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Bubs Australia shares have rocketed higher today after the company reported record sales growth during the March quarter.
“While Bubs may have benefited from some degree of consumer stockpiling during the quarter, we would not underestimate the combination of the ongoing emergence of the Bubs brand, management execution in tandem with the company’s strategic partners and the continued outperformance of the goat and organic categories,” analysts at Citi wrote.
It expects another strong showing from Bubs in the current quarter, underpinning its buy rating with a higher price target of $1.10.
Citi believes the quarterly performance bodes well for rival A2 Milk.
“Bubs’ record quarterly performance indicates the resilience of demand for foreign infant formula brands that operate in niche segments of the China IMF market and have strategic partners that are capable of adapting their supply chain to evolving market conditions,” it said.
Like Bubs, Citi is buy rated on A2M with a price target of $19.20.
BUB shares are up 4.6 per cent to $0.91. A2M shares sit at fresh record highs, lifting a further 3.2 per cent to $18.04.
https://www.smh.com.au/business/ ... 0200415-p54jwo.html |
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