my chickens too soon!

https://www.marketindex.com.au/asx100

[whatsup]

Why the ongoing weakness !!

[couta1]

Why the ongoing weakness !! Games by the big players accumulating off weak hands, they will be trying hard to force the death cross to occur and cause the last round of panic selling.

[see weed]

Games by the big players accumulating off weak hands, they will be trying hard to force the death cross to occur and cause the last round of panic selling.
Good for us couta. Bought some more today and are placing another order soon:).

[carrom74]

Games by the big players accumulating off weak hands, they will be trying hard to force the death cross to occur and cause the last round of panic selling.

On a positive note though... the CEO or any of her mates haven't offloaded the shares yet...Last year she sold it on the last week of September... May be they too reckon its undervalued...

[dobby41]

On a positive note though... the CEO or any of her mates haven't offloaded the shares yet...Last year she sold it on the last week of September... May be they too reckon its undervalued...

Maybe the large tax bill story last year was real and this year she doesn't need to sell?

[see weed]

Why the ongoing weakness !!
Not as bad as last year. It closed at 9.04 on 11/10/18. The next day 12/10/18 it went down to its year low of 8.67, but by days end it was up to 9.89 at close, a gain of 85c from day before. Then it started the long slow up trend to $18 over 9.5 months. Who knows what low for this year, but good buying while it lasts;).ps about a dollar a month over 9.5 months:).

[Beagle]

Games by the big players accumulating off weak hands, they will be trying hard to force the death cross to occur and cause the last round of panic selling.

All negativity (except global thermo nuclear war) now priced in eh mate
Or could it be that the hound dog is right and its really only worth $11.50 :p

[sb9]

Games by the big players accumulating off weak hands, they will be trying hard to force the death cross to occur and cause the last round of panic selling.

Will be waiting for that to unfold, then I can buy back more of the parcel that I sold around $14 mark..

[couta1]

All negativity (except global thermo nuclear war) now priced in eh mate
Or could it be that the hound dog is right and its really only worth $11.50 :p The hound is barking in the wrong milk bottle here, $17-$18 next year sometime. PS-$11.50 possible due to Schizophrenic unmedicated market but that says nothing about true value.

[Beagle]

No...Goat milk is the next big thing mate. I barked it first :p https://www.globalhealingcenter.com/natural-health/goat-milk-benefits/

[couta1]

No...Goat milk is the next big thing mate. I barked it first :p https://www.globalhealingcenter.com/natural-health/goat-milk-benefits/ Good luck drinking that stuff, tastes like crap which is made worse by the fact that it goes off quickly.

[macduffy]

Good luck drinking that stuff, tastes like crap which is made worse by the fact that it goes off quickly.

…… and does that make it taste better or worse?
:confused:

Seriously, though, I reckon some posters are being rather harsh on one of NZ's most successful companies of recent years.

[RTM]

The hound is barking in the wrong milk bottle here, $17-$18 next year sometime. PS-$11.50 possible due to Schizophrenic unmedicated market but that says nothing about true value.

Considering ATM my thoughts are....if anyone is interested.
a) The market will be concerned about the status of one of their key suppliers...Synlait.
b) Really....how valid is the A2 protein science ?
c) If it is totally valid...how long before all dairy herds are A2 ?
That's what keeps me from investing. Oh...and I don't like the dividend structure.

[Baa_Baa]

Games by the big players accumulating off weak hands, they will be trying hard to force the death cross to occur and cause the last round of panic selling.

The 50/200 DMA 'death cross' is inevitable, it's too late to reverse. That said, last time the death cross occurred the SP was rising out of $8.67 and look where it got too. It's likely that the cross this time, when it happens, in a solid down trend from ATH will trigger various TA inspired responses.

[see weed]

All negativity (except global thermo nuclear war) now priced in eh mate
Or could it be that the hound dog is right and its really only worth $11.50 :p
If you were to jump back in for a little drink, what would be the price to get you jumping? ps goats milk is also a2:).

[Beagle]

I see fair value at $11.50 but before dipping my snout in for a drink I'd also want to see TA looking a lot healthier than it does at this point :eek2:
Could be party time if it gets down to $9 and a right old free for all :) https://www.youtube.com/watch?v=lnJ6t-PKLWE

[Baa_Baa]

I see fair value at $11.50 but before dipping my snout in for a drink I'd also want to see TA looking a lot healthier than it does at this point :eek2:

Have you done a valuation to arrive at $11.50 "fair value"? My FA's not good enough to contrive such a low SP number for this high growth company.

In any event, if it's the TA that keeps you out, you'd need the price to fall well below $11.50 and then rise above say the 100MA before the TA looked good enough to buy. Conundrum is even though it was below your fair value, you still wouldn't buy it because the TA was bad.

[couta1]

I see fair value at $11.50 but before dipping my snout in for a drink I'd also want to see TA looking a lot healthier than it does at this point :eek2:
Could be party time if it gets down to $9 and a right old free for all :) https://www.youtube.com/watch?v=lnJ6t-PKLWE Careful Beagle talk of $9 would get you labelled a Troll on another forum by many and I'd be one of them. Lol

[Beagle]

Yes I have and you are right, it would need to fall below $11.50 and then build a base and start to recover before TA looked any good.
$11.50 not so outrageous really. https://www.marketscreener.com/A2-MILK-COMPANY-LTD-11384022/consensus/
One of the analysts has a 12 month price target of just $11.85 which suggests (using a 12% expected rate of return on risk capital), a fair value of just $10.43 at present.
Using the same discounting methodology to the average 12 month price forecast of N.Z. $14.86 (x 0.88) gives $$13.07 as fair value today.

Recent price trading range suggests the current price is about fair value according to average analyst view. Some analysts believe their EDITDA margin will not recover in FY21, FY22 or anytime soon thereafter, (due to ongoing rampant marketing and human resources cost increases) so some DCF valuations are far too optimistic.
Sales rising to $2.3b by 2022 will be a very tough ask too, in my opinion. Lot of growth already well and truly fully priced into this one already.

[Baa_Baa]

Yes I have and you are right, it would need to fall below $11.50 and then build a base and start to recover before TA looked any good.
$11.50 not so outrageous really. https://www.marketscreener.com/A2-MILK-COMPANY-LTD-11384022/consensus/
One of the analysts has a 12 month price target of just $11.85 which suggests (using a 12% expected rate of return on risk capital), a fair value of just $10.43 at present.

Well to keep some balance, one analyst reckons $17.50 and the average analysts target which you quote fairly often for other shares is $14.86. Cherry picking the outlier at $11.85 and building a case around that is dubious. So, have you done your own analysis to arrive at $11.85 and an outrageous $9 in a previous post?

Couta's right, you'd have hell fire and brimstone raining upon you and your credibility would be shot to pieces if you posted this stuff on another well known discussion that is passionate about ATM/A2M. Are you doing it just to wind up your mate, like teasing without a LOL?

[Beagle]

LOL - Yes I have worked my own analysis to arrive at $11.50 as fair value today. $9 talk is just party time for Beagle buying, probably won't get there but it did last year :eek2: (Ducks for cover under a big pile of flak jackets) :D

[Baa_Baa]

LOL - Yes I have worked my own analysis to arrive at $11.50 as fair value today. $9 talk is just party time for Beagle buying, probably won't get there but it did last year :eek2: (Ducks for cover under a big pile of flak jackets) :D

Do you think it slightly incongruous that KFL haven't changed (or sold) their position in ATM even although the SP has dropped from NZ$18 to $13? I thought they were more onto it than that, holding such a losing position. Maybe they still believe their own forecasts?

"Why do we own it?

