The Beamtree Holdings Ltd (ASX: BMT) share price is soaring today after the company announced its plan to acquire data analytics firm, Potential(x).

Potential(x) specialises in the health and human services market. According to Beamtree, the acquisition will set it up as the largest health and artificial intelligence-led support platform in Australia.

Right now, the Beamtree share price is 59,5 cents, 21.43% higher than its previous close.

Let’s take a closer look at today’s news from the health data insights and health coding solutions provider.

New acquisition

The Beamtree share price is gaining after the company announced it’s entered an agreement to acquire Potential(x).

The agreement will see Beamtree paying $4 million in cash and providing Potential(x)’s shareholders with 30 million Beamtree shares.

According to Beamtree’s release, Potential(x) has relationships with more than 300 health service providers, including more than 250 hospitals in Australia, New Zealand and the United Arab Emirates. It also has relationships with 35 disability providers that together represent around 40% of National Disability Insurance Scheme (NDIS) funding.

Potential(x) also has a 26-year partnership as the full-service operator for Australia and New Zealand’s The Health Roundtable Ltd. The cooperative includes a network of 200 hospitals across Australia, New Zealand, and the Abu Dhabi Health Services Authority.

Beamtree believes Potential(x)’s existing industry relationships will help it enter the market.

Potential(x) revenue for the 2021 financial year was $11 million. Its normalised earnings before interest, taxes, depreciation and amortisation (EBITDA) came to $2.6 million.

Following the acquisition, Beamtree expects pro forma revenue of $19.9 million and operational EBITDA of $5.7 million.

Commentary from management

Beamtree’s CEO Tim Kelsey commented on the news sending the company’s share price through the roof today:

This agreement marks a major milestone in the growth opportunity for Beamtree – it doubles the size of the company by revenue and employee numbers and makes it one of the largest health analytics and decision support platforms in Australia. The new company already serves health services in more than 24 countries across four continents – we look forward to accelerating our global growth together with the Potential(x) team.

Potential(x)’s CEO Duane Attree added:

We will be bringing our brilliant teams together, who have complementary skills, expertise and a collective vision to put data and technology to best use for improving the quality and value of global health and human services.

Beamtree share price snapshot

The Beamtree share price has been performing well lately.

It’s currently about 40% higher than it was at the start of 2021. It has also gained around 120% since this time last year.

The post Beamtree (ASX: BMT) share price rockets 21% on acquisition news appeared first on The Motley Fool Australia.

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• Why is everyone talking about Affirm stock?
• August hasn’t been a great month for the Beach Energy (ASX:BPT) share price
• China gaming ban brings BetaShares’ ASIA (ASX:ASIA) ETF into focus

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Beamtree Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Tinybeans Group Ltd (ASX: TNY) share price is surging during early afternoon trade. This comes after the tech company released its full year results for the 2021 financial year.

At the time of writing, Tinybeans shares are travelling 4.09% higher to an intraday high of $1.14.

Let’s take a look at how the company performed for the period.

Tinybeans share price surges on record result

Investors are snapping up Tinybeans shares after digesting the company’s latest results. Here are some of the key operational highlights:

• Revenue increased 102% on the prior corresponding period to US$8 million;
• Monthly active users lifted 16% to 4.33 million users;
• Net loss after tax of US$3.1 million, down 34.8%;

What happened in FY21 for Tinybeans?

Tinybeans achieved sales momentum throughout the year, largely driven by advertising revenues, up 125% to US$6.75 million. The broader rebound in United States advertising saw a number of brand partners and larger average campaign sizes.

In addition, subscription revenue grew 23% to US$860,000 due to improved conversion of existing users to paying subscribers.

The company invested more than US$2.5 million in product growth initiatives with early results beginning to materialise.

Tinybeans declared a cash balance of US$2.16 million and an average operating burn rate of US$0.4 million per quarter.

What did management say?

Tinybeans CEO Eddie Geller commented on the milestone achievement, saying:

We are pleased to report Tinybeans’ record-level operating performance during FY21. The rebound in COVID-19 impacted industries, such as travel and tourism, contributed to these record results, and we were pleased to see momentum build in our subscription revenues throughout the fiscal year.

