Author: therawinformant

Small cap ASX shares typically do not move in tandem with the general market. This is due to the market’s size, liquidity and the standalone nature of its speculative businesses. Despite the S&P/ASX 200 Index (ASX: XJO) nosediving in the latter half of October, many small cap ASX shares continued to deliver eyewatering returns. Here are the best performing small cap ASX shares this month. 

1. E2 Metals Ltd (ASX: E2M) 

The E2 Metals share price spiked 200% in October after exceptional gold and silver drill results at its Mia prospect, Conserrat project, located in the Santa Cruz province of Argentina. Moving forward, the company has planned for further drilling to better define the structural context and controls on mineralisation. 

2. Pioneer Credit Ltd (ASX: PNC) 

Pioneer Credit is a financial services provider involved in acquiring and servicing unsecured retail debt portfolios. The company was involved in a controversial trading halt late 2019 after being in breach of debt and other covenants due to its accounting methods. This involved financiers acquiring the company’s debt and new replacement debt facilities coming into play to save the company. 

This month’s quarterly update highlighted what could be the beginning of a recovery story with the company highlighting a successful refinance and improved market conditions. The Pioneer Credit share price has increased 135% in October. 

3. Kleos Space SA (ASX: KSS) 

Kleos is a space-powered Radio Frequency Reconnaissance data-as-a-service (DaaS) company to clients in the defence, commercial and regulatory sectors. The Kleos Space share price increased 142% this month following a series of announcements regarding satellite contracts and launches.

On 22 October, the company announced the signing of four satellites for the Polar Vigilance Mission to increase its global coverage and broaden revenue opportunities. And on October 29, the company announced the final preparations before the launch of its scouting mission satellites scheduled for 7 November. The satellites will collect data over crucial areas of interest such as the Strait of Normuz, South China Sea, East/West Africa, Southern Sea of Japan and Northern Australian coast.  

4. Weebit Nano Ltd (ASX: WBT) 

The Weebit Nano share price has cooled off in recent days after delivering a peak return of almost 200% in October. The company develops next generation memory technology and plans to become a key player in this market. Weebit focuses on producing Resistive Random-Access-Memory (ReRAM) technology that is 1000 times faster and uses 1000 times less power than flash. 

Its shares have attracted significant trading volumes in the last three months which is likely to assist in its share price outperformance. The company’s quarterly update was also significant with highlights including a key productisation milestone, progressing embedded memory module development, filing three new patents and progressing discussions with potential production partners and customers. 

More reading

• These were the 5 best performing ASX shares last week
• ASX 200 Weekly Wrap: ASX 200 has another shocker as US election approaches
• 5 things to watch on the ASX 200 on Monday
• These were the worst performing shares on the ASX 200 in October
• Is it time to buy ASX gold shares?

Motley Fool contributor Lina Lim 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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Every Monday I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.

This is because I believe it is well worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.

With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:

• Webjet Limited (ASX: WEB) has seen its short interest reduce slightly to 14.3%, but not enough to stop it from being the most shorted ASX share. Short sellers have been going after the online travel booking company due to concerns over its valuation and rising COVID-19 levels globally. The latter could potentially push back the global travel market recovery.
• Speedcast International Ltd (ASX: SDA) has short interest of 10.6%. The communications satellite technology provider’s shares remain suspended whilst it undertakes a recapitalisation. Speedcast shares have been suspended since February.
• InvoCare Limited (ASX: IVC) has short interest of 9.8%, which is down slightly week on week. The funerals company has come under pressure this year after COVID-related restrictions impacted the industry.
• Mesoblast Limited (ASX: MSB) has seen its short interest rise again to 9.5%. The key driver of this rise has been the US FDA not approving its remestemcel-L application for steroid-refractory acute graft versus host disease (SR-aGVHD). Mesoblast does have another meeting coming up with the regulator, but short sellers don’t appear to believe it will come to anything.
• Myer Holdings Ltd (ASX: MYR) has seen its short interest rebound to 9.5%. Last week the department store operator’s chairman bowed to pressure and retired ahead of its annual general meeting. In FY 2020, Myer posted a statutory loss of $172.4 million.
• Inghams Group Ltd (ASX: ING) has 8.7% of its shares held short, which is up slightly week on week. Short sellers don’t appear confident the worst is behind this poultry company. In FY 2020 it reported a 68.2% drop in net profit to $40.1 million.
• Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest remains flat at 8%. Concerns over rising COVID-19 cases globally are weighing on sentiment in the travel sector.
• Galaxy Resources Limited (ASX: GXY) has seen its short interest fall to 7.9%. An oversupply of lithium and subdued demand have attracted short sellers to this battery materials producer.
• Metcash Limited (ASX: MTS) has seen its short interest rise to 7.5%. Short sellers are going after the wholesale distributor despite favourable trading conditions in the supermarkets and home improvement channels.
• CLINUVEL Pharmaceuticals Limited (ASX: CUV) has seen its short interest slide to 7.4%. Last week the biopharmaceutical company posted first quarter cash receipts of $12 million. This was an increase of 22.8% on the prior corresponding period.

