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  1. #1861
    always learning ... BlackPeter's Avatar
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    Funny trading yesterday (SP dropping despite ATM going up) and today (no volume and huge gap between best bid and lowest offer). Feels like somebody played yesterday a game and clear out any stop losses. Good method to accumulate at a low price ...

    Anyway - SP still in upwards trading channel - must be all good.
    ----
    "Prediction is very difficult, especially about the future" (Niels Bohr)

  2. #1862
    Legend minimoke's Avatar
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    Quote Originally Posted by BlackPeter View Post
    (no volume and huge gap between best bid and lowest offer).
    You'll see this quite often. Cant explain why

  3. #1863
    ShareTrader Legend Beagle's Avatar
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    I did a small top up yesterday FWIW which isn't much. My form lately...nobody should follow this dog. SELL lol
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  4. #1864
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    Getting smoked by A2.

  5. #1865
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    I wasn't quite sure why their SP was getting smashed after an announcement for lower milk price forecast. I thought lower milk price meant lower costs for SML therefore higher margin for them and it was a good news for the holders. Please excuse my ignorance and correct me if I am wrong!

  6. #1866
    always learning ... BlackPeter's Avatar
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    Quote Originally Posted by pg0220 View Post
    I wasn't quite sure why their SP was getting smashed after an announcement for lower milk price forecast. I thought lower milk price meant lower costs for SML therefore higher margin for them and it was a good news for the holders. Please excuse my ignorance and correct me if I am wrong!
    Milk price dows not really matter to them - they are basically paid for the throughput they have. As long as they make sure that their condiitions are more attractive for farmers, than Fonterra's (and this is not difficult), as long as farmers can survive on whatever price they pay and as long as they don't overpay farmers, the actual milk price is of no concern to them. If world markets pay more for their product, they can increase milk payout to farmers, and if world market prices drop, they reduce their payout. Simple as that.
    ----
    "Prediction is very difficult, especially about the future" (Niels Bohr)

  7. #1867
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    Thanks for the replies previously guys, great points from each side.
    It's intriguing that atm price is holding steady, while synlait seems to have tumbled.
    Any ideas as to how this has happened?
    sl

  8. #1868
    ShareTrader Legend Beagle's Avatar
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    Maybe its simply an obvious opportunity ? Its been a long time since ATM and SML were about $3.75 apart. Their fortunes seem inextricably linked to me and SML on a much cheaper PE and with a more diverse product mix with very clearly defined growth path's.
    Opportunity knocks ?
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  9. #1869
    always learning ... BlackPeter's Avatar
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    Quote Originally Posted by sl234 View Post
    Thanks for the replies previously guys, great points from each side.
    It's intriguing that atm price is holding steady, while synlait seems to have tumbled.
    Any ideas as to how this has happened?
    sl
    Hard to say. While the fortunes of ATM and SML are obviously linked to a degree, their earnings capacity might be not?

    if everythings goes to plan for ATM only the sky is the limit (not saying this is the case, but given that they are basically just a marketing company, they are easily scaleable - unlimited growth potential).

    For SML on the other hand it is difficult to keep growing that fast. Sure - they doubled their manufacturing capacity last year (by going from 1 to 2 factories). Are they doubling this year again (by building 2 more factories)? Obviously not, i.e. their growth willl rapidly drop.

    Maybe the market considers these days a forward PE of 16.5 as expensive for a company with limited future growth. Who knows? ... as indicated on another thread, the market is not very good in valuing companies and it is terrible in predicting future share prices, but so are most of us .
    Last edited by BlackPeter; 04-02-2019 at 12:50 PM. Reason: spelling
    ----
    "Prediction is very difficult, especially about the future" (Niels Bohr)

  10. #1870
    Legend minimoke's Avatar
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    Pokeno plant construction on target. Test runs due August / September https://www.stuff.co.nz/business/far...on-this-spring

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