The a2 Milk Company has a small but fast growing share of the very lucrative Chinese infant formula market. Management have capably executed on its growth plans to date and we expect its market share to continue growing across a range of distribution channels. In addition, there is potential for further upside from new products and geographies."


Personally, I think $11.85 would require a world war III event and at $9 I'd re mortgage the house to buy the truckload I wish I had. Can't say it won't happen with all the geo political nonsense going on and GFCII deferred until who knows when, but on a 'valuation basis' ... yeah nah.

[allfromacell]

Talk of $10 shares are fun and I guess dreams are free but with just 6 weeks until the next trading update I can't see this falling much further.

[Balance]

Talk of $10 shares are fun and I guess dreams are free but with just 6 weeks until the next trading update I can't see this falling much further.

Downgrades come in threes - so do be careful.

[RupertBear]

Downgrades come in threes - so do be careful.

I see this “Downgrades come in threes” quoted a lot and it really does appear to be true. But how can that be? :confused: Is it really a thing and if so how come? Or does it just seem that way? :mellow:

[Balance]

I see this “Downgrades come in threes” quoted a lot and it really does appear to be true. But how can that be? :confused: Is it really a thing and if so how come? Or does it just seem that way? :mellow:

Companies (listed) are tuned to growth in revenues and/or profits so are extremely reluctant when circumstances change to downgrade, until they really have no option but to downgrade.

All too often when faced with this likelihood, hope still reigns supreme and companies (or rather the management & directors) like to believe they can turnaround the ‘’temporary’ reversal of fortunes - so they only downgrade by as little as they can get away with.

Then, comes the results and reality. So companies are forced to downgrade further but still, by only what they think will be sufficient rather than what is required.

And so on and so forth.

[bull....]

been consolidating between 12.90 - 13.40 last week odd so by my calc's a breakdown would imply a move to 12.40

[Beagle]

Do you think it slightly incongruous that KFL haven't changed (or sold) their position in ATM even although the SP has dropped from NZ$18 to $13? I thought they were more onto it than that, holding such a losing position. Maybe they still believe their own forecasts?

"Why do we own it?

The a2 Milk Company has a small but fast growing share of the very lucrative Chinese infant formula market. Management have capably executed on its growth plans to date and we expect its market share to continue growing across a range of distribution channels. In addition, there is potential for further upside from new products and geographies."


Personally, I think $11.85 would require a world war III event and at $9 I'd re mortgage the house to buy the truckload I wish I had. Can't say it won't happen with all the geo political nonsense going on and GFCII deferred until who knows when, but on a 'valuation basis' ... yeah nah.

KFL's position in ATM is not one I agree with and I am disappointed with their approach of adding too it and furthermore I am not especially comfortable with their approach of having 60% of the fund in their top 5 stocks. Its a very, very aggressive position for a fund manager to take and when it goes wrong, they dramatically underperform the market like they did in August 2019 and probably in Sept as well, (Sept monthly report yet to be published). I have revised my position in KFL a little while back, accordingly.
I posted some of my thoughts on the merits between the different investment vehicles in the Kingfish group in post #649 here. https://www.sharetrader.co.nz/showthread.php?4071-Barramundi-(-BRM-)/page44&highlight=Barramundi
Barramundi has a considerably more diversified portfolio, trades at a much higher discount to NTA and invests in a market trading on a forward PE that's quite considerably lower than the NZX. I don't buy individual stocks on the ASX so Barramundi adds considerable diversification to my portfolio.
In terms of KFL now, by and large I am happiest to pick my own stocks on the NZX with whatever weighting I feel is appropriate.
ATM has been a wonderful growth stock under Geoffrey Babbage's leadership. Jayne Herlicka's approach of throwing vast amounts of resource at marketing and human resources to enjoy much slower eps growth is an "interesting" approach and not one I agree with.

[whatsup]

Relentless !

[sb9]

Relentless !

Yep, writing on the wall is clear for Jayne. She has to come out all guns blazing for next update at ASM time or else game over for her. At least she resisted the temptation to offload her shares as of today and so does other senior managers. Let's see how its going to come out in the wash.

[winner69]

Yep, writing on the wall is clear for Jayne. She has to come out all guns blazing for next update at ASM time or else game over for her. At least she resisted the temptation to offload her shares as of today and so does other senior managers. Let's see how its going to come out in the wash.

Probably next update will be much of same .....good sales growth with reduced margins as we invest for growth

That mightn’t hack it these days and the market will be disappointed

[sb9]

Probably next update will be much of same .....good sales growth with reduced margins as we invest for growth

That mightn’t hack it these days and the market will be disappointed

Could well be. However, she needs to flash some sort of an ace card to get back buy in from market. Its gonna be very interesting ASM in Akl this time in Nov.

[Beagle]

Relentless !

I find when it comes to investing a "dogged" approach to working things out for myself works best :)

[Lewylewylewy]

Market doesn't want growth right now, it wants income, which means higher margins. Id hazard a guess that an ok growth could result in a drop in share price at the next announcement.

[silu]

I'm not quite sure where I read it but apparently Nestle spends nearly double more on marketing based on revenue than ATM.

[Leftfield]

I'm not quite sure where I read it but apparently Nestle spends nearly double more on marketing based on revenue than ATM.

Baby Tiger over in HC commented as follows....

"Nestle spent between 20-25% of their revenue on Marketing and admin expenses (source, Nestle's half yearly report: 10bn marketing over 45bn revenue), only to earn net profit of 10% of revenue (5bn over 45bn). On top of that, Nestle's net profit is declining, along with their market share.

Where as A2M, only spent 10% of revenue, to earn net profit at 21%"

In my experience with companies such as Unilever, the marketing spend of 10% of revenue is about right. Sometimes it goes as high as 20% to (say) launch a new product/range and sometimes much lower (under 5%) for an established or 'mature' product/range.

[Balance]

Market doesn't want growth right now, it wants income, which means higher margins. Id hazard a guess that an ok growth could result in a drop in share price at the next announcement.

Market wants sales growth & growth in income - there is acceptance that margins on incremental sales growth will be at reduced margins - the concern is that all sales will be at reduced margins - so the jury will be out until the next update.

[winner69]

Baby Tiger over in HC commented as follows....

"Nestle spent between 20-25% of their revenue on Marketing and admin expenses (source, Nestle's half yearly report: 10bn marketing over 45bn revenue), only to earn net profit of 10% of revenue (5bn over 45bn). On top of that, Nestle's net profit is declining, along with their market share.

Where as A2M, only spent 10% of revenue, to earn net profit at 21%"

In my experience with companies such as Unilever, the marketing spend of 10% of revenue is about right. Sometimes it goes as high as 20% to (say) launch a new product/range and sometimes much lower (under 5%) for an established or 'mature' product/range.

A lot of what that Baby Tiger says is rubbish

[winner69]

Has that guy on HC updated his Lytleton export data?

I’m banned from HC - even trying to access it.

[couta1]

Has that guy on HC updated his Lytleton export data?

I’m banned from HC - even trying to access it. Now that's a 5 star achievement winner, even the hard core trolls find it hard to get banned over there.

[percy]

Now that's a 5 star achievement winner, even the hard core trolls find it hard to get banned over there.

I have found posters over there more respectful than here.
Maybe its just the threads I post on.?

[winner69]

Now that's a 5 star achievement winner, even the hard core trolls find it hard to get banned over there.

Suppose if I really tried (digitally that is) I could get past the barriers they have put up.

[couta1]

I have found posters over there more respectful than here.
Maybe its just the threads I post on.? Probably, plenty of trolls on the A2 thread.

[dabsman]

Has that guy on HC updated his Lytleton export data?

I’m banned from HC - even trying to access it.

I'd love to see the posts that got you banned - can you PLEASE post in a separate thread so we can all bask in its glory?

