ATM - A2 Milk Corporation Limited

[Hello123]

How many people here will still be thinking its a quality company to Hold and give it more time to come back . Or its better to get out at first opportunity thinking its old days will never come back

I know it happens to all companies but some quality ones like FPH MFT types come back to scale new highs after 1-3 years while others just keep going further down and down .

So what we think about ATM ....Long term hold or sell and buy FPH to recover loss in next 2-5 years ??

Depends on the news.

[Gregnz]

Seems many here already know what the detail is in the yet to be released announcement. Already planning to sell when you don’t even know what the announcement will include. I’d suggest your probably best to sell out regardless of what the news is. Investing isn’t for you.

[glasszon]

@glasszon Wanting to sell before even digesting the information may suggest you could look at your reasons for buying this stock :)

Didn't ASX already said it's due to an earning guidance downgrade? Happy to be proven wrong.

Biggest problem I have with ATM isn't about it's share performance, rather it is the share performance against the market portfolio. Most shares went up by 50%+ in the last 6 months, while ATM is going the other way. I know it's possible they will recover from this, but I don't want my capital to be tied down here when there are still plenty of opportunity from situation created by covid.

[alokdhir]

Depends on the news.

One bad news should not change company quality criteria ....

Assuming the news is bad .

Quality of the management will decide if it can come back in the future or not ...So was more interested in that perspective of the people here please

[Gregnz]

Didn't ASX already said it's due to an earning guidance downgrade? Happy to be proven wrong.

Biggest problem I have with ATM isn't about it's share performance, rather it is the share performance against the market portfolio. Most shares went up by 50%+ in the last 6 months, while ATM is going the other way. I know it's possible they will recover from this, but I don't want my capital to be tied down here when there are still plenty of opportunity from situation created by covid.

No it didn’t say that. It said revised guidance. Didn’t say which way, we are all just interpreting it to be revised down. Who knows? It definitely didn’t even mention the word downgrade

[Sideshow Bob]

Just back from a liquid lunch with old mates.

Read through the last 9 pages of posts, and still now none the wiser.

And here I was hoping that they had discovered A2 was a cure for Covid 19......

More Beer!! ;)

[Waltzing]

Just to add to the nine pages of looking out at the horizon i suspect everyone is now glued to off shore horizons. More happening off shore in the auckland harbour prehaps..Except of course if you are over weight here. Might not be man on the moon but for little NZ its CLOSE. GDP wise it is a very impressive ratio to compete in such a big pond event.

[macduffy]

Is this a record for speculating about the reason for a halt to trading?

:ohmy:

[Panda-NZ-]

Maybe it's something bland like a board reshuffle hehe.

[alokdhir]

Lets start the competition ....The person whose reasons and updated guidance is closest to what company informs ...should be called ATM GEEK :p

[Balance]

No it didn’t say that. It said revised guidance. Didn’t say which way, we are all just interpreting it to be revised down. Who knows? It definitely didn’t even mention the word downgrade

Will be the first time I have seen a trading halt for more than a day because a company is doing a profit upgrade!

[Gregnz]

Will be the first time I have seen a trading halt for more than a day because a company is doing a profit upgrade!

Agree, but you can’t also say a downgrade has been announced when it hasn’t, as was said by others here

[Ogg]

Is this the next Freedom Foods? (FNP-ASX)

[bull....]

Lets start the competition ....The person whose reasons and updated guidance is closest to what company informs ...should be called ATM GEEK :p
been mentioning the rise of local brands for quite some time
feihei is releasing a3 on the market , they want to warn you

A2 Milk trading halt sparks concerns about outlook
A2 Milk is heavily reliant on doing business in China, (https://www.afr.com/companies/manufacturing/is-a2-milk-s-cash-cow-about-to-dry-up-20200902-p55rsn) where channels account for 48 per cent of its total infant nutrition sales

https://www.afr.com/companies/manufacturing/a2-milk-trading-halt-sparks-concerns-about-outlook-20201217-p56ob2

[ratkin]

On the other hand, you might bail out on the bad news at the bottom, only for it to bounce back up a couple of bucks just after your trade goes through! Maybe it's better to sit tight, ride out the storm and use it as an opportunity DCA...options, options...requiring careful consideration.

You might be right there, there will be no buyers for those rushing to the exit. Once it settles down though, there will be a relief rally of some sort, that might be a better time to exit

[tomm]

To me , the Board and BG upgrade the guidance and they didn't believe them then they requires more informations to support the Company Upgrade Guidance.
Who wanna bet for a dinner at Mission bay in Auckland ?

[jimdog31]

Ogg, you missed off the youtube vid with Mr cage....

[Jim]

I think the will be a downgrade and the sp will fall like a lead balloon

[Ogg]

Ogg, you missed off the youtube vid with Mr cage....

This is a serious thread... (cage)

[jimdog31]

This is a serious thread... (cage)

Touche me ol mate

[LEMON]

Couple different articles point to a downgrade and an announcement tomorrow morning.
I could lie and say I'm in it long term and I don't care at this point but IT is annoying and frustrating to watch your money shrink or fear for the worst.

In the end, we have many opportunities to make money in life, but then again chasing money won't make you entirely happy either.

Best to take a deep breath and await the news.

[Balance]

To me , the Board and BG upgrade the guidance and they didn't believe them then they requires more informations to support the Company Upgrade Guidance.
Who wanna bet for a dinner at Mission bay in Auckland ?

Will bet you 6 bottles of Veuve Clicquot, deliverable by Christmas Day to an address of the winner's choosing.

[pierre]

Hi Ogg - I know you said this is a serious thread - but you don't think ATM is about to announce a takeover for SKT do you? ;)

[tomm]

https://www.nzherald.co.nz/business/toyota-warns-of-vehicle-delivery-delays-following-global-logistics-issues/HXCLKSWBCLX3FFCSEFEASU7RLQ/

Toyota warns of vehicle delivery delays following 'global logistics issues'

11 Dec, 2020 12:43 PM

[Hello123]

Hi Ogg - I know you said this is a serious thread - but you don't think ATM is about to announce a takeover for SKT do you? ;)

This is hilarious!

[Balance]

https://www.nzherald.co.nz/business/toyota-warns-of-vehicle-delivery-delays-following-global-logistics-issues/HXCLKSWBCLX3FFCSEFEASU7RLQ/

Toyota warns of vehicle delivery delays following 'global logistics issues'

11 Dec, 2020 12:43 PM

6 bottles of Veuve Clicquot?

[tomm]

6 bottles of Veuve Clicquot?
This will end my day :))))

[winner69]

Blackmores share price collapsing today

[Ogg]

Hi Ogg - I know you said this is a serious thread - but you don't think ATM is about to announce a takeover for SKT do you? ;)

You know somethings going down when you see me...:lol:

[Balance]

Blackmores share price collapsing today

Similar to SML.

Market getting jittery.

Not good.

[jimdog31]

You know somethings going down when you see me...:lol:

They do have enough cash to do it. :t_up:

[tomm]

My expect is due to the global logistics problem and the tension with China which in term will halt the Chinese students to study in Australia , all of the mentioned will effect more sales in daigou chanel and global shipment chain. They will down grade the previous guidance .... Hold tight guys.... Very obvious and the Share Price has been reflecting on this since.

“We have become aware of information which may require us to release an announcement to revise our previously issued guidance to the market,” the company said in a statement to the Australian stock exchange.
“We are requesting a trading halt to provide us with additional time to properly consider the current information and to consider new information as it becomes available, and inform the market.”

[Cyclical]

Similar to SML.

Market getting jittery.

Not good.

Yeah, I had to check the weighting of 1 or 2 ETF's I have...decided it wasn't enough to lose sleep over.

[Beagle]

......................After a very nice long lunch with a couple of really good mates and a few refreshments I reached the inescapable conclusion that some people cannot be helped and one has done a very good job of shooting himself in both feet, (despite years of me trying behind the scenes to get him to take a more reasoned, professional and prudent approach with his investing). In a nutshell, some people are their own worst enemy.

Back to ATM. As I see it four issues present.
1. The immediate downgrade and effect on earnings, likely to be material in my view.
2. Implications for FY22 growth rate, (if any) and beyond. Likely to be a material change.
3. What's a fair PE for a company that may be growing very slowly for the foreseeable future. Another material change coming.
4. The obviously skillful way these downgrades have been crafted to avoid the possibility of any successful action for insider trading is an addition overlay / Governance concern.

I foresee a material downgrade to earnings and future growth projections and a consequent material knock on effect to the multiple the market will attribute to ATM going forward.

I also have never seen such a long trading halt for what looks like a downgrade coming. Possible massive Geopolitical issue with the Chinese coming ? Dairy exports from Australia to be blocked or hit with a massive tariff that effectively blocks them ? Who knows, time will tell.

Synlait down 7.4% in just one day looks a bit ominous. I think Synlait could test multi year lows in the next few days. $4 on the cards I reckon.
On top of the above the $Kiwi at multi year high's will be a further headwind.

[Balance]

Yeah, I had to check the weighting of 1 or 2 ETF's I have...decided it wasn't enough to lose sleep over.

Exactly right.

It is what it is - you cannot influence whatever will be coming but you can manage how you respond to the event.

[Baa_Baa]

Potentially nasty if the revised guidance is not good. If so, TA suggests the GAP to $13 will immediately close with support below that at $12.20 and unfortunately no obvious supports below that until vaguely around $10 then the low Oct 2018 around $8.67.

Thoughts are with current holders, hoping this isn't a near term calamity, but for others looking for an entry or top up ... keep the powder dry until you see the whites of the eyes (might be a capitulation).

[winner69]

Multi day trading halts for guidance updates (usually big downgrades) are not that unusual

Aim to get some reality in the forecasts (ie do a thorough job instead of broad based assumptions / guesses) and robust enough so they don’t have to through the pain of further downgrades again.

But in saying that most don’t get it right and still have ‘hope’ built in....which doesn’t eventuate.

[bulltrap]

ATM still a longterm hold so far, but keeping a cautious eye on their announcement. Wont be selling if its a short-term blimp.

If it goes down like the Hindenburg, we know who jinxed it :p

[Beagle]

Multi day trading halts for guidance updates (usually big downgrades) are not that unusual

Aim to get some reality in the forecasts (ie do a thorough job instead of broad based assumptions / guesses) and robust enough so they don’t have to through the pain of further downgrades again.

But in saying that most don’t get it right and still have ‘hope’ built in....which doesn’t eventuate.

Which is exactly why as Balance astutely says, downgrades usually come in 3's. I reckon more than 90% of the time.
This is why as the famous KW says, Never buy shares in a downtrend.

