ATM - A2 Milk Corporation Limited

[Scottman]

From memory & I could be wrong here but just thinking back to what I read at the weekend they are hoping for around 280 million in sales in 2016.

[silverblizzard888]

Nice. I only have access to Craigs...but they got nothing on ATM

How do you guys get access to the vaulations? Do you have to be signed up with them?

[MAC]

From memory & I could be wrong here but just thinking back to what I read at the weekend they are hoping for around 280 million in sales in 2016.

My FA gives me a valuation of $110 based on that $280M revenue by FY16 target.

The challenge in valuing ATM, as I see it, is in assessing where gross margins will ultimately plateau in the medium to long term. There is not really a precedent within the sector for a company like this, I believe this may well be why not many brokers cover ATM, it's too much effort for them to drill the detail.

If as in Australia and the UK across the counter sales provide a price premium of 50% over A1 bulk brands, and ex gate farm supply is only 8 to 10% over A1 supply (conversion recoupment), then forward margins should be looking pretty good a couple of years out.

Quite happy though for ATM to keep ploughing profits back into JV establishment for now.

Looking forward to the AGM on 19th November, is anyone else going ?

[Scottman]

Yes you have to be doing business with them to get the information.

[Scottman]

Anyone get the felling the market is due for a good correction ?

[forest]

My FA gives me a valuation of $110 based on that $280M revenue by FY16 target.

The challenge in valuing ATM, as I see it, is in assessing where gross margins will ultimately plateau in the medium to long term. There is not really a precedent within the sector for a company like this, I believe this may well be why not many brokers cover ATM, it's too much effort for them to drill the detail.

If as in Australia and the UK across the counter sales provide a price premium of 50% over A1 bulk brands, and ex gate farm supply is only 8 to 10% over A1 supply (conversion recoupment), then forward margins should be looking pretty good a couple of years out.

Quite happy though for ATM to keep ploughing profits back into JV establishment for now.

Looking forward to the AGM on 19th November, is anyone else going ?

Yes Mac I plan to be at the AGM, if you want we can meet up just sent me a PM if that is the case.

[Scottman]

No I actually don't think ATM would get much of a correction if any Moosie as it's undervalued, but just that it was mooted in this weeks FB weekly stock market report. So was wondering what others might think.

[iceman]

No I actually don't think ATM would get much of a correction if any Moosie as it's undervalued, but just that it was mooted in this weeks FB weekly stock market report. So was wondering what others might think.

Agree Scottman. I don't think general market sentiment will be a driver of ATMs share price one way or another. Upward movement in SP will be reliant on runs on the board from Management, the obvious ones to watch being successful market penetration and growth in the UK and then China. On the negative would be some unforeseen (non-)events such as the Fonterra's botulism scare and/or disappointment or failure in the UK.
Discl: A happy holder

[iceman]

sold put todat $4.65 after the market refused to continue the uptrend. bought even more SNK from profits, thanks traders for the 7%!

Wow that's a good price moosie ! Or did you mean to post this on the DIL thread ?

[MAC]

It's an impressive plot already and it's still early for ATM, I think we will see further margin growth yet.

Interested in the thoughts of others on forward margin analysis and outturn ?

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