Breaking into the US market has so far proven a good move for Bubs Australia shares
The post Why the Bubs (ASX:BUB) share price has gained 28% in a month appeared first on The Motley Fool Australia. –
The Bubs Australia Ltd (ASX: BUB) share price is having a great month, despite no news having been released by the company in more than 3 weeks.
Right now, shares in Bubs are trading for 50 cents apiece. This time last month, they were going for 39 cents each. Those figures represent a 28.21% increase in the Bubs share price over the last 30 days.
While that’s impressive, perhaps more so is the fact the gains have all come off the back of a single announcement to the market.
Let’s take a look at the news driving the Bubs share price.
On 18 June, Bubs announced it’s set to break into the United States infant nutrition market with its Aussie Bubs range of formulas.
According to the company, the US market is worth around $5.1 billion annually with a projected forecast growth of 4% by 2025. Some 93% of the products within the US infant nutrition market are powder formulations.
What’s more, Bubs’ product will be the only Australian goat milk formula to be sold in the nation.
On the day of the announcement, the Bubs share price closed a mammoth 28% higher than its previous day’s trade.
Bubs’ products will be available for purchase in the US through Walmart Inc‘s online store and Amazon.com Inc.
As part of the shift, Bubs will establish a US subsidiary, Aussie Bubs, to be based in northern California. Its products will be sold on Walmart’s online store from September.
Bubs Australia share price snapshot
Despite the month’s growth, the Bubs share price is still in the red on the ASX. It has fallen 16.6% since the start of 2021 and 50.5% since this time last year.
The company has a market capitalisation of around $306 million, with approximately 612 million shares outstanding.
Should you invest $1,000 in Bubs Australia right now?
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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.