[Waltzing]

"the Hindenburg"

oh dear this is really almost more exciting than the sailing... but after this afternoons racing i cant see anything being more exciting for NZ over the summer..The Americas cup in NZ is surely one of the great new stories of 2020/2021 for NZ sport to be championed around the world. Lets hope on monday there is no Hindenburg... really chins up people.. chins up..

How many times have they blown it badly before?

[winner69]

So we know where things might be heading.

F20 Revenue $1.73m NPAT $385.8m

F21 Guidance at results announcement - we anticipate continued strong revenue growth ...EBITDA margin of 30%-31% etc etc

September guidance. H1 Revenue $725m to &775m (pcp $806m) but full year to be $1.8 billion and ebitda margin about 31%


Wonder what the latest guidance brings know where things might be heading

I’d say full year revenues less than $1.6b as poor sales continue through H2 and margin pressure reducing npat to less than $300m

Not going broke but way way below expectations.

[flyinglizard]

Which is exactly why as Balance astutely says, downgrades usually come in 3's. I reckon more than 90% of the time.
This is why as the famous KW says, Never buy shares in a downtrend.


Mr. B, I just confirmed the daigou A2 wholesale price of infant powder has collapsed by approximately 10% since Nov. Usually this is the busiest period of daigou business, the price was supposed to increase, according to previous experience. Karicare infant A2 range are half price lower against A2. Price war, very bad signal for the industry.

[petty]

I’m with you Winner but a bit more bearish. I’m picking 700m H1, H2 700m. Fully year 1.4billion. That’s my 2c. I reckon everyone needs to get in their bets and we’ll swing a sweepstake. A tin of A2 to the closest updated guidance.

[alokdhir]

So we know where things might be heading.

F20 Revenue $1.73m NPAT $385.8m

F21 Guidance at results announcement - we anticipate continued strong revenue growth ...EBITDA margin of 30%-31% etc etc

September guidance. H1 Revenue $725m to &775m (pcp $806m) but full year to be $1.8 billion and ebitda margin about 31%


Wonder what the latest guidance brings know where things might be heading

I’d say full year revenues less than $1.6b as poor sales continue through H2 and margin pressure reducing npat to less than $300m

Not going broke but way way below expectations.

Maybe sales around 1.5 Billion and NPAT 300 million as they saved on lots of travelling and marketing costs this year ...lol

SP will eventually rest more on why this happened ? and less on this year numbers only ....If this is going to be difficult market ahead then SP will be hit harder and for longer .

BTW KFL will be hit badly too almost 5 cents of NAV will be shaved off with still 11.4% holding as per latest report . Wonder how they got this idea of selling 500,000 ATM just before the HALT ...very very interesting !!

Main question remains ...Quality Company to Hold or look to get out ??

[Balance]

Mr. B, I just confirmed the daigou A2 wholesale price of infant powder has collapsed by approximately 10% since Nov. Usually this is the busiest period of daigou business, the price was supposed to increase, according to previous experience. Karicare infant A2 range are half price lower against A2. Price war, very bad signal for the industry.




I’d say full year revenues less than $1.6b as poor sales continue through H2 and margin pressure reducing npat to less than $300m

Not going broke but way way below expectations.

Put the picture together and if flying lizard information is correct, we are looking at a multiple downgrade scenarios :

H1 F2021 - somewhat impacted

H2 F2021 - full impact

F2022 - full impact

The way that Synlait share price fell away sharply this afternoon suggests that news of whatever bedevils ATM is 'leaking' out to the well informed.

[Beagle]

I’m with you Winner but a bit more bearish. I’m picking 700m H1, H2 700m. Fully year 1.4billion. That’s my 2c. I reckon everyone needs to get in their bets and we’ll swing a sweepstake. A tin of A2 to the closest updated guidance.

Bingo...I thought I was the only one thinking that. Put some pressure on margins and that could see eps back around the late 30's. https://www.marketscreener.com/quote/stock/THE-A2-MILK-COMPANY-LIMIT-11384022/financials/
That could have serious implications for the value with brokers currently expecting turnover of $1.8b, $2.2b and $2.5b for the near term years ahead.
PE could get rerated down into the late teens or at very best in my view the very early 20's as well as the market gradually takes on board the new reality of the situation and near term outlook.

Shareholders will no doubt be looking forward to some reassurance that the long term future growth story is unchanged, (and they will likely get some platitudes along those lines to help ease their pain) but increasingly some must be wondering what gives the directors such an assurance that's the case and if that really was that way why were insiders selling huge quantities to hapless investors in the ~ $21 price range just a few months ago ?

[Panda-NZ-]

Could it be a takeover of synlait or another company, maybe overseas? ATM has been building alot of cash and could afford to take on more debt.

[Beagle]

Put the picture together and if flying lizard information is correct, we are looking at a multiple downgrade scenarios :

H1 F2021 - somewhat impacted

H2 F2021 - full impact

F2022 - full impact

The way that Synlait share price fell away sharply this afternoon suggests that news of whatever bedevils ATM is 'leaking' out to the well informed.
In my experience there's more leaks that a sieve in that place.

[Sideshow Bob]

In my experience there's more leaks that a sieve in that place.

Would have to be something relatively sudden/just arisen - given capital raising just very recently.

[Beagle]

So we know where things might be heading.

F20 Revenue $1.73m NPAT $385.8m

F21 Guidance at results announcement - we anticipate continued strong revenue growth ...EBITDA margin of 30%-31% etc etc

September guidance. H1 Revenue $725m to &775m (pcp $806m) but full year to be $1.8 billion and ebitda margin about 31%


Wonder what the latest guidance brings know where things might be heading

I’d say full year revenues less than $1.6b as poor sales continue through H2 and margin pressure reducing npat to less than $300m

Not going broke but way way below expectations.

40 cents a share, quite possibly less and likely to be vastly below broker expectations for FY22.

[Balance]

Would have to be something relatively sudden/just arisen - given capital raising just very recently.

Reason why Synlait was sold off by the market today - market reads SML’s announcement as a sales downgrade:

Market roundup on interest.co.nz - “Darling dairy company A2Milk (ATM) is in an unexpected trading halt. The share price was $14.12 at that halt. Little has been revealed by them as to the reason, but Synlait (SML) has suggested A2Milk has sales level issues. SML's share price was at $5.40 before the announcement and has fallen almost -7% since in today's trading. Investors will be watching nervously for the updates by both companies.”

[Raz]

Put the picture together and if flying lizard information is correct, we are looking at a multiple downgrade scenarios :

H1 F2021 - somewhat impacted

H2 F2021 - full impact

F2022 - full impact

The way that Synlait share price fell away sharply this afternoon suggests that news of whatever bedevils ATM is 'leaking' out to the well informed.

Ever considered Synlait has it own problems, a few middle managers jumping ship...

[Panda-NZ-]

Ever considered Synlait has it own problems, a few middle managers jumping ship...

Jeebus just after Fonterra has finished dealing with their own issues. who is coming out of management school these days.. :\

[Balance]

Ever considered Synlait has it own problems, a few middle managers jumping ship...

No, because SML’s comments today were directly related to ATM’s trading halt.

BTW - not saying that the market is right. Just how the market is reading the announcement from Synlait today.

[Beagle]

Jeebus just after Fonterra has finished dealing with their own issues. who is coming out of management school these days.. :\

The short answer is "rocket scientists" who think diversity and inclusion are more important than earnings.

[Cyclical]

I'm not sure we can attribute SML's 7% slide to insider knowledge. I would expect there to be plenty of nervousness with this ATM halt...that's a sure way for buyers to exit and as a result, 7% probably ain't that bad.

[JeremyALD]

Well certainly not great news on the horizon, however they still have over a billion cash and no net debt to weather any storm.

They also reported strong results at the annual meeting in all direct channels, so as long as those things haven't changed I still think the future is bright enough.

Could be a grim year coming up for the SP though.

[Balance]

Well certainly not great news on the horizon, however they still have over a billion cash and no net debt to weather any storm.

They also reported strong results at the annual meeting in all direct channels, so as long as those things haven't changed I still think the future is bright enough.

Could be a grim year coming up for the SP though.

ATM is still a great success NZ story.

Will not be trading at high multiples however?

[JeremyALD]

ATM is still a great success NZ story.

Will not be trading at high multiples however?

Its valuation still seems pretty reasonable to me, especially with the current state of the NZX. I'll wait and see what happens tomorrow, but I don't see myself selling down.

Could be a scary sight once the ASX opens though...

[Cyclical]

Guys, noob questions... When this puppy comes out of halt, I guess it would need to be at a time when both markets are open, no? Does there need to be some advance warning when it's about to happen? Like a premarket type period, or something like that? Cheers

No one able to answer this one? No hard and fast rules?

[Longhaul]

Could be a scary sight once the ASX opens though...

Yeah it could be pretty scary, A2M 10th most shorted stock on ASX (Shortman website link (https://www.shortman.com.au/stock?q=A2M))

[Balance]

Yeah it could be pretty scary, A2M 10th most shorted stock on ASX (Shortman website link (https://www.shortman.com.au/stock?q=A2M))

Short coverings could provide a useful floor in the short term as the substantial profits from shorting are taken & locked in.

[Cyclical]

If we were to set aside for a bit any notion that those at the top are pretty good at engineering things to avoid scrutiny regarding insider trading (eg cashing up at ~21 bucks with impeccable timing), and that this information bringing about the halt has genuinely only recently come to light (ie it wasn't apparent at AGM time), then the one thing in the public domain that has really amped up since that AGM would have to be the CN AU trade war.

Now if the Chinese were suddenly whacking big tariffs on dairy, then I imagine that would be in the public domain as soon as ATM knew about it, if not before. Likewise with C19 infected batches, or shipments being blockaded because they've come from AU (we'd have heard about it already). The Daigou channel is buggered, but we already knew that...perhaps it's got worse, but that shouldn't be a surprise to the board. Maybe logistics are in a bad state and they are having trouble getting the product to the market, again this is something that surely hasn't just become apparent since the AGM. Regarding competition, well that's nothing new.

So what really is the big deal, some new hindrance we've not yet heard of, or is it just a culmination of all of the above and simply the number 2 downgrade in the standard Balance trifecta? If the latter, why such a long halt though?

I don't know, but given the length of the halt and the fact none of the above is really news, I tend to think that it may be a new challenge we've not seen to date.

[HKG2301]

Fascinating reading, catching up on pages of comments since the halt! My thoughts, very briefly...

The trading halt may remain in place until Monday open, in which case WATCH OUT BELOW!

Or... we could see trading restart tomorrow (Friday) with a far less calamitous announcement than feared, in which case stand by for a bea-utiful relief bounce, enhanced by a short squeeze that will make your eyes water.

