Several issues, such as manufacturing complexities, a stretched balance sheet and the disruption from coronavirus add to Morgan Stanley's concerns about the stock. First half earnings (EBIT) were well below estimates and FY20 net profit guidance of $17-21m implies Blackmores will not make a profit in the second half. The broker maintains an Equal-weight rating. Industry view is: Cautious. Target is reduced to $66 from $71. Sector: Household & Personal Products. Target price is $66.00.Current Price is $77.85. Difference: ($11.85) - (brackets indicate current price is over target). If BKL meets the Morgan Stanley target it will return approximately -18% (excluding dividends, fees and charges - negative figures indicate an expected loss). © 2020 Acquisdata Pty Ltd., source FN Arena
Blackmores, the Australian vitamin company, reportedly almost tripled its profits growth, from AUS18.6m ($13.5m) in H2 2015 to AUS48.3m ($35m) in H1 2015, driven by strong demand from China. According to 4-traders, a large part of the growth comes from Chinese tourists and entrepreneurs buying large quantities of supplements in local shops and pharmacies in Australia to sell later in their home country.