More reading

• These were the worst performing shares on the ASX 200 in October
• These were the worst performing shares on the ASX 200 last week
• 5 ASX 200 broker updates after quarterly earnings season
• Could this finally save the Myer (ASX:MYR) share price?
• Are ASX retail investors ‘dumb money’?

Motley Fool contributor James Mickleboro owns shares of Galaxy Resources Limited. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited and InvoCare 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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It was a month to forget for the Megaport Ltd (ASX: MP1) share price in October.

The elastic interconnection services provider’s shares were well and truly out of form last month and recorded a 16.3% decline.

Why did the Megaport share price crash lower?

The Megaport share price came under pressure last month for a couple of reasons.

The first was general weakness in the tech sector late on in the month that weighed on the likes of Megaport and Zip Co Ltd (ASX: Z1P).

The other catalyst for this decline was the company’s first quarter update.

It appears as though investors were disappointed with Megaport’s slower than normal revenue growth during the quarter.

For the three months ended 30 September, the company recorded revenue of $17.3 million, up 2% since the end of the previous quarter. This led to its monthly recurring revenues (MRR) also increasing 2% quarter on quarter to $5.8 million.

Management advised that its growth would have been stronger if the Australian dollar hadn’t appreciated as much as it did. This adversely impacted its MRR by $0.2 million and its total revenue by $0.3 million.

In addition to this, slower net customer and port additions in the fourth quarter of FY 2020 also had a negative impact on its performance.

What about the future?

The good news is that the company did report strong growth in port numbers during the quarter. Megaport posted a 10% quarter on quarter increase in Total Ports to 6,333.

As this is a leading indicator for growth, it is likely to bode well for its second quarter performance.

Another positive is that its CEO, Vincent English, revealed that the company is still aiming to become breakeven in FY 2021.

He commented: “Profitability remains a company-wide priority. We are focused on achieving EBITDA breakeven on an exit run-rate basis by the close of Fiscal Year 2021 by driving further customer growth across all regions.”

“With our SDN reaching over 700 enabled data centres across 24 countries, we are well positioned to capture the demand for elastic interconnection to support the ever-increasing surge of data powered by the digital economy,” he concluded.

Should you buy the dip?

I think last month’s weakness in the Megaport share price could be a buying opportunity for long-term focused investors.

Due to its leadership position in a market that looks set to benefit greatly from the cloud computing boom, I believe the future is very bright for Megaport.

More reading

• ASX 200 Weekly Wrap: ASX 200 has another shocker as US election approaches
• These were the worst performing shares on the ASX 200 last week
• ASX 200 flat: ResMed smashes expectations, AMP surges on takeover talks
• Sezzle (ASX:SZL) share price charges higher on Q3 update
• Are ASX retail investors ‘dumb money’?

James Mickleboro 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 MEGAPORT FPO. The Motley Fool Australia has recommended MEGAPORT FPO. 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) presented a challenging market in October, with the index wiping much of its monthly gains in the latter half of the month. Quarterly reporting season allowed many ASX 200 tech shares to continue their share price momentum following strong updates.