On that note, to bed, perchance to dream...

:t_up:

[porkandpuha]

......................After a very nice long lunch with a couple of really good mates and a few refreshments I reached the inescapable conclusion that some people cannot be helped and one has done a very good job of shooting himself in both feet, (despite years of me trying behind the scenes to get him to take a more reasoned, professional and prudent approach with his investing). In a nutshell, some people are their own worst enemy.


Yet you still struggle to reach the conclusion that "help" is not on the menu and an investment strategy is unique to the individual and not everyone wants advice on the make up of their portfolio.

Until you understand that, the same old story will unfold where every couple of weeks you roll in on your patronising high horse and add your 2c to the A2 thread which is fine and part of a constructive debate, but then you ruin it with jibes like the above. Naturally everyone gets defensive of their portfolio choices and weighting and you wonder to yourself why you, the white knight with thousands of posts and years of service to the ST forum, are not getting any traction with the people, so you go off in a sulk and post the usual "clearly my opinion is not welcome so I am going to leave the thread for the 9th time".

A few days later you pop up on another thread telling them about all the mean folk over on the A2 thread and how they have a different approach to investing to you and they wont listen so now they are labelled "helpless". You quote personal messages from Moosie because "hey if Moosie agrees with me then I MUST be right" and at the next opportunity (today) at the first sign of bad news you get the courage to come back once again and tell everyone how wrong they all were with a bunch of "I TOLD YOU SO" posts, being sure once again to include references to other people who "TOLD US SO", because it gives you reassurance to know some people agree with you.

Go back and read the last 400 pages, then come back and tell me this is not true. You spend too much time on a pointless side debate trying to teach the masses, that you come across as someone glad to see others lose money if it means you get to make your point. Happy to see the behaviour has already been called out a couple times today.

Now we rinse and repeat... although change the number 9 up above to a number 10.

[aperitif]

My nomination for post of the year!

[Comyn]

Could it be as simple as large scale theft, fraud? A2M may need the time to look into legal issues before they comment.

[Panda-NZ-]

Could it be as simple as large scale theft, fraud? A2M may need the time to look into legal issues before they comment.

What has good old Jayne been up to :P

[jimdog31]

Yet you still struggle to reach the conclusion that "help" is not on the menu and an investment strategy is unique to the individual and not everyone wants advice on the make up of their portfolio.

Until you understand that, the same old story will unfold where every couple of weeks you roll in on your patronising high horse and add your 2c to the A2 thread which is fine and part of a constructive debate, but then you ruin it with jibes like the above. Naturally everyone gets defensive of their portfolio choices and weighting and you wonder to yourself why you, the white knight with thousands of posts and years of service to the ST forum, are not getting any traction with the people, so you go off in a sulk and post the usual "clearly my opinion is not welcome so I am going to leave the thread for the 9th time".

A few days later you pop up on another thread telling them about all the mean folk over on the A2 thread and how they have a different approach to investing to you and they wont listen so now they are labelled "helpless". You quote personal messages from Moosie because "hey if Moosie agrees with me then I MUST be right" and at the next opportunity (today) at the first sign of bad news you get the courage to come back once again and tell everyone how wrong they all were with a bunch of "I TOLD YOU SO" posts, being sure once again to include references to other people who "TOLD US SO", because it gives you reassurance to know some people agree with you.

Go back and read the last 400 pages, then come back and tell me this is not true. You spend too much time on a pointless side debate trying to teach the masses, that you come across as someone glad to see others lose money if it means you get to make your point. Happy to see the behaviour has already been called out a couple times today.

Now we rinse and repeat... although change the number 9 up above to a number 10.

Not that beagle needs defending, but I will say this ; his words of caution definitely resonated with me at a timely juncture in the SP slide, so much so that I decided to walk away with a 6 figure loss on A2. That was a bitter pill to swallow. I put those released funds into a couple of shares he was championing at that same time and i have turned that 6 figure loss into a 6 figure profit.

I’m not posting that to gloat, and I get that shares go up and shares go down, but Beagle shares his ideas in a logical and reasoned way, and I for one am extremly grateful he takes the time to do so, as ST would hold a lot less value for forum posters/watchers without his input.

He that has ears listen.....

Thank Beagle.

[King1212]

Jayne is with qantas n laughing at u all...loo

[LEMON]

The news could still be positive.
Maybe the readjustment signals more sales than expected with Melbourne out of lockdown.

Then again even though we know A2 is a NZ company that will not affect the shipments through Daigou from Australia.
Daigou is more or less a way to channel in foreign good to china. If a large majority such as wine has been hammered by the tariffs there is no reason why shipments containing these products may be sent back or put on pause containing A2 formulas and powders.

[dubya]

Not that beagle needs defending, but I will say this ; his words of caution definitely resonated with me at a timely juncture in the SP slide, so much so that I decided to walk away with a 6 figure loss on A2. That was a bitter pill to swallow. I put those released funds into a couple of shares he was championing at that same time and i have turned that 6 figure loss into a 6 figure profit.

I’m not posting that to gloat, and I get that shares go up and shares go down, but Beagle shares his ideas in a logical and reasoned way, and I for one am extremly grateful he takes the time to do so, as ST would hold a lot less value for forum posters/watchers without his input.

He that has ears listen.....

Thank Beagle.

I don't hold this stock, but a big ditto to everything else you've written re The Beagle.
People can use their ignore button if they so wish, but for reasons only known to themselves.....they choose not to!!!

[mike2020]

Not that beagle needs defending, but I will say this ; his words of caution definitely resonated with me at a timely juncture in the SP slide, so much so that I decided to walk away with a 6 figure loss on A2. That was a bitter pill to swallow. I put those released funds into a couple of shares he was championing at that same time and i have turned that 6 figure loss into a 6 figure profit.

I’m not posting that to gloat, and I get that shares go up and shares go down, but Beagle shares his ideas in a logical and reasoned way, and I for one am extremly grateful he takes the time to do so, as ST would hold a lot less value for forum posters/watchers without his input.

He that has ears listen.....

Thank Beagle.

I am glad you said that. No ones perfect. I like to hear everyone's opinion and then I am quite capable of coming to my own conclusion and acting how I see fit for myself. There are a few people here who I think most of us would be worse off without and differing points of view offer valuable information.

[bull....]

Short coverings could provide a useful floor in the short term as the substantial profits from shorting are taken & locked in.

If we do get a big fall i might be inclined to cover my shorts on the stock , depends on what they say in there commentary and outlook.

[alokdhir]

If we do get a big fall i might be inclined to cover my shorts on the stock , depends on what they say in there commentary and outlook.



What levels are u expecting to cover your shorts ? Just to get an idea what is possible and from where bounce is possible ? Shorter also have some intrinsic value for this stock so getting your perspective maybe good for bottom pickers too

As per u where it becomes a buy for long term ?

[bull....]

What levels are u expecting to cover your shorts ? Just to get an idea what is possible and from where bounce is possible ? Shorter also have some intrinsic value for this stock so getting your perspective maybe good for bottom pickers too

As per u where it becomes a buy for long term ?

its a bit hard to comment on that because you need to know what the announcement information is first to adjust any valuations etc. when i cover it does not necessary mean its the bottom it just means im happy to take profits at this level so dont take my short covering comments as a bottom.
As i mentioned a long time ago on this thread if your sitting on huge gains like a lot of people were with a2 it is very sensible to take some gains cause if you get what is happening now ( which happens to all stocks at some stage) at least you haved banked some money to enjoy.

[alokdhir]

its a bit hard to comment on that because you need to know what the announcement information is first to adjust any valuations etc. when i cover it does not necessary mean its the bottom it just means im happy to take profits at this level so dont take my short covering comments as a bottom.
As i mentioned a long time ago on this thread if your sitting on huge gains like a lot of people were with a2 it is very sensible to take some gains cause if you get what is happening now ( which happens to all stocks at some stage) at least you haved banked some money to enjoy.

Just wanted to know from shorter's perspective ...what would be best case outcome ? What most likely ? and what worst case ? When this trading Halt lifts . As shorter's expected this news to come like most market participants so market was sitting on fence ...70% priced ...30 % on news ...MOL

So will be happy to know your best , most likely and worst outcomes out of this announcement please

[bull....]

Just wanted to know from shorter's perspective ...what would be best case outcome ? What most likely ? and what worst case ? When this trading Halt lifts . As shorter's expected this news to come like most market participants so market was sitting on fence ...70% priced ...30 % on news ...MOL

So will be happy to know your best , most likely and worst outcomes out of this announcement please

a really bad statement is the best outcome as the price could halve like what happened to ballamies in the following week , my guess for most likely is its a financial performance issue or accounting irregularities and the worst case is its a profit upgrade

[Hello123]

a really bad statement is the best outcome as the price could halve like what happened to ballamies in the following week , my guess for most likely is its a financial performance issue or accounting irregularities and the worst case is its a profit upgrade

Hey Bull I know you don't have a crystal ball but do you think its best to watch on the side lines when it come to the SP or will it be biggest hit within the first few days, I guess it depends on the news right?

Because if this is due to just current situation and not a change to how things will be done in the future then I'm looking to get in.

[BlackPeter]

Guys, noob questions... When this puppy comes out of halt, I guess it would need to be at a time when both markets are open, no? Does there need to be some advance warning when it's about to happen? Like a premarket type period, or something like that? Cheers


No one able to answer this one? No hard and fast rules?

Hmm .. sort of a no-brainer - isn't it? Apart from market regulators not regulating other markets than their own ...

Given that the stock is in a trading halt it does make absolutely no difference whether the announcement comes during or outside of trading hours. Stock can't be traded until they lift the trading halt.

If the stock would not be in a trading halt (which it however is), than it would be nice if they make the announcement outside of trading hours (to give everybody a chance to read it), but there is no requirement for that.

Sometimes you don't need "hard and fast rules" - a bit of thinking resolves many issues ...

[alokdhir]

a really bad statement is the best outcome as the price could halve like what happened to ballamies in the following week , my guess for most likely is its a financial performance issue or accounting irregularities and the worst case is its a profit upgrade

Thanks for your perspective .

As per me any news about admitting financial or accounting misrepresentation is the worst news possible . Sales or guidance lowering will not be that moving . Profit upgrade is out of picture ...lol

[Hello123]

No one able to answer this one? No hard and fast rules?

I believe if ATM issued there announcement this morning say between 8:30 am - 10:00am and the trade was lifted trading would commence at 10am for the stock, ASX would jump in at 1pm as usual.

[bull....]

Hey Bull I know you don't have a crystal ball but do you think its best to watch on the side lines when it come to the SP or will it be biggest hit within the first few days, I guess it depends on the news right?

Because if this is due to just current situation and not a change to how things will be done in the future then I'm looking to get in.

your right it all depends on the news , just be happy with what you do as you have to live with it

[Cyclical]

Hmm .. sort of a no-brainer - isn't it? Apart from market regulators not regulating other markets than their own ...

Given that the stock is in a trading halt it does make absolutely no difference whether the announcement comes during or outside of trading hours. Stock can't be traded until they lift the trading halt.

If the stock would not be in a trading halt (which it however is), than it would be nice if they make the announcement outside of trading hours (to give everybody a chance to read it), but there is no requirement for that.

Sometimes you don't need "hard and fast rules" - a bit of thinking resolves many issues ...

Yeah, and at the end of the day, the notices did say the halt would be lifted in time for opening of both exchanges on Monday morning, if not before, which basically answered my question.

My question stemmed from the fact that one exchange may be unfairly advantaged if the lifting of the halt happened while the other was closed, but probably doesn't make much difference at the end of the day. Imagine if the lift happens on Monday morning, the NZX opens with ATM at $12 and things get progressively worse over the next couple of hours, say down to $10 at which point ASX opens - the kiwis have had the opportunity to potentially offload at ~$2 more than our Aussie brethren...shame that. Could go the other way of course, with the NZX being closed and ASX open, or we may have undue panic with a big low before the market further digests the news and the SP does the dead cat bounce just in time for the ASX open...

With all this in mind, I'm predicting a mid afternoon lift of the halt today ;)

[Balance]

Yeah, and at the end of the day, the notices did say the halt would be lifted in time for opening of both exchanges on Monday morning, if not before, which basically answered my question.

My question stemmed from the fact that one exchange may be unfairly advantaged if the lifting of the halt happened while the other was closed, but probably doesn't make much difference at the end of the day. Imagine if the lift happens on Monday morning, the NZX opens with ATM at $12 and things get progressively worse over the next couple of hours, say down to $10 at which point ASX opens - the kiwis have had the opportunity to potentially offload at ~$2 more than our Aussie brethren...shame that. Could go the other way of course, with the NZX being closed and ASX open, or we may have undue panic with a big low before the market further digests the news and the SP does the dead cat bounce just in time for the ASX open...

With all this in mind, I'm predicting a mid afternoon left of the halt today ;)

ATM sp is driven out of ASX - we all know that.

[Cyclical]

ATM sp is driven out of ASX - we all know that.

No doubt about it, but how does that alter what I said?

[alokdhir]

Longer the Halt stays ...worse the outcome becomes .

If they lift today then its better then Monday morning automatic time lapsed lifting !!!

What new information can be so time consuming to digest for them ...Financial misrepresentation of the past can be time consuming to work out ...Can be very bad for SP ( worst outcome )

New channel partner promising extra revenues ? Working out or integrating his projections with their own ...can be time consuming !

Simple profit downgrade or sales difficulties surely is not the issue here

[BlackPeter]

No one able to answer this one? No hard and fast rules?


Yeah, and at the end of the day, the notices did say the halt would be lifted in time for opening of both exchanges on Monday morning, if not before, which basically answered my question.

My question stemmed from the fact that one exchange may be unfairly advantaged if the lifting of the halt happened while the other was closed, but probably doesn't make much difference at the end of the day. Imagine if the lift happens on Monday morning, the NZX opens with ATM at $12 and things get progressively worse over the next couple of hours, say down to $10 at which point ASX opens - the kiwis have had the opportunity to potentially offload at ~$2 more than our Aussie brethren...shame that. Could go the other way of course, with the NZX being closed and ASX open, or we may have undue panic with a big low before the market further digests the news and the SP does the dead cat bounce just in time for the ASX open...

With all this in mind, I'm predicting a mid afternoon lift of the halt today ;)

Mmh ... you seem to assume that only the sellers get the relevant information? This is not how the markets are supposed to work.

If you think about it - it makes no difference whether they release their info during or outside of trading hours as long as everybody has the same information. Obviously - it would be nice to keep the trading halt at least for an hour or so after the release to give everybody a chance to read.

My guess would be the news either gets released within the next 30 minutes ... or Monday morning before trading starts with Monday morning in my views the more likely candidate - gives them the weekend to dot the i's and cross the t's.

Obviously if it starts leaking somewhere and they need to react, than anytime would be possible.

[macduffy]

Could go the other way of course, with the NZX being closed and ASX open, or we may have undue panic with a big low before the market further digests the news and the SP does the dead cat bounce just in time for the ASX open...


Does it matter? Aussies can trade on the NZX and vice versa.

[winner69]

Sometimes trading halts are extended ....and sometimes a stock is suspended for a period of time.

[Balance]

No doubt about it, but how does that alter what I said?

Means that whatever happens in the NZX is irrelevant until the ASX opens on ATM.

Sad but true.

[Gregnz]

I’d say if the plan was to re-open trading today then we would have already had the release. Monday morning now seems more likely.

[whatsup]

Once ATM's numbers are known to them there is no reason to continue the T H get the pain over and done with for heavens sake, we all are big boys and girls.

[alokdhir]

Today is index rebalancing day too where ATM weightage in NZX Portfolio Index tracked by FNZ is going up by 1.59 % ....

Was so looking forward to that ...lol

[Lion_graf]

https://www.nzherald.co.nz/business/synlait-shares-drop-after-a2-milk-trading-halt/QTLEVKPYXUG3SOYCPW7EHNQSLY/

Synlait saying they will reassess the impact. The word impact doesn't sound positive in my view..

The quotes in that article all talk about revised earnings guidance.. but maybe they can't say anything about contracts, acquisitions and takeovers until anything is released by a2 and we out of the halt. I guess we just have to wait and see..

[whatsup]

I wonder what % of ATM's product is bought by the diagou ( whatever ) industry as opposed by regular shipping ( air and sea freight ) ?

[alokdhir]

All ATM big inclusions ETF and Funds taking a hit today expecting a big downgrade in SP ...like TNZ , NZG but KFL which has 11.4 % ATM is still going up .

It reveals what kind of investors flock to KFL even at 20 cents over NAV !!

[tomm]

I don't think it is a big deal. Trading as usual.

[Beagle]

Not that beagle needs defending, but I will say this ; his words of caution definitely resonated with me at a timely juncture in the SP slide, so much so that I decided to walk away with a 6 figure loss on A2. That was a bitter pill to swallow. I put those released funds into a couple of shares he was championing at that same time and i have turned that 6 figure loss into a 6 figure profit.

I’m not posting that to gloat, and I get that shares go up and shares go down, but Beagle shares his ideas in a logical and reasoned way, and I for one am extremly grateful he takes the time to do so, as ST would hold a lot less value for forum posters/watchers without his input.

He that has ears listen.....

Thank Beagle.

Thanks mate. You've made my day knowing I've made a big difference for you.

[Beagle]

If we were to set aside for a bit any notion that those at the top are pretty good at engineering things to avoid scrutiny regarding insider trading (eg cashing up at ~21 bucks with impeccable timing), and that this information bringing about the halt has genuinely only recently come to light (ie it wasn't apparent at AGM time), then the one thing in the public domain that has really amped up since that AGM would have to be the CN AU trade war.

Now if the Chinese were suddenly whacking big tariffs on dairy, then I imagine that would be in the public domain as soon as ATM knew about it, if not before. Likewise with C19 infected batches, or shipments being blockaded because they've come from AU (we'd have heard about it already). The Daigou channel is buggered, but we already knew that...perhaps it's got worse, but that shouldn't be a surprise to the board. Maybe logistics are in a bad state and they are having trouble getting the product to the market, again this is something that surely hasn't just become apparent since the AGM. Regarding competition, well that's nothing new.

So what really is the big deal, some new hindrance we've not yet heard of, or is it just a culmination of all of the above and simply the number 2 downgrade in the standard Balance trifecta? If the latter, why such a long halt though?

I don't know, but given the length of the halt and the fact none of the above is really news, I tend to think that it may be a new challenge we've not seen to date.

Very good post, well said. I suspect we may see 4 downgrades this year, this the second one shortly, another in late February with the half year result and a final one in May 2021 or early June as the scale of the problem becomes abundantly clear.

I will wait for this to be properly de-risked and a clear bottom to be firmly established and will have another look at the fundamentals when there's a clear break above the 100 day moving average, whenever that might be but I doubt its anytime soon.

[winner69]

I don't think it is a big deal. Trading as usual.

In a few weeks time when shareprice is $16 or so most will be saying what was the fuss about

Market noise does get excessively amplified at times

[tomm]

In a few weeks time when shareprice is $16 or so most will be saying what was the fuss about

Market noise does get excessively amplified at times
I think the same as all the businesses are effective by the covid-19 but only ATM sailed through, until the late announcement and everybody knew that, the late sharply drop of 30% share price hence has already spoken about the covid-19's shrunk, by saying that despite whatever happen this company is very solid. Also the vaccines are rolling around the globe. Just hold my breath and wish all the best.

[Hello123]

I think the same as all the businesses are effective by the covid-19 but only ATM sailed through, until the late announcement and everybody knew that, the late sharply drop of 30% share price hence has already spoken about the covid-19's shrunk, by saying that despite whatever happen this company is very solid. Also the vaccines are rolling around the globe. Just hold my breath and wish all the best.

Depends on the news, its a trading halt which does not happen to often could be significant to the way they do business.

Yes you can hold your breath and wish for the best but keep your eyes open tomm.

[Getty]

Obviously the market will ignore me, but I'm using $14.60 as a baseline for the last 2 yrs from the graph, so say a 15% down forecast from that is $12.40.which to me means its not worth selling at current cross of $13.
If its only 10% down forecast...

[alokdhir]

Obviously the market will ignore me, but I'm using $14.60 as a baseline for the last 2 yrs from the graph, so say a 15% down forecast from that is $12.40.which to me means its not worth selling at current cross of $13.
If its only 10% down forecast...

12.19 was 2019 low too ...made in Nov 2019 ...so that should be first support below 13.60 ...then 10.80 to 11.20 band ...finally 9.50 to 9.80 levels !!

Depending upon the nature of the news ...SP severity will unfold ....Financial misrepresentation of past will really spook SP

[Balance]

I don't think it is a big deal. Trading as usual.

Irrational hope vs rational fear.

Greed has left the building.

[Getty]

One bit of financial representation I'll rely on is $854M cash, thats not creative accounting.

