BUB - BUBS Australia

[frugal.rock]

Bubby getting chubby ...

 

[frugal.rock]

So, frustratingly I dumped a while ago when price drifted down again. Took a small loss.

Keen to learn why milk, (or in this case, baby formula) stocks are headed downhill, I did some research and found that 2020 resulted in being the lowest birthing year for a long time in China.
I imagine it may be similar elsewhere and I surmise this will probably continue into 2021 somewhat, given baking periods of 9 months.

Had heard previously that there much lower cases of premature birthrates also, but that is uncorrelated to this. That was a result of lockdowns and healthier living etc

I note other milk stocks such as SM1 and A2M are showing similar downhill heading charts, however I will be keeping a lazy eye on them.

 

[aus_trader]

Market darling A2M has halved in price and so has it's peer SM1. Even the small cap AHF in this space has taken a battering

So I think BUBs had all these headwinds to deal with...

 

[frugal.rock]

No news, but very big news for the world !

I didn't think Bubs have much of a market in China anymore after the trade war and lack of open daigou channels, however things will probably change.
The people of China are nice and want our products, it's the CCP/ government that is the PITA.

Massive speculation and any excuse for a pump & dump these days is exploited by high frequency traders.

From please explain speeding ticket issued later today....

"Response: The Company is aware, via publicly reported news articles, that the Chinese
government today announced it is scrapping a policy limiting couples to two children, and
will now permit families to have three children without financial penalty with the formal
introduction of a third-child policy. The Company is aware that the policy announcement
has been widely reported, both internationally and in Australia, including across the Australian Financial Review and ABC News."

World changing/ impacting news really, imo.?

 

[greggles]

Bubs has entered the US formula market with its Aussie Bubs branded formula range available on Amazon.com and Walmart.com from September 2021.

The infant milk formula market in the US is currently worth $5.1 billion annually and is projected to grow 4% by 2025.

BUB's US supply chain infrastructure is now in place including warehousing and distribution and the company plans to expland its US retail footprint following the initial launch.

Good news for BUB. The US market is huge and this could mean substantial retail sales growth should the Bubs product range gain traction with US consumers.

 

[Stockbailx]

I've been looking at this trade around Christmas time a year ago when it was trading around 1$ and getting it self established I would believe. I could really see a lot potential and future in this. It offers organic baby food, goat milk infant formula, adult goat milk powder, and fresh dairy products, as well as pouches, cereals, and snacks under the Bubs, CapriLac, Deloraiane, and Capela brands. The company also provides children’s vitamin and mineral supplement products under the Vita Bubs name; canning services for nutritional dairy products; and holds IP and trademarks. Bubs Australia Limited. It also operates in China (Internationally) Earnings are forecast to grow 65.1% per year. Revenue forecast ed to grow faster then 20% per year. As I'm sure it will be in high demand...Top dollar if it's kick started in the US....
here a look at 3mths on an 1hr chart...

 

[Stockbailx]

Bubs Australia announced that it has secured acceptance for an inaugural USA launch of its Aussie Bubs branded formula range of Walmart.com. The Aussie Bubs range for the USA is expected to be available online from September 2021. Aussie Bubs is to launch as the only Australian Goat milk formula product on the USA market. WINNER

 

[Stockbailx]

Despite the good news, got to look at 'BUBS" performance this past financial year...Perhaps a sign that investors should temper their expectations as well.

After the downgrade, the consensus from Bubs Australia's analysts is for revenues of AU$43m in 2021, which would reflect a small 5.1% decline in sales compared to the last year of performance. Before the latest update, the analysts were foreseeing AU$49m of revenue in 2021. It looks like forecasts have become a fair bit less optimistic on Bubs Australia, given the measurable cut to revenue estimates. Are they turning the tide. With the business potentially at an important milestone, Bubs Australia Limited (ASX:BUB) future prospects. Bubs Australia Limited, together with its subsidiaries, engages in the production and sale of various infant nutrition products in Australia, China, and internationally. The company’s loss has recently broadened since it announced a AU$7.8m loss in the full financial year, compared to the latest trailing-twelve-month loss of AU$13m, moving it further away from breakeven. The most pressing concern for investors is Bubs Australia's path to profitability – when will it breakeven?

 

[Miner]

Just started looking into BUB after seeing Motley Extreme recommended it on June 21 and their prices have gone down significantly.
My concern is if the goat is acceptable milk in the Western world in terms of nutrition value?
If that is not changed then BUB Could be as it is- down hill.
Or BUB needs an expert paper somewhere saying that Goat milk is the best or maybe amalgamated with A2 - all my wishful unfounded garbs

 

[galumay]

I reckon its highly risky listening to promotional stock promoters like Motley Fool, @Miner. Better off doing your own research and finding your own ideas. My biggest mistakes have all involved buying other people's conviction! Have a look at BUB's fundamentals, its latest 4C shows me all I need to see, burning through the cash.