[allfromacell]

Has that guy on HC updated his Lytleton export data?

I’m banned from HC - even trying to access it.

Here you go, all credit to jzhuang from HC who keeps this up-to-date.

10803
10804
10805

[winner69]

Thanks allfromacell

Hope it’s not a reliable indicator for A2 sales any more ....July / August only up 14%

That doesn’t bode well for A2 this half.

[allfromacell]

Thanks allfromacell

Hope it’s not a reliable indicator for A2 sales any more ....July / August only up 14%

That doesn’t bode well for A2 this half.

Last years growth numbers also started quite slow and accelerated as the year progressed, lets see if the same pattern plays out this year.

[Ggcc]

Oh how I like it is heading north slightly for a change......... That could soon change of course

[couta1]

Oh how I like it is heading north slightly for a change......... That could soon change of course Lol yes but dont forget about the Friday frights or should that be the Friday flights.

[Ggcc]

Lol yes but dont forget about the Friday frights or should that be the Friday flights.
You will drive me to the drink with talk like that!! lol

[sb9]

Has that guy on HC updated his Lytleton export data?

I’m banned from HC - even trying to access it.

That same guy has posted some compelling valuation as to his reasons why A2M is a screaming buy at current level. Its a shame you can't access HC even as a guest and its bit too long to copy and paste here.

[allfromacell]

Just for you Winner...

https://docdro.id/sN0rC3G

I think the most compelling part is the review data, can't see any evidence of sales growth slowing.

[Balance]

Just for you Winner...

https://docdro.id/sN0rC3G

I think the most compelling part is the review data, can't see any evidence of sales growth slowing.

Very useful.

Thx.

[winner69]

Just for you Winner...

https://docdro.id/sN0rC3G

I think the most compelling part is the review data, can't see any evidence of sales growth slowing.

Thanks heap

Seems to be on the ball that guy

His sentiments much the same as mine

[Leftfield]

Just for you Winner... https://docdro.id/sN0rC3G I think the most compelling part is the review data, can't see any evidence of sales growth slowing.

Thanks for posting.....nice counter-argument to Beagle's $11.50 fair val!

The full HC post can be seen here. (https://hotcopper.com.au/threads/one-of-your-favorite-a2m-posters-has-upgraded-the-stock-to-buy.5004202/?post_id=40821121)

[couta1]

Thanks for posting.....nice counter-argument to Beagle's $11.50 fair val!

The full HC post can be seen here. (https://hotcopper.com.au/threads/one-of-your-favorite-a2m-posters-has-upgraded-the-stock-to-buy.5004202/?post_id=40821121) The Beagles judgement is clouded on this one, he's peeing on the wrong lamp-post.

[tomm]

I reckon , the one whom were waiting for the lowest as his/her own expectation should buy A2 now :) .

[Beagle]

The Beagles judgement is clouded on this one, he's peeing on the wrong lamp-post.

Good thing about Beagle's is they are always happy to follow their own nose...just watch one at the airport and you'll see what I mean :)

[see weed]

Yesterday, 11/10/18, was the one year anniversary of the lowest closing price for ATM at $9.04c. A drop of $1.17c from the day before. But the next day, 12/10/18, it dropped to the year low of $8.67c, but was only there for a very short time (probably a couple of minutes), by days close it was back up to $9.89c. On that day I was buying into OCA which I made a loss. No worries, still bought 8 blocks of ATM between $9.71 and $10.78. Just a big waiting game now.

[Oberon]

Well, trade talks appear to be going in a positive direction. Citi conference is next week and the AGM is just over a month away. Next few weeks should be interesting (hopefully, for the opposite reasons the past several weeks have been "interesting").

[Southern_Belle]

Well, trade talks appear to be going in a positive direction. Citi conference is next week and the AGM is just over a month away. Next few weeks should be interesting (hopefully, for the opposite reasons the past several weeks have been "interesting").
and singles day on the horizon

[tomm]

The trade US-China is very good today , A2 will lead the way back ATH very soon.

[see weed]

Last years low is up to $9.53 from $8.67 and rising. This years new low is $12.75 and rising for now. Shorters having a little rest. Or will they have a big rest and let sp go up a few dollars. The higher they let it go up, the more money they make pushing it down again. So where to this time $14 to $15 or $17 to $20?

[couta1]

Last years low is up to $9.53 from $8.67 and rising. This years new low is $12.75 and rising for now. Shorters having a little rest. Or will they have a big rest and let sp go up a few dollars. The higher they let it go up, the more money they make pushing it down again. So where to this time $14 to $15 or $17 to $20? Ask the Trumpet otherwise your only guessing.

[couta1]

Interesting day with volume driving VWAP up and then sell down last couple of hrs, nothing to do with the Trumpet this time, probably shorters.

[Balance]

China’s latest export data (poor) could be a contributing factor to the later slide in sp.

[Balance]

Interesting day with volume driving VWAP up and then sell down last couple of hrs, nothing to do with the Trumpet this time, probably shorters.

https://www.shortman.com.au/stock?q=a2m

The latest report shows that shorters are continuing to build up their short position in A2M.

Guess they must be confident that A2M will deliver a second profit downgrade comes the next update?

[sb9]

https://www.shortman.com.au/stock?q=a2m

The latest report shows that shorters are continuing to build up their short position in A2M.

Guess they must be confident that A2M will deliver a second profit downgrade comes the next update?

Not so sure about shorters, but your sentiment has definitely changed since announcement of FY results.

[Balance]

Not so sure about shorters, but your sentiment has definitely changed since announcement of FY results.

As disclosed, I locked in 2/3rd of my gains and am taking a cautious approach with the balance of my holding.

A2M still trades on high expectations and simply cannot afford to disappoint. We have seen what a small fall against expectations in the FY results has lead to with the sp.

[sb9]

As disclosed, I locked in 2/3rd of my gains and am taking a cautious approach with the balance of my holding.

A2M still trades on high expectations and simply cannot afford to disappoint. We have seen what a small fall against expectations in the FY results has lead to with the sp.

Fair enough. I still give them another 2 years for US new market investment and see how it progresses.

[couta1]

As disclosed, I locked in 2/3rd of my gains and am taking a cautious approach with the balance of my holding.

A2M still trades on high expectations and simply cannot afford to disappoint. We have seen what a small fall against expectations in the FY results has lead to with the sp. Not that high with a forward PE of 22 once all the adjustments are done, in fact its dirt cheap for a company with the growth and potential of this one.

[Balance]

Fair enough. I still give them another 2 years for US new market investment and see how it progresses.

The shorts have been badly burnt before and I have no doubts that should A2M delivers, the shorters will get even more badly mauled and burnt again.

[see weed]

Five days in a row and a2 is up 77c from its 6 monthly low:t_up:.

[carrom74]

Citi Investors conference today and tomorrow in Sydney-A2milk is participating...These guys downgraded the stock to $12.20(AU).....

[Beagle]

Not that high with a forward PE of 22 once all the adjustments are done, in fact its dirt cheap for a company with the growth and potential of this one.

https://www.marketscreener.com/A2-MILK-COMPANY-LTD-11384022/

FY20 forward PE 29.5

[couta1]

https://www.marketscreener.com/A2-MILK-COMPANY-LTD-11384022/

FY20 forward PE 29.5 No discount for Net assets which will be about 1 billion by end of 2020 plus eps should be around 50c not 44c.

[Beagle]

No discount for Net assets which will be about 1 billion by end of 2020 plus eps should be around 50c not 44c.

You're certainly entitled to your own estimates mate but I note the average analyst estimate is 45 cps for FY20 so on today's price of ~ $13.50 that's actually a forward PE of 30. Even on your estimate of 50 cents that's still a forward PE of 27. Cash on hand is irrelevant, (in my opinion) when it comes to looking at forward PE's.

