Day: October 27, 2021

Imagion Biosystems (ASX:IBX) share price soars 13% on quarterly update

Photo of a group of Imagion scientists cheering while working in a lab.

The Imagion Biosystems Ltd (ASX: IBX) share price is taking off following the release of the company’s quarterly report.

Over the third quarter of the calendar year 2022, the company moved forward with its MagSense Study and entered a new joint development agreement.

The market has reacted favourably to all the company has achieved. At the time of writing, the Imagion share price is 7.6 cents, which is 13.43% higher than its previous close.

Let’s take a closer look at what the cancer imaging technology company has been up to over the 3 months ending 30 September.

The quarter just been for Imagion

The Imagion share price is surging on news the company has enrolled multiple patients in its MagSense HER2 Breast Cancer Phase I Study.

The study is looking to find if the company’s novel imaging agent, developed specifically for breast cancer patients who test positive for the Human Epidermal Growth Factor Receptor 2 (HER2), is safe for use.

The company signed one hospital on as a clinical site during the quarter, and another since its end. Four hospitals have now agreed to be involved in the study.

The company’s chair and CEO, Bob Proulx commented:  

As we see how the end of lock downs affects cancer screening, we will have a better indication over [quarter 4] as to the likely cadence of recruitment going forward.

Further, the company has partnered with Global Cancer Technology to develop its partner’s novel nanoscintillator technology. The technology aims to treat breast cancer and will utilise Imagion’s nanoparticle expertise.

Under the terms of their agreement, Global Cancer Technology will pay Imagion for research and development services. Meanwhile, Imagion will gain a holding in the product.

Finally, Imagion has used its grant from the CSIRO to fund the first round of animal studies for its MagSense prostate cancer imaging agent. Results of the animal studies are currently being analysed.

The company spent $2.2 million over the course of the quarter.

It stated its costs will probably increase in the near future as its MagSense clinical study gets up and running. Its costs will also likely grow as its development pipeline advances.

The company ended the quarter with $12 million of cash in the bank. That’s enough to fund another 5.5 quarters if its expenses remain the same.

Imagion share price snapshot

Today’s gains included, the Imagion share price has fallen 45% since the start of 2021. However, it is 8.5% higher than it was this time last year.

The post Imagion Biosystems (ASX:IBX) share price soars 13% on quarterly update appeared first on The Motley Fool Australia.

Should you invest $1,000 in Imagion Biosystems right now?

Before you consider Imagion Biosystems, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Imagion Biosystems wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

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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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Damstra (ASX:DTC) share price plummets 15% as COVID takes a toll

Side-on view of a fed-up man with his head on his laptop.

It’s been a rocky day so far for the Damstra Holdings Ltd (ASX: DTC) share price. Shares in the workplace management solutions company are falling after it posted its quarterly report for the first quarter of FY 2022.

At the time of writing, the Damstra share price is down 15% to 78.2 cents. For comparison, the S&P/ASX 200 Index (ASX: XJO) is down 0.46% to 7,414.7 points this afternoon.

Shareholders are applying selling pressure after the quarterly numbers came in below what had been hoped for. Let’s take a look.

Temporary challenges take a toll

Although Damstra reported growth for its operations in the first quarter, the numbers were below management’s expectations. Equally disappointed are shareholders, as reflected by the steep fall in the Damstra share price today.

According to the release, revenue increased by 20% year-on-year to $6.2 million in Q1. At face value, this seems like a respectable level of growth. However, management had previously guided for 32.5% to 40% revenue growth for the full year. This discrepancy between expectations and reality appears to have caught the market off guard.

Management stated the reason for the underperformance in revenue growth was due to “… the impact of COVID but also some client-specific activity in Q1”.

Firstly, COVID-19 resulted in lockdowns across New South Wales and Victoria. This led to client projects being delayed and a reduction in users in these areas. In turn, shareholders are selling down the Damstra share price today.

Secondly, the client-specific aspect involved the descoping of arrangements between Damstra and its client, Newmont. The gold mining company has decided to internalise hardware, access, and site control. This move had an estimated overall impact of $0.8 million to Damstra.

However, it’s not all bad news. Despite the hiccup in its trajectory, Damstra is confident accelerated growth will return as economies reopen. As such, construction verticals and its United States pipeline of opportunities look strong at this point.

Another positive line item is Damstra’s annual recurring revenue grew by 55% year-on-year to $29.3 million. Similarly, 9 new clients were added during the quarter, taking the total tally up to 733.

Damstra share price snapshot

Today’s fall in value adds to a downward trend that has been playing out over the past year. Unfortunately for shareholders, the Damstra share price is now down around 61% compared to this time last year.

Although the share price has been in decline, the company has maintained top-line growth during this time. At the end of June 2021, trailing 12-month (TTM) revenue was $27.05 million. This represents an increase of 38% compared to the TTM revenue reported at the end of June 2020.

The post Damstra (ASX:DTC) share price plummets 15% as COVID takes a toll appeared first on The Motley Fool Australia.

Should you invest $1,000 in Damstra Holdings right now?

