Category: Stock Market

The BHP Group Ltd (ASX: BHP) share price was in fine form in February.

Shares in the S&P/ASX 200 Index (ASX: XJO) mining giant closed out January trading for $50.57. When the closing bell sounded on 27 February, shares were changing hands for $58.41 each.

This saw the BHP share price up 15.5% over the month just past, racing ahead of the 3.7% gains posted by the ASX 200 over this same time.

That strong performance also saw BHP retake the title of biggest stock on the ASX (by market cap) from Commonwealth Bank of Australia (ASX: CBA) towards the end of the month.

Now, here’s why investors have been busily buying shares in the big Aussie miner.

BHP share price jumps on strong earnings results

The biggest news out from the miner over the month was the release of its half-year earnings results (H1 FY 2026) on 17 February.

The BHP share price closed up 4.7% on the day, with investors responding favourably to revenue of US$27.90 billion for the six months, up 11% from H1 FY 2025.

And earnings leapt 25% year-on-year, with BHP reporting underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of US$15.46 billion.

On the bottom line, the ASX 200 miner achieved a 22% increase in underlying profit to US$6.20 billion.

This saw management declare a fully franked interim dividend of 73 US cents (AU$1.03) a share, up 30% in Aussie dollar terms and up 46% in US dollar terms.

That passive income payout is still up for grabs, by the way. Though if you want to score the interim $1.03 BHP dividend, you’ll need to be fast.

BHP trades ex-dividend this Thursday. Meaning you’ll need to own shares at market close tomorrow, 4 March, to receive those dividends. You can then expect to see that passive income hit your bank account on 26 March.

ASX 200 miner embracing copper

One of the standouts from the miner’s half year results were its copper earnings.

At more than US$13,300 per tonne, the copper price has gained 40% over the past 12 months.

And the BHP share price has gotten an added boost as the miner expands its copper exposure.

For H1Y 2026, the company reported underlying EBITDA of US$8.0 billion from its copper division. That’s up 59% year-on-year, and it’s the first time BHP saw copper deliver more than half its earnings.

Management also piqued investor interest on the day after upgrading BHP’s full year FY 2026 copper production guidance to between 1.9 million and 2.0 million tonnes. BHP produced 984,000 tonnes of copper in the first half of FY 2026.

The post Why the BHP share price rocketed 16% in February appeared first on The Motley Fool Australia.

More reading

• 1 miner, 1 bank, and 1 ASX tech share I’d buy this month
• Which ASX 200 mining shares raised their dividends this earnings season?
• I bought 682 BHP shares 5 years ago, this is how they fared
• 3 of the best blue chip ASX shares I’d buy in March
• ASX 200 materials sector leads as earnings season ends with a record high

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 BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Woodside Energy Group Ltd (ASX: WDS) share price is $29.96, down 1%, despite oil and gas prices continuing to climb today.

The largest ASX 200 oil share remains 5.6% up on its Friday close after the US and Israel attacked Iran over the weekend.

The attack pushed oil prices significantly higher on expectations that global supply will be disrupted as a result of the attack.

The Woodside share price has been on a consistent upward trajectory in the new year and is currently up 27% year to date.

Woodside shares reached an 18-month high of $28.37 on Friday, then soared 6.4% yesterday due to the weekend’s events.

FY25 results

The latest major news out of the oil and gas giant was its full-year FY25 results last Tuesday.

Woodside reported record production of 198.8 MMboe in FY25, up 3% from FY24.

The net profit after tax (NPAT) was US$2,718 million, down 24%.

Woodside declared a fully-franked final dividend of 59 US cents per share, up 11% on US dollar terms on the final FY24 dividend.

After the currency conversion, this will equate to about 83.4 AU cents per share, payable on 27 March.

Woodside shares go ex-dividend, along with scores of other ASX shares, this week.

Will the Woodside share price go further from here?

As is customary, the brokers have gone over Woodside’s latest earnings results and adjusted their ratings and 12-month price targets.

The highest target among the nine broker opinions we’ve seen comes from Michael Gable at Fairmont Equities.

On The Bull, Gable gave Woodside shares a buy rating and said the stock could go as high as $38 in CY26.

Gable commented:

Expected increasing demand for oil and gas in 2026 leaves me bullish about the energy sector.

The company posted record annual production of 198.8 million barrels of oil equivalent in full year 2025, exceeding the guidance range.

Record production offset lower realised prices.

The company’s full year results met expectations, and the share price recently moved above a major resistance level.

I expect the shares to trend higher and re-test previous peaks around $38 as calendar year 2026 unfolds. 

The next best price tip comes from RBC Capital.