[couta1]

You're certainly entitled to your own estimates mate but I note the average analyst estimate is 45 cps for FY20 so on today's price of ~ $13.50 that's actually a forward PE of 30. Even on your estimate of 50 cents that's still a forward PE of 27. Cash on hand is irrelevant, (in my opinion) when it comes to looking at forward PE's. Cheap as chips either way for a company with the potential this one has IMO.

[sb9]

Cheap as chips either way for a company with the potential this one has IMO.

Couldn't agree more, let's not give too much notice to market screener numbers, yawn...

[Ggcc]

Couldn't agree more, let's not give too much notice to market screener numbers, yawn...
I’ll be the third to agree. Marketscreener is a guide and has been very accurate to date in regards to turnover figures, but I believe the public determine the share price not marketscreener.

[Nasi Goreng]

I haven’t been here for quite a while but I still see the same patterns. couta1 says cheap as chips = hes long knee deep. Over priced = He got out a few weeks ago.

[couta1]

I haven’t been here for quite a while but I still see the same patterns. couta1 says cheap as chips = hes long knee deep. Over priced = He got out a few weeks ago. Hmm cant remember the last time I said it was overpriced but that could be the dementia kicking in, on the other hand there has hardly ever been more than a day or two for years now when I havent held any. PS-Im probably neck deep currently.

[Snow Leopard]

You're certainly entitled to your own estimates mate but I note the average analyst estimate is 45 cps for FY20 so on today's price of ~ $13.50 that's actually a forward PE of 30. Even on your estimate of 50 cents that's still a forward PE of 27. Cash on hand is irrelevant, (in my opinion) when it comes to looking at forward PE's.

PE's are irrelevant in predicting the future and valuing shares

[winner69]

PE's are irrelevant in predicting the future and valuing shares

Even the much loved Ben Graham said something like that as well.

[couta1]

PE's are irrelevant in predicting the future and valuing shares Yes XRO would be a good case in point with a PE of -385 and finishing at an all time high of $75 NZ.

[Baa_Baa]

PE's are irrelevant in predicting the future and valuing shares

For this company it seems true, as well as not discounting the massive cash bank looking like getting up to close to a billion $ this or next FY. That in itself opens up all sorts of possibilities.

Current share price presents better opportunity than missing out on the next leg up imo, with ATM one blinks and it’s gone, until fomo kicks in and accelerates the ramp up. The short covering when it kicks in will be epic. Today’s gap up open is suggestive.

The rounding bottom on the chart is looking promising as well, log scale of course 😉

[Beagle]

PE's are irrelevant in predicting the future and valuing shares

Not in my book mate. Most DCF valuations I have seen are ostensibly a whole bunch of guesses clobbered together with a wild guess on the terminal growth rate clobbered together into a discounting model.

Forward PE was about the same,30, when Geoff Babbage was running the company and it was growing eps at several times the forecast rate for FY20.
Lower forecast eps growth for the foreseeable future says to me the PE needs to come down to a more realistic level in my book.

Time, as usual will tell.

[winner69]

Not in my book mate. Most DCF valuations I have seen are ostensibly a whole bunch of guesses clobbered together with a wild guess on the terminal growth rate clobbered together into a discounting model.

Forward PE was about the same,30, when Geoff Babbage was running the company and it was growing eps at several times the forecast rate for FY20.
Lower forecast eps growth for the foreseeable future says to me the PE needs to come down to a more realistic level in my book.

Time, as usual will tell.

Beagle me old mate - think about what you said through

A PE ratio is ostensibly a DCF in disguise or as they say in the trade ‘a lazy man’s DCF’

When you come up with what you assess a ‘fair’ PE for A2 to be it means you the one who is making ‘a whole bunch of guesses clobbered together with a wild guess on the terminal growth rate clobbered together into a discounting model.’

[Balance]

Observation - when posters start arguing about PER and how it is irrelevant etc, hope has taken over from greed as a driver of the stock sp.

Me? I think that the 'new' CEO is guiding the market towards lower growth and profit (than market) expectations and analysts are reacting accordingly to the 'guidance' by recommending a more cautious approach.

If she does a good job of massaging the guidance so that A2M always over-deliver on market expectations, the stock will be rewarded with a high PER.

One thing A2M can not afford is to not meet market expectations again - if it does, the sp will be down below $10 in no time.

[Beagle]

Well said Balance. My post yesterday was simply to correct the (hopefully inadvertent) mistake that the forward PE was only 22 and this was cheap for a growth company with ATM's growth prospects. The real forward PE based on average analyst forecasts, (not my forecast or anyone else's on here that might be subject to bias) for FY20 of 45 cps at $13.50 is exactly 30.

I followed this up with observing that the forward PE under Geoffrey Babbage's leadership was ostensibly the same when the company was growing eps dramatically faster than it currently is. Simple logic suggests a lower PE is appropriate if eps growth has dramatically slowed. One example that readily springs to mind is SUM which used to trade on a forward PE of 30 when it was growing much faster and was a less mature company and it now trades on a PE of about 13.

Jayne herself has admitted that essentially all the low hanging fruit has been picked, (as Balance quite correctly points out), has actively guided to lower growth going forward.

Others then went on to critique the whole PE thing as though earnings don't matter. Well, I suppose when faced with an argument that can't be rebutted, (growth is slowing) those who have a strong vested interest have no choice but to try and undermine the valuation methodology.

According to market screener which compiles professional analyst views from ten analysts the average growth rate in eps for the next 3 years is 18%. That is very much lower than what's been enjoyed in the last three years, (in the last 2 years eps has more than tripled). The growth rate has dramatically slowed, something that should be perfectly obvious to anyone prepared to open their eyes.

[Balance]

A2M is presenting at Citicorp’s Investment Conference in Sydney today?

It’s 3.5 months into FY2020 so it will be interesting to see if Jayne provides some update on how things are going.

If she doesn’t, then it will be taken as read that the current market expectations are on track.

[carrom74]

https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12277288

Out of topic... but in broader scheme of things for ATM...

John Key still packs a punch!

[Balance]

Well said Balance. My post yesterday was simply to correct the (hopefully inadvertent) mistake that the forward PE was only 22 and this was cheap for a growth company with ATM's growth prospects. The real forward PE based on average analyst forecasts, (not my forecast or anyone else's on here that might be subject to bias) for FY20 of 45 cps at $13.50 is exactly 30.

I followed this up with observing that the forward PE under Geoffrey Babbage's leadership was ostensibly the same when the company was growing eps dramatically faster than it currently is. Simple logic suggests a lower PE is appropriate if eps growth has dramatically slowed. One example that readily springs to mind is SUM which used to trade on a forward PE of 30 when it was growing much faster and was a less mature company and it now trades on a PE of about 13.

Jayne herself has admitted that essentially all the low hanging fruit has been picked, (as Balance quite correctly points out), has actively guided to lower growth going forward.

Others then went on to critique the whole PE thing as though earnings don't matter. Well, I suppose when faced with an argument that can't be rebutted, (growth is slowing) those who have a strong vested interest have no choice but to try and undermine the valuation methodology.

According to market screener which compiles professional analyst views from ten analysts the average growth rate in eps for the next 3 years is 18%. That is very much lower than what's been enjoyed in the last three years, (in the last 2 years eps has more than tripled). The growth rate has dramatically slowed, something that should be perfectly obvious to anyone prepared to open their eyes.

Interest rates have also fallen dramatically in the last 3 years so higher PERs and valuation multiples are warranted.

Point is that we are here to assist one another to make (hopefully) good investment decisions and there's a lot at stake with a stock like A2M - we want to get the call right.

