Category: Stock Market

ASX dividend shares that provide a good dividend yield and a high level of reliability could be excellent investments for people about to enter retirement. However, some ASX shares aren’t very consistent.

There is plenty to like about the large ASX iron ore shares of BHP Group Ltd (ASX: BHP), Rio Tinto Ltd (ASX: RIO) and Fortescue Ltd (ASX: FMG). These companies are increasing their exposure to decarbonisation and usually offer high dividend yields. Nonetheless, their payouts can bounce around significantly depending on what’s happening with the iron ore price.

Hence, I’d rather invest in ASX dividend shares that can provide more consistent payouts, which is why I like the ones below.

GQG Partners Inc (ASX: GQG)

GQG is one of the largest listed fund managers. It’s based in the US and has four main investment strategies – US shares, international shares, global shares and emerging markets.

Impressively, all of its main strategies have outperformed their respective benchmarks since inception. This level of performance organically helps the funds under management (FUM) grow and is an appealing selling point to attract more client FUM.

In its monthly update for April 2024, the company revealed net inflows of US$6.3 billion for 2024 to date, helping bring its FUM to US$142 billion.

The ASX dividend share has committed to a dividend payout ratio of 90% of distributable earnings. FUM growth is a significant input and driver of revenue and earnings, so FUM growth is integral to GQG’s success.

At December 2023, the business had US$120.6 billion of FUM and it had grown over 17% to US$142 billion, suggesting further dividend growth over the 12 months. The estimates on Commsec suggest an annual dividend yield of over 7% for 2024 and more than 8% for 2025.

Woolworths Group Ltd (ASX: WOW)

Woolworths is the biggest retailer of food in Australia, with its national supermarket network. It also owns BIG W, a majority stake in PETstock, a food distribution business, and other smaller companies.

Food is obviously one of the most vital purchases a household makes. Therefore, the ASX dividend share has very defensive earnings, which we saw during 2020 and 2021 as Australia grappled with COVID-19.

Australia’s population continues to grow, which is a useful tailwind for increasing overall food demand.

In the most recent quarterly update, the FY24 third quarter, Woolworths reported total sales growth of 2.8% despite 0.7% deflation in the supermarkets of shelf prices (excluding tobacco). I think this shows the ability of the business to keep growing even in tougher conditions.

Woolworths increased its annual dividend in FY23 and grew the FY24 half-year payout by 2.2%.

According to the estimate on Commsec, Woolworths is projected to pay a grossed-up dividend yield of around 5% in FY24.

The post About to retire? I’d buy these ASX dividend shares for income appeared first on The Motley Fool Australia.

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• 3 reasons this broker thinks Woolworths shares are a cheap buy

Motley Fool contributor Tristan Harrison has positions in Fortescue. 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 Scott Phillips.

The big news in shares vs. property is Brisbane overtaking Canberra as Australia’s second-most expensive city, with the median home value in the Sunshine State’s capital rising 1.4% last month.

The last time Brisbane was the second highest-value capital city in Australia was 27 years ago, in 1997.

The national median home value, which reflects all types of property in a single data point, rose for a 16th month, up 0.8%, according to CoreLogic data. The median house and apartment prices lifted 0.8% as well.

Meantime, the S&P/ASX 200 Index (ASX: XJO) rose 0.49%, thus recovering only a sliver of its 3% loss in April. But as usual, some stocks shot the lights out, including an ASX biotech that screamed 20.6% higher.

CoreLogic research director Tim Lawless said the May increase in the median home value was the strongest monthly gain since October 2023.

A lack of stock for sale in the strongest markets, which continue to be the mid-sized capital cities, once again powered the national benchmark increase.

Lawless commented:

The number of properties available for sale in Perth and Adelaide remain more than -40% below the five-year average for this time of the year while Brisbane listings are -34% below average.

Inventory levels in these markets remain well below average despite vendor activity lifting relative to this time last year.

Fresh listings are being absorbed rapidly by market demand, keeping stock levels low and upwards pressure on prices.

Perth, Adelaide and Brisbane recorded the highest home value growth in May at 2%, 1.8%, and 1.4%, respectively.

Among the regional markets, regional Western Australia dominated with 1.8% growth, followed by regional South Australia with 1.4%, and regional Queensland with 1.1%.

Shares vs. property price growth in May

Here’s how shares vs. property performed in terms of house price growth and share price growth in May.

