ASX:A2M
A2 Milk Company Ltd
Investment Summary
The fund managers believe that A2 Milk Company Ltd (A2M) is demonstrating promising growth prospects. They note the company's strategic positioning with a $1bn cash balance and flexible supplier contracts, providing optional resources for capital returns and EPS-accretive investments. In their opinion, the successful launch of the new premium genesis product and positive market share data ahead of reporting season point to a robust trading performance. Despite challenges in the infant formula sector, A2M has recorded a 10% growth while capitalizing on supportive birth trends in China. The fund managers express optimism regarding potential accretive supply chain investments and highlight new financial incentives in regions like Hohhot to boost birth rates as vital indicators for broader fiscal support. They view A2M’s strong brand health and market share gains across distribution channels as critical factors that will support continued investment.
Commentary From The Managers
Ten Cap
31 Mar 2025
$7.93
- Ten Cap continues to hold in A2 Milk Company Ltd due to strong market share data.
- Successful rollout of new products has positively impacted A2M's position.
- Demographic developments in China are encouraging for the company's future.
- Announcement from Hohhot regarding financial incentives for families aims to boost birth rates.
- Ten Cap views the efficacy of policy measures as a crucial indicator of broader fiscal support.
- Monitoring fiscal support closely remains a key focus for Ten Cap.
Ten Cap
28 Feb 2025
$7.98
- Ten Cap strategically increased their position in A2 Milk Company.
- A2M's growth is supported by strong market share data.
- Successful new product launches have positively impacted performance.
- There are supportive birth trends in China benefiting A2M.
- Despite a challenging market for infant formula, A2M achieved an impressive 10% growth.
- Ten Cap remains optimistic about accretive supply chain investments and capital returns to shareholders.
Ten Cap
31 Jan 2025
$5.90
- A2 Milk (A2M) was added to Ten Cap's portfolio as of last month.
- Positive feedback on the launch of the new premium genesis product.
- Continued consolidation in the Chinese market.
- Company maintains a strong cash balance of $1bn.
- More flexible supplier contracts enhance business options.
- Provides optionality for capital returns and EPS-accretive investments.
- Ten Cap continues to hold due to the ongoing strength in trading performance.
Milford Asset Management
31 May 2024
$7.08
- A2 Milk has seen a notable increase of 14.9% in its performance.
- Milford Asset Management recognizes A2M's strong execution despite a challenging market.
- A2M's brand health metrics remain solid.
- The company has achieved market share gains across various distribution channels.
- Management expresses optimism regarding a recovery in China's birth rates.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.