It is not useful at all imo for posters to ignore or pretend to ignore what the institutional analysts and investors are saying and recommending as they have the firepower, not us little minnows.

As observed however, they are often wrong - in which case let's take advantage of their errors.

I for one will be reinvesting back fully into A2M and very very happy to pay a higher price if A2M comes out with an upgrade. That's my strategy - not gung ho but suits me as I sleep better at nights!

[Southern_Belle]

this time last year the A2M price was so volatile, up, down sideways, I got so caught up I sold the lot. Pre Xmas & New Year it raced ahead & I had FOMO and wanted to re-invest but kept thinking if I invest now it will go down. I did buy back in and continued going up (with some volatility along the way). No need to get too concerned about the daily fluctuations, A2M is a great company doing what it always does and happy to be a holder.

[sb9]

ASM at Generator on Madden Street down by Wynyard Quarter, Auckland @10.30am on 19th Nov.

Might try and attend this time.

[Beagle]

Coutts mate, seeing as you're donkey deep up to the eyeballs in these you should fly up and get all yappy at the annual meeting with heaps of questions.
Happy to help with transport logistics, (5 star safety rated car of course :p), this end but not sure if they will let extremely yappy non shareholder Beagles into the meeting....they do have some standards you know :lol: I'd buy a token one thousand shares just to get into the meeting if it wasn't for the fact that they're so overpriced at this level :p (Sorry mate, couldn't help myself).

[Balance]

ASM at Generator on Madden Street down by Wynyard Quarter, Auckland @10.30am on 19th Nov.

Might try and attend this time.

A crucial ASM at a critical juncture of A2M's progression into a truly multi-faceted global billion dollar entity. Cannot wait to attend!

https://www.ig.com/au/news-and-trade-ideas/key-broker-upgrades-a2-milk-shares-from-sell-to-hold-191014

Meanwhile, an upgrade from Bell Porter from SELL to HOLD.

Cannot be too far off from Citi making the same call now that A2M sp is around Citi's price target of A$12.20.

[Beagle]

Price target of A12.35 = $N.Z.$13.30 in 12 months time is pretty much how I see it too.

[winner69]

Price target of A12.35 = $N.Z.$13.30 in 12 months time is pretty much how I see it too.

...implies NZ$11.70/$12.00 today

Those analysts have no idea do they

[percy]

Coutts mate, seeing as you're donkey deep up to the eyeballs in these you should fly up and get all yappy at the annual meeting with heaps of questions.
Happy to help with transport logistics, (5 star safety rated car of course :p), this end but not sure if they will let extremely yappy non shareholder Beagles into the meeting....they do have some standards you know :lol: I'd buy a token one thousand shares just to get into the meeting if it wasn't for the fact that they're so overpriced at this level :p (Sorry mate, couldn't help myself).

Either get Mrs Couta1, or some poster here, who is not going to the meeting, to appoint you as their proxy.

[percy]

...implies NZ$11.70/$12.00 today

Those analysts have no idea do they

Some do,some don't.
Makes life more interesting knowing which ones.?

[Balance]

Some do,some don't.
Makes life more interesting knowing which ones.?

The thing to be mindful of is that their calls and recommendations have impact, right or wrong, in the short term.

No point going against their calls in the short term - it’s like trying to hold back a torrent of flood waters with loose rocks.

Let it sweep past and then, survey the aftermath and act according to your own belief.

[Beagle]

Either get Mrs Couta1, or some poster here, who is not going to the meeting, to appoint you as their proxy.

Good thinking.

[couta1]

Too much incessant barking on here so I went skiing yesterday. PS-A2 is the future of milk.

[Beagle]

Incessant in some ways has behaviour traits like incorrigible eh mate :p

[Balance]

Guess A2M did not present at Citicorp's Investment Conference yesterday.

No update then until ASM so it's going to be a while before market gets clear direction.

Meanwhile, UBS continues to have great fun with the stock - buying and selling, and spooking the little minnows on NZX?

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/342809/310012.pdf

[sb9]

Guess A2M did not present at Citicorp's Investment Conference yesterday.

No update then until ASM so it's going to be a while before market gets clear direction.

Meanwhile, UBS continues to have great fun with the stock - buying and selling, and spooking the little minnows on NZX?

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/342809/310012.pdf

Yeah UBS are leeches...in the meantime the following is of interest in long term..

https://www.ft.com/content/564ac492-f0a4-11e9-ad1e-4367d8281195

In particular this bit...

"Asked whether more changes to the portfolio were to come, he said: “Expect more in future to happen.” He added that it was not about a single big deal, but a process where M&A is part of the “repertoire to drive organic growth”.

[Balance]

Too much incessant barking on here so I went skiing yesterday. PS-A2 is the future of milk.

Back to the sp behavior of the past?

Up in NZ before ASX opens, then gets sold down especially just before ASX closes.

Hmmmmmm;)

[couta1]

Back to the sp behavior of the past?

Up in NZ before ASX opens, then gets sold down especially just before ASX closes.

Hmmmmmm;) As much as I'd hate a takeover offer at $20/share, watching UBS getting completely skunked along with a total shorts incineration would almost be worth it.

[dompf]

Back to the sp behavior of the past?

Up in NZ before ASX opens, then gets sold down especially just before ASX closes.

Hmmmmmm;)

With no news big players are playing. Unrelated but APT got hammered UBS downgrades them massively I guess it’s the game they all play but there is no real news until AGM Nov.

so hold tight and and see what happens.

[Oberon]

I've been holding tight for 7 weeks after taking the plunge at just over $15... what's another month?


As much as I'd hate a takeover offer at $20/share, watching UBS getting completely skunked along with a total shorts incineration would almost be worth it.

UBS... I mean, what can you do? I hate their guts for ravaging the SP but I can't do anything to stop them. I'm sure as hell not giving up my position and incurring an eye watering loss at these prices.

So far as Citicorp's Investment Conference ... what a pity. Would've been nice if they could've thrown a few crumbs. But, no news is (hopefully) good news. One would hope they're getting ready to knock it out of the ball park at the AGM. In any event, they might have to reconsider their tight-lipped strategy unless they're okay with one of their main shareholders butchering the SP.

[Balance]

I've been holding tight for 7 weeks after taking the plunge at just over $15... what's another month?

UBS... I mean, what can you do? I hate their guts for ravaging the SP but I can't do anything to stop them. I'm sure as hell not giving up my position and incurring an eye watering loss at these prices.

So far as Citicorp's Investment Conference ... what a pity. Would've been nice if they could've thrown a few crumbs. But, no news is (hopefully) good news. One would hope they're getting ready to knock it out of the ball park at the AGM. In any event, they might have to reconsider their tight-lipped strategy unless they're okay with one of their main shareholders butchering the SP.

Cannot fault a hyena or a vulture doing what they do - it's in their DNA just as it's in the DNA of UBS to try and make money out of the scary cats/minnows and small bit players on the NZX.

Sp is still 16.5% up YTD so all is not lost even though sp today has just dipped below $13.00 again. :eek2:

I do take comfort that Jayne has not sold her shares to date.

[couta1]

A2 is currently like a coiled spring and I've got first hand experience from several incidents what happens when those springs get to uncoil in real life and your standing in the way.

[Balance]

A2 is currently like a coiled spring and I've got first hand experience from several incidents what happens when those springs get to uncoil in real life and your standing in the way.

https://www.shortman.com.au/stock?q=A2M

Shorts continuing to build up - now at 7.40% of total stock on issue or 54.38m shares.

Certainly will be some serious burn if the spring is sprung, so to speak.

