Hindsight?
Profit downgrade one after another, warning one after another and that’s hindsight?
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Its all on the record mate... I can't help wondering where the price goes from here ? Even after the massacre to the share price it still trades on 29 times average broker estimated earnings for FY22 ! https://www.marketscreener.com/quote...22/financials/
29 times with their history and being so dependent on the market in China and with 3 class action lawsuits. WOW !
Maybe that $3 handle I talked about at one stage is not out of the question ? What do you think mate ?
Come on guys its no time to gloat and say we told you so. We all know Couta lost a lot on ATM but as he said he is grateful to still be alive. Lets show him some compassion as I am sure this brings up a lot of horrible memories for him. Stay strong Couta
Cannot see any upside myself in ATM :
A2 milk is getting commoditised with competitors undercutting its pricing. Karicare sells at $23.95 to $26.95 vs A2M’s $41.00 for eg.
It is facing multiple headwinds of declining birthrate & increased domestic competition in its biggest market, China.
Rising prices for milk powder and ingredients are placing cost pressure at a time when margins are already getting squeezed by competition.
US is bleeding money with no end in sight.
The 3 lawsuits are not only going to be costly but extremely distracting for the directors and management.
Only positive so far is that NZ$ has dropped but inflationary costs in NZ are offsetting that to a great extent.
Have I missed anything?
Only 2 things keeping the sp at current level :
1. Rear mirror view of high sp
2. Takeover potential which gets stoked every so often by the Oz media.
2 would have happened by now if it was going to happen imo.
Worth a punt at $3.00.
Prefer to keep my powder dry for the opportunities ahead.
Eying one which could be a double bagger by year end - but not just yet.
WOW that price point for Karicare is so much cheaper !! Chinese customers doing it tough are going to lap that up !Quote:
Have I missed anything ?
Not much more but also record high freight rates, lockdowns in China including at the ports, every increasing encouragement from the CCP to buy Chinese made, geopolitical tension, Chinese housing market in absolute freefall and some stupid processing facility in Southland that won't make money until 2027.
I think that's about it but I've probably forgotten a few things myself.
Was trading on the same metrics in the good old days when it was growing strongly. Why anyone would pay 29 times this years earnings with all those headwinds and class action lawsuits is beyond my comprehension. Go figure ?
Probably get a 3 handle at some stage I reckon.
Bell Porter (previously very bullish) downgraded A2M last week :
https://www.fool.com.au/2022/05/09/a...ker-downgrade/
Next results due in August could be a shocker - watch that cash position carefully.
That’s when the $3.00 could be a reality for the holders.
Plenty more downgrades to come I reckon. Looking at average growth forecasts for FY23 and FY24 they look far too optimistic to me.
Blackrock back again...
370859.pdf (nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com)
Looks like a bit of arbitrage while it lasted , not sure about making money out of babies in developing countries.
https://www.marketwatch.com/story/th...am-11653331970
https://twitter.com/POTUS/status/153...53441708314626
Massive formula order for BUBs BUB.ASX according to Jo Biden
Bubs market cap A$297 mil with wide open register
Cheap entry into USA for ATM with bonus of proper marketing and distribution model in China
Just saying
What if anything would Fonterra gain? Any A2 supplier can change who they supply. I still don't see what ATM actually have that cannot be replicated. Given what Fonterra have been through in the last 10 years I just can't see a single supplier supporting an acquisition of a troubled company with a ton of litigation pending. At least you used the word carcass in context.