The a2 Milk Company Ltd (A2M) fair value: what the stock is really worth
As of Nov 13, 2026: fair value (intrinsic value) of The a2 Milk Company Ltd stock A$5.08, price A$7.26, that is 30.0% below the price, quality 68 out of 100. Rating: overvalued. Calculated from audited financials with 26 valuation models and 37 quality factors, updated daily.
69 individual criteria per stock, every one traceableSee the method →
Price vs Fair Value
White line = price, green steps = our fair value per fiscal year. As of Nov 13, 2026.
How to read this chart
60‑month range A$3.46 – A$9.39 · fair‑value band A$3.07 – A$6.35 · the A$7.26 price screens above the A$5.08 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). As of Nov 13, 2026.
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The a2 Milk Company Limited, together with its subsidiaries, sells A2-type protein type branded milk and related products in Australia, New Zealand, China, rest of Asia, and the United States.
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The company offers infant milk formula; other nutritional products and milk; manufactures and sells nutritional and ingredients products, as well as provides rent, royalty, and licensing services. It offers its products under the a2 Milk and a2 Platinum brands.
The company was formerly known as A2 Corporation Limited and changed its name to The a2 Milk Company Limited in April 2014. The a2 Milk Company Limited was incorporated in 2000 and is based in Auckland, New Zealand.
Stock analysis
The a2 Milk Company Ltd (A2M) currently trades at A$7.26, while our model-based Fair Value estimate is A$5.08, 30% below the price, so the stock looks overvalued today.
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Valuation
Bull case: the Growth Earnings group reads highest at a median of A$6.95 per share, and 2 of the 26 models we run sit above the A$7.26 price.
Bear case: the Asset-Based group reads lowest at A$0.5200, and 24 of the 26 models stay below the price. Data coverage for this calculation is high.
Scenario range: A$3.07 (bear) to A$6.35 (bull), the price of A$7.26 sits above it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target.
Quality & growth
The Quality Score stands at 68/100 (solid quality), in the Consumer Defensive sector.
Expensive Growth: The company is growing, but growth may require heavy reinvestment or weak cash conversion.
The a2 Milk Company Ltd reported revenue of 2.0B NZD in FY2026 versus 1.4B NZD in FY2022, a compound +8.1%/yr. Reported net income was 217M NZD in FY2026, compounding +15.3%/yr from FY2022.
Key figures
Market cap A$5.3B (≈ $3.6B) Mid · P/E ratio 29.0 · P/S ratio 3.19 · EPS (TTM) A$0.2500 · Dividend yield 2.4% · Net margin 11.0% · Return on equity 16.6% · Return on assets (EBIT) 12.1% (5-year average).
Competitive moat
Our AI-assisted moat analysis scores the competitive advantage at 58 out of 100 (low confidence).
What moves the price
The share trades about 23% below its 52-week high and 47% above its 52-week low, currently above its 200-day average.
For context, the median of 10 Consumer Defensive peers we cover trades at 3% fair-value upside, at −30%, A2M screens richer than that median.
Fair Value models
BearA$3.07Fair Value A$5.08BullA$6.35
Price A$7.26 · Downside -30.0%
Model ⓘEach model values the company its own way (discounted cash flow, earnings, assets, dividends). The fair value above starts from their evidence-weighted blend, not from a single model. In cyclical trough or peak years, after dilution or a stock split it is adjusted afterwards, so it can sit above or below the models. Based on fiscal year 2026 figures (about 5 months old). Earnings retained since then (A$0.0298 per share) are deliberately not added.Bear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target. If a model's bull case is above four times its base value, the table shows that limit with a > sign (like the overall Bull above): beyond it no assumption holds.Coverage ⓘCoverage = how well-backed THIS model's estimate is for this stock (0–100): how complete and reliable its input data are, and how well the model fits the company. The final Fair Value is an evidence-weighted blend, so better-evidenced models count more. Green ≥70, amber 50–69, grey below 50.