 

[divs4ever]

I reckon its highly risky listening to promotional stock promoters like Motley Fool, @Miner. Better off doing your own research and finding your own ideas. My biggest mistakes have all involved buying other people's conviction! Have a look at BUB's fundamentals, its latest 4C shows me all I need to see, burning through the cash.

i still glance at Fool and similar publications but THEN research after that

NORMALLY i have not bought a Fool highlighted stock ( unless months/years before ) but still read it as a potential share price move signal ( in case i desire to exit )

now if you are trader such publications can help you earn those extra bucks ( in and out before the excitement fades ) if you have the skills

 

[Miner]

I reckon its highly risky listening to promotional stock promoters like Motley Fool, @Miner. Better off doing your own research and finding your own ideas. My biggest mistakes have all involved buying other people's conviction! Have a look at BUB's fundamentals, its latest 4C shows me all I need to see, burning through the cash.

Thanks @galumay .
I just quoted MF for discussion but as you said MF sales pitch is the last I heed to.

 

[Dona Ferentes]

Just when it was getting tricky. Up 50%

Bubs Australia says the US Food and Drug Administration (FDA) has exercised its discretion for Bubs to import six infant formula products into the US effective immediately.

Bubs has committed to supply an initial 500,000 tins of infant formula, with a further 750,000 tin commitment over the coming months, which equates to at least 27.5 million feeding bottles of infant formula.

Bubs Australia’s FDA application was in response to the US government’s initiatives to address domestic infant formula supply shortages.

 

[Dona Ferentes]

Bubs Australia’s infant formula and toddler products will be available in more than 4000 stores across the United States after the company agreed on deals to increase its bricks-and-mortar store footprint in supermarket chains The Kroger Co and Albertsons.

- holding on to the earlier gains; closed up at 65c today.. Brand recognition would have to be as important as shelf space

 

[bk1]

Starting to set up?
Earnings report in two weeks time, large volume day, well above average..

 

[Dona Ferentes]

• Gross revenue more than doubled to a record $104.3 million in FY22,
• Earnings were $4.8 million
• A 32 per cent increase in gross margins.
• Bubs Infant Formula accounted for 60 per cent of the group revenues compared with just under half in pcp.
• No dividend declared

Bubs executive chairman Dennis Lin said infant formula revenue would be the major driver of growth in the 2023 financial year with China and the US the “key growth engines” within the next three years.

 

[frugal.rock]

Chart update.
Some internal musings are, plenty of sales in the US reported around USD peak.
China reopening. Slingshot out of the blocks?
SP and volume moving up on no direct news. Earnings I expect, must be any day now.

 

[farmerge]

For the March Competition I have chosen BUBS. In the past it has ben a solid contributor to my wheelbarrow fund. I think with the China closures and now with a re-opening of their country, and the introduction of the infant formula into the USA it could be a beneficial time for BUB Australia to make some better inroads into securing a stronger SP. They also have exports into SE Asia, the Middle East and of course a good foothold here in Australia. Myself and the bloke in the mirror are feeling confident that here is the March winner.

 

[The Triangle]

• Gross revenue more than doubled to a record $104.3 million in FY22,
• Earnings were $4.8 million
• A 32 per cent increase in gross margins.
• Bubs Infant Formula accounted for 60 per cent of the group revenues compared with just under half in pcp.
• No dividend declared

Bubs executive chairman Dennis Lin said infant formula revenue would be the major driver of growth in the 2023 financial year with China and the US the “key growth engines” within the next three years.

What does Charlie Munger always say? Substitute EBTDA with Bull? earnings

If fairness maybe no one has explained to the board of Bubs what profit actually is?

For the March Competition I have chosen BUBS. In the past it has ben a solid contributor to my wheelbarrow fund. I think with the China closures and now with a re-opening of their country, and the introduction of the infant formula into the USA it could be a beneficial time for BUB Australia to make some better inroads into securing a stronger SP. They also have exports into SE Asia, the Middle East and of course a good foothold here in Australia. Myself and the bloke in the mirror are feeling confident that here is the March winner.

Good luck. I'm sure H22023 will be the turnaround...

FY2017: Lost money
FY2018: Lost money
FY2019: Lost money
FY2020: Lost money
FY2021: Lost money
FY2022: Lost money
H12023: Lost money

One of my red flags are announcements by Aussie companies which name the president of the United States, or any US laws passed. Australian companies always fail in America and I'm sure bubs will suffer the same fate as so many others.

 

[galumay]

It utterly staggers me that some people actually think this is an investible business! As @The Triangle points out, they have never made a profit, just about every single financial metric you can look at is terrible, the only thing that has really grown consistently is the shares issued, up by 100x over the last 10 years.