The company earlier this month issued a revenue upgrade after a significant boost in infant formula sales.
Following the upgrade, its shares rose 25%, or by 28c, to $1.39. At the close of trading on Christmas Eve, the shares had risen to $1.97 as investors started seeing the possibilities emerging for the company started in Dunedin but now based in Australia.
The shares continued their rise this week, reaching $2.35 on Tuesday before trading up to $2.42 yesterday.
Craigs Investment Partners broker Chris Timms said yesterday A2 shares made up more than a third of the value of the shares traded on the NZX on Tuesday and as the market opened yesterday, more than 9.5 million shares were pre-placed with investors. Nearly 15 million shares were traded through the day.
Based on yesterday's highest trade, the company's market capitalisation was $1.75 billion - larger than Trade Me, Mainfreight and The Warehouse Group. It was close to Sky Network Television in value, a far cry from this time last year, when the shares closed on December 31 at 57c a share.
When people invested in small, rapid-growth companies such as A2, there was a surge of interest and stocks tended to be well supported. The momentum had continued, he said.
Synlait Milk, the main supplier of A2 milk, had been a beneficiary of investor interest as its shares increased by nearly 1%.
Listed dairy producers across the Tasman also felt investor support for companies dealing in high-end milk products. Bega Cheese shares rose 13% and formula producer Bellamy's Australia rose 6.8%.
There was a group of similar stocks that were all getting strong support for dairy-based products, whether they were at the more technical end like A2 or the basic end like Bega, Harbour Asset Management director Shane Solly said.
‘‘If you start looking through what A2's doing, it is easy for people to get excited about growth in Chinese infant formula space, pushing into the UK and US markets with whole milk products or milk-based products.''
A2 Milk
• The a2 Milk brand is a naturally occurring cow's milk that comes from cows selected to produce only the A2 beta-casein protein and not the A1 protein.
• It is an entirely natural pure cow's milk and not a product of technological process or genetic engineering.
• Originally all domesticated cows produced only the A2 type protein.
• Owing to a genetic mutation in European herds, another milk protein emerged (A1 protein) and, through modern farming practices, spread throughout the world.
• The a2 Milk brand is the only cow's milk that is free from the A1 protein.