RBC retained its buy rating on Woodside with a 12-month share price target of $31.50.

Morgans retained its buy rating and raised its price target from $29.80 to $30.50.

In a note, the broker said:

A strong CY25 result, coming in ahead of consensus on both NPAT and dividend.

Yet another half where WDS outperforms on opex and net debt balance.

We see a clear case for value upside remaining in WDS, from a recovering oil price, solid project delivery and FCF harvest as projects come on (CY27-29).

Not every expert says buy

Bernstein increased its share price target on Woodside from $24 to $29 and reiterated its hold rating.

Citi, Macquarie, and Morgan Stanley kept their hold ratings with 12-month targets of $28, $27, and $26, respectively.

UBS also maintained a hold rating on Woodside but upped its share price target from $23.10 to $25.60.

Ord Minnett retains a sell rating on Woodside shares with a price target of $24.

The post What’s next for the Woodside share price? appeared first on The Motley Fool Australia.

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• Here are the top 10 ASX 200 shares today
• Oil prices rocket to 4-year high as ASX energy giants surge
• Why Ampol, EOS, Lynas, and Woodside shares are roaring higher today
• Santos and Woodside shares surging higher on Monday as oil price in focus amid Iran strikes

Citigroup is an advertising partner of Motley Fool Money. Motley Fool contributor Bronwyn Allen 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 Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Major gold stocks Evolution Mining Ltd (ASX: EVN) and Newmont Corp (ASX: NEM) are sliding today despite surging gold prices.

The gold price held above US$5,300 on Monday, paring earlier gains after spiking past US$5,419. At the time of writing on Tuesday morning, the gold price has climbed another 0.58% for the day to US$5,353. This is close to the metals’ all-time high of US$5,419 recorded in late January.

The safe haven asset is now 8% higher over the past month and 84.8% higher over the past 12 months.

The uplift came after a dramatic “buy the dip” rally in US stocks drained the metal’s safe-haven momentum, according to Trading Economics.

But despite the latest rally, Evolution Mining and Newmont shares are travelling in the other direction. Here’s why.

What is happening to these ASX gold shares today?

Newmont is the world’s largest gold miner, and Evolution Mining is one of Australia’s largest listed gold miners. The two mining giants are widely regarded as dominant players in the gold sector.

In Tuesday lunchtime trade, the Evolution Mining share price is down 3.34% to $17.08 a piece. For the year to date, the Aussie gold miner’s share price has climbed 35% and it is currently 178.91% above where it was this time last year.

At the time of writing, the Newmont share price is also trading in the red. The shares have tumbled 3.43% to $180.80 a piece. This means the shares are now 19.64% higher year to date and 165.54% higher than 12 months ago.

Why are the ASX gold stocks not moving higher with the gold price?

There hasn’t been any price-sensitive news out of either of the gold mining companies recently. This suggests today’s slump means the gold price rise was already priced into the stock.

Gold stocks often move ahead of the official gold prices if investors or analysts anticipate higher prices in the near future.

At the same time, the gold price is quoted in US dollars. While ASX gold miners sell their gold in US dollars, they report earnings in Australian dollars. Given that the US dollar is currently weaker against the Australian dollar, a shift in the gold price might not have a significant effect on ASX stock prices.

In other words, even if gold rises globally, the share price of ASX gold miners might not rise if the Australian dollar is also rising. 

What do analysts think of the shares?

Analysts are very mixed on the outlook for Evolution Mining shares this year. TradingView data shows that eight out of 20 analysts have a hold rating, five have a buy or strong buy rating, and another seven have a sell or strong sell rating.

The average target price is $14.05, which implies an 18% downside at the time of writing. 

Analysts are much more bullish on Newmont’s outlook. TradingView data shows that 20 out of 24 analysts have a buy or strong buy rating on the stock. The average target price is $197.67, which implies a 9.1% upside at the time of writing. 

The post Evolution and Newmont shares tumble despite surging gold price appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
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• 5 things to watch on the ASX 200 on Monday
• Which ASX 200 mining shares raised their dividends this earnings season?
• ASX 200 materials sector leads as earnings season ends with a record high

Motley Fool contributor Samantha Menzies 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.

When I think about holding a share for 10 years or more, I’m not asking whether next quarter’s result will beat consensus.

I’m asking something much simpler. Does this business sit in front of a powerful, long-term trend that is likely to be bigger in a decade than it is today?

If the answer is yes, and management executes reasonably well, time can do a lot of the heavy lifting.

Here are three ASX 200 shares I would be happy to tuck away for the next decade.