Growth Quality ⓘGrowth is valuable only when reinvestment earns attractive returns (Aswath Damodaran): sustainable growth depends on return on capital, reinvestment and efficiency. Basis: total company revenue over the periods shown on the cards (3Y/5Y/all years), not per share, so a merger can show up as a growth jump; per-share earnings growth is in the value-creation card.62/100
The company is growing, but growth may require heavy reinvestment or weak cash conversion.
Revenue growth 1 year
+3.8%
Revenue growth 3 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+7.4%
Revenue growth 5 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+10.3%
Start year 2021 (pandemic). Over 10 years: +18.8% a year
Revenue growth 22 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+46.9%
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What shareholders gained per year (last 5 years) ⓘWhat the business itself delivers per year: earnings growth per share plus the dividend yield. This is what you get IF the market keeps valuing the stock the same way: it contains no assumption about the market changing its mind. Computed per share, so buybacks count and a merger does not pass as growth. For a company that pays no dividend it is pure earnings growth per share. Period: earnings growth per share as CAGR over the last 5 reported fiscal years (annual statements), plus the current dividend yield. The start value is the median of the three years around the start, so a single crisis year (a pandemic or a write-down) does not distort the rate.
+14.8%
Earnings growth per share plus dividend.
Earnings per share, growth per year+12.4%
Dividend (yield on the price)2.4%
Pace: 5 vs 10 years ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.12.4% vs 13.5%, steady
Profit margin 2021 to 2026 ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.11% → 15%
Pace: the 5-year rate starts in 2021 (pandemic)
Growth Forecast
A lot of optimism in the price
The price assumes more growth than the company has delivered so far and more than analysts expect.
What the price assumes ⓘThis turns our valuation around: instead of asking what the share is worth, it asks what growth the current price requires. It uses the cash the company keeps after all spending (free cash flow), the same discount rate as our models, five years of growth, then slowing evenly to 2 % a year by year ten. Compared with the analysts' sales forecasts extended to the same five years (at least three analysts, for context only, it does not enter the Fair Value): within 3 percentage points counts as "in line" (amber), below that little optimism (green), above that a lot of optimism (red).
+35.4%
Yearly growth needed for the next five years to justify today's price.
What forecasts expect ⓘAnalysts publish sales forecasts for the next two fiscal years. For the years after that, growth slows evenly to 2 % a year by year ten (2 % is the long-run rate our models use). Projected years are marked as such.
+8.2%
Yearly sales growth analysts expect, extended to five years.
After inflation (figures in NZD, New Zealand: IMF forecast 2.3% a year to 2030, 3.0% from 2016 to 2025) that is about +32.4% a year for the price and +5.7% for the forecasts.
AI conclusion: Diversification through nutritionals innovation and Pokeno plant integration for China margins represent the main strength, while thin evidence and niche positioning limit signals of long-term durability.
Main risk: Dependence on the China market combined with manufacturing ramp-up at Pokeno risks creating ongoing volatility in sales and margins.
a2 Milk is expanding beyond core infant formula through innovation, where other nutritionals grew 42 percent last year and new products drove more than half the overall sales increase. At the same time the company is integrating its Pokeno plant to capture more margin in China after recent supply disruptions. Will this diversification and vertical integration strengthen the business over time, or will dependence on the China market and manufacturing ramp-up continue to create volatility?
Compare The a2 Milk Company Ltd with another stock
Price, fair value, quality and upside side by side.
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Peer GroupⓘHow this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.Packaged Foods · 661 stocks
Beats the industry median on 7/15 measures
A mixed picture versus its industry peers.
Valuation
Quality Score68 · Top 25%
Fair Value upside−30.0% · Below median
Profitability
Return on equity (12 months)16.6% · Top 25%
Return on assets11.1% · Top 25%
Net margin (12 months)5.8% · Above median
Operating margin (12 months)14.8% · Top 25%
Growth and dividend
Revenue growth (quarter YoY)6.5% · Above median
Dividend yield (12 months)2.4% · Below median
Balance sheet
Debt / equity0.04× · Below median
Valuation Multiplesvs Packaged Foods median · lower = cheaper
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Cite: Fair Value Calculator (2026). "The a2 Milk Company Ltd Fair Value". https://www.fairvalue-calculator.com/stock/A2M
Frequently asked questions
Is The a2 Milk Company Ltd (A2M) overvalued or undervalued?