FY22 outlook for Tinybeans

Looking ahead, Tinybeans did not provide much for its earnings or profit guidance for the new financial year. However, Mr Geller spoke about FY22 promising to be the most successful year yet, adding:

We are launching an array of new product upgrades that we believe will support acceleration in our consumer subscription revenues, and we aim to drive continued growth in advertising revenues through enhancing ad integration and adding new in-demand features.

We see our photos and sharing platform expanding as we double down on new areas of engagement that align with our vision of content, community, commerce and related services.

The post Tinybeans (ASX:TNY) share price rises on record revenue of US$8 million appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Tinybeans Group Ltd. The Motley Fool Australia has recommended Tinybeans Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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August has brought a blow to the Rio Tinto Limited (ASX: RIO) share price despite the company staying relatively quiet.

Having ended July trading at $133.42, the Rio Tinto share price is now $112.92. It has slipped another 0.18% today.

Perhaps most peculiar is the fact there doesn’t seem to be any particular catalyst for Rio Tinto’s woes. Though, the company has recently had some bad press.

Let’s take a look at what the resource giant has been up to lately.

What’s weighing on the Rio Tinto share price?

The Rio Tinto share price had a rough trot in August. It has fallen about 15% between the end of July and the time of writing.

Rio Tinto has only released one announcement to the market in August. Last Tuesday it announced it was restarting its Richards Bay Minerals operation in South Africa after the security situation surrounding the mine stabilised.

While it’s not exactly ground-breaking news, Rio Tinto’s stock gained 1.3% last Tuesday.

Other news that might have moved the Rio Tinto share price in August was its earnings for the first half of 2021, which were released during the final days of July.

The 6 months ended 30 June 2021 was a good period for Rio Tinto. It saw US$33.08 billion in sales revenue and US$12.2 million in underlying earnings.

Additionally, Rio Tinto announced it’s investing $2.4 billion into a Serbia-based lithium project.

Despite the company’s seemingly strong performance and exciting news, the Rio Tinto share price dipped 0.1% on the back of its results.

Bad press

The small mountain of bad press that’s surrounded Rio Tinto lately likely isn’t helping its recover from its bad month on the ASX.

As the Motley Fool Australia covered recently, it has been reported that the company’s $1.4 billion cost blowout at the Oyu Tolgoi mine was caused by mismanagement rather than challenging conditions, as Rio Tinto claimed.

Additionally, Rio Tinto’s name has come up at the Western Australian parliamentary inquiry into sexual harassment against women in the FIFO mining industry. Those interested can read Rio Tinto’s submission to the inquiry here.

Finally, Rio Tinto is also in the headlines as, according to the Australian Financial Review, its planned lithium mine in Serbia has sparked protests in the European nation

Rio Tinto share price snapshot

Rio Tinto’s poor month on the ASX has seen it back into the long-term red.

Right now, its share price is about 2% lower than it was at the start of 2021. However, it’s still about 15% higher than it was this time last year.

The post August hasn’t been a great month for the Rio Tinto (ASX:RIO) share price appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Affirm Holdings‘ (NASDAQ: AFRM) stock hit an all-time high after it announced a partnership with Amazon (NASDAQ: AMZN) on Aug. 27. Amazon is integrating Affirm’s “buy now, pay later” (BNPL) network into its marketplace. The new payment option will enable its shoppers to split purchases of $50 or more into smaller monthly payments. Amazon has already tested out Affirm’s service with select customers and plans to broaden its reach over the next few months.

That’s good news for Affirm, which already serves big customers like Walmart and Peloton, and it’s another vote of confidence for the BNPL market which has been growing in the shadow of traditional credit card companies. Let’s see why Amazon partnered with Affirm, how the deal could benefit both companies, and whether or not Affirm’s recent rally is worth chasing.

Cutting credit card companies out of the loop

Every time a shopper uses a credit card, the retailer pays a “swipe fee” of about 1% to 3%. The credit card company keeps most of the fee while the issuing bank and payment processor split the rest.