DroneShield Ltd (ASX: DRO)

The nature of warfare is evolving. Low-cost drones have become a genuine battlefield threat, and countries are rapidly adapting their defence strategies. Counter-drone technology is shifting from a niche capability to something closer to a standard requirement.

DroneShield has built a reputation in RF detection and defeat systems, backed by years of development and real-world deployment. It also has a growing sales pipeline worth over $2 billion that reflects how seriously governments are taking this risk.

If you zoom out ten years, I find it hard to imagine a world where counter-drone capabilities are less important than they are today. That’s the lens through which I view this stock. It will be volatile. It will win and lose contracts. But the structural tailwind looks powerful to me.

Zip Co Ltd (ASX: ZIP)

Zip is a very different story. For me, this isn’t about explosive growth at any cost anymore. It’s about discipline and maturing as a business.

The buy now, pay later company has already been through a full cycle. It has tightened credit settings, exited weaker markets, and focused on profitability. That evolution matters. It tells me management has learned from the past.

Over the next decade, digital payments and alternative credit are unlikely to shrink. Consumers increasingly expect flexibility at checkout, and merchants value higher conversion rates. If Zip continues to operate with discipline, there is room for steady expansion without needing to chase reckless growth.

This isn’t a defensive ASX 200 share. But over a ten-year horizon, I think a leaner, more focused Zip could look very different to the company many investors remember.

Telix Pharmaceuticals Ltd (ASX: TLX)

Telix is a story about precision medicine. Healthcare is moving toward more targeted diagnostics and therapies, particularly in oncology. Telix operates in radiopharmaceuticals, combining imaging and treatment in ways that can improve patient outcomes.

What attracts me here is not just a single product cycle. It’s the broader shift toward personalised cancer care and the role nuclear medicine can play in that shift.

Telix already has commercial products on the market and is expanding its pipeline. If even part of that pipeline delivers over the next decade, earnings could scale meaningfully.

Of course, clinical development carries risk. But over a long time frame, I believe innovation in cancer diagnostics and treatment will only accelerate. Telix is positioned at the heart of that change.

Foolish takeaway

DroneShield, Zip, and Telix operate in defence technology, digital payments, and precision medicine. Three very different industries, three very different risk profiles.

What they share, in my view, is exposure to trends that are unlikely to fade over the next decade. If I’m building a portfolio for the long haul, those are the kinds of ASX 200 shares I want to own.

The post 3 ASX 200 shares to buy and hold for a decade or more appeared first on The Motley Fool Australia.

More reading

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• ASX 200 shares to buy on the cheap right now
• 2 ASX 200 shares tipped to more than double in value
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Motley Fool contributor Grace Alvino has positions in DroneShield. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield and Telix Pharmaceuticals. The Motley Fool Australia has recommended Telix Pharmaceuticals. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Choosing ASX shares can feel overwhelming, especially when there are hundreds to consider.

Rather than trying to cover every sector, sometimes it helps to narrow the field. If you’re looking for a starting point this month, here’s one miner, one bank, and one ASX tech share I’d be comfortable owning right now.

BHP Group Ltd (ASX: BHP)

If I want mining exposure, BHP is still my first pick.

It offers scale, diversification across commodities, and strong free cash flow generation. While iron ore remains a major earnings driver, I’m particularly interested in BHP’s copper exposure. Copper is central to electrification, renewable energy infrastructure, and electric vehicles, all of which are long-term structural themes.

BHP’s balance sheet strength and disciplined capital allocation also matter. In cyclical industries, financial strength can make the difference between surviving downturns and thriving through them.

I don’t expect BHP to shoot the lights out every year, but as a core miner in a diversified portfolio, I think it still makes sense.

Commonwealth Bank of Australia (ASX: CBA)

CBA is rarely cheap, but I think it earns its premium. Its scale, technology leadership, and dominant deposit base give it structural advantages in the Australian banking sector. 

In a competitive environment, that matters. It allows CBA to defend margins and maintain strong returns on equity relative to peers.

For income investors, the fully franked dividend remains appealing. For long-term holders, the consistency of earnings and capital management is what stands out.

If I want bank exposure, I’m choosing quality over chasing a slightly lower valuation elsewhere.

WiseTech Global Ltd (ASX: WTC)

For technology exposure, I’d lean into WiseTech. Its share price has been volatile over the past year, but the underlying opportunity in global logistics software remains significant. 

CargoWise is deeply embedded in customer workflows, and switching costs are meaningful once the platform is integrated.

Consensus forecasts point to strong earnings growth over the next few years. At current levels, the stock is trading on a multiple that I think looks more reasonable relative to its long-term growth potential than it did at prior peaks.

