Dairy

FNArena’s Treasure Chest reports on money making ideas from stockbrokers and other experts. Today’s idea is Bega Cheese

a2 Milk has outlined a bold 5-year strategy and revenue target which require a meaningful recovery in its infant formula sales

Michael Gable of Fairmont Equities is keen on cyclicals as the ASX200 pushes higher and notes Bega Cheese is on the move.

While investors are encouraged to look through the one-off issues that have plagued Synlait Milk over the last year, uncertainty over demand from a2 Milk weighs on valuations

Opinion differs as to whether a2 Milk will be impacted by sharply declining volumes of infant formula sales in China or emerge from the pandemic with its market share protected by a strong brand

As was widely feared, a sharp slowdown in sales to China has materialised for a2 Milk, which has significantly downgraded guidance for FY21

A new global customer should help Synlait Milk counter the potential entry into manufacturing by chief customer a2 Milk but risks remain.

Sales of a2 Milk’s infant formula within China remain robust but the slump in daigou sales has caught the market napping and forecasts for FY21 are downgraded sharply.

FNArena’s Treasure Chest reports on money making ideas from stockbrokers and other experts. Elevated inventory accrued during the height of the pandemic has led to de-stocking of infant milk formula product in China. Is a2 Milk in danger of more permanent disruptions?

The Chartist reports a2 Milk is in a downtrend that may provide a good entry point, but likely not yet.