A2 Milk share price up after UBS reveals 5% stake in the company
UBS stands by its research as it's revealed that the Swiss bank has taken a massive 5% stake in the Australian infant formula company.
This morning a2 Milk Co Ltd revealed that Swiss banking giant UBS has built a 5% stake in the company.
When the markets opened in Australia, a2 Milk's share price was up 1.16%.
As we previously reported, UBS just recently upgraded their rating of a2 Milk to ‘buy’ from ‘neutral’ and slapped an increased 12-month price target of A$16.70 on the infant formula company.
UBS’s research report highlighted how a2 Milk’s unique product offerings, premium brand presence and the potential to expand its Chinese market share are all potential drivers of growth for the company.
UBS puts its money where its mouth is
It’s refreshing to see UBS Group AG stand behind its research, with the banking giant having bought some 36 million ordinary shares in a2 Milk over the last five months.
All up, this amounts to a 5.01% stake in a2 Milk.
The bank has been building its sizable position in the Australian company for some time now, with UBS’s London branch accumulating a2 Milk stock all the way back in March 2019.
Though not necessarily the price that UBS got in at, back in March 18, shares of a2 Milk Co Ltd traded for just A$13.44 per share.
By comparison, in the last month alone a2 Milk’s share price has risen 22.1% and currently trades at A$16.42 per share.
Analysts still mixed on a2 Milk
While UBS is evidently optimistic concerning a2 Milk’s prospects, other analysts seem less enthused.
According to the Wall Street Journal, of the 13 analysts covering the company: six rate it as a buy, four a hold and three a sell.
Ultimately, given that China remains a key part of a2 Milk’s growth strategy, potential head-winds from the US-China trade war may still be weighing on the minds of investors and analysts.
Even still, the company looks to be in a good financial position, having posted strong growth year-over-year in the first-half of 2019. In this period the company saw both revenue and earnings per share (EPS) increase 41% and 53%, respectively.
Year-to-date, a2 Milk (ASX: A2M) has far outpaced the ASX200, rising 57% since January.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Act on share opportunities today
Go long or short on thousands of international stocks with spread bets and CFDs.
- Get full exposure for a comparatively small deposit
- Trade on spreads from just 0.1%
- Get greater order book visibility with direct market access
See opportunity on a stock?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See opportunity on a stock?
Don’t miss your chance – upgrade to a live account to take advantage.
- Trade a huge range of popular stocks
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See opportunity on a stock?
Don’t miss your chance. Log in to take advantage while conditions prevail.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
