Citi positive on a2 Milk following Nestle 3Q26 update; reiterates Buy

** Citi says Nestle's NESN.S 3Q26 results provide an incremental positive read-through for a2 Milk ATM.NZ

** Says the results show that foreign infant formula brands can return to growth relatively quickly after a major supply disruption, particularly when supported by product innovation

** Brokerage maintains its "buy" rating on a2 Milk with a target price of A$7.40

** Citi also says its review of recent CBEC pricing data and port data was broadly favourable for a2 Milk ahead of the company's AGM on November 19

** Stock down over 16% this year, as of last close