company background image
ATM

a2 Milk NZSE:ATM Stock Report

Last Price

NZ$4.63

Market Cap

NZ$3.4b

7D

2.0%

1Y

-18.2%

Updated

19 May, 2022

Data

Company Financials +
ATM fundamental analysis
Snowflake Score
Valuation2/6
Future Growth4/6
Past Performance1/6
Financial Health5/6
Dividends0/6

ATM Stock Overview

The a2 Milk Company Limited, together with its subsidiaries, sells A2 protein type branded milk and related products in Australia, New Zealand, China, other Asian countries, and the United States.

a2 Milk Competitors

Price History & Performance

Summary of all time highs, changes and price drops for a2 Milk
Historical stock prices
Current Share PriceNZ$4.63
52 Week HighNZ$7.88
52 Week LowNZ$4.20
Beta-0.082
1 Month Change-7.59%
3 Month Change-17.62%
1 Year Change-18.20%
3 Year Change-71.15%
5 Year Change34.99%
Change since IPO478.75%

Recent News & Updates

May 15
Capital Allocation Trends At a2 Milk (NZSE:ATM) Aren't Ideal

Capital Allocation Trends At a2 Milk (NZSE:ATM) Aren't Ideal

If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Firstly, we'll...

Feb 27
Does a2 Milk (NZSE:ATM) Have A Healthy Balance Sheet?

Does a2 Milk (NZSE:ATM) Have A Healthy Balance Sheet?

David Iben put it well when he said, 'Volatility is not a risk we care about. What we care about is avoiding the...

Feb 09
a2 Milk's (NZSE:ATM) Returns On Capital Not Reflecting Well On The Business

a2 Milk's (NZSE:ATM) Returns On Capital Not Reflecting Well On The Business

What trends should we look for it we want to identify stocks that can multiply in value over the long term? In a...

Shareholder Returns

ATMNZ FoodNZ Market
7D2.0%-1.0%0.4%
1Y-18.2%-25.0%-13.3%

Return vs Industry: ATM exceeded the NZ Food industry which returned -25% over the past year.

Return vs Market: ATM underperformed the NZ Market which returned -13.3% over the past year.

Price Volatility

Is ATM's price volatile compared to industry and market?
ATM volatility
ATM Average Weekly Movement4.6%
Food Industry Average Movement4.4%
Market Average Movement4.3%
10% most volatile stocks in NZ Market7.4%
10% least volatile stocks in NZ Market2.9%

Stable Share Price: ATM is not significantly more volatile than the rest of NZ stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: ATM's weekly volatility (5%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
2000335David Bortolussihttps://www.thea2milkcompany.com

The a2 Milk Company Limited, together with its subsidiaries, sells A2 protein type branded milk and related products in Australia, New Zealand, China, other Asian countries, and the United States. The company offers fresh milk under the a2 Milk brand; and infant formula under the a2 Platinum brand. The company was formerly known as A2 Corporation Limited and changed its name to The a2 Milk Company Limited in April 2014.

a2 Milk Fundamentals Summary

How do a2 Milk's earnings and revenue compare to its market cap?
ATM fundamental statistics
Market CapNZ$3.41b
Earnings (TTM)NZ$20.24m
Revenue (TTM)NZ$1.19b

170.2x

P/E Ratio

2.9x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
ATM income statement (TTM)
RevenueNZ$1.19b
Cost of RevenueNZ$713.56m
Gross ProfitNZ$474.66m
Other ExpensesNZ$454.42m
EarningsNZ$20.24m

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)0.027
Gross Margin39.95%
Net Profit Margin1.70%
Debt/Equity Ratio7.0%

How did ATM perform over the long term?

See historical performance and comparison

Valuation

Is a2 Milk undervalued compared to its fair value and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Below Fair Value

  • Significantly Below Fair Value

  • PE vs Industry

  • PE vs Market

  • PEG Ratio

  • PB vs Industry


>50%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: ATM (NZ$4.63) is trading below our estimate of fair value (NZ$14.02)

Significantly Below Fair Value: ATM is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ATM is poor value based on its PE Ratio (170.2x) compared to the NZ Food industry average (14.1x).