Here are the 3 best-performing ASX 200 tech shares in October. 

1. Link Administration Holdings Ltd (ASX: LNK) 

The Link share price increased 27% in October, driven by the non-binding indicative proposal the company received from Pacific Equity Partners. The offer would acquire 100% of the shares in Link Group at an indicative cash price of $5.20 per share. 

The current view from Link is that the proposal materially undermines the company and is not in the best interests of the shareholders. The company views itself as possessing leading positions in the markets in which it operates in, making early progress in its transformation plan and an expected recovery in market-driven revenue as economic activity improves. While no hard decision has been made, there is no certainty that such a proposal will eventuate. 

2. Dicker Data Ltd (ASX: DDR) 

The Dicker Data share price soared 23% following a strong quarterly update for the quarter ended 30 September. The update outlined a 14.9% increase in total revenue, year-to-date (YTD), to $1,481.5 million and a 28.3% increase in net profit before tax YTD to $60.8 million. The company highlighted it had been experiencing over and above forecasted revenue growth rates in the first half of the year, off the back of a significant mobilisation to remote working solutions. It sees growth stabilising for the second half of the year to expected levels. 

Looking ahead, the greatest opportunity for Dicker Data over the next quarter is supporting businesses with their return-to-work strategies and business continuity plans in a post-COVID-19 environment. It also commented it has experienced increased quoting activity and the resumption of larger infrastructure projects that were previously put on hold. 

The company also points to the rollout of 5G connectivity as a “tremendous opportunity” with all its hardware and software vendors. Furthermore, the company also intends to develop and invest in a new distribution centre at Captain Cook Drive, Kurnell NSW. The new distribution centre represents an increase in capacity of almost 80%. The large-scale expansion will pave the way for substantial inventory growth and technology portfolio diversification to meet the emerging needs of the Australian market. 

3. Hub24 Ltd (ASX: HUB) 

The Hub24 share price has been relentless, with a 250% run since its March lows and a 28% increase in October. From a fundamental perspective, the company continues to go from strength to strength, with a strong quarterly update and strategic acquisitions announced in October. 

The company posted a record September quarter, with $19 billion funds under administration (FUA), up 32% on the prior corresponding period. The company experienced strong inflows driven by new and existing licensee channels across self-licensed and boutique advisers, brokers and large national accounts. Even with its significant FUA, HUB24 only has a 2.1% market share in the investment and superannuation administration sector, so still has much room to grow.

On 28 October, the company announced three strategic transactions and a $60 million capital raising. These transactions included: 

• The proposed acquisition of investment platform provider Xplore Wealth Ltd (ASX: XPL) for $60 million
• The acquisition of Ord Minnett’s non-custody Portfolio Administration and Reporting Service for $10.5 million upfront cash consideration 
• Proposed subscription for new shares in Easton Investment Ltd (ASX: EAS) of $14 million which will result in a shareholding of up to 40% of Easton. 

More reading

• These were the best performing shares on the ASX 200 in October
• 5 ASX 200 broker updates after quarterly earnings season
• ASX 200 sinks 1.6%, ANZ (ASX:ANZ) reports FY20 result
• Xplore Wealth share price surged to a 2-year high today on M&A fever
• ASX 200 down 1.1%: ANZ cash earnings down 42%, SEEK slammed, HUB24 jumps

Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Hub24 Ltd and Link Administration Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Dicker Data Limited. The Motley Fool Australia has recommended Hub24 Ltd and Link Administration Holdings Ltd. 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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Later this week the Reserve Bank of Australia is widely expected to cut the cash rate to a new record low of 0.1% or even 0%.

Unfortunately, I think it could be a long time until interest rates move higher from here, let alone back to normal levels again.

In light of this, I continue to believe that income investors would be better off sticking with dividend shares instead of term deposits or savings accounts.

