Author: therawinformant

The Bellevue Gold Ltd (ASX: BGL) share price is out of form on Thursday and is sinking lower again.

At the time of writing the gold-focused mineral exploration company’s shares are down 6% to $1.32.

This latest decline means the Bellevue Gold share price is now down over 11% since hitting a record high of $1.49 on Monday.

Why is the Bellevue Gold share price sinking lower?

Investors have been selling the company’s shares over the last few days after a meaningful pullback in the gold price.

This has been driven by news of a potentially effective COVID-19 vaccine being developed by Pfizer, which has given risk sentiment a boost and put pressure on safe haven assets.

The impact has been so great that it has overshadowed a positive update by the company this week in relation to its resource estimate at its Bellevue Gold Project in Western Australia.

According to the release, the company’s drilling activities have resulted in its indicated resource increasing by 20% to 1.04 million ounces of gold at 11.4 grams per tonne.

Management believes the increased estimate will further strengthen the baseline economic study now underway on the project, providing scope for longer mine life, an increased production profile, and stronger financial returns.

Bellevue Gold’s Managing Director, Steve Parsons, commented: “This is an outstanding result which demonstrates the exceptional quality of the mineralised system at Bellevue. To have an Indicated Resource of this size and this grade and with such immense scope for further increases highlights the underlying strength of the project.”

Is this a buying opportunity?

One broker that believes the recent weakness in the Bellevue Gold share price is a buying opportunity is Macquarie Group Ltd (ASX: MQG).

This morning its analysts have responded to its updated resource estimate by retaining their outperform rating and lifting the price target on the company’s shares to $1.55.

This price target implies potential upside of over 17% for its shares over the next 12 months.

More reading

• Bellevue Gold’s (ASX:BGL) share price leaps 9% to new record highs
• RED 5 (ASX:RED) share price in focus as gold production nears
• Why the Bellevue (ASX:BGL) share price is dropping lower

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Dubber Corp Ltd (ASX: DUB) share price is surging today. Dubber shares are up 2.93% at the time of writing to $1.58, after closing at $1.51 yesterday and opening at $1.55 this morning.

Even though 2.93% is a hefty one-day gain by any means, Dubber shares were actually doing much better earlier in the day. The Dubber share price climbed as high as $1.64 soon after market open (a rise of nearly 6% and a new 52-week high) before settling at the current share price soon after. For comparison, the S&P/ASX 200 Index (ASX: XJO) is down 0.25% at the time of writing.

So why is this ASX tech share defying the broader market today and climbing high?

Share purchase plan swamped

Today, we got news from Dubber that its share purchase plan (SPP) has been successful – extremely successful, it seems.

In an ASX release to the market this morning, Dubber told investors that it has received over $33 million in applications for the SPP, well over the targeted $6 million initially flagged.

As a result, the company will reportedly endeavour to accept $10 million in applications by scaling back its acceptance of SPP offers. This will result in the issuance of just over 9 million shares.

The initial Dubber retail SPP closed on Friday 6 November and involved the opportunity for ‘eligible shareholders’ in Australia and New Zealand to apply for up to $30,000 worth of new shares each at the price of $1.10 a share.

A preceding SPP for institutional investors also took place last month, which raised another $35 million.

What else has been moving the Dubber share price?

It’s also worth noting that this cloud data company has had a very busy week, and indeed month – in fact, the Dubber share price is up almost 45% over the past month alone.

Last week, Dubber announced that the company had been selected as the recording and data capture platform for big blue itself, IBM (NYSE: IBM). IBM has launched a new service, the IBM Cloud for Telecommunication Services platform, and Dubber is playing a central role.

IBM is a behemoth company with a market capitalisation of ~US$104 billion, so this is obviously big news for the $378 million-sized Dubber. The Dubber share price shot up 8% on the news.

That was on top of the announcement last month that Dubber has launched an artificial intelligence solution for Microsoft Teams, owned by Microsoft Corporation (NASDAQ: MSFT), which sent Dubber shares up 16%.

