Why Horse-Drawn Carts Could Be A Better Bet Than Baby Food

Time it right and a dead cat bounce can make you money…

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

While it's true that Australian baby formula companies such as A2 Milk (ASX:A2M) and Bellamy's Organic (ASX:BAL) made a small fortune for investors in 2015, now could be the time to consider an investment in horse drawn carts.

Bellamys and A2 must continue to sell high priced formula to China for many years to come to justify current share prices, and the only reason to think this could happen is that they have very strong brands and China is finally relaxing the one child policy. The fact that children consume formula in China until an older age than do children in Australia is barely relevant, and Chinese parents will probably forget that children were previously poisoned to death by a home grown Chinese brand.

On the other hand, Horse Drawn Cart companies have been sold down to the point that there isn't even an ASX listed Horse Drawn Cart company.

Never fear.

I have the solution.

I can exclusively reveal that I am in the early stages of planning the IPO for Horse Drawn Carts Limited (ASX:HDC).

Never mind the fact that Horse Drawn Carts are an 18th century technology.

Never mind the fact that the pollution from horses defecating everywhere causes sickness and repulsive aromas.

Horse drawn carts have staying power, and I'm driving a resurgence. Even hundreds of years since cleaner technologies were invented, you still see them on the streets, on movie screens, and even in the draft prospectus for Horse Drawn Carts Limited.

The best part is that whereas the combined market capitalisations of A2 Milk and Bellamys Organic stretch into the billions, Horse Drawn Carts Limited will have a market capitalisation of only $10 million on listing. Now, don't get me wrong, Bellamys is a great company. But is it really worth more than 100 times Horse Drawn Carts Limited?

The comparison is totally valid and relevant.

Horse Drawn Carts Limited is a Buy.

APRIL FOOLS!! Motley Fool contributor Claude Walker does not own any of the companies mentioned in this article. You can follow him on Twitter @claudedwalker Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia owns shares of Bellamy's Australia. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »