NZ shares fall as Synlait declines another day
The S&P/NZX 50 Index declined 46.01 points, or 0.4 percent, to 11,834.83. Within the index, 24 stocks fell, 23 gained, and three were unchanged. Turnover was $168.2 million.
Synlait Milk fell 5.6 percent to $6.42, having been aggressively sold off yesterday, after it revised first-half net profit down by roughly $10 million and lowered its annual outlook to a flat profit at best. In two days the stock has dropped 22.6 percent.
Research house Jarden today decreased its target price on the stock to $7.75 from a previous target of $8.84, but said an absence of information about the margin in their key source of profitability made the outlook foggy.
“The investment case in Synlait remains challenging for investors who are increasingly less focused on the immediate growth in profitability Synlait is generating and more focused on the trajectory in margins with A2, which currently appear to be subject to regular renegotiation,” a note to clients said.
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