What’s the outlook for the A2 Milk share price in May?

Here’s what experts have recently forecasted for the former market darling’s stock.

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Key points

  • The A2 Milk share price has struggled recently, falling 22% year to date and 41% over the last 12 months 
  • But experts are predicting greener pastures for the company, slapping it with price targets of between $4.80 and $6.39 
  • Here's what they expect could help boost the company's stock in the future 

The A2 Milk Company Ltd (ASX: A2M) share price has been in the trenches for close to 2 years now.

It’s tumbled around 76% since July 2020 and hasn’t shown many signs of easing yet. In fact, it slumped another 15.5% last month.

But could the future be brighter for the S&P/ASX 200 Index (ASX: XJO) milk and infant formula company? Let’s take a look at what experts are expecting from the A2 Milk share price in the future.

The A2 Milk share price was trading at $4.34 at Tuesday’s close.

What does the future hold for the A2 Milk share price?

The former market darling has been plagued by a slew of issues over the last few years, starting with its changed position in the Chinese market. That’s recently been exacerbated by the country’s declining birth rate.

A2 Milk also outlined continued margin pressures and supply chain issues born from COVID-19 in its most recent half year results.

But such gloom could soon be in the company’s rearview mirror according to some experts.

Its expansion in New Zealand and the United States, as well as its entrance into Malaysia, Singapore, and Vietnam has Catapult Wealth’s Tim Haselum excited, reports The Motley Fool Australia’s Tony Yoo.

Further, Haselum thinks merger and acquisition activity could be on A2 Milk’s horizon due to its “strong net cash position”.

Meanwhile, Credit Suisse is warning lockdowns in China could impact the company’s bottom line in the short term. Though, the broker expects it could grow its market share in future years, my Foolish colleague Tristan Harrison reports.

It has slapped the company with a neutral rating price target of $5.15 to $5.75 – representing a potential upside of 34%.

Other brokers have varied targets for the A2 Milk share price. Citi has slapped it with a target of $4.80 while Morgans expects it to reach $6.39.

A2 Milk’s management predicts the second half of this financial year will be a better one for the company’s revenue.

However, that likely won’t be reflected in its earnings, with the extra cash earmarked to go to the company’s growth strategy.

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended A2 Milk. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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