ATM - A2 Milk Corporation Limited

[minimoke]

I used the numbers supplied by 777m which imply a 12% drop in 2018. didn't check his source, but if this is correct than the birthrates seem to drop quite fast (you said only 3.5% in 2017). Frightening if you need babys to run your business.

.

There is still the relatively untapped Pregnant Mother Market. Research from china in 2017 showed the higher the birth weight the better the math and word skills in 10 - 22 year olds. What better way oor helping higher birth weight is a healthy chinese Mum digesting premium AT Mothers Formula. And if the child isnt up to target weight a diet of healthy brain stimulating A2 will be just what the wealthy parents ordered.

The flip side of these numbers is the aging population - Maybe we need to see the development of an RYM or OCA model in china. Or you keep your workforce healthier by providing better nutrition. Or you incentivise parents to breed more.

Loads more opportunities ahead!

[hardt]

I used the numbers supplied by 777m which imply a 12% drop in 2018. didn't check his source, but if this is correct than the birthrates seem to drop quite fast (you said only 3.5% in 2017). Frightening if you need babys to run your business.

And yes, we all know that A2 managed to grow their Chinese sales in 2017 as well as in 2018 despite the reductions in the birth rates. They just increased their market share faster than the birthrate dropped. However - this is not a sustainable strategy.



Sure - Coca Cola did pretty well. Whether it is possible to repeat this success with a product without a secret recipee is a different question. I hear you, but I notice that you are comparing coke with milk ... (worse than apples with oranges?)



Maybe - but don't think that this scandal brushed up very positively on Fonterra. If your argument is right, than it should be Fonterra making the big dollars in China ...

Your views are very much expected of a top down view from an armchair in New Zealand.

If milk + IF are just commodities, so is honey, wine and meat all of which Chinese consumers pay a premium for ANZ sourced "commodities" as this country has a magic intangible value add to everything it produces.

[Sideshow Bob]

We also all know that can't be a one-trick pony and rely on the Chinese IF market - and the regulatory uncertainties that come with this. Sure China IF remains hugely important, and one of the main reasons where A2 has got to where it is. But remains plenty of potential elsewhere and in other products.

You either buy the growth story and buy/hold, or you don't and sell.

[BlackPeter]

Your views are very much expected of a top down view from an armchair in New Zealand.

If milk + IF are just commodities, so is honey, wine and meat all of which Chinese consumers pay a premium for ANZ sourced "commodities" as this country has a magic intangible value add to everything it produces.

I notice you sent all these valuable information from "inside a bubble" . Is this the A2 milk fan bubble?

Look - I don't know how the future will pan out, and so don't you. Just saying that too much euphoria seldom goes the right way. Related to the arm chair in NZ ... yes, I have that as well, but I might have more connections to Asia than many others here.

Anyway - all the best to investors - while I personally think that the share is currently fairly priced at best, nobody can predict where hype will drive any share price - well, certainly not me. Take it just as a different view ... sometimes useful in investing to see other opinions as well, but if it is not useful for you - feel free to only read your own posts ;

[Balance]

I used the numbers supplied by 777m which imply a 12% drop in 2018. didn't check his source, but if this is correct than the birthrates seem to drop quite fast (you said only 3.5% in 2017). Frightening if you need babys to run your business.

And yes, we all know that A2 managed to grow their Chinese sales in 2017 as well as in 2018 despite the reductions in the birth rates. They just increased their market share faster than the birthrate dropped. However - this is not a sustainable strategy.



Sure - Coca Cola did pretty well. Whether it is possible to repeat this success with a product without a secret recipee is a different question. I hear you, but I notice that you are comparing coke with milk ... (worse than apples with oranges?)



Maybe - but don't think that this scandal brushed up very positively on Fonterra. If your argument is right, than it should be Fonterra making the big dollars in China ...

What is so frightening about needing babies and human beings to run a successful business? Growing market share is not a sustainable strategy - question of time horizon and how much market share, surely!

Coca Cola has a secret recipe? In a blind test, the executives of Coca Cola & Pepsi Cola could not successfully pick 5 out of 5 of their 'unique' formulation! A2M is already perceived as a cut above local products in China and has an excellent positioning in the Australasian markets. Wonder why that is. Heck, it's a commodity, right!

Fonterra is a disaster - confirmed fact. How could a company not learn from its Sanlu disaster ($200m write-off) and lost $504m in Beingmate in China? And watch for the write-offs in South America to come. Why is it that other NZ dairy companies are milking it in China, but not Fonterra?

[Baa_Baa]

ATM on NZX does seem a bit more tentative or risk averse, its chart is lagging A2M on ASX which has an air of confidence and the TA is working well. Might just be the massive difference in liquidity, A2M is much easier to analyse than ATM.

[Balance]

ATM on NZX does seem a bit more tentative or risk averse, its chart is lagging A2M on ASX which has an air of confidence and the TA is working well. Might just be the massive difference in liquidity, A2M is much easier to analyse than ATM.

ATM on NZX is but a sad reflection of what actually happens in the real market for A2M on ASX.

Notice that A2M trading volumes are always 3 or 4 times that of ATM?

Plus, most of ATM shares traded are actually shunted to ASX.

[Snow Leopard]

Couple of posters looking at the world through their Kiwi inferiority goggles .

Need to leave your emotions behind when you are doing your TA as much as you do with your FA.

[hardt]

I notice you sent all these valuable information from "inside a bubble" . Is this the A2 milk fan bubble?

Look - I don't know how the future will pan out, and so don't you. Just saying that too much euphoria seldom goes the right way. Related to the arm chair in NZ ... yes, I have that as well, but I might have more connections to Asia than many others here.

Anyway - all the best to investors - while I personally think that the share is currently fairly priced at best, nobody can predict where hype will drive any share price - well, certainly not me. Take it just as a different view ... sometimes useful in investing to see other opinions as well, but if it is not useful for you - feel free to only read your own posts ;

I am well aware valuations are a tought elastic band that could snap under the simplest of pressures..

I was led to A2 and subsequently QEX via anecdotal evidence of my partners family and their behaviours as Chinese consumers.

No one knows what is coming, A2 in 10 years may be far less appealing, but currently growth is strong and momentum continues into the next 3-5 years

[winner69]

Take it just as a different view ... sometimes useful in investing to see other opinions as well, but if it is not useful for you - feel free to only read your own posts ;

Useful to see other opinions .............hmmm