As of Nov 13, 2026, our model estimates a fair value of A$5.08 versus a price of A$7.26, about 30% lower (overvalued).
What is the fair value of A2M?
Our model-based fair value for The a2 Milk Company Ltd is A$5.08 (as of Nov 13, 2026), built from audited fundamentals. The current price: A$7.26.
What is the quality score of A2M?
The a2 Milk Company Ltd has a Quality Score of 68/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for The a2 Milk Company Ltd (A2M)?
Our model-based price target is the fair value of A$5.08 (as of Nov 13, 2026) from 26 valuation models. Cautious scenario A$3.07, optimistic scenario A$6.35. It is a calculation from audited fundamentals, not an analyst target.
What is the The a2 Milk Company Ltd stock forecast for 2026?
Our models put fair value at A$5.08, about 30% lower versus a price of A$7.26 (overvalued). Cautious scenario A$3.07, optimistic scenario A$6.35. The calculation is refreshed regularly with new filings.
What is the revenue of The a2 Milk Company Ltd (A2M)?
The a2 Milk Company Ltd reported trailing-twelve-month revenue of about 2.0B NZD (latest available figure, as of Nov 13, 2026).
Does The a2 Milk Company Ltd pay a dividend?
The a2 Milk Company Ltd currently shows a dividend yield of 2.36% relative to its recent price (as of Nov 13, 2026).
How much is the dividend of The a2 Milk Company Ltd (A2M) and when is the ex-dividend date?
The a2 Milk Company Ltd pays a dividend of A$0.171 per share a year, a dividend yield of 2.4%. The last ex-dividend date was Sep 17, 2026. The payout ratio is 70.6% of earnings. Free cash flow covers the dividend 0.39 times. Our assessment: Watch coverage. The dividend isn’t fully covered by free cash flow or earnings, part of it is funded from reserves or debt. Fine for now, but worth watching: if it stays uncovered, the dividend could be cut.
What growth is priced into The a2 Milk Company Ltd (A2M)?
For today's price to be fair in a discounted-cash-flow model, The a2 Milk Company Ltd would have to grow free cash flow by +35.4 % per year for five years (discount rate 8.3 %, then slowing evenly to 2 % perpetual growth by year ten). Over the last 5 years revenue grew +10.3 % per year. As of Nov 13, 2026.
What discount rate (WACC) does the fair value of A2M use?
Our models discount The a2 Milk Company Ltd at 8.3 %: a base by market capitalisation (mid), damped by beta 0.30, country premium for Australia. The same rate applies in all 26 models.
What is a reverse DCF?
A reverse DCF turns the usual calculation around. Instead of deriving a value from assumptions, it takes today's price as given and asks: what free-cash-flow growth would a company have to deliver for exactly this price to be fair? The result is not a forecast but the expectation already priced in. For The a2 Milk Company Ltd that is +35.4 % per year for five years, then slowing evenly to 2 % by year ten, using the same discount rate (8.3 %) and the same formula as our fair value.
How much growth has The a2 Milk Company Ltd (A2M) delivered so far?
Over the past 5 years revenue at The a2 Milk Company Ltd grew +10.3 % a year. The price currently implies free-cash-flow growth of +35.4 % per year. Comparing the two shows how much confidence is in the price: if it demands more than has been delivered, the business has to accelerate for the maths to work.
How fast is the sector of The a2 Milk Company Ltd (A2M) growing?
The median revenue growth in the sector is +3.6 % a year. That is the yardstick for the growth priced into The a2 Milk Company Ltd (+35.4 % per year): it shows whether the expectation is within the usual range or beyond it.
What is the free cash flow yield of The a2 Milk Company Ltd (A2M)?
The free-cash-flow yield on the price is 0.92 %: that much free cash flow The a2 Milk Company Ltd produces per unit of market value. When it exceeds the discount rate of our models (8.3 %), the business already earns more than its cost of capital demands, and the price needs little additional growth.
What is the intrinsic value of The a2 Milk Company Ltd (A2M)?
Intrinsic value and fair value mean the same thing: what the business is worth on its numbers, independent of the share price. For The a2 Milk Company Ltd it is A$5.08 per share (as of Nov 13, 2026), against a price of A$7.26. It is the blended result of 26 valuation models in 8 families (DCF Models, Earnings-Based, Dividend Discount, Multiples, Asset-Based, Growth DCF, Economic Profit, Growth Earnings).
Is The a2 Milk Company Ltd stock overvalued or undervalued in 2026?
As of Nov 13, 2026, A2M trades above its calculated fair value: price A$7.26, fair value A$5.08, a gap of about −30% (overvalued). The calculation is refreshed with each new quarterly report, so the verdict can change during the year.
Is fair value the same as the market price of A2M?
No. The price is what the market pays today (A$7.26); the fair value is what the company's own numbers justify (A$5.08). For The a2 Milk Company Ltd the two are A$2.18 per share apart. That gap is exactly why we show both numbers side by side.
How much is The a2 Milk Company Ltd worth?
The market values The a2 Milk Company Ltd at about A$5.3B (market capitalisation, as of Nov 13, 2026). Per share that is A$7.26; our models calculate a fair value of A$5.08 per share.
What do the bullish and bearish scenarios say about A2M?
Our models span a range for The a2 Milk Company Ltd: cautious scenario A$3.07, base A$5.08, optimistic A$6.35 per share (as of Nov 13, 2026, price A$7.26). The range comes from different growth and margin assumptions, not from analyst opinions.
What is the P/E ratio of A2M?
The a2 Milk Company Ltd trades at a price-to-earnings ratio of 29.0 (as of Nov 13, 2026). A P/E on its own says little: it compares the price with ONE year of profit, while our fair value of A$5.08 is built from several models across several years. Median P/E at fiscal year-end, 10 fiscal years (2017 to 2026), reported earnings: 32.1. Other multiples: PEG 1.7, P/B 3.4, P/S 1.8, EV/EBITDA 9.8.
What is the PEG ratio of A2M?
The PEG ratio of The a2 Milk Company Ltd is 1.75 (P/E divided by earnings growth, as of Nov 13, 2026). That is above 1, so the growth is already paid for in the price.
How solid is the balance sheet of The a2 Milk Company Ltd (A2M)?
Balance-sheet figures for The a2 Milk Company Ltd (as of Nov 13, 2026): return on equity 16.6%, debt of 0.04 per unit of equity. They feed the Quality Score of 68/100, which measures business quality independently of the share price.
How far is A2M from its 52-week high?
The a2 Milk Company Ltd trades at A$7.26, about 23% below its 52-week high of A$9.39 and 47% above the low of A$4.93 (as of Nov 13, 2026). Distance from the high says nothing about value: that is what the fair value of A$5.08 is for.
Which stocks are comparable to The a2 Milk Company Ltd?
From the same area (Consumer Defensive) we also value Nestlé S.A, Danone S.A, Foshan Haitian Flavouring and Food Company, The Kraft Heinz Company, among others. Each of them has its own fair-value calculation on this site using the same models, so the comparison is like for like.
Is The a2 Milk Company Ltd stock attractive at the current price?
The data as of Nov 13, 2026: price A$7.26, calculated fair value A$5.08 (−30%), Quality Score 68/100, from 26 models. Whether that fits your horizon and risk tolerance is your call. We provide the calculation, not investment advice.
How is the fair value of A2M calculated?
We run The a2 Milk Company Ltd through 26 models from 8 families: DCF Models, Earnings-Based, Dividend Discount, Multiples, Asset-Based, Growth DCF, Economic Profit, Growth Earnings. Every model gets the same audited fundamentals; the fair value of A$5.08 builds on their evidence-weighted average, with the spread shown as a cautious and an optimistic scenario.
Is it still worth investing in stocks now?
