ATM - A2 Milk Corporation Limited

[Shareguy]

I also have been a long-term holder so at current price I’m still well in the money. I’m planning on buying more if it gets down to $5.50. See this stock as a takeover play.

[couta1]

I also have been a long-term holder so at current price I’m still well in the money. I’m planning on buying more if it gets down to $5.50. See this stock as a takeover play.

Identifying a stock early on in its life and going big is the way to go if you can hold the vision through the tough times, I think of the eary XRO investors as another example, I've gone big on PAZ on the unlisted market for this very reason and are confident that investment will make back all my A2 losses plus some in due course.

[Leftfield]

Well articulated.

ATM as a stock has served us very very very well until a year ago.

But I have learnt the hard way over the years to never fall in love with a stock or to hold a stock for sentimental reasons.

You invest or hold a stock because you believe in its business, it’s management and the industry that it is in.

Thanks Balance, appreciated.

FWIW your last para is the key reason I still hold some (as well as the dodgy sentimental reasons.) I'll wait for the Oct update before I make any more moves, if the news is promising I'll scale up, if its not I may well get out.

Couta, thanks for sharing. I wish you well.

[aperitif]

Thanks for the insight in your investing journey,

I resonate with your story as I have held XRO for over a decade now and it has changed my family’s life behind my wildest dreams. I held through the gigantic drawdowns whilst everyone told me it’s best days we’re behind it.

The big thing focus on with a2 is market share, the rest is all noise! a2 milk is a once in a lifetime innovation in a commodity category. Consumers still adore the product, the paths to market will change over time but the demand will always be there.

From my point of view the next steps for a2 are;

1- Increased marketing into T3/4/5 cities where they have traditionally under indexed.

2- Product innovation - The baby food market has inherent high margins. I see yoghurt pouches and kids cheese being the next step, along with milk adjacencies in the US.

3- Strategic tie ups - Starbucks/Hema stores and a potential stake from a multinational which will increase the speed to market which I have talked about previously.

4- Hainan domestic travel - Currently 10-15% of Chinese people have a passport. The entire population is able to travel to Hainan(Hawaii of China) and buy luxury goods/IF duty free up to 100,000 yuan. This will in time replace the need for daigou.

Like XRO, the road ahead will be bumpy but I believe in their vision.

I recommend you read the book “100 baggers” by Chris Mayer during the lockdown. Large drawdowns are common in all great companies.

[Beat the Bank]

I sold out on Thursday - down $11k. I felt that we have not had good transparent management and I didn't see a path to manage the massive changes the market has presented. The world, especially marketing to China, has changed. It is a great product and brand but we cannot be confident of growth. I also own Synlait that I haven't yet sold. I wonder what to do with that? It would be really sad to loose this company to a takeover offshore and I would certainly buy in again if I feel they have a solid plan to relaunch the brand, and that the China demand is there. I feel for so many who have lost out in this kiwi growth story killed by Covid.

[Jim]

The good old days a2milk are history, it is not paying any dividend even with a great cash pile. Not worth looking at it

[Balance]

The good old days a2milk are history, it is not paying any dividend even with a great cash pile. Not worth looking at it

Because it is still a growth story - according to the company.

It is debatable but trading on a PE multiple of 25X F22 forecast earnings that there are still those in the market who believe the same.

[Master98]

Because it is still a growth story - according to the company.

It is debatable but trading on a PE multiple of 25X F22 forecast earnings that there are still those in the market who believe the same.

did a2 milk give F22 forecast earnings or just someone speculation? a2 milk did say 1HF22 performance will be materially lower than 1HF21, so i think F22 earning will be similar or lower than F21.

[Balance]

did a2 milk give F22 forecast earnings or just someone speculation? a2 milk did say 1HF22 performance will be materially lower than 1HF21, so i think F22 earning will be similar or lower than F21.

Consensus forecast by 7 brokers per MarketScreener.

And looking at it now, the brokers have all updated their forecasts and it shows EPS of 16cps in F22!

So PER of 38 X !!!!

Priced like a growth stock, that's for sure.

[aperitif]

Do you own shares balance or are you looking to buy? Thanks