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  1. #9371
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by Left field View Post
    Mmm interesting. Both are good companies to have in yr portfolio.

    While the recent SML SP chart may look better from a TA perspective, when you compare 2yr historical SP performance as per the following chart, ATM has performed about 350% better than SML

    Attachment 9789

    What will happen in the future?

    IMO SML's potential is more capital intensive and tied to its NZ production facilities. By comparison, ATM's less capital intensive potential is tied to multiple production facilities in NZ, AUS, UK, and USA with the benefits of any Frontera production as yet untapped. ATM seems to be disrupting traditional diary production/marketing methods.

    Which share will perform best in the longer term? It's going to be interesting to see.
    Good post. Interesting to note BAL is now trading well below where it was in January 2016.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  2. #9372
    ShareTrader Legend Beagle's Avatar
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    Quote Originally Posted by MikeE View Post
    What does everyone see the share price at for this stock in 18 months?
    Between $5 and $50 depending on how they grow over the next 18 months. Its been a 22 bagger since listing in Australia in 2014 so a lot of good news is already priced in. Disc: Holding a modest stake as part of a well diversified portfolio.
    Last edited by Beagle; 05-07-2018 at 05:12 PM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  3. #9373
    Senior Member hardt's Avatar
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    Don't know too much about Jayne, apart from the fact I cant pronounce her last name Hrdlicka ( herd licker/herd icker )

    But I do know she was a Senior partner of Bain & Company Sydney for 13 years ( 1997 - 2010 )

    Bain & Company have been pinned to the China/Aus loveboat for several years now.
    http://www.bain.com/publications/art...eed-china.aspx
    http://www.bain.com/publications/art...australia.aspx
    http://www.bain.com/Images/WEF_Futur...er_Markets.PDF
    http://www.bain.com/publications/articles/keeping-up-with-chinas-shoppers-at-two-speeds.aspx

    I am more than pleased with her leading A2 towards being an absolute behemoth... kept 50% of my portfolio in A2 for now.
    Last edited by hardt; 06-07-2018 at 01:13 AM.

  4. #9374
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    Quote Originally Posted by Beagle View Post
    Good post. Interesting to note BAL is now trading well below where it was in January 2016.
    I don't get the BAL comparison?

    About 3-4 yrs ago when BAL got into inventory problems ATM got hammered also. At that time I thought the ATM/BAL comparison was not logical and bought more ATM on the dip. Sure enough, ATM was subsequently shown to have no inventory problems and the SP climbed back and since then has left BAL in the dust.

    IMO ATM a much better managed company than BAL and more internationally diverse. Here's the last 3 yrs for you to compare. DYOR.

    Attachment 9790
    Last edited by Leftfield; 06-07-2018 at 07:46 AM.

  5. #9375
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    Quote Originally Posted by hardt View Post
    Don't know too much about Jayne, apart from the fact I cant pronounce her last name Hrdlicka ( herd licker/herd icker )
    In the old country you would pronounce it Hrdlitschka (https://forvo.com/word/hrdli%C4%8Dka/) in case anyone is interested.

  6. #9376
    Aspiring to be an Awesome Bear
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    [QUOTE=hardt;720733]Don't know too much about Jayne, apart from the fact I cant pronounce her last name Hrdlicka ( herd licker/herd icker )

    Classic! Appeals to my dreadful sense of humour

  7. #9377
    ShareTrader Legend Beagle's Avatar
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    http://nzx-prod-s7fsd7f98s.s3-websit...449/282325.pdf
    Wouldn't it be interesting to know what the hurdles are in terms of what the board set as annual diluted EPS growth to achieve vesting of long term incentives.

    Now on that topic (and I am certainly not putting myself out there as an expert) it would appear that Goeff Babbage's long term incentives that mature may cause a few waves with the expense side of the ledger in the future. As I understand it, and I could well be wrong, the company has to record as a salary expense the cost of his LTI as they vest. The problem is he was issued shares and LTI's when the SP was vastly lower than the current price so any need by the company to buy those huge numbers of shares on market to meet those LTI vesting requirement is going to get VERY expensive ! That's how I read it anyway. LTI's made up 3.6% of the market cap when I last looked at this so depending on the issue terms, and spread over a number of years this still looks very material over the years ahead. I guess it all depends upon how strongly they keep growing as to whether this makes a big hole in future years profits or not...


    Got to love RYM that have none of these hugely lucrative long term incentive plans for their management...just saying.
    Last edited by Beagle; 06-07-2018 at 10:24 AM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  8. #9378
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    Got to love RYM that have none of these hugely lucrative long term incentive plans for their management...just saying

    Thats right Roger,

    Also RYM directors wont be distracted when they meet with organising and administrating incentive plans. RYM directors can concentrate on whats important. Spend there time to plan the long term well being of the company, that works for the benefit of the residence, employees and share holders.

  9. #9379
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    Default A hidden problem with a company that has enjoyed explosive growth in its share price.

    Its just good old fashioned management greed...problem is its getting entrenched in the system and attracting the right senior staff without it is getting harder.
    Why would people paid $A1.5m need an incentive to perform anyway ? The fact they have short term incentives and long term incentives (LTI's) grinds my gears more than just a bit.

    Putting some numbers around the cost of previous long term incentives issued by ATM, the problem is we have a > 20 bagger over the last few years so almost all of the 3.6% of shares to be issued is going to amount to a management incentive cost and recorded as an expense item in the year in which the LTI's vest as I read it. 3.6% of market cap is just on $300m. That's going on the expense ledger as management costs as and when these LTI's vest over the next few years and will make quite an impact...well that's my read of the situation anyway and one of the reasons I only have a moderate stake in this company. Anyone else think a $100m extra expense next year to meet previous LTI's will make a difference to FY19's profit result ?

    Geoff has done a fine job and is going to retire an extremely wealthy man...just beware of where this is coming from...
    Last edited by Beagle; 06-07-2018 at 11:24 AM.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  10. #9380
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    Incentive scheme are typically hard to get right - and notorious for incentivizing the wrong behavior to maximize the reward, and not maximizing shareholder wealth. The longer the more difficult. Given the huge rise in shareprice, many A2 shareholders will probably be quite relaxed at this (but concerned on Beagle's observations on potential liability on Geoffreys LT incentives).

    Often incentives are based on things like share price or profit, but there are so many factors outside of the CEO's influence that can work either way - or otherwise things difficult to measure.

    A few million bucks per year should buy you someone that doesn't need motivation through an incentive and should be enough of a self-starter. If they believe in the company and what they are doing then they should have enough leftover after the weekly bills to buy a few shares, perhaps through a staff scheme to encourage all levels of staff - not just top dog or the elite few.

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