Abundant Produce back in Punter's sights

Abundant Produce back in Punter's sights

Business
Seeds for 10 new tomato varieties are expected to be commercially available by the end of the year, while Abundant Produce continues cucumber sales and trials.

Seeds for 10 new tomato varieties are expected to be commercially available by the end of the year, while Abundant Produce continues cucumber sales and trials.

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Duxton Broadacre Farms (ASX code DBF) remains high on the Punter's "sell" list, but it is still in his portfolio.

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Duxton Broadacre Farms (ASX code DBF) remains high on the Punter's "sell" list, but it is still in his portfolio. He's not sure why. Maybe he thinks it will rain.

Hardly anyone is interested in buying or selling shares in this grain/cotton/cattle outfit. There were only 14 investors, the last time he looked. Sellers outweighed buyers, trying to offload some 36,000 shares in a market with buyers for only 16,000. DBF is not the hottest stock on the ASX.

The only steady buyer for DBF is DBF, which reckons its shares have a net asset value of about $1.70, and therefore they are a bargain at the current price of around $1.40. That's one reason for holding on, though asset values are always a matter of judgement until they are sold. Another plus is the NSW government might give DBF's new 20ml bore the big tick. And there might even be good soaking rains.

But the drought has forced the company to revise its forecast for pre-tax profit down from between break even and $500,000 profit to a "modest loss". The Punter may give them another month.

However, one loss-making company which has cost the Punter dearly is back on his watchlist of possible buys - the seeds and cosmetics group Abundant Produce (ABT). He lost $1000 when he sold them at 11c in March, and they later sank as low as 5c. Slow sales on both sides of the business were probably the main reason, but that may now be turning around.

In its latest business update, the company reported that its Abundant Natural Health products will be exhibited in two Chinese trade fairs this year. They have also been accepted by US retail giant Amazon, at a time when they are culling smaller companies from their list.

The company has put no figures on any of this, but the news generated some interest. The Punter has taken a very deep breath and bought 30,000 ABT at 7.3c each.

  • The Punter has no financial qualifications and no links to the financial services industry. He owns shares in a number of companies featured in this column.
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