Bubs (ASX:BUB) share price explodes 17% on US launch

Big deals with Walmart and Amazon have sent the formula maker into the stratosphere.
The post Bubs (ASX:BUB) share price explodes 17% on US launch appeared first on The Motley Fool Australia. –

The Bubs Australia Ltd (ASX: BUB) share price is rising like cream on Friday. At the time of writing, shares in the infant formula manufacturer are trading for 44 cents each – up by a whopping 17.33%.

The company comes into focus after announcing this morning it is entering the US market for dairy-based powder formula.

Let’s take a closer look at today’s news.

Why the Bubs share price is surging

In a statement to the ASX, Bubs Australia said from September 2021, the world’s largest retailer, Walmart Inc (NYSE: WMT), will begin to stock and sell its products under the brand name ‘Aussie Bubs’ on its website. As well, the product will be sold in the US by Inc. (NASDAQ: AMZN).

The company claims the US formula market is worth a total of US$5.1 billion. On top of this, Bubs says it will be the “only Australian Goat Milk Formula product on the USA market.” If that’s the case, then this helps explain today’s meteoric rise in the Bubs share price.

To facilitate the launch of Aussie Bubs, Bubs Australia will establish a US-based subsidiary. The company said it will “spearhead in-country marketing and [be] based in health-conscious Northern California.”

Management commentary

Bubs CEO Kristy Carr said:

We are delighted to announce this important milestone in our continued implementation of our export diversification strategy, as we look for key global markets in which to expand our now award-winning Clean Label formulations.

Bubs executive chair Dennis Lin added:

As Australia’s largest producer of goat dairy products built on our unique vertically integrated business model and deep understanding of the speciality goat dairy supply chain, we are well placed to take advantage of continuing opportunities to expand our global footprint for the Bubs range.

Bubs share price snapshot

Over the past 12 months, the Bubs share price has decreased by around 55%. Australia’s international border closures, due to the COVID-19 pandemic, severely affected the company. The daigou market formed an important part of the business’ performance, with Bubs suffering when the channel shut down.

Bubs Australia has a market capitalisation of around $273 million.

The post Bubs (ASX:BUB) share price explodes 17% on US launch appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

Investors are overlooking Amazon’s next $50 billion dollar idea

Are Zip (ASX:Z1P) shares cheap enough to buy now?
ASX investors couldn’t get enough of meme stocks last week

4 ASX shares to gain exposure to international market growth: fund manager

5 international value shares with a positive outlook: analyst

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool Australia has recommended Amazon and BUBS AUST FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!