Property market	Median house price	Price growth in April	12-month price growth
Sydney	$1,441,957	0.5%	8.2%
Melbourne	$937,289	0%	1.9%
Brisbane	$937,479	1.4%	16%
Adelaide	$811,059	1.7%	14.3%
Perth	$769,691	2%	22.2%
Hobart	$697,770	(0.5%)	(0.1%)
Darwin	$584,538	0.7%	3.8%
Canberra	$961,403	0.5%	2.8%
Regional New South Wales	$762,506	0.4%	4.2%
Regional Victoria	$603,432	(0.3%)	(0.6%)
Regional Queensland	$634,988	1%	11.7%
Regional South Australia	$430,389	1.5%	10.7%
Regional Western Australia	$519,311	1.8%	15.2%
Regional Tasmania	$534,801	0.1%	0.1%
Regional Northern Territory	$450,431	0%	(6.1%)

Top 5 risers of the ASX 200 in April

The S&P/ASX 200 Index (ASX: XJO) lifted 0.49% in May.

According to CommSec data, these 5 ASX 200 shares were the outperformers.

ASX 200 share	Share price growth in May
Telix Pharmaceuticals Ltd (ASX: TLX)	20.6%
PEXA Group Ltd (ASX: PXA)	19.3%
Alumina Ltd (ASX: AWC)	16.6%
Pinnacle Investment Management Group Ltd (ASX: PNI)	16.3%
A2 Milk Company Ltd (ASX: A2M)	16.1%

What drove the Telix Pharmaceuticals share price higher?

News released by Telix Pharmaceuticals on the final day of the month pushed the biotech share to the top of the ASX 200 group. The Telix Pharmaceuticals share price soared 15.31% on 31 May alone.

Telix is a commercial-stage biopharmaceutical company. It develops diagnostic and therapeutic products to treat cancer with new precision using targeted radiation.

Its diagnostic imaging can precisely locate the cancer. Its therapeutics can then deliver isotopes directly to affected cells, thereby protecting healthy tissue.

On 31 May, the company announced additional positive data from its ProstACT SELECT trial of TLX591.

TLX591 is a treatment for adult men with PSMA-positive metastatic castrate-resistant prostate cancer.

Telix said the study reported a median radiographic progression-free survival (rPFS) of 8.8 months.

This builds on prior data from the trial showing a favourable safety profile and biodistribution.

Dr Nat Lenzo, a nuclear oncologist and lead recruiter for the SELECT trial, said:

We are encouraged by this rPFS result …

This is a compelling signal of the potential efficacy of TLX591 in this heavily pre-treated population.

The results further support the development of this candidate in an earlier mCRPC patient population which is the focus of the ProstACT GLOBAL7 Phase III trial and where there remains significant unmet need for effective treatment.

Telix shares also rose by 2.53% on 22 May when the company held its annual general meeting.

In a speech, Telix Chair Kevin McCann said:

Despite all that we have achieved, there is plenty more to come. Indeed, it is the view of Management that 2024 is going to be the biggest year yet for Telix.

By the end of the year, we expect to have launched new products and territories, reported several key development milestones for our therapy programs and progressed some of our very exciting “next generation” assets – such as TLX592 and TLX300.

The post How ASX shares vs. property performed in May appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• What a pay rise for 2.6 million Aussies could mean for ASX shares
• Sell in May and go away? Not for these top 3 ASX 200 stocks!
• Up 80% in 2024, here’s why the Telix Pharmaceuticals share price is marching higher again on Monday
• Should you buy this defensive ASX 200 stock on a pullback?

Motley Fool contributor Bronwyn Allen has positions in Alumina. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended PEXA Group, Pinnacle Investment Management Group, and Telix Pharmaceuticals. The Motley Fool Australia has positions in and has recommended Pinnacle Investment Management Group. The Motley Fool Australia has recommended A2 Milk and Telix Pharmaceuticals. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Galileo Mining Ltd (ASX: GAL) share price was a very strong performer on Monday.

The small-cap mineral exploration company’s shares ended the day 12% higher after announcing a deal with ASX 200 mining giant Mineral Resources Ltd (ASX: MIN).

Why has it signed a deal with this ASX 200 mining stock?

According to the release, Galileo Mining has entered into a farm-in and joint venture agreement (JVA) with Mineral Resources.

