MM view on BUB
Hi James and M&M, just looking for a view on BUB if it is cheap at the moment, and whether it's capable of bouncing back along with A2M. Thank you Tony
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Answer
Hi Tony,
Like A2M, the infant formula company has been on the skids for the past year and their last result was a poor one. Losses accelerated as margins continued to contract. For both BUB and A2M we need to see Chinese demand improve and right now we don’t yet have evidence of that. I m 50/50 on what our best course of action should be for A2M. On one hand, it’s a small 3% position that’s gone against us, and when it turns it will recover quickly, however there’s not the evidence there yet – the same applies for BUB although it’s still loss making, at least A2 makes money.