[Blue Skies]

Late July & it was $18.02 & in the euphoria thought it was racing toward & going to beat FPH to $20+.
Been pretty much downhill since then. Who would have believed 3 months later it would be 1294 today!
Missed out on ATM but so much volatility & uncertainty its hard to pick a point to get in.
Not sure if I want to risk it now.

[couta1]

Late July & it was $18.02 & in the euphoria thought it was racing toward & going to beat FPH to $20+.
Been pretty much downhill since then. Who would have believed 3 months later it would be 1294 today!
Missed out on ATM but so much volatility & uncertainty its hard to pick a point to get in.
Not sure if I want to risk it now. If you had a true vision for the stock you wouldn't hesitate to get in, my last large parcel has an avg buy of $17.31 and its substantial and no I dont sleep less. PS-At current price the risk is tiny.

[Beagle]

Late July & it was $18.02 & in the euphoria thought it was racing toward & going to beat FPH to $20+.
Been pretty much downhill since then. Who would have believed 3 months later it would be 1294 today!
Missed out on ATM but so much volatility & uncertainty its hard to pick a point to get in.
Not sure if I want to risk it now.

For what its worth I think a good risk minimisation strategy is too keep a very close eye on the chart. At this point there is no sign of it bottoming and a risk averse investor might want to keep waiting for as long as necessary for a clear sign its has done so and wait until it breaks back up through a technical indicator such as the 100 day moving average, or 30 day MA for those less risk averse. Perhaps put on half one's position on a break up through 30 day MA and the other half when the uptrend is confirmed on a break of the 100 day MA. Stocks with a stretched PE and unhelpful technical analysis do have significant risk.

[Snow Leopard]

Late July & it was $18.02 & in the euphoria thought it was racing toward & going to beat FPH to $20+.
Been pretty much downhill since then. Who would have believed 3 months later it would be 1294 today!
Missed out on ATM but so much volatility & uncertainty its hard to pick a point to get in.
Not sure if I want to risk it now.

If you are not sure then do not buy it. Quite simple really.

I own some of these and was asked by my broker if I would allow them to be shorted, said no, and they came back and suggested I might want to reconsider.
So I did and the rent eases the pain.

[dobby41]

If you are not sure then do not buy it. Quite simple really.

I own some of these and was asked by my broker if I would allow them to be shorted, said no, and they came back and suggested I might want to reconsider.
So I did and the rent eases the pain.
How much is the rent?

[Blue Skies]

Thanks Couta, Beagle & SL, all viewpoints v much appreciated as try to anticipate what everyone else will value this company at next week, next month, next year.

[winner69]

Wonder what would happen if an outfit like JCAP decided to ‘attack’ A2

Look at what’s happened to Wisetech WTC.ASX ....couldn’t happen to A2 could it?

[sb9]

Cannot fault a hyena or a vulture doing what they do - it's in their DNA just as it's in the DNA of UBS to try and make money out of the scary cats/minnows and small bit players on the NZX.

Sp is still 16.5% up YTD so all is not lost even though sp today has just dipped below $13.00 again. :eek2:

I do take comfort that Jayne has not sold her shares to date.

With time leading upto ASM next month, its fairly certain to assume that she isn't offloading her shares before that neither did all other senior executives. One can only take this as a very positive sign going by past years pattern.

[Leftfield]

..... its fairly certain to assume that she isn't offloading her shares ..... One can only take this as a very positive sign ....

This and the new employee share scheme (https://www.nzx.com/announcements/342963) also hints that the company thinks the SP is currently undervalued. All good for holders (and employees.)

[Blue Skies]

If you are not sure then do not buy it. Quite simple really.


I own some of these and was asked by my broker if I would allow them to be shorted, said no, and they came back and suggested I might want to reconsider.
So I did and the rent eases the pain.



If I waited till I was sure, don't think I would own any shares.
I envy your directness.
Don't think I've ever been 'sure' when buying shares but that hasn't stopped me building a substantial portfolio.
TBH, most of my decisions are little more than educated guesses, based on an amalgamation of incomplete information & if the combination of factors informed by MA, PE, opinions, cultural trends, trade barriers/talks etc, looks like representing a net long term gain or a net loss at current SP.
That seems to have worked ok for me.


Interesting your broker so persistent & confident they were overvalued.

[BlackPeter]

Interesting your broker so persistent & confident they were overvalued.

Don't think the broker meant to imply a view on the shares value, they just had some other clients desperately trying to short A2M shares and the broker did not had any other to lend out.

If I have shares which I consider to be overvalued, than I would not lend them to shorters, but sell them. Obviously - I can't speak for PT, but I would assume he would act similarly in this situation.

[Balance]

Interesting your broker so persistent & confident they were overvalued.

Brokers are there to facilitate trades (and fees) if they have clients who think ATM is overvalued and want to short the stock - their job is to find stock they can borrow to allow the shorting.

[see weed]

5 days up, 5 days down. Good buying now. Get in before it takes off again to the next level. Last low was 12.75 on 9/10/19. Get in early before lift off in Nov-Dec:D.

[Balance]

5 days up, 5 days down. Good buying now. Get in before it takes off again to the next level. Last low was 12.75 on 9/10/19. Get in early before lift off in Nov-Dec:D.

Concern for me is the sp manipulation which seems to be a daily occurrence now - notice how the sp is shunted up each morning on NZX before getting sold down when ASX opens?

Something smells.

[silu]

Concern for me is the sp manipulation which seems to be a daily occurrence now - notice how the sp is shunted up each morning on NZX before getting sold down when ASX opens?

Something smells.

The same thing happened with Serko right?

[Balance]

The same thing happened with Serko right?

Not every day like with ATM.

[couta1]

Concern for me is the sp manipulation which seems to be a daily occurrence now - notice how the sp is shunted up each morning on NZX before getting sold down when ASX opens?

Something smells. Just low volume rats and mice shunting until the ASX opens then big players be playing with their robots, and yes I can smell shorters as well.

[waikare]

Concern for me is the sp manipulation which seems to be a daily occurrence now - notice how the sp is shunted up each morning on NZX before getting sold down when ASX opens?

Something smells.

I have noticed that also Balance.

[Balance]

I have noticed that also Balance.

NZX sp action each morning (up on ASX close the day before) giving the impression that sp has bottomed out - sucking in buyers - then, sellers offloading stock when ASX opens.

Suggestion to me is that seller(s) has(ve) a lot more stock to offload. Just imo.

[Balance]

So A2M closes at A$11.84 today = NZ$12.64 vs $12.80 close on NZX.

Pathetic volume on NZX today vs ASX - miserable 12% volume on NZX vs ASX.

Matter of time before this stock decamps to ASX like Xero.

Let’s see what happens tomorrow morning when NZX starts trading.

[see weed]

So A2M closes at A$11.84 today = NZ$12.64 vs $12.80 close on NZX.

Pathetic volume on NZX today vs ASX - miserable 12% volume on NZX vs ASX.

Matter of time before this stock decamps to ASX like Xero.

Let’s see what happens tomorrow morning when NZX starts trading.
sw reporting from Piha, Came out here on Tuesday for one night and am still here. Had the best day blokarting yesterday, what a high, continuous 25kt winds from the west:t_up:. Now back to a2, what a low, will probably open about 12.68ish, but am going to sit it out or blokart it out and wait for the silly shorty games to end. a2 is just being a2 with its yearly ups and downs.

[Balance]

So A2M closes at A$11.84 today = NZ$12.64 vs $12.80 close on NZX.

Pathetic volume on NZX today vs ASX - miserable 12% volume on NZX vs ASX.

Matter of time before this stock decamps to ASX like Xero.

Let’s see what happens tomorrow morning when NZX starts trading.

Looks like ATM on NZX may open well above $12.64 - confirming the manipulative game being played imo.

