EPS will be 26/27 cents (did you forget about tax.)
So
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Since when are overheads going to remain static for a growing consumer goods business expanding through physical locations in China... costs remaining inline with revenues...
Fonterra deal introducing many new products to market will require significant marketing expenditure... they should have around half a billion $$$ on hand right now as well.
A2 have been conservatively managing expectations since I can remember, the last dip was a result of some hype and not the company, although explained through label transitioning it will need to be confirmed later this year.
The lower than expected revenue guidance has been attributed to A2M's move to both new CFDA registered Chinese and English labelled packaging. Due to this transition, A2M has intentionally been running down stock levels so that distributors aren't left with the old packaging and to limit the chance of discounting (A2M’s premium status is the key to its success). Importantly, management said that Nestle's new A2 infant formula (called Atwo), while only early, has had no noticeable impact on its sales.
No one really listens to the evangelical holders anyway...
Will be interesting how the market reacts to this update, 922 mill(Unaudited) I thought they would do better than this to be honest. A bit of a nothing update IMO.
A bit disappointed with $922mil so interested to what the market is deciding on. But even then the shares I have left will stay with me for a long time or until something dramatic changes. Won't sell just because of some millions off my own assumptions.
just woke from my catnap and was shocked with this news .... bad and revenue growth was acheived from discounting as well according to goldmans.
be interesting if the price collaspses today , the fact it has struggled to get over $12 resistance and has been in a downtrend since the highs also the slight rise of late has coincided with some light short covering. be interesting to see .... fill the gap lol
goldmans say in this article a2 were discounting product so if that the case the 922m is fake news it was lower in reality
http://www.thebull.com.au/articles/a...lay-fears.html
What was the revenue guidance or estimate that were given a few months back for full year revenue?
Great outcome then..
Before the last update, I reckon the market was expecting about 950 mill for the year so 922 mill confirmation still quite light hence that big drop in the SP at the time. SP probably about right based on 922 mill, certainly no $15 in sight for quite a while yet.
have to wait for aus to open as they set the price for a2
think one thing many of you have missed was ron mark speech on defence where he said china is a threat , hence backed up by winston after china demanded it be taken back.
think trade wars
I wouldn't expect any great movement up or down based on today's announcement. A lot of that in today's news is pretty much factored into current price. Only bit of extra information relating to margin % to sales.
I expect the sp to be range bound between 10-12 until next month when they report full results at which time depending on the commentary price will be reset.
Guidance of $900 to $920m suggested $910 at the mid point so a significant beat for this quarter at $922, a $12m increase for this quarter above the mid point.
Discounting referred to by Goldman's probably to clear the last of the old labelled product.
"Have teacup..some will make try and make storm". Long term holder.
I echo what sb9 has just said. As an example have you ever noticed that new cars dealers discount old stock before the facelifted model comes out ? Everyone wants the freshly "Gee Wiz" labelled stock. Welcome to the commercial world and reality of how things really work. Some people will try and conjure up nefarious theories from the depths of their imagination while others understand how retailers work.
think your all assuming its old stock
It worries me that bull trusts Goldman's. Lol.
past experience shows if it drops hard in aus it bounces quick ... see if the same happens better than a slow grind down lol
30% margin on sales of nearly billion dollars, not sure anyone with a right mind would disagree with that kind of profitability.
We’ll be over 12 bucks by days end
Woohoo !!!! They just did $262m for the last quarter against guidance of $250m (4.8% beat for the quarter against mid point of forecast for those that want to know the facts) so I'd say they're comfortably on their way to your target for FY19. http://www.4-traders.com/A2-MILK-COM...ncials/Trading on a forecast FY19 PE of 31.
FY2018 figures are ahead of analyst estimates, but some margin compression look set to kick in FY19 onwards which arent incorporated into alot of the analyst's models. Unfortunately mgmt's commentary dont really give any indication on the scale of these cost increases. Guessing market's just pricing in that uncertainty today.
just as we thought bounce at open folloowed by grind down
Extract from press releasePress release speaks for itself on margins in my opinion. I guess its human nature that some people will try and interpret things their own way...Quote:
Notwithstanding the higher expenditure referred to above, the EBITDA to Sales ratio for FY2019 is assumed to be broadly consistent with the Company’s expectations for FY2018.