Under the agreement, the company will sell 30% of all lithium rights held by Galileo on the Norseman tenement to Mineral Resources for a $7.5 million cash consideration.

The release notes that Mineral Resources has already completed comprehensive due diligence prior to execution. As a result, there are no conditions precedent to completion of the transaction with the ASX 200 mining stock and the deal is expected to close within five business days of the execution of the JVA.

From completion, Mineral Resources and Galileo will form a 30%/70% unincorporated joint venture. However, Mineral Resources has the ability to increase its stake to 55% by sole funding an additional $15 million of exploration expenditure on the tenements over the four years following completion.

The ASX 200 mining stock also has the further ability to elect to increase its stake to 70% by sole funding expenditure through to a decision to mine. At that point, Galileo Mining must elect to either remain in a joint venture and contribute to development costs or convert its interest into a royalty.

‘Excited’

Galileo’s managing director, Brad Underwood, was very pleased with the deal. He commented:

We are excited to add a lithium exploration joint venture to our ongoing exploration programs for PGEs and nickel at our Norseman Project. The Norseman project has excellent lithium potential and is strategically located in the world’s most prospective region for lithium. The project’s outstanding location relative to existing infrastructure provides a short cut to development for any lithium resources discovered through the joint venture.

Galileo will benefit from a focussed program of lithium exploration by MinRes, one of Australia’s pre-eminent lithium companies, as well as increasing our cash reserves to aggressively pursue other high value resource discoveries at both our Norseman and Fraser Range projects. With $5 million of additional funding to be received within five days of execution of the agreement, a further $2.5 million to be received within 12 months, and $10 million in the bank, Galileo is fully funded to undertake all of its planned exploration programs.

The post Mineral Resources is joining forces with this micro-cap lithium share appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro 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 Scott Phillips.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

More reading

• The worst three performing ASX 200 shares in May unmasked
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Motley Fool contributor Sebastian Bowen 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 positions in and has recommended Amcor Plc. The Motley Fool Australia has recommended Challenger and Orora. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It was only a few days ago that we learned that Gina Rinehart retained her spot as Australia’s richest person for 2024. With a fortune worth over $40 billion, Rinehart saw her wealth rise a healthy 8.5% since the 2023 rich list was released. So it goes without saying that investors are going to be paying close attention to any ASX shares (usually ASX mining shares) that Rinehart might be buying or selling.

We’ve documented a few of Rinehart’s ASX mining shares in recent years, including Azure Minerals Ltd (ASX: AZS) here and Titan Minerals Ltd (ASX: TTM) here.

But today, let’s talk about Vulcan Energy Resources Ltd (ASX: VUL).

Rinehart’s interest in this lithium stock first emerged back in 2021. Rinehart’s Hancock Prospecting also took a big stake in Vulcan’s $120 million capital raising program that year.

It appears Rinehart is doubling down on this ASX mining share this week.

Rinehart buying up ASX mining share

According to an ASX filing released this morning, Vulcan confirmed that a number of institutional investors have just made a large investment in the company. This was done via a private share placement program.

The filing states that CIMIC Group, Victor Smorgon Group and Hancock Prospecting have all been issued with additional Vulcan shares. CIMIC made a 25 million euro investment and was issued with 10 million shares as a result. Victor Smorgon invested 2.5 million Euros and was awarded 1 million shares.

Hancock came right in the middle, investing 12.5 million Euros ($20.41 million) and receiving 5 million shares for its efforts.

These investments were executed at a price of 2.50 Euros per share, or $4.08. That’s reportedly a 9% discount to Vulcan’s 30-day volume weighted average price as of last Friday.

Collectively, they have raised 40 million Euros (approximately $65 million) for Vulcan.

Vulcan stated the following in light of these cash injections:

The Investments demonstrate commitment from strategic investors to support the lithium value chain globally and the construction of Phase One of Vulcan’s integrated renewable energy and ZERO CARBON LITHIUM Project (the Project) in Germany…

These strategic Investments will materially contribute to the funding of pre-execution activities during the final stage of Project financing and protection of the Project’s deterministic execution schedule.