But which dividend shares should you buy? Two top dividend shares I would buy are listed below. Here’s why I like them in the current low interest rate environment:

Commonwealth Bank of Australia (ASX: CBA)

Rather than put money in its savings accounts, I think investors should be buying its shares. Although the pandemic is certainly hitting the bank hard, it is reassuring to see that the number of loans on deferral continue to reduce. I believe this is a sign that the provisions it has made will be sufficient.

In light of this and the relaxing of responsible lending rules, I believe Commonwealth Bank’s outlook is improving greatly. So with its shares still down over 24% from their 52-week high, I think now could be an opportune time to invest with a long term view.

Finally, estimating what dividend the bank will pay in FY 2021 is difficult because of the pandemic. However, based on the current Commonwealth Bank share price, I would expect a fully franked yield in the region of 4% over the next 12 months.

National Storage REIT (ASX: NSR)

Another ASX dividend share I would buy is National Storage. It is a leading self-storage operator which I believe has a very positive long term growth outlook. This is thanks to its organic and inorganic growth opportunities. The latter is through its growth through acquisition strategy which has been very effective over the last few years.

Pleasingly, management has persisted with this strategy even during the pandemic. Last week at its annual general meeting, National Storage revealed that it has completed eight acquisitions totalling $139 million in FY 2021. Management also advised that its forward-looking acquisition pipeline remains strong.

Another positive from its annual general meeting was that its occupancy levels are increasing. It advised that in excess of 60,000 square metres of occupancy has been added since 1 July, which is the equivalent of 12 full centres.

Finally, management reaffirmed its underlying earnings per share guidance of 7.7 cents to 8.3 cents per security. Based on this, its dividend policy, and the latest National Storage share price, I estimate that its shares offer a 4.2% yield.

More reading

• ASX 200 Weekly Wrap: ASX 200 has another shocker as US election approaches
• 3 ASX blue chip shares to buy for dividends
• Forget savings accounts and buy these ASX dividend shares instead
• RBA will cut rates Tuesday, say 67% of experts
• CBA (ASX:CBA) busted raising credit limit for problem gambler

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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Australia’s third biggest energy company by market cap, Origin Energy Ltd (ASX: ORG), has lost more than half its value this year, with the share price slumping 52% year to date (YTD).

The dismal performance of Origin Energy’s share price is largely in line with the broader energy sector’s performance, in which the ASX 200 Energy Sector Index (ASX: XEJ) has lost more than 45% YTD.

Australia’s other two biggest energy companies have also done miserably in 2020, with Woodside Petroleum Limited (ASX: WPL) falling by 49% YTD, and Santos Ltd (ASX: STO) slumping by 42%.  

What’s dropping the Origin Energy share price?

Needless to say, Origin Energy has been a casualty of the big slump in demand for energy this year as the coronavirus pandemic stopped the world dead in its tracks.

As a commodity producer, Origin Energy is a price taker and therefore its earnings closely track the price of Brent crude oil, which has fallen to under US$40 from nearly US$70 a barrel at the start of 2020.

Understanding Origin Energy’s business

Before deciding to buy shares in a company, it’s imperative that you as an investor have a basic understanding about what the company does, and how it makes money. Only then will you get a sense of the risk of the investment you are about to make.

Let’s take a look at Origin’s Energy’s business model.

Origin Energy has two main revenue sources – Australian energy retail, and liquified natural gas (LNG) export.

In the retail business, Origin Energy is one of three energy retailers in Australia controlling 80% of the market. The other two being Energy Australia and AGL Energy Limited (ASX: AGL).

The retail business is relatively stable where each of the three players essentially owns similar percentages in market share. The retail energy market in Australia is also highly regulated, so significant future growth from this segment might be unlikely.

Origin Energy’s LNG business on the other hand, is a volatile yet potentially highly lucrative business. It owns 37.5% stake in a company called Australia Pacific LNG (APLNG), which is a major liquefied natural gas exporter in Queensland. 

APLNG has a contract in place to export 8.6 million metric tons per year to Asian customers for the next 20 years, with the price linked to the volatile Brent crude oil price.

Can Origin Energy recover from the slump?