[dompf]

Looks like ATM on NZX may open well above $12.64 - confirming the manipulative game being played imo.

This has been happening for months 2 hours of gains then woomf asx opens.

[see weed]

Looks like ATM on NZX may open well above $12.64 - confirming the manipulative game being played imo.
no market depth on ASB at the moment. What's going on?

[BlackPeter]

This has been happening for months 2 hours of gains then woomf asx opens.

Not really following hourly patterns, but if this is true and consistent, than it must be an amazing money maker. Buy cheap in the evening and sell dear in the morning ...

[couta1]

Not really following hourly patterns, but if this is true and consistent, than it must be an amazing money maker. Buy cheap in the evening and sell dear in the morning ... Not really because it's only rats and mice volume in the morning on the NZX.PS-Down on NZX.

[Balance]

Not really following hourly patterns, but if this is true and consistent, than it must be an amazing money maker. Buy cheap in the evening and sell dear in the morning ...

Not big enough volume to make it worthwhile?

[allfromacell]

no market depth on ASB at the moment. What's going on?

Same issue with a few other shares in ASB at the moment, probably a technical issue.

[Balance]

This has been happening for months 2 hours of gains then woomf asx opens.

A pattern like that over months tells you something - shorters selling and sellers getting out appear to be the underlying theme.

[Leftfield]

xxxxxxxxxxx

[Ggcc]

https://www.lawyerly.com.au/a2-milk-looks-to-turn-trade-mark-losses-around-in-federal-court

[Balance]

https://www.lawyerly.com.au/a2-milk-looks-to-turn-trade-mark-losses-around-in-federal-court

Shows how valuable the brand 'A2' is now!

[Beagle]

https://www.businesstimes.com.sg/consumer/taylor-swift-headlines-alibaba-singles-day-concert
Taylor Swift to headline singles day -That's got to be a good thing.

[limmy]

I've just returned to NZ from a 2 week holiday in China. I was asking around in Shanghai, Xian and Beijing if they had heard of A2 milk and guess what ? No one had heard of it, even though one of them has a 15 month old baby. I didn't get the chance to look at the supermarket shelves, so I wondered if I could spot any there.

I'm not sure if this is a good or a bad sign... ? Does this mean that ATM has heaps of potential for growth or does this mean a failed advertising campaign run so far ?

[Ggcc]

I've just returned to NZ from a 2 week holiday in China. I was asking around in Shanghai, Xian and Beijing if they had heard of A2 milk and guess what ? No one had heard of it, even though one of them has a 15 month old baby. I didn't get the chance to look at the supermarket shelves, so I wondered if I could spot any there.

I'm not sure if this is a good or a bad sign... ? Does this mean that ATM has heaps of potential for growth or does this mean a failed advertising campaign run so far ?

I spoke with many people in NZ of my friend group and none of them even heard of ATM being on the NZX/ASX.

With China having a population of 1.4 billion people I am understanding not everyone has heard of A2 milk and its benefits.

I guess it is our best kept secret.

[RTM]

Shows how valuable the brand 'A2' is now!

I hope for all investors sakes....its much more than a brand.

[Beagle]

I spoke with many people in NZ of my friend group and none of them even heard of ATM being on the NZX/ASX.

With China having a population of 1.4 billion people I am understanding not everyone has heard of A2 milk and its benefits.

I guess it is our best kept secret.

Jayne will try and fix that by throwing many hundreds of millions more marketing spend at the problem. Whether its money down a rat hole is the $64,000, (or for some people many times that), question. Only time will tell. Much, much easier to pick low hanging fruit than use ladders to get to the more difficult ones.

[Ggcc]

Jayne will try and fix that by throwing many hundreds of millions more marketing spend at the problem. Whether its money down a rat hole is the $64,000, (or for some people many times that), question. Only time will tell. Much, much easier to pick low hanging fruit than use ladders to get to the more difficult ones.
I do know that the best fruit in the orchards are all at the top of the tree and sometimes worth the effort to collect them. We will see next month when we get the update. I am guessing that growth will be 30-35% higher in turnover, no idea on profit though.

[Leftfield]

Some positive signs for ATM holders as we head into November...

1.) Signs that Shorts are retreating. (https://www.shortman.com.au/stock?q=a2m) (Note; this data is delayed 4 working days)
2.) Indications that November is a good month for holders (https://www.shortman.com.au/seasonality?q=A2M)

Onwards and upwards... GLH.

[Balance]

Some positive signs for ATM holders as we head into November...

1.) Signs that Shorts are retreating. (https://www.shortman.com.au/stock?q=a2m) (Note; this data is delayed 4 working days)
2.) Indications that November is a good month for holders (https://www.shortman.com.au/seasonality?q=A2M)

Onwards and upwards... GLH.

November - AGM month.

Let's hope this year will be another very good one.

[Balance]

Presentation to be given today at the Select Equities Conference in Sydney today.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/343483/310877.pdf

Nothing new - is that a good thing or a bad thing? :confused:

[Ggcc]

Presentation to be given today at the Select Equities Conference in Sydney today.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/343483/310877.pdf

Nothing new - is that a good thing or a bad thing? :confused:
I can’t see positive or negative from this announcement. Guess you have to be there to ask the tough questions

[Balance]

I can’t see positive or negative from this announcement. Guess you have to be there to ask the tough questions

Too close to the AGM for anything meaningful to be said, I suspect.

So why bother to present - timing is so important in this game and as a shareholder, I would much prefer her to be spending the time presenting to customers and buyers.

[t.rexjr]

I can’t see positive or negative from this announcement. Guess you have to be there to ask the tough questions

Not much substance in that at all...

Beat eggs in large bowl with hand beater until fluffy. Beat in flour, a2 milk, vegetable oil, sugar, baking powder, salt and vanilla, just until smooth. Pour mix onto hot waffle iron. Cook until golden brown. Serve hot.

[Beagle]

Too close to the AGM for anything meaningful to be said, I suspect.

So why bother to present - timing is so important in this game and as a shareholder, I would much prefer her to be spending the time presenting to customers and buyers.

Must have been a big yawn as is the share price. Wonder what Coutts doing these days, not much point trying to trade almost no volatility ?

[Baa_Baa]

I can’t see positive or negative from this announcement. Guess you have to be there to ask the tough questions

It's not an 'announcement' as such, just their usual practice of publishing to market the same materials presented. Have a look here for the purpose of the conference and why Jayne is presenting. http://www.selectequities.com.au/events/investor-briefings-conference ... along with the other 18 presenters over two days.

[see weed]

November - AGM month.

Let's hope this year will be another very good one.
It can't be anything else. Isn't Nov-Dec usually the start of the long......no, not saying anymore, don't want to jinx the sp;).

[tomm]

Latest News from the CEO .

Big Read: A2 Milk - formula for growth - NZ Herald (https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12280993)
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12280993

[dzhang1510]

Any way to read this without paying for it??

[dzhang1510]

Latest News from the CEO .

Big Read: A2 Milk - formula for growth - NZ Herald

(https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12280993)
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12280993


Ooops was supposed to reply to this comment

[Beagle]

Should be a good day for ATM on Monday. https://www.cnbc.com/2019/11/01/china-says-its-reached-a-consensus-in-principle-with-the-us-during-this-weeks-trade-talks.html
I remain cautious with the valuation and the fact that they are so reliant on the Chinese market.

[Baa_Baa]

A2 earned over twice the total revenue of China/Asia $405m from Australia/NZ $842m

[Beagle]

How much of the Australian sales was product brought to on sell into China ?

[BigBob]

Any way to read this without paying for it??

If you have a library card... You will find that your local library probably has free online access to pretty much any newspaper in the world... (and heaps of magazines too)

Certainly the case in Wellington...

