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12-07-2018, 08:04 PM
#9461
Originally Posted by Left field
Thanks Winner...... duly corrected ( I was expecting 25c EPS).
25 cents seems so insignificant relative to a $11 plus share price doesn't it
”When investors are euphoric, they are incapable of recognising euphoria itself “
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12-07-2018, 09:51 PM
#9462
Originally Posted by winner69
25 cents seems so insignificant relative to a $11 plus share price doesn't it
Market is forward looking, lucky it has such a strong telescope into the future and unbridled optimism at this PE ratio, so yes EPS will be pathetic unless E catches up with P, which holders might not want to dwell on how that might happen.
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13-07-2018, 08:34 AM
#9463
Originally Posted by winner69
25 cents seems so insignificant relative to a $11 plus share price doesn't it
Mmmmm not quite.
If you look at some of the forward projections as posted by Beagle you will see that the market is pricing on a forward PE which looks at some of the following;
· Likely sales growth between 30 to 50% = $NZ 1.3 to 1.5 billion. Korea will begin pumping and Frontera will re-launch A2 Milk in NZ from Aug 18. I also expect considerable hype re new A2 milk products (diversifying away from IF and raw milk.) There may be further Asian expansion, possibly Japan and possible news of a strategic partnership there. USA and UK will continue strongly.
· Likely FY19 EPS 35c to 40c (NZD) Some say .50c!
· Mounting cash reserves $NZ 500 mill. Expect some announcements re this. Furure dividends ( Maybe .10c?) More likely IMO is an investment in another related company…. (or both!!)
Current price pretty fair IMO. Forward price of $15 by later this year still my target.
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13-07-2018, 09:20 AM
#9464
they will have to ramp up marketing spend way more as global competitors enter the space in china more forcefully also entering new markets will require way more spend also to compete against bigger competitors.
the only reason i would see the price gaining from here is on the back of the bull market just like most other shares.
one step ahead of the herd
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13-07-2018, 09:27 AM
#9465
If I had a spare $8 billion would I buy A2 today and expect say a 10%pa return for many years into the future?
I don’t think I would
Maybe there is a ‘greater fool’ who would pay $10 billion for A2 in the next year or two ...if I knew that I might pay $8 billion today
In saying this I still have my ATM shares ....obviously only looking out for a short to medium term return
Last edited by winner69; 13-07-2018 at 09:39 AM.
”When investors are euphoric, they are incapable of recognising euphoria itself “
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13-07-2018, 09:54 AM
#9466
Originally Posted by bull....
they will have to ramp up marketing spend way more as global competitors enter the space in china more forcefully also entering new markets will require way more spend also to compete against bigger competitors.
the only reason i would see the price gaining from here is on the back of the bull market just like most other shares.
The reason the SP will make further solid gains over time is perfectly obvious, its EPS Growth.
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
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13-07-2018, 10:01 AM
#9467
Originally Posted by Beagle
The reason the SP will make further solid gains over time is perfectly obvious, its EPS Growth.
EPS will grow ....but lower PE could see share price stay about the same
And we could even get a reversion to the mean ...that could be interesting eh Couts
”When investors are euphoric, they are incapable of recognising euphoria itself “
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13-07-2018, 10:24 AM
#9468
Originally Posted by winner69
EPS will grow ....but lower PE could see share price stay about the same
And we could even get a reversion to the mean ...that could be interesting eh Couts
Or the PE could stay the same...not that difficult to find other companies on the NZX trading on higher multiples with lower growth than ATM, (FPH, POT, AIA e.t.c.).
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
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13-07-2018, 10:35 AM
#9469
Originally Posted by Beagle
Or the PE could stay the same...not that difficult to find other companies on the NZX trading on higher multiples with lower growth than ATM, (FPH, POT, AIA e.t.c.).
Hmm - I do have a list of companies which I don't hold but intend to buy when we are leaving the next recession. FPH, POT and AIA are prominent contenders. So you think ATM belongs on this list as well?
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"Prediction is very difficult, especially about the future" (Niels Bohr)
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13-07-2018, 10:49 AM
#9470
Originally Posted by BlackPeter
Hmm - I do have a list of companies which I don't hold but intend to buy when we are leaving the next recession. FPH, POT and AIA are prominent contenders. So you think ATM belongs on this list as well?
All of those companies to be fair have more defensive properties than ATM. Hard to get comparatives for ATM in their sector. I guess the relative PE of BAL is something to think about. My sense is the ATM SP is about fair and reasonable at the current level and its should move up in line with earnings growth over the next few years. For what its worth I have a 6% portfolio allocation and about 4% to Synlait. I think that's enough for me and am disinclined to add to either right at the minute.
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
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