[dobby41]

13 pages of nothing :eek2: :t_up:

[bull....]

check out this announcement by iri today . this is what happens if its a simple profit downgrade

The Company announced at its Annual General Meeting (AGM) that its revenue for the first fourmonths of financial year 2021 were below the prior corresponding period and commented on therisk that its operating results for the half year ending 31 December 2020 may be below the priorcorresponding period.

http://research.iress.com.au/IDS/old/20201218/02324079.pdf?uid=EC4921BCDCBFA00D66077677A9BA72B46 F3E0000056671671193E540093D250091850000&ppv=

and the stock carries on trading


now check out these

Lessons from Bellamy’s Australia
Bellamy’s Australia has fallen into a serious hole.
Trouble first started emerging at Bellamy’s in early December last year. The company provided a trading update to the market announcing a substantial downgrade to its Chinese growth aspirations

https://milfordasset.com/insights/lessons-bellamys-australia

then

The share price of the organic infant formula producer has declined 67% since early December following the announcement and resumption of trading


worst case

Freedom Foods Group Limited (ASX Code: FNP) Freedom Foods hereby requests a trading halt for its ordinaryshares immediately.a) The trading halt is requested pending a further announcement concerning its financialperformance. The trading halt will remain in place until the morning of Friday 26th June.

delayed so they can investigate the issues found and its still under suspension

[alokdhir]

One bit of financial representation I'll rely on is $854M cash, thats not creative accounting.

If thats confirmed then rest all doesn't matter ...as its out of NP .

If that amount is confirmed 100 % then nothing else can shake SP too much .

My worst fears are about that amount only ....:eek2:

[winner69]

One bit of financial representation I'll rely on is $854M cash, thats not creative accounting.

Wirecard had a few billion ‘cash’ once

[bull....]

Wirecard had a few billion ‘cash’ once

yea if its inventory issues there cash pile could evaporate overnight

[Gregnz]

If thats confirmed then rest all doesn't matter ...as its out of NP .

If that amount is confirmed 100 % then nothing else can shake SP too much .

My worst fears are about that amount only ....:eek2:

They definitely have the cash on hand, so that will be confirmed. The cash doesn’t suddenly go missing and their last financial report included the interest that money was generating. I don’t believe the issue will be cash on hand, that’s safely in a bank account.

[bull....]

They definitely have the cash on hand, so that will be confirmed. The cash doesn’t suddenly go missing and their last financial report included the interest that money was generating. I don’t believe the issue will be cash on hand, that’s safely in a bank account.

except if its inventory issues then all there cash will go and they might need you to give them some money

[Gregnz]

Wirecard had a few billion ‘cash’ once

You can’t make a comparison between wirecard and a2. Wirecard was a fraudulent company from the get go.

[Getty]

Gee, maybe all this is why a certain woman delved back into her Hard liquor cabinet.

We may all need a stiff one after the ann.

[Gregnz]

except if its inventory issues then all there cash will go and they might need you to give them some money

Very much doubt an inventory issue would require close to a billion in cash to resolve. The most I've ever seen A2 have in their warehouse was around $300 million. I'd suggest if its a product issue, contamination, covid on the shipment, then we would have heard that from Synlait as it came from their factory.

[alokdhir]

You can’t make a comparison between wirecard and a2. Wirecard was a fraudulent company from the get go.

Agree with U ....Also ATM is not Ballerys either ...much different sized and market cap and much better researched by Intos ...Number 2 market cap stock of NZ , widely owned by institutions cant be compared with a new start up

Reasons given for its failure in report provided by Bull dont apply to ATM at all

Looks like many out to hurt ATM sentiment ...just because they facing challenges .

ATM should clear the air either way sooner then now ...Too much negative speculation going on during their difficult time !!

[bull....]

dont forget as well depending what there announcement is they may face class actions in australia

[bull....]

Agree with U ....Also ATM is not Ballerys either ...much different sized and market cap and much better researched by Intos ...Number 2 market cap stock of NZ , widely owned by institutions cant be compared with a new start up

Reasons given for its failure in report provided by Bull dont apply to ATM at all

Looks like many out to hurt ATM sentiment ...just because they facing challenges .

ATM should clear the air either way sooner then now ...Too much negative speculation going on during their difficult time !!

its probably a ballamy's

On December 2, Bellamy’s released a trading update to the market that resulted in 40% of its share price being wiped off over the following two days.
In the statement to the ASX, the company outlined “temporary volume dislocation in Chinese sales channels

[Waltzing]

More twists and Turns on this speculation than Tacks between Dean Bark and Team NZ yesterday... dizzying from a Take over to Covid contamination ... no lack of imagination displayed by the participants...

[Gregnz]

its probably a ballamy's

On December 2, Bellamy’s released a trading update to the market that resulted in 40% of its share price being wiped off over the following two days.
In the statement to the ASX, the company outlined “temporary volume dislocation in Chinese sales channels

I love the fact that your trying very hard to dig up dirt. Great examples of scaremongering. How do I add someone onto Ignore?

[alokdhir]

dont forget as well depending what there announcement is they may face class actions in australia

Thats the reason its taking them so much time to bring out the announcement . Need cover their tracks well

Way Halt letter was worded was also lawyers written all over it .

Keep in mind they are highly paid , trained professionals . They know fully well how to do their jobs ...atleast how to safe guard themselves !!

If many of them could sell shares around $ 21 levels and just before downgrade announcement and get away with it ....

Also at ASM ...just 30 days before its business as usual ...Guidance stands ...after 30 days .. multi day Halt for revising Guidance

I am just dying to know and understand what was the urgency for the Halt ...sent to exchange at 10.05 AM ...NZX maybe informed over phone to Halt as it did not trade for 5 minutes before they got the communication at 10.05 AM

Very very mysterious ...Better then any Thriller movie ...exciting just to know why so ?

What new information they just discovered or got aware of that it required hurried multi day Halt for first time in 5.5 years !!!

[bull....]

did you know that in the case of ballamy's the chairman and ceo were selling shares before there plunge

But, while the company seemed to be scaling heights, its chairman Robert Woolley and Ms McBain were quietly selling off hundreds of thousands of shares, fuelling scepticism in some corners.

https://www.nzherald.co.nz/business/infant-formula-company-bellamys-shares-plunge-44pc-on-weaker-china-sales/XDFDS4LJ2552B22GBIG3BYDNYE/

[silu]

Not sure if related to ATM issues but we import quite a bit from China and we have been told over the last few weeks to expect quite significant delays in shipments which are not only due to issues at NZ ports but also along the main shipping routes and ports in China. Honestly I don't know how much IF is being shipped but if there are really delays for ATM as well then it would certainly impact their profit. This in my book would be a best-case-scenario on why we are in Trading Halt at the moment.

[Sideshow Bob]

Not sure if related to ATM issues but we import quite a bit from China and we have been told over the last few weeks to expect quite significant delays in shipments which are not only due to issues at NZ ports but also along the main shipping routes and ports in China. Honestly I don't know how much IF is being shipped but if there are really delays for ATM as well then it would certainly impact their profit. This in my book would be a best-case-scenario on why we are in Trading Halt at the moment.

Shipping/exporting to China at the moment is completely ******. Getting bookings, getting empties, ships going on time, delays at trans-shipment ports, congestion in Chinese ports, importation, Covid testing of product etc etc. At least they don't need reefers, because these are another issue with plugs.

However this is all a known, albeit getting worse over recent months - ie no need for a trading halt. Still leaves airfreight, which is reasonable pricing to China and something they've done before.

[alokdhir]

Not sure if related to ATM issues but we import quite a bit from China and we have been told over the last few weeks to expect quite significant delays in shipments which are not only due to issues at NZ ports but also along the main shipping routes and ports in China. Honestly I don't know how much IF is being shipped but if there are really delays for ATM as well then it would certainly impact their profit. This in my book would be a best-case-scenario on why we are in Trading Halt at the moment.

Have been told traffic into China is not a problem . Traffic out is problem . So ATM shipping from Lyt port not effected . Latest port data showed IF shipments up so inventory also not a issue it seems .
SML also didn't flag any inventory problems recently

Something very legal and something very impacting financial numbers is the issue which requires very delicate and legally correct handling thus more time required . Halt was part of getting time to get that info out in correct manner

[Gregnz]

From HC "Port data out, infant formula up 40%(+$65 mill). China big, my thoughts are daigou demand just hasn't picked up re Aus data"

[Jay]

I'm just amazed there has been about 10 pages on nothing but speculation/trying to read things into the announcement that may or may not be there

Discl: small holder

[Balance]

I love the fact that your trying very hard to dig up dirt. Great examples of scaremongering. How do I add someone onto Ignore?

Bull ... is short so of course he is going to be very negative.

Whatever it is, all will be revealed by Monday afternoon.

[bull....]

I love the fact that your trying very hard to dig up dirt. Great examples of scaremongering. How do I add someone onto Ignore?

but if you had me on ignore you would have missed my call of the great breakout at 60 odd cents and the great short at 20 odd dollars lol

[LEMON]

I'm just amazed there has been about 10 pages on nothing but speculation/trying to read things into the announcement that may or may not be there

Discl: small holder

Exactly.
It could be something extremely positive, who knows.

[alokdhir]

Bull ... is short so of course he is going to be very negative.

Whatever it is, all will be revealed by Monday afternoon.

Trying to deduce from the cryptic clues we have is part of the fun ...no harm in trying to use grey matter !!:D

[Balance]

Trying to deduce from the cryptic clues we have is part of the fun ...no harm in trying to use grey matter !!:D

But of course!

It staggers & beggars belief that there are some posters here who actually think that there could be a definitive comment here of what’s actually happening!

All we can do is draw different scenarios and prepare for the actuality.

[arekaywhy]

I'm just amazed there has been about 10 pages on nothing but speculation/trying to read things into the announcement that may or may not be there

Discl: small holder


this is how these guys have "fun"

[Dotbond]

Bull may be short but still a very astute person.
I appreciate his input either way.

[Davexl]

Agree with U ....Also ATM is not Ballerys either ...much different sized and market cap and much better researched by Intos ...Number 2 market cap stock of NZ , widely owned by institutions cant be compared with a new start up

Reasons given for its failure in report provided by Bull dont apply to ATM at all

Looks like many out to hurt ATM sentiment ...just because they facing challenges .

ATM should clear the air either way sooner then now ...Too much negative speculation going on during their difficult time !!

So much negative speculation, could end up with a relief rally after the announcement when they realize things ain't so bad after all!

[Baa_Baa]

Over AU$9m put options exercised (https://stocknessmonster.com/quotes/a2m.asx/)

[Gregnz]

So much negative speculation, could end up with a relief rally after the announcement when they realize things ain't so bad after all.