Specifically in relation to Hancock Prospecting, Vulcan expanded:

HPPL [Hancock Prospecting Pty Ltd] is Australia’s most successful private company and has maintained a significant shareholding in Vulcan since January 2021. Through its [12.5 million Euro] Investment, HPPL has increased its substantial shareholding to ~7.5% of the outstanding share capital of Vulcan. HPPL will become Vulcan’s second largest shareholder…

HPPL and Vulcan have shared a supportive, long-term relationship, with HPPL maintaining a top-5 shareholding position in the Company since January 2021. Today’s investment builds upon this, with HPPL increasing their ownership to ~7.5% of Vulcan’s issued capital. Vulcan welcomes HPPL’s increased investment and looks forward to a further continuation of the strong partnership between the two companies.

Investors lap up Hancock’s buy

It’s clear that the markets approve of this announcement from Vulcan today. The Vulcan Energy Resources share price closed at $4.74 last Friday afternoon and opened at $4.62 this morning. But at market close today, those same shares finished trading at $5.08, up 7.17% for the day.

That puts this ASX mining share up a huge 80.78% in 2024 to date. Vulcan is also up 34.75% over the past 12 months.

However, Rinehart might still be underwater from some of Hancock’s 2021 investments in the company. Back in 2021, Vulcan shares got as high as $16 each. As such, some long-term investors would remain down on their investments at the current share price.

The post Which ASX mining share did Gina Rinehart inject another $20 million into? appeared first on The Motley Fool Australia.

More reading

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Motley Fool contributor Sebastian Bowen 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 Scott Phillips.

Guzman y Gomez (GYG) is planning to become an ASX business by the end of the month, through an initial public offering (IPO).

GYG sells Mexican-inspired, made-to-order food across drive-through restaurants and outlets on shopping strips, food courts and universities. The quick-service restaurant (QSR) has been thinking about an IPO for years and it is finally making the jump.

GYG aims for $2.2 billion valuation

The company is aiming to raise approximately A$242.5 million in the ASX IPO, by selling 11.1 GYG shares at a price of $22 per share. This includes existing shareholders selling $42.5 million of shares during the process.

Guzman y Gomez plans to use the $200 million of primary proceeds to fund its growth strategy over the coming years, with a focus on the “significant expansion” of its corporate restaurant network in Australia. The funds will provide flexibility to accelerate its growth strategy if “appropriate opportunities arise”.

If GYG is successful with its ASX IPO, the offer price will value the company at approximately $2.2 billion.

There is no offer for the general public. However, GYG shares are available to institutional investors, clients of some brokers, other eligible GYG shareholders and certain investors, eligible employees of GYG in Australia and eligible franchisees. The general public can buy GYG shares on the market once shares are trading later in June.

GYG has received “considerable support” and demand from existing shareholders including Aware Super, Cooper Investors, Hyperion Asset Management, Firetrail Investments and QVG Capital.

According to Guzman y Gomez, the board, senior management and existing substantial investors will own 62% of the business after the ASX IPO.

The offer is reportedly fully underwritten by Barrenjoey and Morgan Stanley Australia.

GYG shares are expected to start trading on 20 June 2024, initially on a conditional and deferred settlement basis under the ticker ‘GYG’.

Guzman y Gomez’s plans for growth

The business opened its first restaurant in Sydney in 2006, and it now has 210 restaurants across four countries, with 185 restaurants in Australia, 16 in Singapore, five in Japan and four in the US.

GYG expects to open 30 new Australian restaurants in FY25 and believes it can increase this to opening 40 restaurants per year within five years. GYG thinks it can grow its Australian network to more than 1,000 restaurants over the next two or so decades.

Of Guzman y Gomez’s 185 Australian restaurants, 62 are corporate restaurants and 123 are franchise restaurants. The Singapore and Japan restaurants are owned and operated by separate master franchisees, while the four in the US are corporate restaurants.

Between FY15 and FY23, GYG’s global network sales have increased from $101 million to $759 million. The Mexican food business is expecting global sales of $1.14 billion in FY25 thanks to “strong comparable sales growth and ongoing network expansion.”

It’s expecting to improve the guest experience and leverage the benefits of scale to enable its underlying/pro forma earnings before interest, tax, depreciation and amortisation (EBITDA) to grow from $29.3 million in FY23 to $59.9 million in FY25.

Management believes there is a large growth opportunity in the US fast food market, but it will adjust the pace of restaurant expansion to ensure “robust restaurant economics”. All four of its US stores are in the suburbs of Chicago.

GYG said the health and profitability of its franchisees are “fundamental.” According to GYG, its Australian franchisee return on investment is 51%.

