ATM - A2 Milk Corporation Limited

[Balance]

Thanks for sharing. Interestingly they have downgraded to eps of 31 cps for FY21...same as some old dog on here ...and they're not predicting much of a recovery in FY22.

Must be very very very satisfying to see that Forbar is following you (again)?

[Sideshow Bob]

Must be very very very satisfying to see that Forbar is following you (again)?

Speaking for Forbar's, I remember the day, many years ago when I was at uni we did a preso about an NZX company, and we chose AIR NZ. Part of the judges were local Dunedin ForBar staff.

We said AIR was a buy. This is absolutely no sh1t, within the next 2 days ForBar had updated them to a buy....!! Coincidence or not, I don't know.......

[Rawz]

Speaking for Forbar's, I remember the day, many years ago when I was at uni we did a preso about an NZX company, and we chose AIR NZ. Part of the judges were local Dunedin ForBar staff.

We said AIR was a buy. This is absolutely no sh1t, within the next 2 days ForBar had updated them to a buy....!! Coincidence or not, I don't know.......

Hahaha that's gold! Good yarn

[Balance]

Speaking for Forbar's, I remember the day, many years ago when I was at uni we did a preso about an NZX company, and we chose AIR NZ. Part of the judges were local Dunedin ForBar staff.

We said AIR was a buy. This is absolutely no sh1t, within the next 2 days ForBar had updated them to a buy....!! Coincidence or not, I don't know......

I have a good friend working for Forbar. Whenever any of their analysts put a 'sell' on a stock after having said stock as a 'buy or hold or accumulate' for a long while, he says that many old timers in the firm know that's the BUY signal and they load up PA.

True story.

[BlackPeter]

Hate to say it, but while ATM is undoubtably below a lot of longer MA's, it is most certainly not in a long term downtrend. It might seem long for anyone suffering the recent medium term down trend, but definitely not long term.

You have to back out to a monthly chart to see that the uptrend from 2005 is rock solid, and even the steeper long term uptrend from 2010 is intact. It would have to close below about $5.00 to break that long term up trend.

If you talking about the 2015 very steep uptrend to mid-2019, and consider that to be long, then yes it broke down from that about a year and half ago, so that's not really long term trend news. Basically in TA terms, it's range trading for the past three years. That in itself should give the 'longs' something to ponder.

The wheels of exhurberance in the market came off in August 2020 and have not yet reattached. Is the company going broke, heck no way. It it a good time to buy, well who would know for sure, I guess it's about ones personal risk/reward profile. The day to day chatter is so meaningless and irrelevant when one takes a long term view.

gltah

Absolutely agree ... you are (as far as I can see) the first on this thread talking about a long term downtrend (whatever this is) and then you explain to us in very convincing terms that the stock is not in a long term downtrend. Bingo - you are a genius!

Just in case you missed it - we discussed whether this is a "confirmed" downtrend, not whether it is a "long term" downtrend.

As far as I am concerned - the "confirmed" downtrend started in September / early October 2020 (depending whether you take the first dip under the MA200 or the cross of death as indicator) - and it continued without interruption until today. I have no idea how long this confirmed down trend will last and neither have you or anybody else.

Whether the roughly 6 months so far are long term or not lies in the eyes of the beholder, but as I said - you are the only one talking about "long term downtrend". Just wondering what Sigmund Freud would have to say regarding this phenomena? Whistling in the dark?

Just to clarify - I am just observing. I don't know either how the trend will continue and I suspect at some stage it will turn. However - I have no clue when this will be and from a personal perspective weighing the risks and opportunities would I call ATM at this stage probably fairly valued. Obviously - other people might and will have different views, and I guess the 64 million dollar question is - how fast will ATM's earnings keep growing in future? Anybody who sees continued and sustainable earnings growth of around or above 15% per year would consider the current price as fair or cheap. Just as a comparison - backwards earning growth CAGR for ATM was 70%, i.e. it is possible (but hey, its easy to get this CAGR if you start with 1 cent EPS in 2012 ...). Anybody who thinks that they are reaching the limits of growth with revenue growth constrained by increased competition and margins concurrently sinking will see them at the current price still as too dear.

In a decade or so we will know, which view was the better guess :

[Baa_Baa]

Absolutely agree ... you are (as far as I can see) the first on this thread talking about a long term downtrend (whatever this is) and then you explain to us in very convincing terms that the stock is not in a long term downtrend. Bingo - you are a genius!

Just in case you missed it - we discussed whether this is a "confirmed" downtrend, not whether it is a "long term" downtrend.:

You're so condescending BP, "we" did not discuss anything, you said in a post 'confirmed' - yes it is a confirmed downtrend - well done. Winner said 'long term' which I replied to - well depending on the definition of long term, I put it that it's not a long term down trend.

Try to be polite.

[BlackPeter]

You're so condescending BP, "we" did not discuss anything, you said in a post 'confirmed' - yes it is a confirmed downtrend - well done. Winner said 'long term' which I replied to - well depending on the definition of long term, I put it that it's not a long term down trend.

Try to be polite.

... and this statement is not condescending?

BTW - winner mentioned a "long term uptrend" and questioned in the same paragraph, whether it isn't broken.

Sorry - it was you bringing the term "long term downtrend" into the recent discussion. I really would like to help you with that, but facts are facts.

So sorry this hurts your feelings ... how can you fix that ?

[causecelebre]

This thread is almost as volatile as the stock itself.

[Akane]

Completely expected. Heavy selling on open on news day, slight rebound over the course of a few days, then back down to somewhere in between the ATL and the "new rebound".

There's fanboys who were creaming themselves over the classic bull trap makes me giggle.

Back to single digit today.

I wish I had today's knowledge, yesterday.

[Balance]

Should turn our minds now to what the new CEO is likely to do over the next 6 months.

Opportunity of a lifetime for him to reset and reposition the company in his own image now that the existing BOD & management have lost so much credibility.

He must have been very aware of the circumstances of Jayne Hrdlicka's appointment & subsequent sudden departure over the divergence of opinion as to what ATM should have focus on - Jayne's long term growth via heavy investment in sales, marketing and promotions vs the short term BOD's desire to maintain EBITDA margin.

So we can assume he would have negotiated a free hand to run the company. If he did not, then he is as useless as a fifth leg on a broken chair and ATM will continue to wallow in uncertainty.

Excerpt from Forbar's downgrade update which is noteworthy : " .... the latest earnings downgrade was "a further unwelcome reminder of [a2's] ATM's opaque channels to market, with very limited visibility (including for management)".

A free hand imo means that David Bortolussi will be taking his time to assess ATM's problematic channels to market before formulating a growth strategy to capitalize on ATM's still strong brand position and market positioning. If he does not, ATM is screwed as the market has gotten ever more competitive as we are aware.

In short, expect a repeat of what Jayne wanted to do but was over-turned by the BOD - Short term pain for long term gain.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Reference :

https://www.smh.com.au/business/comp...09-p53i1s.html

Excerpt : " The investor said there were “conflicting messages” between Ms Hrdlicka and chairman David Hearn to investors recently. Ms Hrdlicka’s message was that the “company was in investment mode ... and the investors shouldn’t be concerned about EBITDA returns because it was just purely investing for growth. Yet the chairman said that that wasn’t the case, that the company was very much wanting to deliver a strong EBITDA outcome of 30plus per cent.”

Mr Hearn said a2 had made an agreement with Ms Hrdlicka that she would leave the business.

"We've agreed that this is the right thing and I think it's the right thing for Jayne as well," he said."