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Alterego1168

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17

04/04/16

19:48

Post #: 17419504
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Originally posted by Silverhorse ↑

This from a respected broker.

We wanted to provide a quick update on Bellamy’s Organic (BAL) which despite a period of slightly weaker prices remains a high conviction, key growth stock.
Recent price weakness can only be attributed to speculation of, and recently announced regulatory change in China.
However, as outlined in the attached article from today’s Financial Review, we do not see this as a negative issue for BAL, if anything a positive one.
Due to the rapid growth of demand for these products in China, regulations have to be changed to make sure consumers get the products they think they are, and pricing is fair across all channels.
Currently there is a wide range of misrepresentation and inconsistent pricing. So in the medium term we view these regulatory changes as positive for the quality producers such as BAL.
Also keep in mind, 85% of BAL’s revenue is still domestic.
In February BAL reported earnings growth of 334% and net profit growth of 325%!!!
That is before some recent price rises ion the products came into effect and before some recently signed new supply agreements come into place allowing further production growth.
As the attached article outlines, BAL still see substantial growth opportunities in China as well as abroad, and we agree.
With this sort of growth appearing set to continue, we remain of the view BAL should be considered as a key stock in a growth portfolio.
However, please keep in mind this should not be seen as a advice and has not taken any personal circumstances into account, and should you wish to discuss this further, please feel free to contact us.

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I'm only expecting 100% increase from this time to next year in SP
as opposed to 300%+ change from last year's SP to today.... (in line with earnings yoy growth)

BAL Price at posting: $10.07 Sentiment: Buy Disclosure: Held
1 Upvote

0 Great analysis

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