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  1. #8701
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    Quote Originally Posted by Snoopy View Post
    Perhaps you need to ask yourself Couta, why every time the share price goes up your belief in the company and its future is reinforced, whereas every time the share price goes down it is an irrational overblown counter-reaction.

    SNOOPY
    My belief in the company doesn't change either way otherwise I'd be one of the sheep selling out but yes the market tends to overshoot in both directions. This particular drop is a one way battle however as retail holders have no chance of putting up any counter reaction to the machines and rampant shorters in combination. It's all an orchestrated move by the big boys whilst the shorters are just riding on their backs as opportunists.

  2. #8702
    Advanced Member Valuegrowth's Avatar
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    If I am correct still company has not well established in China. The recent announcement by Nestle that they have just launched an A2 infant formula in China is a new development. Nestle is a big and well-resourced competitor. Its Wyeth brand, account for approximately 18 per cent of the infant formula sales volume in China. It can spend huge amount for its sales on advertising and marketing.

    For ATM’S revenue growth to continue, it will need to sell more in Chinese retail stores. If it can establish very well in China, then there will be some support for this stock. Otherwise demand for this stock could come down in the coming months and years. In addition, we should monitor behavior of this stock during coming bear market as well. Could it be another winner in the coming bear market?

  3. #8703
    Senior Member hardt's Avatar
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    Quote Originally Posted by Snoopy View Post
    Perhaps you need to ask yourself Couta, why every time the share price goes up your belief in the company and its future is reinforced, whereas every time the share price goes down it is an irrational overblown counter-reaction.

    SNOOPY
    Over the last 18 months significantly material announcements and updates have lead to substantial increases to analysts revenue and earnings assumptions for A2M, justifiably so, the SP has risen with the tide...

    A year ago the expectations for FY18 was Revenues of 667M and EPS of 15c
    Fast forward to todays expectations of FY18 Revenues of ~920M and EPS of 25-29c ( ^38% & ^87% )

    Increasing IF consumption market share in China to 4.6% ( not based on value but on volume )

    Perhaps you need to ask yourself why you only contribute to this thread when the share price goes down?
    Last edited by hardt; 21-05-2018 at 05:31 PM.

  4. #8704
    ShareTrader Legend bull....'s Avatar
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    citi downgraded atm due to the increasing uncertainty over the stock’s short-term outlook as it transitions to a new packaging for its infant formula and is wary of price reductions in the Australian daigou network and Chinese online shopping platforms.
    one step ahead of the herd

  5. #8705
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    Quote Originally Posted by Snoopy View Post
    ....One rule of thumb I have is that in the 'long term' in a mature market, PE deflation will see the market value of all the suppliers equal the sum total of total market revenue. If ATM has a market capitalization of $NZ10 billion and the total size of the infant formula market in China is $NZ10 billion, this implies an expected 100% market share for ATM infant formula is already priced into the share. This assumes a static overall infant formula market in China. No doubt the overall infant formula market in China will grow over time. But this metric does show just what sort of sales growth will be required to justify anything like todays ATM share price. I assess ATM as being uninvestable, for now. Not because it is no good. But because there is no credible fundamental data than can be used to justify the current share price, or anything close to it. In my assessment conservative sharemarket investors, and that includes those who invest via index funds, should have 0% of their wealth invested in this company.

    Give it another couple of years and that data may come through though!.

    SNOOPY

    discl: Not a holder, not looking to buy.
    Excuse my ignorance, but isn't it the profitability of the "mature market" that matters. Some markets like supermarket retail have high turnover and low margins. The cumulative market value of the participants may only be some fraction of the volume sold. Other markets can be mature with quite strong margins. The cumulative market value of companies operating in these markets will materially exceed the value of sales. Australian companies like ANZ and BHP show this through market capitalisations more than 3x annual sales.

    One of ATM's strengths is the strong margin on the sales its making. IMO it would take a collapse of the A2 market margins before the market capitalisation of the participants was sensibly lower than the market sales figures. This could happen but its not what's being priced by the market currently. If there are $10b of china sales, the cumulative market capitalisation of the participants should be a lot more than this. ATM being near this figure at about $8.2b isn't an issue.

  6. #8706
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    Quote Originally Posted by bull.... View Post
    citi downgraded atm due to the increasing uncertainty over the stock’s short-term outlook as it transitions to a new packaging for its infant formula and is wary of price reductions in the Australian daigou network and Chinese online shopping platforms.
    Do you believe Citi over all the other analysts consensus? As I have said before, they are notorious shorters and downrampers for their own purposes. Trusting Citi is equal to listening to the advice from Devon Lol.
    Last edited by couta1; 21-05-2018 at 05:35 PM.

  7. #8707
    ShareTrader Legend bull....'s Avatar
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    Quote Originally Posted by couta1 View Post
    Do you believe Citi over all the other analysts consensus? As I have said before, they are notorious shorters and downrampers for their own purposes. Trusting Citi is equal to listening to the advice from Devon Lol.
    obviously more people believe citi , than your other brokers by the way the price has not recovered , if it was so undervalued there would be no way you could short it profitably it would be up in price.
    one step ahead of the herd

  8. #8708
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    Quote Originally Posted by bull.... View Post
    obviously more people believe citi , than your other brokers by the way the price has not recovered , if it was so undervalued there would be no way you could short it profitably it would be up in price.
    Give it a couple of days

  9. #8709
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    Quote Originally Posted by bull.... View Post
    obviously more people believe citi , than your other brokers by the way the price has not recovered , if it was so undervalued there would be no way you could short it profitably it would be up in price.
    Come on bull, you know as well as I do that the machines are in control of the price(Driven by multiple big players) and that the shorters are just riding on their backs.

  10. #8710
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    Quote Originally Posted by bull.... View Post
    obviously more people believe citi , than your other brokers by the way the price has not recovered , if it was so undervalued there would be no way you could short it profitably it would be up in price.
    It is far easier to convince someone to sell than it is to convince them to buy...

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