More reading

• Why are ASX tech shares all over the place today?
• Here’s how ASX investors have reacted to a Biden win
• Why the Aristocrat (ASX:ALL) share price could jump next week
• The Hipages (ASX:HPG) share price jumped 16% after its IPO
• ASX 200 down 0.1%: Xero hits record high, Telstra and Wesfarmers updates impress

Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of IBM. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Microsoft and recommends the following options: long January 2021 $85 calls on Microsoft and short January 2021 $115 calls on Microsoft. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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On Wednesday I looked at three ASX shares that brokers have given buy ratings to this week.

Unfortunately, not all shares are in favour with them right now. Three ASX shares that have just been given sell ratings by brokers are listed below.

Here’s why these brokers are bearish on them:

Commonwealth Bank of Australia (ASX: CBA)

According to a note out of the Macquarie equities desk, its analysts have retained their underperform rating but lifted the price target on this banking giant’s shares to $65.00. This follows the release of Commonwealth Bank’s first quarter update. While Macquarie found things to like in the update, it has concerns over the impact of low interest rates and competitive pressures on its future performance. In light of this, it doesn’t believe its shares offer value for money at the current level. The Commonwealth Bank share price is trading at $72.99 this afternoon.

Computershare Limited (ASX: CPU)

Analysts at Citi have retained their sell rating and $12.00 price target on this share registry company’s shares following the release of its annual general meeting update. Although the broker acknowledges that Computershare has had a better than expected start to FY 2021, it isn’t overly convinced that its outperformance will continue in the second half. Furthermore, it doesn’t believe the company will benefit as greatly from US delinquent mortgage servicing in the coming years. This led to the broker downgrading its future earnings estimates accordingly. The Computershare share price is changing hands for $13.78 on Thursday.

Domino’s Pizza Enterprises Ltd (ASX: DMP)

Another note out of the Macquarie equities desk reveals that its analysts have downgraded this pizza chain operator’s shares to an underperform rating with a reduced price target of $72.10. The broker made the move in response to the prospect of an effective vaccine being released in the near future. It believes this will lead to consumer behaviour returning to normal in 2021, which could bring an end to Domino’s elevated sales. The Domino’s share price is trading at $78.23 today.

More reading

• Why the Aristocrat (ASX:ALL) share price could jump next week
• Is the Commonwealth Bank (ASX:CBA) share price in the buy zone?
• ASX 200 surges again on Wednesday
• Commonwealth Bank (ASX:CBA) share price higher on Q1 and loan deferral update
• ASX 200 up 1.3%: CBA Q1 update, tech shares rebound, JB Hi-Fi sinks

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Domino’s Pizza Enterprises Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) is cooling off today. After 5 straight days of shares in the green, the ASX 200 is down 0.7% to 6,405 points at the time of writing.

However, one sector, in particular, is bucking this broad-market trend, if a little inconsistently. ASX tech shares spiked in early morning trade this morning. Note the S&P/ASX All Technology Index (ASX: XTX). It’s up 0.81% at the time of writing, outperforming the ASX 200 handily. But soon after market open this morning, it was as high as 2,740 points – a 2.7% spike from yesterday’s close.

Let’s dig a little deeper.

When most investors think of ‘ASX tech shares’, they probably jump to the WAAAX shares – the collective name for some of the ASX’s highest-flying tech companies. WAAAX stands for WiseTech Global Ltd (ASX: WTC), Altium Limited (ASX: ALU), Appen Ltd (ASX: APX), Afterpay Ltd (ASX: APT) and Xero Limited (ASX: XRO). All of these companies have made investors a lot of money in recent years. All 5 are up more than 500% over the past 5 years, with a couple (Afterpay and Appen), up more than 2,000%.

WAAAX on for ASX tech shares?

So this morning, Xero hit a new all-time high of $130.95 after jumping almost 5%. The catalyst? Xero released a strong half-year update that was evidently well-received by investors. The update included the relevation that Xero managed to grow its revenue by 23% over the period, and subscribers by 19%. Xero shares have since cooled from these highs, and are trading up 0.93% at $123.85 at the time of writing.

Afterpay shares, however, are having a much more consistent day in the green. Afterpay is up 3.94% to $99.82 at the time of writing, after making a new all-time high of its own earlier this week ($105.80).

