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Buy, hold, sell: A2 Milk, Costa, NearmapAug 26, 2019 —...

  1. birdman29
    27,866 Posts.
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    26/08/19
    16:02
    Post #: 40156202

    Buy, hold, sell: A2 Milk, Costa, Nearmap




    Aug 26, 2019 — 3.00pm

    Nearmap

    Josh Clark:Look, I think Nearmap's a hold purely on valuation grounds. So you're right, it's been an incredible story. What they'vedone in the US over the last two years has been really impressive.
    And the business looks completely different to what it looked like five years ago.
    In July, they gave an earnings update where incremental revenue growth in in dollars in the U.S. there was actually a slight acceleration. So that's really positive.
    But the market reaction is telling you something, that a business that's now trading on 12 times sales really needs more than a meet to expectations.
    It really needs a beat to go up. So I think for the moment Nearmap's a hold.

    Rachel Cole:We think it's a sell for the same reasons, really.Valuation has just gone to the extremes, and we think that it is assuming that an extremely high level of growth occurs over a long term, actually.
    And we don't think that's realistic, particularly when we kind of look at the business and think that the competitive advantage is not that clear to us, and there could well be some risk of disruptive technologies on the horizon. So it's not one for us. It's a sell.

    copyright link/wealth/investing/buy-hold-sell-a2-milk-costa-nearmap-20190823-p52k68
    Last edited by birdman29: 26/08/19
    NEA Price at posting: $2.69 Sentiment: Hold Disclosure: Held
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    lightbulb Created with Sketch.  Great analysis
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