Institutional shareholders in Treasury Wine Estates are urging the company to maintain a presence in the United States despite calls from analysts for management to stop “destroying value” in the world’s largest economy.
Shares in Treasury, the ASX-listed owner of wine labels including Penfolds, Wolf Blass and Wynn’s tumbled 26 per cent in a single session this week after the company cut its earnings forecasts and blamed the downgrade on underperformance of its US businesses.
Jun Bei Liu, portfolio manager at Treasury shareholder Tribeca Investments, said the size of the earnings downgrade this week was a surprise but the market reaction was even more puzzling. “The share price move was very interesting,” she said. “There was a lot of angry selling, it was absolutely emotional in terms of selling”.
Ms Liu said Tribeca has increased its stake in Treasury in recent months and was still confident in its future growth prospects. “Treasury Wine represents a really strong brand, and strong brands should deserve a premium. And look at how well it’s doing in Asia, and that’s where a lot of future growth is going to come from,” she said.