To avoid that fee, some retailers refuse to accept credit card payments. Others only accept credit cards with lower swipe fees while larger retailers often issue their own private label payment cards.

However, processing payments without credit card networks can be a difficult task. That’s why most retailers that issue private label cards work with automated clearing houses which charge much lower fees than credit card companies but take a longer time to process payments.

That’s where digital payment companies and BNPL services come in. Digital payment companies like PayPal (NASDAQ: PYPL) and Square (NYSE: SQ) charge merchants flat fees for processing all their card-based payments, regardless of the brand or issuing bank, as a simpler solution.

PayPal and Afterpay (OTC: AFTP.F) (which Square plans to acquire) also provide BNPL options that enable shoppers to split their payments into interest-free payments without using a credit card. That’s why it makes sense for Amazon, which relies heavily on credit card payments and didn’t offer any BNPL options yet, to team up with Affirm.

Is this a win-win deal for Amazon and Affirm?

Bank of America expects the market for BNPL apps to expand 10-15 times by 2025, with more retailers using the services to avoid swipe fees and more shoppers using them to avoid high interest fees.

Partnering with Affirm could help Amazon reduce the operating expenses at its retail business, which operates at much lower margins than its cloud business, and attract more shoppers. Amazon’s decentralized rival Shopify also recently partnered with Affirm to roll out BNPL services.

Affirm has already grown like a weed since its founding in 2012. Its revenue rose 93% to $509.5 million in fiscal 2020, which ended last June, and is expected to grow 64% to $834.5 million in fiscal 2021 when it posts its full-year earnings report on Sept. 9.

Affirm ended the third quarter of 2021 with 5.4 million active consumers, up 60% from a year ago. Its transactions per active customer rose 10% to 2.3. In addition, the number of active merchants more than doubled to nearly 12,000.

Analysts expect Affirm’s revenue to rise 38% to $1.15 billion next year, but those estimates haven’t factored in its partnership with Amazon yet. Amazon serves more than 300 million active customers worldwide, so Affirm’s revenue could soar as Amazon rolls out the feature for more shoppers.

However, Amazon and Affirm didn’t disclose if shoppers using Affirm’s BNPL service would pay any interest fees. PayPal’s “Pay in 4” and Afterpay both offer four interest-free payments to all consumers, but Affirm’s interest fees vary based on the retailer and the consumer’s credit score.

If Affirm waived its interest fees to work with Amazon, it might be sacrificing its margins to grow its market share and boost its brand recognition.

Is it the right time to buy Affirm?

Affirm isn’t profitable yet and its stock was already richly valued at over 20 times this year’s sales prior to its deal with Amazon. As of this writing, the stock trades at nearly 30 times this year’s sales.

Affirm’s high price-to-sales ratio might seem justified by its growth potential but investors should remember it’s not the only BNPL service in town. It’s still a nascent market and BNPL services integrated into major digital payment platforms like PayPal and Square could threaten Affirm’s stand-alone business model, which relies heavily on retail partnerships.

I personally prefer sticking with diversified fintech players like PayPal and Square to gain some exposure to the expanding BNPL market. However, investors with a bigger appetite for risk might still consider buying Affirm as a “pure play” on this high-growth niche in digital payments. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why is everyone talking about Affirm stock? appeared first on The Motley Fool Australia.

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• Why shares of Affirm Holdings were down over 16% in July
• Here’s why Affirm Holdings was up big on Monday

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Bank of America is an advertising partner of The Ascent, a Motley Fool company. Leo Sun owns shares of Amazon and Square. The Motley Fool owns shares of and recommends AFTERPAY T FPO, Affirm Holdings, Inc., Amazon, PayPal Holdings, Peloton Interactive, Shopify, and Square. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon, long January 2022 $75 calls on PayPal Holdings, long January 2023 $1,140 calls on Shopify, short January 2022 $1,940 calls on Amazon, and short January 2023 $1,160 calls on Shopify. The Motley Fool has a disclosure policy.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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