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ATM: Rising Discount Rate and High P/E Will Pressure Future Returns

Update shared on 07 Nov 2025

Fair value Increased 3.56%
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AnalystConsensusTarget's Fair Value
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1Y
100.2%
7D
-0.9%

Analysts have raised their price target for a2 Milk from $9.05 to $9.37, citing slight improvements to expected revenue growth and overall fair value estimates.

What's in the News

  • The a2 Milk Company Limited (ASX:A2M) has been added to the S&P Global BMI Index (Key Developments).
  • The a2 Milk Company Limited (NZSE:ATM) was dropped from the S&P Global BMI Index (Key Developments).
  • The company has provided earnings guidance for fiscal year 2026, expecting high single-digit percent revenue growth compared to FY25 continuing operations (Key Developments).

Valuation Changes

  • The Fair Value Estimate has increased slightly to NZ$9.37 from NZ$9.05.
  • The Discount Rate has risen moderately to 7.10 percent from 6.90 percent.
  • The Revenue Growth Forecast has edged up marginally to 5.90 percent from 5.88 percent.
  • The Net Profit Margin projection has declined slightly to 12.83 percent from 12.84 percent previously.
  • The Future P/E Ratio has increased to 28.8x from 27.7x.

Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.