Absolutely. Doesn't help when the so called 'astute' ones on here start comparing Wirecard with A2, and suggesting this as an example of how a billion dollars cash on hand can disappear overnight. I generally hold most on here in high regard for valid arguments, but comments like that, you quickly learn who to trust and who to ignore.

[Davexl]

Over AU$9m put options exercised (https://stocknessmonster.com/quotes/a2m.asx/)

PUT price doesn't appear to be too low, but they only make money if lower than the PUT price right?

[bull....]

NZ getting more involved in china/ aus dispute?

Wellington in no position to mediate Beijing-Canberra talks


New Zealand's new Foreign Minister Nanaia Mahuta said on Tuesday that New Zealand could help negotiate a truce between China and Australia amid the escalating trade and diplomatic spat

the article says

New Zealand is not in a position to blame China or to mediate - as Wellington is fundamentally in the same boat with Canberra on this issue.

In the face of its disputes with China, Australia wants to ally itself with other members of the Five Eyes alliance, including New Zealand. Some media reports claim that the alliance is planning sanctions against China

https://www.globaltimes.cn/content/1210247.shtml

is it payback did they find bugs or something in a2 infant formula? they might be wanting to tell NZ to shut up. this would be bad as 48% of a2 revenue is china

[alokdhir]

So much negative speculation, could end up with a relief rally after the announcement when they realize things ain't so bad after all!

Most likely if announcement is anything better then company will not be trading anymore ...lol

But on serious thought ...It seems we have a real big issue on our hands ...multi day Halt for ATM is unprecedented step ...which must have needed massive justification to do so !

Either way up or down ...expecting big moves after news is out !!!

Down side actually maybe more cushioned due to massive shorts in the system ....upside can be super massive ...just needs something positive :t_up:

[bull....]

looks like Mahuta insulted them ... oh no

[alokdhir]

looks like Mahuta insulted them ... oh no

What ever she says will never get any negative response from China ....NZ is too small ...will make China look very bad in world eyes bullying a small country like neutral NZ

Secondly our PM is the darling of the world opinion ...She knows how to play and get sympathy ...China will not cross paths with that ...they too smart for such petty loosing battles

[Waltzing]

Five eyes support was pushed out the door early this week by the AUSSI's. This is a long game the Kanga's want to play and like the JAP found on the KOKODA trail those out back Kanga's can be stubborn. If you want to see the kind of stubborn stuff the english used to be made of the defense of Kohima by the Kents is a good example. I dont think the new young chinese understand what they are up against. They think the blighty boys are whimps...NZ will be pulled into line soon enough. Our defense rely's on AUS. We dont have any defense. Much bigger game being played out at the moment. The PM is a possum in the search lights..beating trump is one thing.. china is a much bigger harder game player. ART of War.

[Balance]

PUT price doesn't appear to be too low, but they only make money if lower than the PUT price right?

Put is a downside protection - so obviously expecting the sp to drop below $13.00 to exercise the $13.00 puts.

[Greekwatchdog]

Here it is http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/365349/337791.pdf

[bull....]

its funny no new zealand papers reported the fact that nz offered to mediate and china shot NZ advances down?

[tomm]

https://www.sharecafe.com.au/2020/12/18/a2m-ubs-rates-the-stock-as-buy-6/







BROKER NEWS (https://www.sharecafe.com.au/category/broker-news/)
December 18, 2020

A2M – UBS rates the stock as Buy

By Broker News | More Articles by Broker News (https://www.sharecafe.com.au/author/broker-news/)
RELATED COMPANIESTHE A2 MILK COMPANY LIMITED (https://www.sharecafe.com.au/company/the-a2-milk-company-limited/)

a2 Milk is in a trading halt ahead of a potential update to its guidance.
Some issues facing the company include a slower-than-expected recovery in infant formula sales via daigou channels and surplus channel inventory, suggests UBS. The broker believes demand will return over time with receding covid led disruptions.
Choosing to look through the short-term earnings volatility, UBS maintains its Buy rating with a target of NZ$20.50.
Sector: Food, Beverage & Tobacco.

Current Price is $A13.28. Target price not assessed.

[bull....]

Here it is http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/365349/337791.pdf


massive downgrade ​just like we say ballamies situation could halve in price ? on this news

[HKG2301]

Here it is http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ATM/365349/337791.pdf

So just a minor, distinctly un-worrying guidance adjustment after all.

Now for that relief rally!

:t_up:

[McPussPuss]

Guidance announcement released, revised lower due to slower then anticipated rebound in Daigou channels

[whatsup]

Resumes @ 2.44 today

[bull....]

just remember there be massive volumes at end of day for futures adjustment esp in a2

[macduffy]

Five eyes support was pushed out the door early this week by the AUSSI's. This is a long game the Kanga's want to play and like the JAP found on the KOKODA trail those out back Kanga's can be stubborn. If you want to see the kind of stubborn stuff the english used to be made of the defense of Kohima by the Kents is a good example. I dont think the new young chinese understand what they are up against. They think the blighty boys are whimps...NZ will be pulled into line soon enough. Our defense rely's on AUS. We dont have any defense. Much bigger game being played out at the moment. The PM is a possum in the search lights..beating trump is one thing.. china is a much bigger harder game player. ART of War.

What's with this teaching your grandmother to suck eggs? Some of us have lived through all of this.

:mellow:

[HKG2301]

Now for that relief rally! :t_up:

Trading to resume at 2:44pm...

[Gregnz]

Hardly a massive downgrade.

[Waltzing]

There you go... back to the yatching then? looking for champagne deals at your local super market. French champagne anyone? Or a nice south island white? Supporting the local white wine growers this xmas. Dropped off a few nice whites as presents today already. Cheers to al holders but we cant buy till monday what a shame!

[silu]

When you expect the worst this is almost a relief.

[HKG2301]

Hardly a massive downgrade.

Agreed. Group EBITDA margin for FY21 adjusted from "in the order of 31%" to "between 26 and 29%".

[Waltzing]

"What's with this teaching your grandmother to suck eggs? Some of us have lived through all of this."

well if you were in your teens or twenties then. Any younger and the news of those events would have only come later one images unless of course one was already following dispatches at the time. Dispatches would have come via australian papers at the time and from India via london. News would have taken time to reach NZ and that is something worth spending some time investigating. Just the kind of research i enjoy.

I will look into it. Where would i start? Simply i will start at the ministry this afternoon by contacting recent staff.

Just saying we dont expect the fall out from the Australian trade position to move on next week and it may only get worse.

[bull....]

yes guidance could easliy get worse again next year

[macduffy]

Hardly a massive downgrade.

But they did use the word "material".

[Panda-NZ-]

But they did use the word "material".

Spooky.

clearly it's not has bad as some thought.

[gbogo]

TA broken long-term triangle on 1-week chart. target $6.00 don't @me.

[nztx]

Spooky.

clearly it's not has bad as some thought.


probably just done that way to scare our mates across the Tassie .. ;)

[Gregnz]

yes guidance could easliy get worse again next year

Well yes, if Covid gets worse. Lets hope the vaccine works.

[McPussPuss]

Almost down 50% now from it's highs.

It will be interesting to see where it finds a bottom, and how far it will overshoot to the downside

[winner69]

Hardly a massive downgrade.

Just a 30% fall in H1 Ebitda - maybe not massive but quite a lot

[bull....]

Well yes, if Covid gets worse. Lets hope the vaccine works.

its not all covid related its to do with chineses brands gaining traction as well thats why there instore sales are down as well. its been widely said how china brands are gaining more favour

[Gregnz]

Just a 30% fall in H1 Ebitda - maybe not massive but quite a lot

Definitely, but considering I had thoughts of accounting discrepancies or product blocked at the Chinese border, this is actually quite a relief.

[Ggcc]

Im not in a rush to hop out. The news is good enough for me to stay in for the long haul

[alokdhir]

Down 20% and ASX yet to trade ....

Hopefully they will start with short covering to bring it to 12 at least ....:p

[Gunner]

massive downgrade ​just like we say ballamies situation could halve in price ? on this news

I wouldnt say massive. Will be interesting to see how much downside is already factored in. I'll forecast $12

[HKG2301]

Just a 30% fall in H1 Ebitda - maybe not massive but quite a lot

How do you get 30%...?

[bull....]

i dont think ill short cover today

[Akane]

"It's okay guys! Wait for 11.11 sales!" LOL

[Joshuatree]

Thoughts Bull re topping up? When or not?

[Waltzing]

We posted if there was turbulence . price under 10.. but i dont think we get that today .. still a bit of drop.. Off to shop for KIWI white wine.. dont forget to shout for the little battlers out on the water if your at the boating...massive effort for a small GDP nation.

[daveypnz]

CBEC sales down is a bit worrying. I know they say the daigou channel plays a big part in spreading the good word which increases CBEC sales but concerning nonetheless...

disc: hold

[HKG2301]

i dont think ill short cover today

Well done for your short position, bull.... seems you called it.

However, not nice to gloat - especially when you know that certain people on this thread are losing their shirts...

:t_down:

[nztx]

Im not in a rush to hop out. The news is good enough for me to stay in for the long haul

similar stance here

may even look at a bit of averaging down to smooth things over at the right levels

[bull....]

Well done for your short position, bull.... seems you called it.

However, not nice to gloat - especially when you know that certain people on this thread are losing their shirts...

:t_down:

i dont gloat , ive lost too many times before to realize that but i do call it as i see it

[Balance]

Second downgrade.

Amazing how the ‘downgrades’ come in threes come true so often.

Credibility of management & directors - gone.

[Ronaldthump]

Time to top up and average down. Over 50% down from ATH

[Beagle]

I have called their 2H forecast a crock for a long time and what do you know...it is !!
At mid point the second half is forecast to be down from $1,100m to just $800m and a massive reduction in gross profit margin to boot, WOW !! (the margin contraction is worse than I would have thought).
https://www.marketscreener.com/quote/stock/THE-A2-MILK-COMPANY-LIMIT-11384022/financials/
My preliminary calculations have sales at $1,475m against weighted average market expectations of $1,806m
EBITDA of $405m against market expectations of $550m
Net profit after tax at $292m against market expectations of $389m
eps of 39.8 cps against market expectations of 53 cps.

Truly remarkable that some evidence of such a brutal downgrade wasn't known at the time of the annual meeting held very recently, although some commentators including this dog sniffed the B.S. and did notice the widespread proliferation of caveats they mentioned around their forecast at annual meeting time which to this dog at least, (as noted on here) read like a VERY serious warning sign.

Fair value now eps is shrinking ?...who knows but I would not be at all surprised to see a test of $8 and I would never touch this falling knife until the bottom is confirmed to be in.