Appen shares are also having a pretty nice day of it – up 1.99% to $33.89. That stands in contrast to Altium, which is down 0.7% to $37.10. Unlike most ASX tech shares, Altium is still way off it’s 52-week high that it recorded in February, just before the coronavirus-induced market crash in March. WiseTech Global shares were also missing out on the fun for most of today. After initially spiking all the way up to $32.79 this morning, WiseTech dropped down 0.34% to $32.04. It has since rallied slightly to $32.32 at the time of writing.

Looking outside the WAAAX sphere though, and we see other ASX tech shares making moves as well. Dubber Corp Ltd (ASX: DUB) shares are still very much in positive territory, up 2.93% from open to $1.58 a share at the time of writing. Dubber was as high as $1.64 ealier in the day, but is still very much in the green.

It’s hard to say what’s causing these erratic moves, but it might be a case of ASX tech investors getting FOMO with some shares, or just a rising tech tide trying to lift all boats, with varying degrees of success.

More reading

• Here’s how ASX investors have reacted to a Biden win
• Why the Aristocrat (ASX:ALL) share price could jump next week
• The Hipages (ASX:HPG) share price jumped 16% after its IPO
• ASX 200 down 0.1%: Xero hits record high, Telstra and Wesfarmers updates impress
• Best and worst ASX retail stocks to own in the COVID recovery

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Xero. The Motley Fool Australia owns shares of AFTERPAY T FPO, Appen Ltd, and WiseTech Global. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Nitro Software Ltd (ASX: NTO) shares are trading higher today following its presentation at the JMP Securities small-cap technology forum. At the time of writing, the Nitro share price is trading up 5.56% at $3.04.

First half FY20 results and highlights 

The presentation highlighted the company’s first half results for FY20 which included a 60% increase in revenue to $19.1 million. Annual recurring revenue increased 57% to $20.2 million.

Nitro’s financial performance for the half was able to meet or beat its prospectus forecasts. Its cash balance closed $8.7 million ahead of its prospectus plan of $35.2 million, which provides substantial resources to support working capital requirements and growth, including acquisitions. 

About Nitro 

Nitro is a document productivity software company focused on streamlining the most critical and widely used documents by businesses. The company listed on the ASX on 11 December 2019. The Nitro share price of $3.04 at the time of writing which is more than 100% higher than its initial public offering (IPO) offer price of $1.72 per share. 

Its products include Nitro Pro which addresses common PDF productivity bottlenecks by enabling every worker with the tools to create, edit, convert, sign and secure PDF files. Nitro Sign is a simple, intuitive eSignature product backed by enterprise-grade security and supported by any tablet, desktop or mobile device. It also possess analytics and consulting services to support businesses in their Nitro migration and understanding of its value proposition. The company currently has more than 2 million licensed users across 11,000 business customers. 

Business strategy and outlook 

An independently-assessed combined PDF productivity and eSigning serviceable market was identified to be worth at least US$5.5 billion. The industry is likely to experience continued tailwinds on the back of remote work and digitisation. 

The consumers of Nitro services are largely enterprises that generate predictable and expanding revenues. Based on Nitro licenses purchased by customers, 68% were Fortune 500 companies including GE, Exxon Mobil, BP and Caterpillar. 

Looking ahead, the company reaffirmed its FY20 prospectus revenue forecast of $40.5 million and raises its ARR forecast to $26-27 million from $24.4 million. Nitro is a loss-making company and expects an earnings before interest, tax, depreciation and amortisation (EBITDA) loss of $8.1-8.6 million for FY20, in line with its forecasts.  

More reading

• Nitro Software (ASX:NTO) share price drops lower despite strong Q3 growth
• 5 ASX tech shares that could be the next WAAAX stocks

Motley Fool contributor Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Nitro Software Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Last week’s US presidential elections have resulted in a win for Democratic candidate Joe Biden. Mr. Biden was, of course, running against the incumbent Republican President Donald Trump. After an initially unclear election result, Biden was declared the eventual winner on Sunday (our time), and has since assumed the title of ‘President-elect’.

How has the market reacted to this news? Very well, if the numbers are anything to go by.

Since 4 November (the date of the election in Australia), the S&P/ASX 200 Index (ASX: XJO) is up 6.1%. That’s pretty close to the long-term average the ASX 200 delivers in an entire year (according to State Street Global Advisors, the ASX 200 has returned an average of 7.53% per annum since 2001). And since Biden’s win was called, the ASX 200 is up 4.4%.