Before you consider Damstra Holdings, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Damstra Holdings wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

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Motley Fool contributor Mitchell Lawler 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 Damstra Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Damstra Holdings 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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Here’s why the BHP (ASX:BHP) share price is down 13% so far in 2021

A sad BHP miner holds his head in his hands

The BHP Group Ltd (ASX: BHP) share price rose strongly up until mid-August before plummeting in the following months. The miner’s shares have continued to shed value as investors remain concerned about the iron ore market.

At the time of writing, the BHP share price is down 1.39% to $37.14 this afternoon. This means that over the course of the year, its shares have now dropped by 13.76%.

What’s happened to BHP?

The plunging spot price of iron ore has heavily impacted the miner’s shares.

In May, the steel-making ingredient reached an all-time high of US$229.50 per tonne. BHP shares accelerated on the back of bumper revenues over the period.

However, a slowdown in Chinese demand amid political pressure has led iron ore prices to tumble in recent months.

Currently, iron ore is fetching US$122.36, a drop of 25% since the beginning of 2021. Since the start of the new financial year on 1 July, iron ore prices have sunk 40%.

Chinese lawmakers have introduced new rules for its steel producers in an apparent effort to curb reliance on Australian iron ore and boost domestic supply and demand. Steel mills have been instructed to limit 2021 output to no more than 2020 levels, or face penalties.

China wants its steel industry to halt iron ore production at roughly 1 billion tonnes in 2021. Consequently, Chinese crude steel production has dropped 8% in July, 13% in August, and 12% in September.

To meet its goal, however, steel output will have to contract another 10% over the last 3 months of the year.

China has also increased its efforts to close down some domestic factories to achieve carbon reduction targets. In addition, the country is seeking alternative resources to maintain production.

Macquarie has cut its price target for the BHP share price by 3.6% to $54. Analysts at Morgans have slightly raised their rating by 1.9% to a bearish $46.05.

Based on the current BHP share price, this implies an upside of 45% and 24%, respectively.

BHP share price summary

Over the past 12 months, the BHP share price has moved in circles to post a sub-7% gain.

BHP commands a market capitalisation of roughly $111.10 billion, making it the third most valuable company on the ASX.

The post Here’s why the BHP (ASX:BHP) share price is down 13% so far in 2021 appeared first on The Motley Fool Australia.

Should you invest $1,000 in BHP right now?

Before you consider BHP, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and BHP wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

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. 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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Telstra (ASX:TLS) share price struggles amid energy deal news

person on old-fashion telephone, surprised person

The Telstra Corporation Ltd (ASX: TLS) share price is in focus today after it was reported that the telco may have walked away from a potential deal.

What is Telstra not going to try to buy?

It is being reported by The Australian that Telstra was in the running to possibly buy the Australian assets of Meridian Energy Ltd (ASX: MEZ). The telco was supposedly really interested in the retail energy division on the business, called Powershop Australia.

Telstra has been talking about expanding in the energy space for some time because of the synergies that it would create to allow it to be a large utilities player, not just a telco.

Why did the telco decide not to proceed?

Businesses don’t typically make announcements for why they didn’t do something. But The Australian referenced the deal that Telstra just made for Digicel.

Companies don’t have endless amounts of capital to make acquisitions, and Telstra has signalled it is trying to ensure its balance sheet is strong.

Digicel acquisition

Earlier this week, Telstra announced that it has partnered with the Australian government to acquire the Digicel business in the South Pacific region for US$1.6 billion, plus up to an additional US$250 million subject to business performance over the next three years. The Telstra share price has risen around 5% since this was announced.

This business will be owned and operated by Telstra. The telco is only contributing US$270 million of the equity of the overall US$1.6 billion purchase price. The Australian Government is providing the rest of the money needed through a combination of non-recourse debt facilities and equity-like securities. Telstra will own 100% of the ordinary equity.

Telstra believes that Digicel is a commercially attractive asset and critical to telecommunications in the region. The Australian Government is supposedly “strongly committed” to supporting quality private sector investment infrastructure in the Pacific region.

The telco explained that it has a “strong” market position in the South Pacific region, holding a number one position in all markets other than Fiji where it is number two.

Digicel generated earnings before interest, tax, depreciation and amortisation (EBITDA) of US$233 million in the year to 31 March 2021, with a “strong” margin. Around 76% of its revenue is generated from its mobiles business, which is largely prepaid, and the balance is from business solutions, TV and broadband services.

It was noted that Digicel has already invested significant capital into PNG, which is its largest market, to achieve extensive market coverage. Including 4G to 55% of the population.

Management believe that Digicel will deliver an attractive internal rate of return and exceeds all of Telstra’s acquisition criteria including adding to earnings per share (EPS) and being better than a share buyback.

The transaction implies a multiple of FY21 EBITDA of between 5.8x to 6.9x.

Telstra said that whilst the transaction will not distract from Telstra’s T22 or T25 strategies, it is a unique commercial opportunity and will improve its outlook.

The telco concluded its announcement by saying the financial arrangements make it very attractive for Telstra, and it strengthens its relationships with the Australian Government and the Pacific region.

The post Telstra (ASX:TLS) share price struggles amid energy deal news appeared first on The Motley Fool Australia.

Should you invest $1,000 in Telstra right now?

Before you consider Telstra, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Telstra wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

Motley Fool contributor Tristan Harrison 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 owns shares of and has recommended Telstra Corporation 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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