Management comments

The GYG founder and co-CEO Steven Marks said:

Over the last 18 years, the team at GYG have been obsessed with providing our guests with the freshest, cleanest and fastest made-to-order Mexican-inspired food. I am incredibly proud to say that we now do this across more than 200 restaurants in Australia, Singapore, Japan and the US. And the most exciting part is that we are just getting started.

As we commence the next chapter as an ASX-listed company, our vision to reinvent fast food and change the way the masses eat will remain central to what we do. We truly believe that fast food doesn’t have to be bad food and we look forward to sharing our food with more guests across Australia and overseas as we look to realise the opportunity we have to grow our network to more than 1,000 restaurants over the next 20+ years.

What next for the potential GYG shares?

The Guzman y Gomez ASX IPO offer opens on 10 June 2024, and GYG shares are expected to start trading on 20 June 2024 on a conditional and deferred settlement basis. Normal trading is expected on 25 June 2024.

The post Guzman y Gomez (GYG) is set for an ASX IPO. Here’s what we already know appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
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• Here’s why the Newmont share price is making big ASX news today
• The worst three performing ASX 200 shares in May unmasked
• Guess which ASX All Ords stock is leaping 10% on a $1.3 billion bid

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 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 Scott Phillips.

It’s a big day for ASX gold share Newmont Corporation (ASX: NEM) this Monday. Not that you’d know it from looking at the Newmont share price right now.

This gold miner is having a decent, if uninspiring, session so far this Monday. At the time of writing, Newmont shares are up 0.1% at $62.51 each. That’s a gain of a fraction of the size of the S&P/ASX 200 Index (ASX: XJO)’s lift of 0.81%.

But that’s not why it’s a big day for Newmont shares, if that isn’t obvious. No, today is the day that Newmont stock has traded ex-dividend for its upcoming quarterly shareholder dividend payment.

Because Newmont is a US-domiciled company with its ASX shares only a secondary listing, it adheres to an American-style dividend policy. That means its dividends come without franking credits, but are paid out every three months. That’s instead of the six-month interval that is common on the ASX.

The latest dividend from Newmont will be worth 25 US cents per share (worth around 38 cents at today’s exchange rates). It will be doled out later this month on 27 June. This dividend will come in right between Newmont’s previous two ASX payments. These were worth 41.6 cents (paid out in December) and 26.5 cents per share (March) respectively.

However, as we warned last week, today is the day that Newmont has traded ex-dividend for this upcoming payment. This means that anyone who didn’t own Newmont shares as of market close on Friday is now ineligible to receive this dividend. So even if you buy Newmont stock today, you’ll miss out on this latest payment. Instead, you’ll have to wait until the company’s next dividend is declared to receive any cash flow.

What about the Newmont share price?

As many ASX dividend investors would know, it is normal to see a dividend share fall substantially in value upon its ex-dividend date. This reflects the inherent loss of value for the investors buying the stock without the rights to receive the latest dividend attached.

However, this doesn’t seem to be occurring today. The Newmont share price closed at $62.45 each last Friday but opened at $62.88 this morning. The gold miner is currently sitting at $62.51. That’s up 0.1% for the day thus far, as we touched on earlier.

All we can conclude from this strange stock price movement is that Newmont shares would be even higher today if not for the company trading ex-dividend.

Newmont investors can all now look forward to bagging the company’s dividend payment on 27 June.

The post Here’s why the Newmont share price is making big ASX news today appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Newmont. 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 Scott Phillips.

The S&P/ASX 200 Index (ASX: XJO) closed up 0.5% in May, but it certainly wasn’t helped by these three ASX 200 shares.

Below we look at the three companies on the benchmark index receiving the ignominious prize as the worst performers over the month just past.

Three ASX 200 shares down 16% to 19% in May

Starting with the best of the worst three performers, in terms of share price, we have Tabcorp Holdings Ltd (ASX: TAH).

The Tabcorp share price ended April trading for 74 cents. When the closing bell rang on 31 May, shares were swapping hands for 62 cents, putting the ASX 200 share down 16.2% over the month.

There was no fresh price sensitive news from the wagering and gaming products and services company in May. There were a few media reports on potentially inappropriate workplace language taking place at the company, as well as a minor being allowed to gamble at one of its venues.

But Tabcorp’s big May fall largely looks to be in line with the selling trend that commenced in September 2023. Despite a slight uptick today, the Tabcorp share price is now down 46.8% over 12 months.