So clearly the US election was a major market-moving force. But how exactly have ASX investors really responded to the changing of the guard at the White House?

Reporting in the Australian Financial Review (AFR) this week answers that question.

Biden win leads investors to China… and cannabis

Cannabis and China: not a combination of words we see too often. But that’s where the AFR tells us investors are parking their money at the dawn of the Biden administration.

According to the AFR article, analysis of trading activity on poplar brokering platform Stake over the past week or so has come up with some interesting results. Chief amongst those is that investors are suddenly far more bullish on Chinese companies (at least those listed in the US).

Stake lists Chinese electric car maker Nio Inc (NYSE: NIO) as the most popular share its investors have been buying in the wake of Biden’s win. That displaces long-running favourite Tesla Inc (NASDAQ: TSLA).

It also notes that other Chinese companies like e-commerce giant Alibaba Group Holding Ltd (NYSE: BABA) and electric vehicle company Xpeng Motors (NYSE: XPEV) were also in Stake investors’ ‘top 5’ shares.

Why China? Well, according to the AFR article, investors are likely to be “reacting positively to a potential end to the so-called trade war and the Trump administration’s tough stance on China.”

Stake investors were also giving the green light to cannabis stocks. Canadian marijuana company Aurora Cannabis Inc (NYSE: ACB) was reportedly the second-most popular share on Stake in the wake of Biden’s win, after multiple US states also legalised recreational cannabis in last week’s elections. According to the AFR article, Biden’s attitude towards the sector is also much more lenient than Trump’s.

It will be interesting to see whether these trends hold up over the coming weeks and months, or if this surge in interest in cannabis and Chinese companies is more of a flash in the pan.

More reading

• Why the Aristocrat (ASX:ALL) share price could jump next week
• The Hipages (ASX:HPG) share price jumped 16% after its IPO
• ASX 200 down 0.1%: Xero hits record high, Telstra and Wesfarmers updates impress
• Best and worst ASX retail stocks to own in the COVID recovery
• The Soul Patts (ASX:SOL) share price just hit a 52-week high

Sebastian Bowen owns shares of Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alibaba Group Holding Ltd. and Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Even as the market seems to be losing its puff, the Aristocrat Leisure Limited (ASX: ALL) share price could be poised to rally next week.

The S&P/ASX 200 Index (Index:^AXJO) gave up morning gains and slipped 0.2% during lunch time trade.

The benchmark is up by nearly 9% since the start of the month thanks to news of a potential COVID‐19 vaccine and a Joe Biden US presidency.

Is a market correction looming?

But some experts believe the bounce is an overreaction. The vaccine candidate from Pfizer, as promising as it is, still has some ways to go before it’s available to the general public.

President-elect Biden is also going to face an uphill battle to control the pandemic and execute on his economic agenda.

While experts will continue to debate whether the golden run for COVID beneficiaries like the Afterpay Ltd (ASX: APT) share price and Domino’s Pizza Enterprises Ltd. (ASX: DMP) share price is coming to an end, the stock investors should be watching is Aristocrat.

Why the Aristocrat share price can outperform

The gaming machine maker is set to report its full year results next Wednesday. And if brokers are right, the Aristocrat share price could be set to rally further.

Morgans believes the group’s outlook will give investors something to celebrate over and it reiterated its “add” recommendation on Aristocrat.

“The company’s 2H20 result will have been heavily impacted by COVID-19 but we expect ALL to exit the current environment in a stronger position than competitors,” said Morgans.

“And given an expected sharp deleveraging over the next few years, we see scope for further debt funded acquisitions.”

Is Aristocrat’s weakest business set to recover?

Social distancing and lockdowns to control the spread of COVID have impacted on casinos and gaming venues. These are customers of Aristocrat.

Even then, there are reasons to be optimistic. UBS noted that Aristocrat contributes 28% of net win for casino-owned games despite still having fewer machines than its rivals on the floor.

While that’s encouraging news, make no mistake that Aristocrat’s digital division is really the growth engine for the group.

Digital is the real driver for the ALL share price

“One key positive for the group to come out of COVID-19 has been the significant lift in demand for digital games,” added the Morgans.

“We expect ALL’s digital division to report ~24% (USD) revenue growth in FY20.”