On Friday 30 October, the company announced that its FY21 first-quarter revenue from its stake in the APLNG project fell 46%, as a result of lower prices for its oil and gas exports.

This demonstrates that the key to the Origin Energy share price recovery will need to come from a recovery in the oil price to pre-COVID-19 levels.

There’s some bad news, however. A group of 10 investment banks in the US recently polled by The Wall Street Journal forecast that Brent crude oil price will only average $53.50 a barrel by the end of 2021 – far below the pre-COVID levels.

The decision on whether or not to invest in Origin Energy, at least in the short term, comes down to a call on the movement in the oil price. The Origin Energy share price is trading up 0.5% to $4.02 at the time of writing.

More reading

• The Amaysim (ASX:AYS) share price has rocketed up today. Here’s why.
• ASX 200 Weekly Wrap: ASX 200 has another shocker as US election approaches
• 5 things to watch on the ASX 200 on Monday
• Top ASX shares to buy in November 2020
• How La Nina will create unexpected ASX stock winners and losers

Motley Fool contributor has no positions 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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There was a lot of movement among ASX shares last week, even though the S&P/ASX 200 Index (ASX: XJO) ended up down by 3.8% by Friday.

Much of this movement was due to 2 large takeovers within 4 days of each other. However, there were other reasons for individual shares performing well. 

Top moving ASX shares

Takeovers

The best performing ASX share of the week went to Coca-Cola Amatil Ltd (ASX: CCL). Its share price rose by 15.6% in response to a takeover bid by Coca-Cola European Partners PLC (NYSE: CCEP). The share blasted up by 15.63%, most of which occurred in the first trades on Monday. The deal gives the company an enterprise value of $10.8 billion and is unanimously supported by the board.

AMP Limited (ASX: AMP) was next in line with a jump across the week of 12.92%. This was due to another high value takeover bid of a large cap ASX share. In this case from US private equity firm Ares Management Corp Class A (NYSE: ARES). While there is a lot of speculation about the AMP bid, at this stage it is less advanced than that of Coca-Cola Amatil. 

Performance increases

Blackmores Limited (ASX: BKL) saw its share price jump up by 12.29% last week. This was due to a combination of a divestment, and forecast performance improvement. The company announced it would sell its Global Therapeutics business to McPherson’s Limited (ASX: MCP) in a deal worth $27 million. Global Therapeutics is the market leader in Chinese herbal medicine in Australia. Moreover, the company expects to generate a growth in profits over FY21.

Canadian iron ore miner Champion Iron Ltd (ASX: CIA) saw its ASX share price rise by 10.89% over the week. This was due to solid second quarter results. The company produced record revenue, earnings before interest and taxes, net cash flow, and net income. This was due largely to the increases in iron ore prices. In fact, the ASX share saw its average sales price increase by 13.4% on the prior corresponding period. The company is also continuing with its Phase II expansion, and modifications to the train loadout. 

Resmed CDI (ASX: RMD) was the fifth best performing ASX share, closing the week up by 8.47%. Resmed saw its share price rise by 9.45% on Friday alone after the release of the company’s Q1FY21 results. In comparison to the previous corresponding period, the company saw revenues increase by 10%, net operating profit increased by 27%, with a gross margin of 58.3%. In USA and Europe this was due to an increase in demand for ventilators.

More reading

• 6 major events for ASX shares this week
• ASX 200 Weekly Wrap: ASX 200 has another shocker as US election approaches
• 5 things to watch on the ASX 200 on Monday
• Top brokers name 3 ASX shares to sell next week
• These were the worst performing shares on the ASX 200 in October

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Blackmores Limited. The Motley Fool Australia has recommended ResMed Inc. 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 Afterpay Ltd (ASX: APT) share price was among the best performers on the S&P/ASX 200 Index (ASX: XJO) in October.

The payments company overcame weakness in the tech sector to storm a remarkable 21% higher.

Here are three reasons Afterpay smashed the market:

Partnership with Westpac.