Moving on to the second-worst performing ASX 200 share in May, we have Fletcher Building Ltd (ASX: FBU).

The Fletcher Buildings share price closed out April trading for $3.47 and ended May at $2.84 a share, down 18.2%.

Most of the pain for the building and materials company came on 13 May following an uninspiring market update.

Shares closed the day down 10.9% after the New Zealand-focused company reported on “weakened” market conditions in its materials and distribution divisions.

This led to a significant reduction in the company’s FY 2024 earnings before interest and taxes (EBIT) guidance. Management’s revised guidance of EBIT before significant items of $500 million and $530 million came in well below the prior guidance of $540 million to $640 million.

Up 3.0% today, the Fletcher Buildings share price is down 36.6% over 12 months.

Which brings us to the worst-performing ASX 200 share in May, Eagers Automotive Ltd (ASX: APE).

The Eagers Automotive share price ended April at $12.64 and closed out May at $10.12, down a painful 19.9%.

Most of those losses came on 22 May, when shares in the auto retailer closed down 15.0%.

That dramatic fall came on the heels of a trading update, which highlighted expected ongoing headwinds from inflation, interest rates and competition.

Eagers Automotive CEO Keith Thornton noted that given the difficult market conditions, “We expect to achieve an underlying trading performance for the first half of 2024 that is approximately 85% of the underlying profit before tax for the first half of 2023.”

Edging higher today, the ASX 200 share is now down 20.1% over 12 months.

The post The worst three performing ASX 200 shares in May unmasked appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben 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 Eagers Automotive Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The APM Human Services International Ltd (ASX: APM) share price has jumped 10.4% to $1.38 today after the All Ordinaries (ASX: XAO) stock accepted a $1.3 billion takeover bid.

Today’s acquisition news and subsequent share price boost follow a challenging period for the employment and human services business as low unemployment rates chipped into client flows.

Let’s take a look at the news.

Takeover bid accepted

In today’s announcement, APM advised it has entered into a scheme implementation deed with Ancora BidCo Pty Ltd, an entity controlled by US-based private equity outfit Madison Dearborn Partners (MDP).

The accepted agreement means MDP will buy all remaining APM shares it doesn’t already own for $1.45 cash per share, valuing APM at $1.3 billion.

While a previous bid from CVC Asia Pacific in February of $1.60 per share was higher than today’s accepted offer, APM rejected it for being too low at the time, and CVC walked away.

In the latest deal, eligible APM shareholders will have the option to receive either 90% or 100% of their takeover consideration in unlisted shares in the acquisition entity.

If the scheme is implemented, executive chair Megan Wynne and APM CEO Michael Anghie intend to receive 100% unlisted shares in the acquisition entity for their APM shares.

Why is APM accepting this offer?

The APM independent board committee (IBC) unanimously recommends that shareholders vote in favour of the takeover in the absence of a superior proposal. This recommendation is subject to an independent expert concluding and continuing to conclude that the scheme is in the best interests of APM shareholders.

The IBC is positive on the offer, saying it provided a “significant premium” to the undisturbed APM share price and delivered certainty of value. It noted the APM share price may trade at a significantly lower price in the absence of the takeover offer, and there were no alternative viable proposals.

The IBC cited the “uncertainty of the near-term outlook” as a key reason to accept the offer. It added that the ASX All Ords stock “continues to operate in an environment of extended low levels of unemployment and client flows, with increased support provided to achieve sustainable employment.”

While APM thinks these factors will “normalise over time” and that its other businesses can continue to grow, it is uncertain when this will occur.

The IBC also noted this offer allowed for shareholders to remain invested in APM, if they chose to do so.

Trading update

Also in a short trading update today, APM revealed it had experienced low client flows in Australia and the United Kingdom during April and May this year.

The company expects its FY24 profit to be “around the bottom” of its profit guidance range. FY24 underlying net profit after tax (NPATA) had been guided at between $95 million and $105 million, and underlying earnings before interest, tax, depreciation and amortisation (EBITDA) was previously guided to between $280 million and $290 million.

Additionally, APM expects the activity levels in the second half of FY24 to be “likely to continue into FY25.” It also noted that the completion of the refinancing of certain existing bank facilities was expected to result in a higher interest expense in FY25 compared to FY24.

What next?