UBS is also optimistic about digital gaming. It estimated that the industry grew by over 30% in the past month.

Why the Aristocrat share price is a “buy”

“For Aristocrat specifically, the digital division appears to be broadly holding share and we feel confident around the 1H21 consensus forecast for +16% growth,” said UBS.

“Looking at individual title performance, Evermerge is now Aristocrat’s second largest social gaming title (behind RAID) and continues to ramp.”

With digital powering ahead and land-based gaming turning the corner, now’s the time to be buying the stock. UBS’s rates the ALL share price as a “buy” with a price target of $34.25 a share.

Morgan’s target on the Aristocrat share price is $36.78 a share.

More reading

• The Hipages (ASX:HPG) share price jumped 16% after its IPO
• ASX 200 down 0.1%: Xero hits record high, Telstra and Wesfarmers updates impress
• Best and worst ASX retail stocks to own in the COVID recovery
• The Soul Patts (ASX:SOL) share price just hit a 52-week high
• 2 ASX healthcare shares that have risen since Pfizer’s vaccine news

Motley Fool contributor BrenLau owns shares of Aristocrat Leisure Ltd. Connect with me on Twitter @brenlau.

The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Domino’s Pizza Enterprises Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The hipages Group Holdings Limited (ASX: HPG) share price has had a mixed start to life as a listed company.

This morning the tech company’s shares landed on the ASX boards following the completion of its initial public offering (IPO) that raised $100.4 million at $2.45 per new share. This gave hipages a market capitalisation of approximately $318.5 million.

In early trade the hipages share price climbed as much as 16% to $2.85. However, it has since given back these gains and is currently trading flat at $2.45.

What is hipages?

hipages is a leading Australian-based online platform and software as a service (SaaS) provider that connects tradies with residential and commercial consumers. It currently has 36,000 tradies subscribed to the platform.

Based on the number of jobs posted, it is the leader in the on-demand tradie economy. The company notes that to date, over three million Australians have changed the way they find, hire, and manage trusted tradies with hipages.

The hipages IPO.

The company advised that its IPO received strong demand from a broad range of retail and institutional investors in Australia and New Zealand.

Its largest shareholder will be News Corporation (ASX: NWS) Australia, with a 25.7% interest. The media giant didn’t sell any shares under the offer and remains a committed and supportive strategic investor in hipages.

Approximately $40 million in gross proceeds was raised through the issue of new shares by the company. The net proceeds will be used to drive future growth through investment in its brand and technology platform, as well as its expansion into new channel and adjacent opportunities.

hipages Chair, Chris Knoblanche, commented: “Today marks an important step in our evolution with hipages well positioned to take advantage of powerful digital and community trends that will drive increased demand for our innovative solutions. We believe hipages has a significant role to play in improving the engagement of Australians with a wide range of trade services. My fellow directors and I are delighted to welcome our new shareholders to the register and thank existing shareholders for their ongoing support, as we embark on the next phase of our journey.”

hipages Co-Founder and CEO, Roby Sharon-Zipser, added: “With 1.4m jobs posted to our platform in FY2020, hipages is the leading online platform connecting consumers and tradies in Australia. Our listing today on the ASX represents an important milestone for hipages and its shareholders as it will enable us to entrench our sector leadership and drive further innovation that benefits both tradies and their customers.”

Outlook.

In its prospectus, hipages is forecasting FY 2021 total revenue of $53.9 million. This will be 15% higher than the prior year. Recurring revenue growth is expected to be 20%.

Pleasingly, the company has started the year strongly and is tracking ahead of its prospectus forecast.

During the first quarter of FY 2021, it delivered total revenue of $13 million, up 17% on the prior corresponding period. Recurring revenue grew 24% during the quarter.

Positively, management advised that October revenue growth has continued at similar levels.

More reading

• ASX 200 down 0.1%: Xero hits record high, Telstra and Wesfarmers updates impress
• Best and worst ASX retail stocks to own in the COVID recovery
• The Soul Patts (ASX:SOL) share price just hit a 52-week high
• 2 ASX healthcare shares that have risen since Pfizer’s vaccine news
• Brickworks (ASX:BKW) hasn’t cut its dividend for over 40 years

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Cleanspace Holdings Ltd (ASX: CSX) share price is storming higher today following a positive trading update.