PE vs Market: ATM is poor value based on its PE Ratio (170.2x) compared to the NZ market (17.3x).


Price to Earnings Growth Ratio

PEG Ratio: ATM is poor value based on its PEG Ratio (6.6x)


Price to Book Ratio

PB vs Industry: ATM is overvalued based on its PB Ratio (3.1x) compared to the NZ Food industry average (0.9x).


Future Growth

How is a2 Milk forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


25.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ATM's forecast earnings growth (25.6% per year) is above the savings rate (2%).

Earnings vs Market: ATM's earnings (25.6% per year) are forecast to grow faster than the NZ market (6.7% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: ATM's revenue (11.7% per year) is forecast to grow faster than the NZ market (5.4% per year).

High Growth Revenue: ATM's revenue (11.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ATM's Return on Equity is forecast to be low in 3 years time (13.8%).


Past Performance

How has a2 Milk performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


8.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: ATM has a large one-off loss of NZ$10.4M impacting its December 31 2021 financial results.

Growing Profit Margin: ATM's current net profit margins (1.7%) are lower than last year (20%).


Past Earnings Growth Analysis

Earnings Trend: ATM's earnings have grown by 8% per year over the past 5 years.

Accelerating Growth: ATM's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: ATM had negative earnings growth (-93.7%) over the past year, making it difficult to compare to the Food industry average (4.8%).


Return on Equity

High ROE: ATM's Return on Equity (1.5%) is considered low.


Financial Health

How is a2 Milk's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: ATM's short term assets (NZ$1.0B) exceed its short term liabilities (NZ$387.4M).

Long Term Liabilities: ATM's short term assets (NZ$1.0B) exceed its long term liabilities (NZ$78.4M).


Debt to Equity History and Analysis

Debt Level: ATM has more cash than its total debt.

Reducing Debt: Insufficient data to determine if ATM's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: ATM's debt is well covered by operating cash flow (246.2%).

Interest Coverage: ATM earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


Dividend

What is a2 Milk current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Future Dividend Coverage


1.17%

Forecast Dividend Yield

Dividend Yield vs Market

Notable Dividend: Unable to evaluate ATM's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate ATM's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ATM's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ATM's dividend payments have been increasing.


Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as ATM has not reported any payouts.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

2.8yrs

Average management tenure


CEO

David Bortolussi (52 yo)

1.25yrs

Tenure

NZ$2,209,599

Compensation

Mr. David L. Bortolussi, BComm, FFin, FCA serves as Advisory Board Member at Whiteoak Pty Ltd. He served as Group President of Innerwear International at Hanesbrands Inc. since April 2019 until February 6,...


CEO Compensation Analysis

Compensation vs Market: David's total compensation ($USD1.40M) is about average for companies of similar size in the NZ market ($USD1.44M).

Compensation vs Earnings: Insufficient data to compare David's compensation with company performance.


Leadership Team

Experienced Management: ATM's management team is considered experienced (2.8 years average tenure).


Board Members

Experienced Board: ATM's board of directors are considered experienced (4.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

The a2 Milk Company Limited's employee growth, exchange listings and data sources


Key Information

  • Name: The a2 Milk Company Limited
  • Ticker: ATM
  • Exchange: NZSE
  • Founded: 2000
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Implied Market Cap: NZ$3.414b
  • Shares outstanding: 743.81m
  • Website: https://www.thea2milkcompany.com

Number of Employees


Location

  • The a2 Milk Company Limited
  • 51 Shortland Street
  • Level 10
  • Auckland
  • 1010
  • New Zealand

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/05/19 00:00
End of Day Share Price2022/05/19 00:00
Earnings2021/12/31
Annual Earnings2021/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.