The Nuix Ltd (ASX: NXL) share price is surging higher today. Its gains follow news that the Australian Securities and Investment Commission (ASIC) has finished part of its investigation into the company’s financial history after finding nothing to follow up on.
At the time of writing, the Nuix share price is $1.66, 9.93% higher than its previous close.
Though, that’s down from its early morning high of $1.65 – an 11.5% gain.
Let’s take a closer look at the news boosting Nuix’s stock higher.
Nuix share price launches on news of ASIC investigation
ASIC has finished flipping through Nuix’s financial statements for the 3 years prior to its landmark Initial Public Offering (IPO), concluding it will take no further action.
The news boosted the embattled Nuix share price after the company released a statement to the ASX this morning.
However, while the watchdog has put the software company’s financial statements for the periods ending 30 June 2018, 30 June 2019, 30 June 2020, and in relation to Nuix’s IPO prospectus to rest, its investigation hasn’t ended.
Nuix said it is continuing to cooperate with ASIC’s investigation into the company’s market disclosures since its much-anticipated float in December 2020.
A long road for Nuix
News of ASIC’s investigation first hit the market in mid-2021.
Then, the watchdog was also holding a microscope up to the company’s former chief financial officer and their family members on accusations of insider trading.
It followed immense drama that ultimately escalated to an Australian Federal Police probe into the software company’s co-founder. The AFP probe was reportedly looking at a $3,000 options package issued in 2005 which was cashed in for $80 million in 2020.
Additionally, as The Motley Fool Australia reported in September, the company has been the subject of 2 class actions. They claim its prospectus may have contained inflated figures and misleading forecasts.
After listing in December 2020, Nuix downgraded its financial year 2021 guidance in April 2021 and again in May 2021.
Macquarie Group Ltd (ASX: MQG) – a major Nuix shareholder and joint manager of its IPO – is said to have conducted a review into the company’s listing last year. Like ASIC’s investigation so far, it also found no shadows in the company’s books.
Nuix share price snapshot
The ongoing drama has taken a major toll on the Nuix share price.
It has fallen 82% over the last 12 months. It’s also currently trading for 68% less than its IPO offer price of $5.31 per share.
The post Off the hook: Here’s why the Nuix (ASX:NXL) share price is leaping 10% higher today appeared first on The Motley Fool Australia.
Should you invest $1,000 in Nuix right now?
Before you consider Nuix, 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 Nuix wasn’t one of them.
The online investing service he’s run for over 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 January 13th 2022
More reading
- Why Allkem, Nuix, Whitehaven Coal, and Zip shares are sinking today
- Nuix (ASX:NXL) share price crashes 11% amid another disappointing update
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 recommended Nuix Pty Ltd. The Motley Fool Australia has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
from The Motley Fool Australia https://ift.tt/NXJfZgk
Leave a Reply