APM will send shareholders a scheme booklet in July 2024, which will include information about the offer, the reasons for the IBC recommendation, an independent expert’s report, and details of the scheme meeting.

A meeting will likely be held in September 2024 for shareholders to vote on the proposal. If accepted, implementation is expected to occur in October 2024.

APM share price snapshot

The APM share price has lifted more than 9% since the start of 2024, but it’s been a bumpy ride for shareholders this year, as we can see in the graph below.

The post Guess which ASX All Ords stock is leaping 10% on a $1.3 billion bid appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in APM Human Services International. 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 APM Human Services International. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

One of the great things about investing in shares is that you don’t have to do anything with them, while you hold them. There’s no rent to collect, no bills to pay, and no agents to deal with.

The companies just… do their thing.

It was that thought which prompted this tweet, on Saturday afternoon:

So, the ASX was closed today, because it’s a Saturday.

Yet, listed companies went about their business: mining,  selling groceries, processing transactions, collecting rents, providing insurance, generating electricity, and more.

The market is a sideshow.

I followed it up with:

When you own shares, you own small pieces of real businesses. If you only see them as things to buy, swap and sell, you’re missing the point, and being distracted from the real value creation.

Focus on the company, not the stock.

And then this:

Honestly, I’d be happy if the market opened for an hour, once a week.

Or a month, for that matter.

The minute-by-minute volatility is noise and action… but not much more.

Like my woodwork teacher’s sign:

“Don’t be like a rocking horse: plenty of movement, but no progress”

I figured it was a pretty stock-standard few tweets, and I didn’t expect much engagement.

But I was wrong.

More than a few people told me that Bitcoin was better, because it could be traded 24/7.

Uh-huh.

A couple of others told me they wanted the market open longer because it’d mean they could trade on the back of US news, or to avoid big share price movements at the beginning and end of the trading day.

In response?

I told them I couldn’t care less.

Truly, who needs to trade shares at 2.47am?

Or on a Saturday?

Sure, you can buy and sell Bitcoin 24/7 but… so what? 

Because let me remind you that there is no correlation between activity and success in the stock market.

Those who trade more don’t do better. In fact the research suggests exactly the opposite.

I can’t emphasise this enough, either: if you think you need the market open longer, or that you want to be able to trade more often, I think you’re missing the point.

(Too harsh? Sorry, but it’s true.)

The money in investing isn’t made in the trading. It’s made in the waiting.

Waiting while Woolworths Group Ltd (ASX: WOW) goes from $4.72 in 1999 to $31 today.

Waiting while BHP Group Ltd (ASX: BHP) goes from $4.91 to $45 over the same timeframe.

Waiting while REA Group Ltd (ASX: REA) goes from $1.09 to $184.

Do all companies do that? Nope. 

But let me remind you that according to fund manager Vanguard, an investment in the ASX over 30 years to June 30 last year turned a hypothetical $10,000 into over $130,000 in three decades – that’s with both the winners and the losers included.

The market didn’t have to be open 24/7 over that 30 year period.

In fact, if it was, it would have just tempted more people to trade more often… rather than just biding their time.

Yes, the ASX will probably eventually go 24/7. But it won’t be to help investors. It’ll be to help the exchange, and stock brokers, make more money from more activity.

Note: not more ‘wealth creation’, but ‘more activity’. You didn’t think most brokers were on your side, did you? (There are some noble exceptions… but not many.)

In the meantime? My investment strategy – and investment actions – wouldn’t change one iota if the stock market was only open for an hour, once a month. 

Why would they?

I buy quality companies when they’re available for good prices, then hold them for as long as it makes sense to do so… hopefully for years and decades to come.

That’s investing.

Everything else is noise.

(Oh, and speaking of noise, there are some fake social media ads going around, using a video of me and dubbing some dodgy offers over the top. And others using fake accounts in my name. Please be careful if you see them – always check the source!) 

Fool on!

The post Why I don’t want to trade 24/7 appeared first on The Motley Fool Australia.

More reading

• The worst three performing ASX 200 shares in May unmasked
• Guess which ASX All Ords stock is leaping 10% on a $1.3 billion bid
• How the CBA share price defied the bears to surge in May
• Leading brokers name 3 ASX shares to buy today
• What a pay rise for 2.6 million Aussies could mean for ASX shares

Motley Fool contributor Scott Phillips has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended REA Group. The Motley Fool Australia has recommended REA Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.