I'm out finally, at least for a while. So it's bye bye ATM and hello FANGMAN. Good luck to holders.
Mmmmm not quite.
If you look at some of the forward projections as posted by Beagle you will see that the market is pricing on a forward PE which looks at some of the following;
· Likely sales growth between 30 to 50% = $NZ 1.3 to 1.5 billion. Korea will begin pumping and Frontera will re-launch A2 Milk in NZ from Aug 18. I also expect considerable hype re new A2 milk products (diversifying away from IF and raw milk.) There may be further Asian expansion, possibly Japan and possible news of a strategic partnership there. USA and UK will continue strongly.
· Likely FY19 EPS 35c to 40c (NZD) Some say .50c!
· Mounting cash reserves $NZ 500 mill. Expect some announcements re this. Furure dividends ( Maybe .10c?) More likely IMO is an investment in another related company…. (or both!!)
Current price pretty fair IMO. Forward price of $15 by later this year still my target.
they will have to ramp up marketing spend way more as global competitors enter the space in china more forcefully also entering new markets will require way more spend also to compete against bigger competitors.
the only reason i would see the price gaining from here is on the back of the bull market just like most other shares.
If I had a spare $8 billion would I buy A2 today and expect say a 10%pa return for many years into the future?
I don’t think I would
Maybe there is a ‘greater fool’ who would pay $10 billion for A2 in the next year or two ...if I knew that I might pay $8 billion today
In saying this I still have my ATM shares ....obviously only looking out for a short to medium term return
All of those companies to be fair have more defensive properties than ATM. Hard to get comparatives for ATM in their sector. I guess the relative PE of BAL is something to think about. My sense is the ATM SP is about fair and reasonable at the current level and its should move up in line with earnings growth over the next few years. For what its worth I have a 6% portfolio allocation and about 4% to Synlait. I think that's enough for me and am disinclined to add to either right at the minute.
nothings changed and there were no surprises... good result as per normal.
The theory that A2 will always land at the top of their guidance remains in tact and Analysts sales expectations were beaten.
They were effectively (not literally) given a few months to selldown all the old label product in China and can only introduce new label to the shelves from a certain date, there is no real option to simultaneously sell both labels on the shelves in the 9,100 Chinese Mother and Baby Stores that stock A2 IF. old labels do not meet new regulation requirements and there is a small window where both the new and old label can co-exist on shelves... but if you decide to sell both you risk selling new labels instead of old possibly leaving many millions of worthless inventory on hand.
a2 Platinum is now stocked in over 9,000 Mother & Baby stores in China (was 6,700 at 1H18 result).
Disc: own a lot of A2 and not selling anytime soon.
My partner is half Chinese with parents in China and sister ( a daigou ) in Australia
All of whom are heavily invested in A2M.
lets hammertime it
Could easily fall another 5-10%, next support around A$9.50. I expect some funds to start trimming weights in this. I better start raising some funds to buy the next dip.
Why not, specially if you are shorting or looking to add more to your portfolio at lower prices. (Lots of Bot manipulation today to support you.)
Meanwhile this article provides another viewpoint. GLH I'm signing off to take a well earned holiday.
(Disc - Holding, but now 'freehold' :t_up:)
Average analyst forecast sales for FY19 is $1.238m so if they can do the $1.4b that Craigs are estimating we're going to have a very good year ahead as other brokers upgrade. Happy holiday :)
http://www.4-traders.com/A2-MILK-COM...22/financials/
Another run of the mill day with a 44c spread, so erractic yet so consistent.
A great article for the weekend.
https://www.afr.com/business/retail/...0180713-h12myu
GS Latest TP NZ$13.30
Heading back to 10 something by looks of it
Suppose $10 is about fair value for now based on GS target of $13.30 after discounting the GS hype factor and considering it’s a target for a year out
They use combnination of DCF & EV/EBITDA, multiples roughly inline with peers now.
I added a handful today for a medium-long term hold, probably gonna get abit f* if this tries to test the A$10 level but I wouldnt be surprised if this becomes a buyout target given the brand has built some notoriety overseas.
hammertime is coming i can feel it
We all hope for that bottom price to start investing...... of course you need to think am I investing or trading. These are in my bottom drawer for a long long time and there is no wrong time when you are investing. If all goes well and I believe it will, I can see $20 per share by 2021 or sooner. Of course this website is called sharetrader not share investor