A2M recently announced plans to undertaken an on market share buyback.

The company currently holds $815m cash and announced $150m of capital return to shareholders via share buybacks.

With the share price and market sentiment low for A2M it seems like a great time to use their surplus cash.

A2M are also starting to shows signs of growth with FY22 revenue up 19.8% to $1.45b and earnings up 42% to $145m.

IMO A2M is at an incredibly interesting stage right at this point in time. i am not going to give any heroic assumptions but point out the following. many strobgly branded ANZ companies have failed going into China, Fosters one of the most famous. why has A2 succeeded? and more importantly will it continue?. IMO A2 has succeeded where many others have tried and failed because of two reasons. the first and most importantly is a profitalbe distribution platform. by profitable i am mean profitable for distributors, like the daigou channel. the second is successful positioning of the brand (quality, health benefits etc etc). how successful has the brand been? i worked with a chinese lady who told me a long forgotten friend suddenly connected with her after nearly 20 years, after a few how is the family, etc she asked for as many A2 cans as possible. now thats brand power. A2 continues to invest in brand against a much more vigorous competitive landscape as IMF becomes saturated with prouduct. chinese domestic operators are going hard. i think A2 can hold their own in this regard. 

what does worry me is the chanegs to the distribution channel. the daigou channel has been the differentiator and immensely profibale for A2. will it recover? is it as relevant? can A2 transition to more physical and platform (tmall JD.com) sales. Imo opinion these q's are unanswered at this stage. however they will be. over the next year or sooner we will discover the answer. i suspect a positve outcome will see the share price much higher, a poor outcome, well it will be a case of move on. DYOR. this is opinon no advice given

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