What’s our plan with A2 Milk (A2M)

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Question asked 23/04/2021

What’s our plan with A2 Milk (A2M)

Hi MM team, I am really enjoying the new daily reporting structure. Could you please give an update on your (my) plan for A2 Milk as it keeps sliding with no stop in place. I would also like your thoughts on GOR- Gold Road Resources at its current price. Regards Burge.

Answer

Hi Burge,

A2M is not our finest play at this moment in time as it continues to make fresh multi-year lows on a combination of operational and China fears. This week saw Pendal drop below substantial while Morgans fell on it’s sword cutting it from a buy to hold and downgrading their PT 20% to $8.34. On Friday morning there were some large orders obvious in the stock, big sell side lines through from the get-go which had a vibe of capitulation about them, but only time will tell there.

Ultimately, our plan is to add to our position when downside momentum subsides – we deliberately only allocated 3% into the stock deeming it fairly aggressive at the time. We think value is there and when it turns, it will be swift. For that reason we’ll continue to hold with one eye on a level to accumulate.

GOR has bounced nicely along with the whole precious metals sector and we can see a test of $1.50 in the near future but our local preference remains Newcrest Mining (NCM).

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A2 Milk (A2M)

LAST UPDATED 23/04/2021 12:25

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