Last month Afterpay announced a surprise partnership with banking giant Westpac Banking Corp (ASX: WBC). The agreement will see the introduction of Afterpay savings accounts and cash flow tools for customers in Australia. The company advised that the new money management services will be facilitated by Westpac’s new digital bank-as-a-service platform. It will allow Afterpay to provide Westpac transaction and savings accounts and other cashflow management tools to its millions of customers in Australia from the second quarter of 2021.

Underlying sales continue to grow at a rapid rate.

Another key driver of its share price outperformance was the release of its first quarter update, which revealed that its underlying sales are still growing rapidly. For the three months ended 30 September, Afterpay reported a 115% increase in underlying sales to a record of $4.1 billion. This was driven by a 229% increase in US underlying sales to $1.6 billion, a 346% jump in UK underlying sales to $0.3 billion, and a 63% lift in Australian underlying sales to $2.2 billion. This was underpinned by a 98% increase in active customers to 11.2 million.

Bullish broker note.

Finally, also giving the Afterpay share price a boost last month was a broker note out of Bell Potter. According to the note from 15 October, the broker has retained its buy rating and lifted its target price on the company’s shares to $121.00. Bell Potter made the move after looking into its US in-store rollout. This in-store solution means shoppers in the US can use Afterpay to purchase items in select retail stores using their Afterpay card. This is a virtual card stored in the digital wallets of Apple and Android devices.

More reading

• 6 major events for ASX shares this week
• ASX 200 Weekly Wrap: ASX 200 has another shocker as US election approaches
• Westpac (ASX:WBC) posts 62% cash earnings decline in FY 2020
• 3 ASX blue chip shares to buy for dividends
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of AFTERPAY T FPO. 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 Amaysim Australia Ltd (ASX: AYS) share price has rocketed up 10.45% to 74 cents today. This follows the company’s announcement this morning of an deal to sell its mobile business to Optus.

Second major asset sale in 2 months

On 31 August Amaysim announced it was selling its subscription energy business, Click Energy, to AGL Energy Limited (ASX: AGL) for $115 million.

The final net proceeds from this sale were $51.9 million. That figure is after the company repaid $53.1 million of bank debt and transaction costs.

Today’s announcement regards the sale of Amaysim’s remaining operations, its mobile business, to Optus Mobile Pty Limited for a cash consideration of $250 million.

What’s in it for Amaysim’s shareholders?

The company estimates somewhere between $207–$226 million will be distributed to shareholders. That includes the final net proceeds from the sale of its Click Energy business. This would represent 67–73 cents per share.

Amaysim expects there will be additional value from franking credits, up to around 11 cents per share, attached to “certain components of the distribution”.

Amaysim CEO Peter O’Connell said:

We are delighted to announce the proposed sale of Amaysim’s mobile business to our long-term strategic wholesale partner, Optus. Amaysim has a first-class team that cares for its customers, which Optus has recognised through this acquisition. We believe Optus, with its deep knowledge of our operations, is well-placed to look after our customers and staff and take the growth of the business to the next level. 

What’s next for Amaysim shares?

The sale of Amaysim’s mobile business remains conditional on shareholder approval. The company expects to hold an extraordinary general meeting in January 2021. It states that the sale to Optus is not subject to any additional due diligence of financing conditions. The sale agreement has received all needed regulatory ticks of approval.

If shareholders vote to approve the sale, amaysim will offer transitional services to Optus for a 3-month period. Following that period, amaysim would then begin de-listing from the ASX and winding up.

Amaysim’s board is unanimous in recommending shareholders vote for the sale of its mobile business, barring a superior proposal.

The Amaysim share price closed at 67 cents yesterday and is up 10.45% at 74 cents in early trade today.

More reading

• Should you turn down AGL’s (ASX:AGL) 7% dividend yield?
• Top brokers name 3 ASX shares to sell next week

Motley Fool contributor Bernd Struben 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 past week was very eventful for ASX shares with news of surprise takeovers of AMP Limited (ASX: AMP) and Coca-Cola Amatil Ltd (ASX: CCL). Moreover, annual general meeting (AGM) season continued with meetings for heavyweights like Carsales.Com Ltd (ASX: CAR) and JB Hi-Fi Limited (ASX: JBH).

