SML - Synlait Milk Ltd

[Sideshow Bob]

Jarden 11th Feb 2020

"Synlait Milk led the market higher, up 4.6 percent at $8.27 on slightly below average volumes. Jarden upgraded its recommendation on the stock to 'neutral' with the 12-month target price increasing to $8.84 from $8.50. Analyst Arie Dekker said in a note to clients that the risk-reward is now more balanced, with valuation still focused on long-term return."

No doubt that brings a lot of comfort for shareholders who have seen a couple of bucks shaved off the share price in the last couple of days.

[Beagle]

Haven't said it for a while so it possibly bears repeating but I am staggered at their arrogance to build and commission the Pokeno plant in the face of an existing legal ruling against them.

Management are betting the entire profit the company has made in the last 6 years on a successful appeal at the Supreme court. While not an existential threat to the company if it loses it will be profoundly damaging both in terms of building a new facility in the Waikato and with relationships with suppliers, customers and staff.

Don't want to predict what the share price will be if they lose other than to say it will be extremely ugly.

What concerns me about this company apart from everything else previously mentioned is there appears to be more leaks than a sieve. On pending good news it rises before the announcement.
What are we then to make of the current break down through the $8.50 support line ?
All out of court attempts to settle this have been fully exhausted and Synlait have been told to get stuffed and the aggrieved party think they have a water tight case in the Supreme court ?
Are Synlait about to be totally snookered with their facility at Pokeno ? A cease and desist operations order has been sought ?

One thing for sure, you cannot rely on Synlait management to be totally forthcoming that's for sure !!Posted 8 February 2020.

Jarden 11th Feb 2020

"Synlait Milk led the market higher, up 4.6 percent at $8.27 on slightly below average volumes. Jarden upgraded its recommendation on the stock to 'neutral' with the 12-month target price increasing to $8.84 from $8.50. Analyst Arie Dekker said in a note to clients that the risk-reward is now more balanced, with valuation still focused on long-term return."

Jarden's analysts have access to company visits, I do not. I'll leave it to others to judge who called this one right. This is certainly not the first time I have noticed the share price move materially ON STRONG VOLUME , just before a price sensitive announcement. Its very safe to say there are more leaks than a sieve so that's yet another blow to management credibility at least in my eyes.

Jarden's subsequently adjusted fair value down after this most recent announcement...for what its worth and I think that's very little, they are somewhere in the late $7 range as a 12 month price target now. How they can value it at that with the unknown of the Supreme court case is anyone's guess ? Maybe they are ingratiating themselves to company management and the board in the hope of lining themselves up to manage the massive fully underwritten rights issue when it all goes pear shaped so they can make millions in underwriting fees ?

[winner69]

Beagle - share price less than half what it was a while ago

A 50% discount makes it really really cheap

[Beagle]

Beagle - share price less than half what it was a while ago

A 50% discount makes it really really cheap

You're in good form today mate. What will it be when it gets to a quarter of $13 at $3.25 ? Really really really really cheap or a train wreck in the middle of a derailment

[winner69]

If diversity, inclusiveness and sustainability are very high on Synlait’s priorities the page on their website showing the senior leadership team is a bad look ....a team of 11 ..all very Caucasian looking and 2 females (quality and legal)

There’s been studies done that improving gender mix (ie more female) often improves overall competency with the displacement of mediocre men.

Maybe that next on the agenda for Synlait.

[BlackPeter]

If diversity, inclusiveness and sustainability are very high on Synlait’s priorities the page on their website showing the senior leadership team is a bad look ....a team of 11 ..all very Caucasian looking and 2 females (quality and legal)

There’s been studies done that improving gender mix (ie more female) often improves overall competency with the displacement of mediocre men.

Maybe that next on the agenda for Synlait.

They probably should start with the board (though there would be at least one mediocre woman to replace as well) and the CEO ...

[Beagle]

If diversity, inclusiveness and sustainability are very high on Synlait’s priorities the page on their website showing the senior leadership team is a bad look ....a team of 11 ..all very Caucasian looking and 2 females (quality and legal)

There’s been studies done that improving gender mix (ie more female) often improves overall competency with the displacement of mediocre men.

Maybe that next on the agenda for Synlait.

Way more important than Pokeno eh
https://www.synlait.com/people/ Trouble is you study this too much. With pink its all about appearance and this photo presents the image they want you to see. You're not meant to scratch beneath the surface and read the detail lol. Nice balance of 50/50 male female apart from Leon who heads the table but we know LOVES PINK, say no more...

Ruth Richarson and that Bill Roest as directors. Oh my goodness, no wonder this company is such a "winner"

[winner69]

There’s more to PINK than that beagle

Remember recent ASM when shareholder gave the Board etc a standing ovation for such an amazing result and then Leon went on to say:

“Pink is the colour of disruption and difference. Our new wordmark is friendly and more appropriate for a company working with flowing milk. We think together they work really well to tell the world who we are.”

[winner69]

....and Chris Lee once said Synlait deserves to be of the first chapters in a book of ‘Great NZ Corporate Successes’

From where it’s come from Spose it still deserves to be included.

[Beagle]

They won't even make $60m this year, you read it from me first. I don't fancy their chances at the Supreme Court either. This would have been settled already if the other party didn't think they had a bullet proof case.