Shares in the respiratory protection equipment provider jumped to as high as $6.80 in opening trade. While shares have since retreated, the Cleanspace share price is still up 12% to $6.50.

In comparison, the All Ordinaries Index (ASX: XAO) is 0.2% lower to 6,639 points.

Let’s take a closer look at what Cleanspace announced today.

Trading update

According to the release, CleanSpace advised that business performance remains strong across key geographical areas in healthcare and industrial sectors. Its product sales mix is 77% healthcare and 23% industrial, and the company reports that geographical sales are evenly split between North America, Europe, and Asia Pacific.

The United States healthcare market saw continued growth in its VA, Sutter and Parkview hospital groups. The company reported that new deployments to community health services and a large dental group also supported its direct sales model.

In Europe, the company has been busy providing personal protection equipment and offering healthcare services. This is due to the second wave of COVID-19 that has locked down the United Kingdom, Germany, France and Spain. Cleanspace built an industrial base in Europe, in which it sees attractive growth opportunities.

Across the Pacific, Australia and Singapore saw demand stabilise with purchases for protection considered for the long term. In Japan, Philippines and Indonesia, strong sales are continuing to flow.

Operations update

Cleanspace said it has set up production teams at its new facility, and remains on track to ramp up operations. It expects the facility to deliver over $100 million in capacity capabilities per year. In addition, Cleanspace noted that supply chains and outbound logistics are well positioned to respond to global demand.

Upgraded guidance

Up to the end of October, Cleanspace reports that sales have been robust and are tracking well ahead of expectations. The company upgraded its forecast for the first half of FY21 and anticipates revenue to be in the range of $34 million to $36 million.

Furthermore, earnings before interest, tax, depreciation and amortisation (EBITDA) for the full six months is predicted to be between $14 million and $16 million.

Consumable sales are currently 45% of total sales and are broadly in line with the previous year, and the current forecast.

What did management say?

Cleanspace executive director and CEO Mr Alex Birrell commented:

The upgrade in the forecast reflects work done to leverage our existing markets and expand the base with new customers. Deeper market penetration strengthens the business for a post COVID-19 environment and reinforces CleanSpace as best practice respiratory protection that offers significant benefits including higher protection, greater user comfort and cost effectiveness.

While Australia has managed to achieve no new COVID-19 cases and low community transmission, other regions are now experiencing second waves. A vaccine in the market will signal the return of growth in economic markets and industrial sectors where we have consistently seen 30%-40% growth, while the impacts of COVID-19 on hospitals has delivered a permanent change in mindset towards PPE, and protection of healthcare workers, in the hospital setting.

More reading

• Sky Network (ASX:SKT) share price shoots 6% higher on upgraded guidance
• Why the Immutep (ASX:IMM) share price flew up 5% this morning
• ASX 200 Weekly Wrap: US election special
• Why the Dubber (ASX:DUB) share price is soaring 8% today
• Why the Encounter Resources (ASX:ENR) share price is up today

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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National Tyre & Wheel Ltd (ASX: NTD) shares rocketed up after the company reported that its trading for the first four months of FY21 had exceeded expectations. The update at today’s annual general meeting (AGM) sent the National Tyre share price up by almost 15% to 86 cents in early trade. Shares are now trading at 85 cents, up 13.33%. 

Highlights from the AGM

National Tyre advised that earnings before interest, tax, depreciation and ammortisation (EBITDA) for the half year to 31 December 2020 is now expected to range between $11.5 million and $12.5 million.

The company said it expected the strong performance to continue in the second-half of FY21.

National Tyre shareholders were told that the tyre industry was proving resilient, despite COVID-19-related challenges. However, Asian suppliers have advised that import prices will rise by 1% to 3% over the coming months.

National Tyre also pointed to several short term tailwinds facing the company. These include adverse agricultural conditions, weak truck movements across the country, and the still-depressed domestic travel industry. The company said that consumer demand remained difficult to predict amid the uncertainty surrounding the pandemic.

A quick take on National Tyre

National Tyre distributes motor vehicle tyres, wheels, tubes and related products. It focuses on tyres and wheels that fit passenger cars, SUVs 4WDs, light commercial vehicles, caravans and trailers.

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Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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