ATM - A2 Milk Corporation Limited

[HKG2301]

Fascinating reading this thread, surreal in places. Hard to believe that anyone in an investors forum would admit to having 90% of their portfolio invested in a single share – let alone be proud of it! It smacks of speculation (if not outright gambling) which makes emotionless, clear thinking on the subject almost impossible. Witness the bias here to only positive, bullish comments. No room for healthy, pro & con discussion, that would be dis-loyal!

We live in interesting times. Much of the investing world is in denial about the paradigm-busting economic & social effects of Covid, which is not surprising given the hot mess in the US. IMO, most markets are way overpriced, but out of challenge comes opportunity and some shares will benefit going forward. Many others will sink without trace. Difficult to say which, when risk abounds: a global plague, a madman in the White House, power-struggles in (and from) China. And who’s to say there’s not another black swan lurking?

Personally, I see ATM as one of the winners and shake my head at the NZX-ASX battle that’s going on, which can take the share price from +4% to -5% on the day of a relatively good Annual Report. However, the balance of risk is positive: down-side, perhaps $13-ish v’s upside, a return to the $20 range. China will decide, ultimately, not the shorters. In fact, I’m rather looking forward to the inevitable short squeeze. Hence accumulating at these levels...

Just my tuppence worth.

[Beagle]

Agree. Sticking to my posts on 28 / 29 September. The time to top up on A2 will be when 'the time is right' and SP stability returns. That isn't going to happen short term with market nervousness and uncertainty surrounding A2's trading. I predict the SP will jump 10%+ on the day that A2 announces that the trading uncertainty of the covid environment is diminishing, and prospects for the future have 'normalised' with a positive outlook. That is still some time away obviously, but not being invested where you want to be before that day by trying to be too 'cute' with your timing of the market means missing out on the easy money of first leg of the recovery. In the overall scheme of things, a year of weak SP performance is but a minor blip and an opportunity to ride the recovery. You can analyse and agonise all you like in the meantime, but the recovery will come. Just be part of it and get in before lift off.

Its clear to me from his comments to the N.Z. Herald that the well experienced Mark Lister of Craig's has genuine doubts about their ability to meet the challenging goal presented by their second half sales forecast.

Nobody is disputing that ATM has been a great long term story. I doubt any serious long term investor would be especially perturbed by a year of share price weakness and this would be a minor blip except for the fact that we're into our third year of share price weakness now and the shares have dramatically underperformed the NZX50 since March 2018 when they were $13. This fact should have people scratching their head wondering if the fabulous eps growth rates experienced in the past which have driven market outperformance will ever return ? A gain of only $1.80 in the 30 months since March 2018 and all the while with no dividends being paid is not a minor blip and represents quite a dramatic underperformance against the NZX50.

In my opinion shareholders are right to be concerned by the current slowdown, (nobody is actually talking about how forecasted sales this half are down on last year) and right to wonder if the company can meet its lofty 2H sales projections which even if achieved will lead to only a minor uptick in eps 53 cps v 52 cps last year (according to average analyst forecasts on market screener).

The Herdlicker appointment was an abject failure by the board, (called by me very early on with her appointment) and one wonders if the new guy will be any good ?

https://www.marketscreener.com/quote...22/financials/ Currently on a forward PE of 27.7. I think that's expensive for a company that's presently forecast not to grow this year and if my hunch is right, actually experience eps decline. Looking further out analysts have lofty expectations for growth in FY22 and beyond. Time will tell.

I see plenty of challenges ahead am pleased to have exited at $13 in March 2018. The shares are up by only 13.8% in the last 30 months against the NZX50 which is up 59%.

Of course I accept that there have been some phenomenal years of growth in the past and every man and his dog has pointed to the long term index outperformance. My key point is I believe the best years of growth are behind this company and the best years of leadership probably are as well.

I share Mark Lister's skepticism about their lofty sales target for the second half. I hope I am wrong as I have a significant stake in Kingfish and they have a significant stake in ATM.

[alokdhir]

Not expecting any big moves today imo, however depending on outlook commentary it may start to track into higher price trajectory...

Originally Posted by alokdhir
I have a feeling that either way ATM will move in a big way today as it has been looking for direction for quite some time now ....it needs a path for next 3-6 months ..hopefully it will be upwards !



Not expecting any big moves today imo, however depending on outlook commentary it may start to track into higher price trajectory...

From positive + 4.5 % to minus - 5.5 % ie almost $ 1.6 range of yesterday ...its definitely a big range as per me buddy !!

Though I was not expecting this kind of move ...but I was expecting a big range as it was being coiled up for long ...yesterday both sides showed their hand ...Bears won as it must be very short term players unwinding in disappointment .

Let the dust settle and hope it doesn't break last low of 13.96 as that will be food for bears ...fingers crossed

[couta1]

Fascinating reading this thread, surreal in places. Hard to believe that anyone in an investors forum would admit to having 90% of their portfolio invested in a single share – let alone be proud of it! It smacks of speculation (if not outright gambling) which makes emotionless, clear thinking on the subject almost impossible. Witness the bias here to only positive, bullish comments. No room for healthy, pro & con discussion, that would be dis-loyal!

We live in interesting times. Much of the investing world is in denial about the paradigm-busting economic & social effects of Covid, which is not surprising given the hot mess in the US. IMO, most markets are way overpriced, but out of challenge comes opportunity and some shares will benefit going forward. Many others will sink without trace. Difficult to say which, when risk abounds: a global plague, a madman in the White House, power-struggles in (and from) China. And who’s to say there’s not another black swan lurking?

