#$20in2020
The current share price weakness is due to change in sentiment provoked by China trade war, and some analysts worried China sales are stalling.
NOW is the time to buy.
I think we will see $20 in 2020 and then move towards $40 in years to follow.
My reasons are below...
- Growth in China IF will continue towards 10% and well beyond. This will be underpinned by strong MBS sales (not so much online sales)
- Infant formula and milk powder sales in rest of Asia will start to build, this will be underpinned by, South Korea which will surprise, Additional South east Asia markets, such as Vietnam.
- Additional product launches in China label, stage 4, pregnancy, individual sachets.
- Liquid milk infant formula launched in China. Will be a huge market as flagged by Synlait. Another growth area.
- USA sales will accelerate, during FY19, and accelerate further in FY20. This will be on the back of the increased marketing. Infant formula will be rolled out. This will be the next growth engine.
- UK will continue to be a very small market. Infant formula will be launched.
- NZ fresh milk will launch early FY19 (possibly August).
- Middle East infant formula to launch in 2H19 (Fonterra)
- Additional product launches from Fonterra, cheese, butter, cream. Also nutritional powders, chocolate powder protein shake, vanilla powder protein shake.
- Additional growth in Australia market. Driven by substantial increased supply from synlait, and new powder products from Fonterra. Diagou sales will continue to grow.
- Synlait Wakaito infant formula manufacturing plant to start production in FY19
- Synlait Dunsandel long life liquid milk plant to open FY20
- Fonterra site operational in FY19
- New canning site purchased by A2M / Fonterra
- special dividend and market buy back announced.
Based off the above growth (which will be underpinned by an approximate doubling of supply in next 2 years) I estimate the following revenues...
FY19 - 1.4 billion up 55%
FY20 - 2 billion up 40%
So as I said... $20 in 2020
$20 in 2020
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Last
$7.05 |
Change
0.200(2.92%) |
Mkt cap ! $5.096B | |||
| Open | High | Low | Value | Volume |
| $6.90 | $7.05 | $6.89 | $9.342M | 1.335M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 3 | 5662 | $7.00 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $7.05 | 43467 | 7 |
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| Last trade - 16.10pm 29/07/2024 (20 minute delay) ? |
| A2M (ASX) Chart |