This week, the theme of takeovers is likely to continue. In addition, there will be a series of AGMs, some of which may prove contentious. All times mentioned are eastern standard time. 

Major events planned for ASX shares

Monday

New listing:

Monday will see Dusk Group Limited (ASX: DSK) list for the first time. This company is the candle retailer you may have run into in the local malls. An omni-channel consumer discretionary company, it has reportedly completed a $70 million deal at $2 a share. The IPO will value Dusk at 10.1 times earnings for the year to 30 September. This is the equivalent of $124.5 million in terms of market capitalisation.

This comes on the heels of Adore Beauty Group Ltd (ASX: ABY) and, more successfully, Zebit Inc CDI (ASX: ZBT)’s recent listings.

Westpac annual report:

This morning, Westpac Banking Corp (ASX: WBC) released its annual report, posting a 66% decline in statutory net profit to $2,290 million, which was largely in line with expectations. Analysts at Goldman Sachs, for example, were expecting Westpac to deliver a 63% decline in cash earnings. The bank also included additional charges for AUSTRAC matters. Additionally, a write down associated with Westpac Life Insurance Services Ltd, and an increase in provisions for refunds and litigation. 

The Westpac share price slid by 4.9% across last week’s trading, but is up by 0.34% so far this morning as the market digests the results.

Reports on the economy:

At 11.30 am the Australian Bureau of Statistics (ABS) will release the building approvals and the housing finance reports. At the same time Australia and New Zealand Banking GrpLtd (ASX: ANZ) will release the ANZ job ads report. These three reports will provide investors with a view into the domestic economy. In particular, there has been a lot of interest in the housing market since the lockdowns started. This is likely to impact ASX shares. 

Wednesday

At 9 am, small cap ASX share, Evans Dixon Ltd (ASX: ED1) will hold its AGM. While only a small company, it is likely to be a contentious event. Evans Dixon is currently being targeted for takeover by 360 Capital Group Ltd (ASX: TGP). 360 Capital managing director Tony Pitt recently manoeuvred the company to purchase 19.9% of Evans Dixon from company co-founder Alan Dixon. 

Tony was then elected with unanimous support to the board of Evans Dixon, subsequently dropping an unsolicited takeover bid into their laps on 22 October. As of last Friday, the board had withdrawn support for him. In addition, it has recommended shareholders do not support his election to the board, declaring in a statement: “The directors believe that his appointment would put him in a position of conflict between his obligations to 360 Capital Group and his obligations as a director to the company.”

Thursday

At 9 am Ansell Limited (ASX: ANN) will hold its AGM, with detail behind Q1 performance and FY21 guidance. Last Friday, the personal protective equipment company company upgraded its FY21 guidance for earnings per share from $1.26–$1.38 to $1.35–$1.45. This is due largely to better than expected sales across all of its 5 strategic business units. The healthcare ASX share will also provide further detail on the progress of expansion capex spending, which it believes is proceeding to plan.

Friday

Macquarie Group Ltd (ASX: MQG) will present an interim result on Friday. In a recent presentation, Macquarie included its Q1 results, which showed that the profit contribution from the company’s annuity-style businesses was slightly up versus the prior corresponding period (pcp). Its market-facing businesses were slightly down versus pcp.

The rise in  from the annuities businesses was largely due to the sale of the company’s rail operating lease business. In the market-facing businesses, Macquarie Capital saw investment-related income reduce significantly.

Macquarie Group has also been making headlines due to its stake in Barrenjoey investment bank. The interim update may also include further information on this issue. 

More reading

• 3 reasons the Afterpay (ASX:APT) share price smashed the market in October
• ASX 200 Weekly Wrap: ASX 200 has another shocker as US election approaches
• Westpac (ASX:WBC) posts 62% cash earnings decline in FY 2020
• 3 ASX blue chip shares to buy for dividends
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia has recommended Ansell Ltd. and carsales.com 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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