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A2M

A2 Milk Falls 6% After CEO Steps Down

Jordan Baird

Jordan Baird is the head ASR Wealth Advisers client services desk and has been with the organisation since 2017. He first started investing in his early years. While he believes that investors should leave no stone unturned he has a particular interest in trading based on broad macroeconomic trends along with specific analysis of innovative up-and-coming companies.

A2 Milk’s (ASX: A2M) stock plummeted 6% today, from 14.54 to 13.55 after Managing Director and Chief Executive Officer Jayne Hrdlicka announced she would be stepping down from her role. The market’s reaction to the news was much greater than projected, with CommSec only anticipating a 0.4% fall. Hrdlicka cited her reason for stepping down as the job required more travel than initially anticipated when joining the company. She commented that:

being present in our core markets of China and the US… combined with running a New Zealand company based in Australia… is going to be too difficult to manage.

The announcement came as a surprise to many given that the former CEO was only in the role for a year and a half. However, the Company’s board has commented that they would immediately commence a global search for a replacement CEO.

A2M FALL6

A2 Milk managing director and CEO Jayne Hrdlicka is standing down after just 18 months in the role.

 

The A2 Milk Company Limited is an ASX 200 public company that commercializes intellectual property relating to A1 protein-free milk that is sold under their two milk brands: A2 and A2 MILK. The company also sells related products such as infant formula. A2 Milk’s primary markets are in Australia, New Zealand and the United Kingdom. A2M generated over NZ$1.3B in revenue in FY19 (a 41.4% increase), and has a market cap of $10.7B, making it one of Australia’s largest listed companies.

The aforementioned share price dip comes as only a small setback to A2 Milk, as the company has rallied nearly 35% YTD, a significant feat, especially when compared to the ASX 200 index, which has seen growth of 20% in 2019. Furthermore, the Company has rallied 2,400% since listing back in 2015, making it one of the best performing stocks of the past 5 years.

 


 

Disclaimer:

This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)

(“ASR”). ASR is part of Amalgamated Australian Investment Group Limited (AAIG) (ABN: 81 140 208 288 Level 13, 130 Pitt Street, Sydney NSW 2000).

This article is provided for informational purpose only and does not purport to contain all matters relevant to any particular investment or financial instrument. Any market commentary in this communication is not intended to constitute “research” as defined by applicable regulations. Whilst information published on or accessed via this website is believed to be reliable, as far as permitted by law we make no representations as to its ongoing availability, accuracy or completeness. Any quotes or prices used herein are current at the time of preparation. This document and its contents are proprietary information and products of our firm and may not be reproduced or otherwise disseminated in whole or in part without our written consent unless required to by judicial or administrative proceeding. The ultimate decision to proceed with any transaction rests solely with you. We are not acting as your advisor in relation to any information contained herein. Any projections are estimates only and may not be realised in the future.

ASR has no position in any of the stocks mentioned.

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