In afternoon trade the A2 Milk Company Ltd (ASX: A2M) share price has avoided the market weakness and pushed slightly higher.
This slight gain means that the infant formula and dairy company's shares are up over 12% since the start of the year.
Is it too late to invest?
One broker that believes there is still meaningful upside for a2 Milk's shares in 2019 is Goldman Sachs.
According to a note out of the investment bank this morning, its analysts have maintained their buy rating and $13.00 price target on the company's shares.
This price target implies potential upside of over 11% for its shares over the next 12 months.
What was in the note?
This morning's note was in relation to infant formula export volumes from Lyttleton New Zealand to Australia, Hong Kong and China during the month of December.
Based on weight, combined exports to these three countries were up 68% month on month and also 68% year on year. This has continued the improving trends that have been seen in recent months.
The biggest driver of this growth was exports to Australia. Infant formula volumes totalled 2.4k MT, an increase of 105% year on year.
The broker believes this data is supportive of its forecasts for a2 Milk and Synlait Milk Ltd (ASX: SM1) in FY 2019.
Incidentally, the broker has a neutral rating and $9.40 price target on Synlait Milk's shares.
Should you buy a2 Milk shares?
At around 35x estimated full year earnings a2 Milk's shares are not cheap, but I believe they are fairly priced for a company that has been growing earnings at such an impressive rate.
For example, after smashing expectations in FY 2018 with stellar growth, during the first four months of FY 2019 a2 Milk built on this with net profit growth of 64.5% to NZ$86 million.
Overall, I agree with Goldman Sachs and think it's a buy. The same could be said for rival Bellamy's Australia Ltd (ASX: BAL), though I would only recommend it to investors that are prepared to be patient and hold onto its shares for the long-term.
