Why baby formula player Synlait Milk Ltd’s share price has risen 173% in a year

Dairy processing company and infant formula player Synlait Milk Ltd (ASX: SM1) shares were down 1.2% to $10.32 at the time of writing after hitting a 52-week high to cap off May. They’re closing the month off up 3.9% at $10.45.

Synlait today announced it has increased its 2017/18 forecast milk price from $6.50kgMS to $6.65kgMS and $7.00kgMS for the upcoming 2018/19 season.

Synlait CEO John Penno said while the price upgrade was positive, farmers should “remain cautious” because “small changes in market dynamics can have major influence on milk price”.

Synlait shares have rocketed up from just $3.82 at this time last year – a 173% gain.

Synlait has some S&P/ASX 200 stars to look up to in its fight to join the baby formula export success list, with A2 Milk Company Ltd (ASX: A2M) and Bellamy’s Australia Ltd (ASX: BAL) leading the way in the sector.

Synlait’s half-year results showed net profit for the 6 months to January 31, 2018 was $40.7 million – up from just $10.6 million in the previous corresponding period, with net debt reducing from $147 million to $50 million over the same timeframe.

Japanese Billionaire’s Prediction Will Give You Goosebumps

When a veritable investing and entrepreneurial genius speaks, it pays to listen.

In fact, he's now preparing a $100B "war chest" to invest entirely in this "terrifying" new technology, which could spell huge profits for investors.

Click here to learn about this technology and how you can profit!

Motley Fool contributor Carin Pickworth has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of A2 Milk. 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 Scott Phillips.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.