The second downgrade is confirmed. I am expecting at least 1 more downgrade before the end of the year, possibly 2 more.

Kudos to the old wily dog Balance. Downgrades almost always comes in 3's eh mate. You're a legend mate !

[Hello123]

I have called their 2H forecast a crock for a long time and what do you know...it is !!
At mid point the second half is forecast to be down from $1,100m to just $800m and a massive reduction in gross profit margin to boot, WOW !! (the margin contraction is worse than I would have thought).
https://www.marketscreener.com/quote/stock/THE-A2-MILK-COMPANY-LIMIT-11384022/financials/
My preliminary calculations have sales at $1,475m against weighted average market expectations of $1,806m
EBITDA of $405m against market expectations of $550m
Net profit after tax at $292m against market expectations of $389m
eps of 39.8 cps against market expectations of 53 cps.

Truly remarkable that some evidence of such a brutal downgrade wasn't known at the time of the annual meeting held very recently, although some commentators including this dog sniffed the B.S. and did notice the widespread proliferation of caveats they mentioned around their forecast at annual meeting time which to this dog at least, (as noted on here) read like a VERY serious warning sign.

Fair value now eps is shrinking ?...who knows but I would never touch this falling knife until the bottom is confirmed to be in.

The second downgrade is confirmed. I am expecting at least 1 more downgrade before the end of the year, possibly 2 more.

So you expect possibly 2 more downgrades before end of 21?

[winner69]

How do you get 30%...?

Sales 670 AT 27% $181 ebita v 263 pcp

ebitda margin down nearly 6% points

[bull....]

covid has probably helped sales of local chinese brands as china being largely covid free becomes an attraction for local people worried about overseas goods. that might explain some of the sales decline

[trader_jackson]

All very mysterious... I remember being shouted out the room back in August on results day... share price back then was over $20... might be half of that when trading resumes.

ATM now half it was at results day not that long ago... $10.49 share price for a company with 40c EPS... still a PE of 26 odd... quite high for a company now with unknown growth (if any) in the short to medium term.

[Beagle]

So you expect possibly 2 more downgrades before end of 21?

I am expecting at least 1 more downgrade before the end of the FY21 year, possibly 2 more.

[Beagle]

Sales 670 AT 27% $181 ebita v 263 pcp

ebitda margin down nearly 6% points

Very UGLY and they have significantly undershot their H1 forecast sales as well. I can't see your $16 happening any year soon.

[whatsup]

This is far from over, Q is will it go under $10.00 ?

[Filthy]

This is far from over, Q is will it go under $10.00 ?

bounced pretty well off 1049. but i reckon maybe next week?

[jonu]

The cat will bounce (it aint dead!)

[Beagle]

Expecting a small bounce in the final 15 minute match process this afternoon as their index weighting in the NZX50 is increased and hapless index tracking funds have to buy but I would suggest a lot of institutional fund managers and analysts have already closed off for the year and are having their Xmas office party this afternoon. Some could be pulling after hours duties over the weekend or be back in the office on Monday and I would not be at all surprised to see the painful downward momentum continue next week.

[Balance]

Short coverings will provide the sp with some short term floor.

After that, try PE multiple of 18 times as a starting point.

[Beagle]

Short coverings will provide the sp with some short term floor.

After that, try PE multiple of 18 times as a starting point.

I agree with that multiple...something in the late teens makes sense now to me. On their current forecast, (which I am sure we both expect to be further downgraded) that suggests fair value of 18 x 39 cents = just ~ $7.

[King1212]

Mayday...mayday ..mayday!!!

[Beagle]

Mayday...mayday ..mayday!!!

I've been saying that for months and been abused out of the room on multiple occasions.

[King1212]

I am hearing u Master! I did mention couple weeks ago..as I went to food show...the supplies said eventually all the herds will be A2 cows...but people here laughed at me too...

So long people!

[imarktu]

My initial (and until recently, by far my largest) investment in this stock was at $21, and I have been topping up at various points on the way down from $17.
I matched my initial investment @ $13.70, and will continue to nibble away with smaller chunks over the coming weeks.

Would be nice to see $21 again.


Hahah, oh man
Chucking this one in the bottom drawer and forgetting about it for a while.
Merry Christmas to all, I hope the pain of this is offset by the gain somewhere else.

[Gregnz]

But in fairness, I think the board have a lot to answer for. I dont see how the board couldn't have seen this coming, it certainly doesn't appear to have been something that could blindside a board, resulting in a urgent trading halt. I'm curious to see their explanations in due course, as Im sure a lot of investors are. Given the AGM has realistically only just happened.

[Hello123]

This stock is like a game of limbo now!

How low can yaaa gooo!?

[bull....]

CHINA (https://www.newshub.co.nz/home/storytag.:storyTag=newshub:tag-library___cd___China.:offset=0.html)
China state media takes aim at Nanaia Mahuta's suggestion New Zealand could 'mediate Beijing-Canberra talks


Chinese state media has taken aim at Nanaia Mahuta for suggesting New Zealand could arbitrate a conversation between feuding China and Australia, while also accusing Jacinda Ardern of "arrogance and duplicity".

https://www.newshub.co.nz/home/politics/2020/12/china-state-media-takes-aim-at-nanaia-mahuta-s-suggestion-new-zealand-could-mediate-beijing-canberra-talks.html

[Getty]

Gee, maybe all this is why a certain woman delved back into her Hard liquor cabinet.

We may all need a stiff one after the ann.

One stiff one poured.
Cheers.

Beware the rigor mortis tho.

[sb9]

Expect to see a Takeover offer in the new year...Chinese want to gobble this up too..

[dobby41]

I've been saying that for months and been abused out of the room on multiple occasions.

Not another 'I told you so"

[silu]

The true value for ATM doesn't come until a takeover offer imo. The worst thing about this is that management has really crapped themselves and have lost an awful lot of trust.

[King1212]

Now everyone loves Chinese money ehh...

[ThaiJohn]

No point in cryin over spilt A2 milk. Great time to average down my holding plus buy a few more since it's xmas . :t_up:

Commiserations to those who jumped in @ post 20 bucks.

[Hello123]

Not another 'I told you so"

True but let him be, oh god does it not feel great to be right!

[flyinglizard]

Some concerns, ATM management does not mention in its announcement,

- Price War. How ATM responses to it. Karicare A2 infant range sell price is half of the A2 range, the price even beats up most of Chinese domestic brands. Any comments on this behaviour? Daigou would more prefer to sale Karicare products, eg, wholesale at 500 then retail to customers at 750, then 50% of profit (Karicare A2), 250 in terms of money value. wholesale at 950 then retail to customers at around 1150, then 20% of profit (A2), 200 in terms of money value. Clearly daigou will promote Karicare A2.

- Daigou Channel shrinks since Pandemic and keeps the trend. less Chinese students/visitors to OZ/NZ, more local daigou retired.

- MBS sales increase, how about the account receivables and credit terms? The daigou sales are cash sales, however, MBS will bring ATM mountains of account receivables. Credit terms 1 month, 3 months or 6 months?

- 20% INVESTMENT in SML, if SML SP collapses, ATM suffers a loss. The trend does not change so far.

Single sales channel with non-diversified products, The ATM SP will go down under $8 soon.

ATM management built the A2 concept and patent, but Daigou built the ATM growth legend. Now it is over!

[trader_jackson]

One thing is for sure, this announcement has called ATM's whole growth story (and it being priced liked one) into question...

[tomm]

So, no trading on the 24/Dec or 23/Dec ??

[Getty]

---------------------

[bull....]

synliat on trading halt now , wow sdomething up with them maybe lost a2 contract?

[YoungBull]

Hi, sorry if this is a stupid question, still learning. I have heard the idea that Chinese consumers may be changing to local brands being tossed around in this forum. Would A2 have sufficient data to disclose/discuss that by now? Would it have been referenced in their underlying brand health metrics?

[winner69]

One thing is for sure, this announcement has called ATM's whole growth story (and it being priced liked one) into question...

If they actually go down the production route (Mataura etc) all that stainless steel and capital will see different valuations applied by the market .....won’t be seen as branded marketing company.

[bull....]

Hi, sorry if this is a stupid question, still learning. I have heard the idea that Chinese consumers may be changing to local brands being tossed around in this forum. Would A2 have sufficient data to disclose/discuss that by now? Would it have been referenced in their underlying brand health metrics?

they would have data , but discussing it is another matter

[winner69]

Has the new CEO started yet?

Is this going to be a new broom sweeps clean?

Could clean up forecasts even more and blame Geoff.

[glasszon]

Phew, finally got out after taking a 15k hit. Note to self: stop investing in growth companies! I haven't had any luck picking growth companies this year.

[JeremyALD]

Unbelievable things have changed so much since AGM. I'm really disappointed. I no longer have a lot of trust in management. Had it been an unforseen disruption I would of been a lot more understanding, however their guidance was off by hundreds of millions. They knew the challenges.

[Beagle]

Some concerns, ATM management does not mention in its announcement,

- Price War. How ATM responses to it. Karicare A2 infant range sell price is half of the A2 range, the price even beats up most of Chinese domestic brands. Any comments on this behaviour? Daigou would more prefer to sale Karicare products, eg, wholesale at 500 then retail to customers at 750, then 50% of profit (Karicare A2), 250 in terms of money value. wholesale at 950 then retail to customers at around 1150, then 20% of profit (A2), 200 in terms of money value. Clearly daigou will promote Karicare A2.

- Daigou Channel shrinks since Pandemic and keeps the trend. less Chinese students/visitors to OZ/NZ, more local daigou retired.

- MBS sales increase, how about the account receivables and credit terms? The daigou sales are cash sales, however, MBS will bring ATM mountains of account receivables. Credit terms 1 month, 3 months or 6 months?

- 20% INVESTMENT in SML, if SML SP collapses, ATM suffers a loss. The trend does not change so far.

Single sales channel with non-diversified products, The ATM SP will go down under $8 soon.

ATM management built the A2 concept and patent, but Daigou built the ATM growth legend. Now it is over!


One thing is for sure, this announcement has called ATM's whole growth story (and it being priced liked one) into question...

Those comments hit the nail directly on the head !!


Has the new CEO started yet?

Is this going to be a new broom sweeps clean?

Could clean up forecasts even more and blame Geoff.

Yeap, that happens far more often than not ! Start with an even more brutal downgrade after the H1 announcement in February 2021 and then claim to have beaten guidance when they report in August and get some new forecast into the market for FY22 to try and convince the punters its still a growth company...oh and the usual as well, throw in millions of dirt cheap share options on extremely favorable multiple year terms when the shares hit rock bottom.

[Lease]

It should be a good opportunity to buy.

[777]

Post deleted

[Beagle]

Unbelievable things have changed so much since AGM. I'm really disappointed. I no longer have a lot of trust in management. Had it been an unforseen disruption I would of been a lot more understanding, however their guidance was off by hundreds of millions. They knew the challenges.

You could easily be forgiven for thinking this whole downgrade thing has been extremely carefully crafted specifically to avoid any chance of anyone taking successful legal action against insiders for insider trading when they sold in huge volumes just a few months ago at close to double the price they are today. Don't blame you for using the adjective unbelievable, because it is ! The directors and senior management's credibility is in complete tatters in my opinion and I am sure I'm not the only one that feels that way !

[Gregnz]

In the old days Vince would have banned you from these forums for that post. If we could vote you off then one vote would come from me.

Another vote would certainly come from me. The immaturity of some here beggars belief.

[Greekwatchdog]

Well count me as 3.

[ThaiJohn]

Point made. Give it a rest.

[gbogo]

at what point do passive funds have to sell? any chance ATM drops out of some indices if share price settles around here?

[JeremyALD]

You could easily be forgiven for thinking this whole downgrade thing has been extremely carefully crafted specifically to avoid any chance of anyone taking successful legal action against insiders for insider trading when they sold in huge volumes just a few months ago at close to double the price they are today. Don't blame you for using the adjective unbelievable, because it is ! The directors and senior management's credibility is in complete tatters in my opinion and I am sure I'm not the only one that feels that way !

Yes and why a trading halt? They would of been aware of this at least 7 days ago and could of reviewed last weekend and announced before Monday trading...

[tango]

synliat on trading halt now , wow sdomething up with them maybe lost a2 contract?

They will need to revise their forecasts on the back of ATM expecting much slower recovery

[Rawz]

Well I just got out at $11.20. Took a 29.9% loss on the chin. It had accounted for 8.7% of my portfolio pre halt.
I have come to the conclusion that the Chinese are trusting their home brands more and more and the melamine disaster memory seems to be fading. That and the price war. Not keen to sit around and see margins get slowly eroded.

In better news I added STU yesterday and it is up 7% already. EBOS had a nice gain. Thank god for a diversified portfolio!! This has been my big learning today. Diversify!

Now where to put the ATM funds?

[tomm]

Well I just got out at $11.20. Took a 29.9% loss on the chin. It had accounted for 8.7% of my portfolio pre halt.
I have come to the conclusion that the Chinese are trusting their home brands more and more and the melamine disaster memory seems to be fading. That and the price war. Not keen to sit around and see margins get slowly eroded.

In better news I added STU yesterday and it is up 7% already. EBOS had a nice gain. Thank god for a diversified portfolio!! This has been my big learning today. Diversify!

Now where to put the ATM funds?
No mate, just buy the dip , it will come back.

[pierre]

Nobody likes seeing this kind of destruction of the SP for any company but it's not quite so bad if you hold a variety of stocks over which you can share the pain and have sufficient courage and patience to stay on the roller coaster.

The plunge in ATM today has been offset substantially by other gains so there has been only a 0.7% reduction in my total portfolio today - and I wont be selling into the panic following this announcement. The business is not stuffed and the SP will recover - one day. To be fair I've been holding since 2017 and my average cost is around $9. I'm currently on the right side of the SP and can afford to be a bit sanguine but I do feel for those who bought in at much higher levels.

Once again, attitude depends on whether you're a trader or an investor - and I'm definitely the latter.

Meanwhile HGH, IFT, MCY, OCA, PEB RYM, SCL, SKO, SPK, SUM, TRA, XRO & others in my portfolio have all had their share of rock 'n roll on the roller coaster but are humming along OK right now and not keeping me awake at night. (Good article in NBR about PEB today too.)

I'm not gloating - I don't enjoy SP dives - but do try to be philosophical when danger strikes, as long as it's not across the board!

Bonne chance to all.

[nztx]

No mate, just buy the dip , it will come back.

too true .. did so & averaged well down today --- never ever waste a good SP dip .. ;)

Note how things starting recovering towards close

[flyinglizard]

The price war started from Fonterra is targeting on A2. The Karicare A2 infant daigou wholesale price is 30-50% lower than normal Karicare infant. IT DOES NOT MAKE SENSE, BUT MESSAGE HAS BEEN DELIVERED.

Even most of Chinese domestic brands cannot compete with this low price.

[Swala]

This one a big learning curve for me. Just sold out for a 30% loss. Biggest lesson, don't keep buying on the way down thinking you've picked a bottom. Lesson learnt!

[bull....]

Well I just got out at $11.20. Took a 29.9% loss on the chin. It had accounted for 8.7% of my portfolio pre halt.
I have come to the conclusion that the Chinese are trusting their home brands more and more and the melamine disaster memory seems to be fading. That and the price war. Not keen to sit around and see margins get slowly eroded.

In better news I added STU yesterday and it is up 7% already. EBOS had a nice gain. Thank god for a diversified portfolio!! This has been my big learning today. Diversify!

Now where to put the ATM funds?

painful , but your be happy i guess that you didnt have all your money in one stock

[Ronaldthump]

How everyone changes their tune so quickly. Take a look around. The world is in a pandemic. Now it seems everyone is just writing A2 off. Why is this a shock to everyone. Things will improve in due time. Still a very strong brand and product with room to grow in the future.

Will be taking the opportunity to load up some more. Fear and emotion taking its toll on peoples decision making I think.

[nztx]

Nobody likes seeing this kind of destruction of the SP for any company but it's not quite so bad if you hold a variety of stocks over which you can share the pain and have sufficient courage and patience to stay on the roller coaster.

The plunge in ATM today has been offset substantially by other gains so there has been only a 0.7% reduction in my total portfolio today - and I wont be selling into the panic following this announcement. The business is not stuffed and the SP will recover - one day. To be fair I've been holding since 2017 and my average cost is around $9. I'm currently on the right side of the SP and can afford to be a bit sanguine but I do feel for those who bought in at much higher levels.

Once again, attitude depends on whether you're a trader or an investor - and I'm definitely the latter.

Meanwhile HGH, IFT, MCY, OCA, PEB RYM, SCL, SKO, SPK, SUM, TRA, XRO & others in my portfolio have all had their share of rock 'n roll on the roller coaster but are humming along OK right now and not keeping me awake at night. (Good article in NBR about PEB today too.)

I'm not gloating - I don't enjoy SP dives - but do try to be philosophical when danger strikes, as long as it's not across the board!

Bonne chance to all.


Like you recent past has seen a fairly good unrealised cushion built up

ATM for a few months in the red here has never really bothered & with patience opportunity came today

When a notional (possibly temporary) loss is realised - then that's it - opportunity forgone to position
it better for future recovery..

[Pegasus2000]

Nobody likes seeing this kind of destruction of the SP for any company but it's not quite so bad if you hold a variety of stocks over which you can share the pain and have sufficient courage and patience to stay on the roller coaster.

The plunge in ATM today has been offset substantially by other gains so there has been only a 0.7% reduction in my total portfolio today - and I wont be selling into the panic following this announcement. The business is not stuffed and the SP will recover - one day. To be fair I've been holding since 2017 and my average cost is around $9. I'm currently on the right side of the SP and can afford to be a bit sanguine but I do feel for those who bought in at much higher levels.

Once again, attitude depends on whether you're a trader or an investor - and I'm definitely the latter.

Meanwhile HGH, IFT, MCY, OCA, PEB RYM, SCL, SKO, SPK, SUM, TRA, XRO & others in my portfolio have all had their share of rock 'n roll on the roller coaster but are humming along OK right now and not keeping me awake at night. (Good article in NBR about PEB today too.)

I'm not gloating - I don't enjoy SP dives - but do try to be philosophical when danger strikes, as long as it's not across the board!

Bonne chance to all.


Thanks pierre. Need some stomach to contain ATM now. Wondering what time to pick some bargain......

[Rawz]

No mate, just buy the dip , it will come back.

I was a believer! Trust me. Originally brought at $19. Doubled down at $15. Then again at $14. But the writing is on the wall for all to see now. I've got a 3yr old so understand once an infant anything (formula, prams, front pack etc) brand falls out of favor, and new (Chinese) brands build traction.. mums talk.. not keen to sit around watching it play out.

I'm now in the other camp and expect another downgrade before the end of the FY. :(

[Balance]

This one a big learning curve for me. Just sold out for a 30% loss. Biggest lesson, don't keep buying on the way down thinking you've picked a bottom. Lesson learnt!

Learnt the hard way years ago like you - double up on the way up, not on the way down.

That way, you are buying more and more of a good story rather than buying more and more of a bad story (on the way down).

[madmat]

its not all covid related its to do with chineses brands gaining traction as well thats why there instore sales are down as well. its been widely said how china brands are gaining more favour Just wait for them to get greedy and use melamine powder again :S

[Swala]

Learnt the hard way years ago like you - double up on the way up, not on the way down.

That way, you are buying more and more of a good story rather than buying more and more of a bad story (on the way down).
That's good advice. Overall not too worried about the mistake as the best lessons are when you have skin in the game. ATM was about 8% of my portfolio which has had a great year so can't complain too much.

[Lease]

Just wait for them to get greedy and use melamine powder again :S

True, A2 is far more superior and in fact today's announcement did disclose its sales are very strong at physical stores in China. That means people there still love A2 and its recovery is just a matter of time.

[daveypnz]

True, A2 is far more superior and in fact today's announcement did disclose its sales are very strong at physical stores in China. That means people there still love A2 and its recovery is just a matter of time.

Conversely online sales are down which is pretty worrying as online shopping is huge in China (compared to the rest of the world). They say online sales are down due to daigou not spreading the word but that pretty concerning imo.

[Beagle]

Yes and why a trading halt? They would of been aware of this at least 7 days ago and could of reviewed last weekend and announced before Monday trading...

Only logical explanation I can think of is they had to run it past their public relations team and their team of QC lawyers to make sure they chose their words extremely carefully (given how close to the wind they are sailing with their insider selling potentially being an actionable matter). Poor timing to lift the trading halt too, mid afternoon on the last Friday of work for many people when vast numbers of people would be enjoying their work Christmas party and be completely oblivious to what has happened and not had the opportunity to respond.


The Karicare A2 infant daigou wholesale price is 30-50% lower than normal Karicare infant.
Things appear to have fundamentally shifted a long way from a few years ago when Fonterror were alleged to be entering into some cooperation agreement with ATM.
Fonterror, (deliberately misspelt), have very deep pockets and can spend a fortune in a sustained campaign of buying market share. Yet another headwind on top of everything else and the very high $Kiwi as well.