The global stock market currently sits 13.9% above its aggregate fair value. The a2 Milk Company Ltd itself currently trades above fair value. An expensive market is no reason to stay out and no reason to buy everything at once: keep a broad savings plan running, buy single stocks only with money you can do without, and hold part of your money liquid while the market is high. The full picture including sectors is on is it worth investing now.
What is the share price of The a2 Milk Company Ltd (A2M)?
The closing price on Nov 13, 2026 was A$7.26. Our model-based fair value is A$5.08, about 30% lower (overvalued). We carry closing prices from our data provider, not a live tick.
What should I pay attention to with The a2 Milk Company Ltd right now?
The price sits above even our optimistic bull case (A$6.35). The favourable scenario is already priced in. Solid but not exceptional quality (68/100) and above fair value, neither a clear bargain nor a standout compounder. A fairly wide model range (A$3.07 to A$6.35) leaves room in how you read the outcome.
Where does the earnings growth of The a2 Milk Company Ltd (A2M) come from?
Earnings per share at The a2 Milk Company Ltd grew +14.7 % a year from 2016 to 2026. Broken into its drivers: revenue per share +17.9 %, EBIT margin −6.0 %, tax rate +0.9 %, residual (interest, one-offs) +2.4 %. The four rates multiply to the earnings growth rate, they do not add up. Start and end are three-year averages so a single exceptional year does not distort the result.
Key figures of The a2 Milk Company Ltd
How large is the market capitalisation of The a2 Milk Company Ltd (A2M)?
The market capitalisation of The a2 Milk Company Ltd is A$5.3B (≈ $3.6B). The stock-market value of the whole company: share price times number of shares. It is what the market asks for the entire business today.
What is the P/S ratio of The a2 Milk Company Ltd (A2M)?
The price-to-sales ratio of The a2 Milk Company Ltd is 3.19 (P/E × margin). Price to sales: market value relative to yearly revenue. Useful when profit is thin or distorted.
What are the earnings per share of The a2 Milk Company Ltd (A2M)?
Earnings per share at The a2 Milk Company Ltd are A$0.2500 (price ÷ EPS = P/E 29.0). Earnings per share over the last twelve months: total profit spread across every single share.
What is the dividend yield of The a2 Milk Company Ltd (A2M)?
The dividend yield of The a2 Milk Company Ltd is 2.4% (payout 68.5%). Yearly dividend relative to the share price. 3% pays 3 per 100 invested. Below: how much of profit is used for it.
What is the net margin of The a2 Milk Company Ltd (A2M)?
The net margin of The a2 Milk Company Ltd is 11.0% (fiscal year 2026). How much of every unit of revenue ends up as profit. 10% means 10 cents of profit per dollar of sales.
What is the return on equity of The a2 Milk Company Ltd (A2M)?
The return on equity (ROE) of The a2 Milk Company Ltd is 16.6% (last twelve months). Profit relative to shareholders' equity, how efficiently the company works with its owners' money.
What is the EBIT return on assets of The a2 Milk Company Ltd (A2M)?
On an EBIT basis the return on assets of The a2 Milk Company Ltd is 12.1% (avg 5y). Operating profit (EBIT) relative to everything the company owns, as a multi-year average. It describes the business model rather than one good or bad year.
What is the operating margin of The a2 Milk Company Ltd (A2M)?
The operating margin of The a2 Milk Company Ltd is 14.8% (last twelve months). Profit from the core business (before interest and taxes) relative to revenue.
How fast is revenue growing at The a2 Milk Company Ltd (A2M)?
Revenue at The a2 Milk Company Ltd is growing 6.5% versus a year earlier (3y avg +7.4%). How much revenue grew versus a year earlier (YoY). The 3-year average next to it puts the single year in context.
How fast are earnings growing at The a2 Milk Company Ltd (A2M)?
Earnings per share at The a2 Milk Company Ltd are down 8.1% versus a year earlier. How much earnings per share grew versus a year earlier.
How much net cash does The a2 Milk Company Ltd (A2M) hold?
The a2 Milk Company Ltd holds more cash than debt, 660M NZD net (fiscal year 2026). The company holds more cash than debt, a safety cushion.
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Broad data
Nov 13, 2026