Personally, I see ATM as one of the winners and shake my head at the NZX-ASX battle that’s going on, which can take the share price from +4% to -5% on the day of a relatively good Annual Report. However, the balance of risk is positive: down-side, perhaps $13-ish v’s upside, a return to the $20 range. China will decide, ultimately, not the shorters. In fact, I’m rather looking forward to the inevitable short squeeze. Hence accumulating at these levels...

Just my tuppence worth.

Need more honesty on these forums I reckon, many on here hold over 70% of their total portfolio in this stock, put all your eggs in one strong basket and watch that basket closely. I have no problem with opposing views that come from the right motive but I'm very good at sniffing out ulterior ones and will call them out eg Baa_Baa put up a TA post here last night which was fine as he's straight up so no problem with that.

[winner69]

Beagle - thought you had gone into bag of interesting words with skecticim ...got it eventually

Kingfish been buying quite a few of late by the looks of it ....are they helping the 87% go to 88%...and become long term believers in a good story

[couta1]

Its clear to me from his comments to the N.Z. Herald that the well experienced Mark Lister of Craig's has genuine doubts about their ability to meet the challenging goal presented by their second half sales forecast.

Nobody is disputing that ATM has been a great long term story. I doubt any serious long term investor would be especially perturbed by a year of share price weakness and this would be a minor blip except for the fact that we're into our third year of share price weakness now and the shares have dramatically underperformed the NZX50 since March 2018 when they were $13. This fact should have people scratching their head wondering if the fabulous eps growth rates experienced in the past which have driven market outperformance will ever return ? A gain of only $1.80 in the 30 months since March 2018 and all the while with no dividends being paid is not a minor blip and represents quite a dramatic underperformance against the NZX50.

In my opinion shareholders are right to be concerned by the current slowdown, (nobody is actually talking about how forecasted sales this half are down on last year) and right to wonder if the company can meet its lofty 2H sales projections which even if achieved will lead to only a minor uptick in eps 53 cps v 52 cps last year (according to average analyst forecasts on market screener).

The Herdlicker appointment was an abject failure by the board, (called by me very early on with her appointment) and one wonders if the new guy will be any good ?

https://www.marketscreener.com/quote...22/financials/ Currently on a forward PE of 27.7. I think that's expensive for a company that's presently forecast not to grow this year and if my hunch is right, actually experience eps decline. Looking further out analysts have lofty expectations for growth in FY22 and beyond. Time will tell.

I see plenty of challenges ahead am pleased to have exited at $13 in March 2018. The shares are up by only 13.8% in the last 30 months against the NZX50 which is up 59%.

Of course I accept that there have been some phenomenal years of growth in the past and every man and his dog has pointed to the long term index outperformance. My key point is I believe the best years of growth are behind this company and the best years of leadership probably are as well.

I share Mark Lister's skepticism about their lofty sales target for the second half. I hope I am wrong as I have a significant stake in Kingfish and they have a significant stake in ATM.

Your highlighted bit about the best yrs of growth being behind this company is pure speculation, even with a slowing its still a growth machine and your obsession with PE ratios is so yesterday, for me the PE is very modest for the potential and big future ahead. PS-If you think the sp isnt going to keep advancing in a healthy way from here then your barking mad.

[Beagle]

Beagle - thought you had gone into bag of interesting words with skecticim ...got it eventually

Kingfish been buying quite a few of late by the looks of it ....are they helping the 87% go to 88%...and become long term believers in a good story

Its early in the day, thank goodness for spell checker lol. Chief investment officer at Kingfish, Sam Dickie has done okay in the last few years, outperformed the NZX50 by 4.3% per annum after expenses, (source yesterday's monthly KFL newsletter, NAV to NAV after fees over the last 3 years), which is no easy feat but its well behind his peers at BRM and MLN, probably in no small measure because of ATM's weak share price performance in recent years. I think he's barking up the wrong tree but I can't stop him doing that and KFL does plug a lot of gaps in my portfolio, even the odd one I don't want plugged

[bull....]

Need more honesty on these forums I reckon, many on here hold over 70% of their total portfolio in this stock, put all your eggs in one strong basket and watch that basket closely. I have no problem with opposing views that come from the right motive but I'm very good at sniffing out ulterior ones and will call them out eg Baa_Baa put up a TA post here last night which was fine as he's straight up so no problem with that.

ive been very honest in my talk about the price going down since $20 and even backed it up with fundamentals.

[couta1]

ive been very honest in my talk about the price going down since $20 and even backed it up with fundamentals.

Yes but your here as a shorter to try and shake out weak holders with your constant negative talk.

[HKG2301]

Need more honesty on these forums I reckon, many on here hold over 70% of their total portfolio in this stock, put all your eggs in one strong basket and watch that basket closely. I have no problem with opposing views that come from the right motive but I'm very good at sniffing out ulterior ones and will call them out eg Baa_Baa put up a TA post here last night which was fine as he's straight up so no problem with that.

My point exactly. This smacks of 'thought police'. Do we really need a self-appointed judge to examine every post, to tell us which passes the 'couta test' and which doesn't?

Example: I disagree with much of Beagle's last post above. It's painfully selective, ignoring the SP being in the $18 - $21.50 range for 5 months of the year to date. However I share his concerns about a possible slowdown. On balance, I think this correction from the $21 level is healthy but overdone, an opportunity to accumulate. All interesting to discuss though, and I respect his/her opinion.

I don't need Constable Couta to vet every post and tell me what is and isn't acceptable. Once maybe - you have a right to your opinion as well - but several times a day?