[winner69]

The Listener had a bit on A2 v A1 this week

Seemed reasonably complementary to A2 ...as long as you were prpared to pay more for it (and the perveived benefits)

[Oberon]

The Listener had a bit on A2 v A1 this week

Seemed reasonably complementary to A2 ...as long as you were prpared to pay more for it (and the perveived benefits)

I have IBS and switched to plant-based milk products a couple of years ago. Whenever I drank regular milk I invariably had cramps, bloating and gas. Since investing in A2 a couple of months ago I thought it would be the decent thing to at least try the product.

Guess what? No cramps, no bloating and no gas (not from the milk, at least). I really wasn't expecting it. Price per litre works out to a few cents more than what I pay for Pams soy milk. It's creamier and tastes better. Thumbs up from me.

Given the complexities of IBS it's not guaranteed to work for everyone, but it's certainly worth a try if you have any gastrointestinal issues.

[tomm]

I have IBS and switched to plant-based milk products a couple of years ago. Whenever I drank regular milk I invariably had cramps, bloating and gas. Since investing in A2 a couple of months ago I thought it would be the decent thing to at least try the product.

Guess what? No cramps, no bloating and no gas (not from the milk, at least). I really wasn't expecting it. Price per litre works out to a few cents more than what I pay for Pams soy milk. It's creamier and tastes better. Thumbs up from me.

Given the complexities of IBS it's not guaranteed to work for everyone, but it's certainly worth a try if you have any gastrointestinal issues.

The same here , it wasn't that bad when I was at a young age but then I got the same problem when drinking milk as yours at the age of 35, since then I and my children changing to A2, the kids are so happy about A2 Milk and told me to change to A2 because their stomach feel so easy, they just refuse to drink normal Blue Anchor Milk. I feel the same so here we go A2 Milk since. Being honest Goat Milk is also feel good but the problem is it is so expensive and I am just an average earner. And please don't talk about alternate milk or vegs milk, can't compare it is maybe just for vegeterians but not for me and they are also expensive as hell :scared:.

[Leftfield]

I have IBS and switched to plant-based milk products a couple of years ago. Whenever I drank regular milk I invariably had cramps, bloating and gas. Since investing in A2 a couple of months ago I thought it would be the decent thing to at least try the product....Guess what? No cramps, no bloating and no gas (not from the milk, at least).


The same here.....

Similar story here....not only that, investing in ATM 5 yrs ago has seriously changed my financial health!!:t_up:

[Oberon]

Similar story here....not only that, investing in ATM 5 yrs ago has seriously changed my financial health!!:t_up:

Mine as well.

Except I threw my hat into the ring about 10 weeks ago. So my health in that regard is pretty sickly at the moment. Hopefully the upcoming AGM will give my health a much need boost. :t_up:

[Blue Skies]

I see A2 milk sold in the supermarket under the Anchor brand as a2 The a2 Milk Company & also under licence under the Fresha Valley brand as 'fresh A2 Protein' milk.
Since this is just milk from cows with the A2 protein & easy enough to segregate herds, can someone remind me what's going to stop China agri (or any one else) from doing this. Why would they remain dependent on NZ for this milk for long if a growing demand exists? Forgive me if this such a naive question but still a bit of a mystery to me after seeing all these dairy factories (under cover milking herds) we've built in China & the strong drive for independence of food supply.
This my biggest concern about investing in A2 now & if we are not going to see anything like the strong growth its had going forward, & unable to meet its projected PE.

[Balance]

Latest News from the CEO .

Big Read: A2 Milk - formula for growth - NZ Herald (https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12280993)
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12280993

Well worthwhile reading.

A few issues if you read the article in terms of competition and the need for ATM to spend more on IT, logistic support and staff to meet the competitive landscape in China.

[longy]

I see A2 milk sold in the supermarket under the Anchor brand as a2 The a2 Milk Company & also under licence under the Fresha Valley brand as 'fresh A2 Protein' milk.
Since this is just milk from cows with the A2 protein & easy enough to segregate herds, can someone remind me what's going to stop China agri (or any one else) from doing this. Why would they remain dependent on NZ for this milk for long if a growing demand exists? Forgive me if this such a naive question but still a bit of a mystery to me after seeing all these dairy factories (under cover milking herds) we've built in China & the strong drive for independence of food supply.
This my biggest concern about investing in A2 now & if we are not going to see anything like the strong growth its had going forward, & unable to meet its projected PE.

Segregation is time consuming. Mums/dads in China trusting foreign brands more than local's productions and given the OZ and NZ's good reputation.

[BlackPeter]

I see A2 milk sold in the supermarket under the Anchor brand as a2 The a2 Milk Company & also under licence under the Fresha Valley brand as 'fresh A2 Protein' milk.
Since this is just milk from cows with the A2 protein & easy enough to segregate herds, can someone remind me what's going to stop China agri (or any one else) from doing this. Why would they remain dependent on NZ for this milk for long if a growing demand exists? Forgive me if this such a naive question but still a bit of a mystery to me after seeing all these dairy factories (under cover milking herds) we've built in China & the strong drive for independence of food supply.
This my biggest concern about investing in A2 now & if we are not going to see anything like the strong growth its had going forward, & unable to meet its projected PE.

Nothing stopping the Chinese or anybody else to copy the product (A2 milk, this is ...) ... and it even would be legal (as long as they are careful in naming it). A2 might have an edge in testing for A2, but I don't think this is an issue as soon as competitors have pure A2 herds ...

However - the big money maker for A2 is not the milk, but the Infant formula (IF) ... and for some funny reason do Chinese parents not trust Chinese companies to produce IF which is good for their children. Must have something to do with poisonous non food items found previously in Chinese milk products (https://en.wikipedia.org/wiki/2008_Chinese_milk_scandal) ...

Ah yes, and for the infant formula do Synlait have IP protection - the recipe contains more than just milk.

[Beagle]

I see A2 milk sold in the supermarket under the Anchor brand as a2 The a2 Milk Company & also under licence under the Fresha Valley brand as 'fresh A2 Protein' milk.
Since this is just milk from cows with the A2 protein & easy enough to segregate herds, can someone remind me what's going to stop China agri (or any one else) from doing this. Why would they remain dependent on NZ for this milk for long if a growing demand exists? Forgive me if this such a naive question but still a bit of a mystery to me after seeing all these dairy factories (under cover milking herds) we've built in China & the strong drive for independence of food supply.
This my biggest concern about investing in A2 now & if we are not going to see anything like the strong growth its had going forward, & unable to meet its projected PE.


Segregation is time consuming. Mums/dads in China trusting foreign brands more than local's productions and given the OZ and NZ's good reputation.

I won't win any friends for saying this but :-
I used to think the intellectual property that ATM often bragged about was worth a lot and was a defensible moat.
Nestle debunked a lot of myth about that a while back and I believe over time A2 Milk will just become another commodity.
I agree ATM has first mover advantage but that only lasts so long and then...
Its easy enough for PRC to issue an edict that changes the goalposts and any company that relies on the Chinese for a large proportion of their sales deserves to have an appropriate risk premium attached to it
Growth is quite obviously slowing and the risk is eps growth slows even further in FY21 and beyond and the PE contracts still further as ATM becomes just another commodity company.
An enormous amount of future growth is already built into the share price and one wonders if its not more than fully built in.
The company enjoyed fabulous outperformance in the strong growth phase with Geoffrey Babbage's tremendous leadership but the jury is well and truly out on whether Jayne Herdlicka can continue that momentum.

On the plus side mega star Taylor Swift is the headline act at the singles day this month and the annual meeting isn't far away.

[Lewylewylewy]

That perspective sounds like a barrier to entry in countries that trust their existing suppliers, ie America