There are risks, as with any growth stock, but for investors willing to look beyond short-term sentiment, I think WiseTech offers attractive upside over time.

Foolish takeaway

If I were adding ASX shares to my portfolio this month, I’d be happy owning BHP for mining exposure, CBA for income and resilience, and WiseTech for growth.

Together, they span commodities, financials, and technology. That kind of balance can be more powerful than trying to pick a single winner.

The post 1 miner, 1 bank, and 1 ASX tech share I’d buy this month appeared first on The Motley Fool Australia.

More reading

• 3 ASX shares down 25% or more that could roar back
• ASX 200 shares to buy on the cheap right now
• How low can WiseTech shares go?
• How the CBA share price rocketed 17% in February
• 5 top ASX 200 shares I’d buy in March

Motley Fool contributor Grace Alvino has positions in Commonwealth Bank Of Australia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool Australia has recommended BHP Group. 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 3.7% in February, but these five ASX 200 stocks went sharply the other way.

From market close on 30 January through to the closing bell on 27 February investors sent these five stocks tumbling 26% to 32%.

Here’s what put these companies under heavy selling pressure.

Austal Ltd (ASX: ASB)

The Austal share price tumbled 25.9% in February.

Shares in the Aussie ship builder crashed 22.8% on 13 February after management revealed they had inadvertently overstated the ASX 200 stock’s potential earnings.

Ahead of Austal’s half-year results release, the company reported that a US$17.1 million “overstatement had been included in the Company’s FY2026 EBIT guidance”.

EBIT guidance for FY 2026 was subsequently lowered to approximately AU$110 million.

Austal shares closed down another 11.0% on 23 February following the release of the ship builder’s half-year results.

Cochlear Ltd (ASX: COH)

The Cochlear share price also had a month to forget, closing down 26.1% in February.

Shares in the ASX 200 stock, which manufactures and sells cochlear implantable devices,

Much of that pain was delivered on 13 February. Cochlear shares slumped 18.9% on the day following the release of the company’s half year results.

While sales revenue was up 1% year-on-year to $1.18 billion, revenue was down 2% in constant currency.

And investors were favouring their sell button’s, with Cochlear reporting a 9% decline in underlying net profit to $194.8 million.

Zip Co Ltd (ASX: ZIP)

The third ASX 200 stock investors would have done well to avoid buying and holding in February is buy now, pay later (BNPL) company Zip.

Zip shares fell 27.9% over the month just past.

All of that pain, and then some, was delivered on 19 February. The Zip share price closed down 34.4% on the day after the company released its – you guessed it – half year results.

Investors punished the stock despite Zip achieved an 85.6% year-on-year increase in cash EBTDA to $124.3 million. As the Motley Fool’s James Mickleboro pointed out on the day, that looked to be fuelled by concerns of moderating profit growth, with management flagging that H2 cash EBTDA is likely to be broadly in line with the first half earnings.

Pro Medicus Ltd (ASX: PME)

Pro Medicus shares also took a beating in February, shedding 29.4% of their value over the month.

Shares in the health imaging company tumbled 23.9% on 12 February after the company reported its own half-year results.

That sharp selloff came despite the ASX 200 stock reporting a 28.4% year-on-year increase in half year revenue to $124.8 million. And underlying profit before tax of $90.7 million was up 29.7%.

But investors look to have gotten swept up with rising concerns about the potential for AI to disrupt the global software industry.

Temple & Webster Group Ltd (ASX: TPW)

Rounding off the list with the biggest monthly loss is online furniture and homewares retailer Temple & Webster.

Temple & Webster shares crashed 31.6% in February, with the share price plunging 32.6% on 12 February.

I’m sure I don’t need to tell you why.

Yep, the company reported its half-year results on the day.

The ASX 200 stock came under intense selling pressure despite achieving 20% year-on-year revenue growth to $376 million.

But investors were clearly not pleased with depreciation and amortisation costs, which saw Temple & Webster’s net profit before tax for the six months decline 28% to $7.4 million.

The post The five worst performing ASX 200 stocks bought and held in February unmasked appeared first on The Motley Fool Australia.

More reading

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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 positions in and has recommended Cochlear and Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has recommended Cochlear, Pro Medicus, and Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

French billionaire Olivier Goudet has increased his stake in Treasury Wine Estates Ltd (ASX: TWE) to 7.13% after tipping another $41.7 million into the company since mid-January.

Treasury shares jumped when it first emerged that Mr Goudet had spent about $226 million buying into the struggling wine company, with the stock adding 10% in the couple of days after the news was announced in late December.

Treasury Wine shares have continued to slide since then however, falling from $5.39 on December 24 to be changing hands for $4.55 currently.

A new announcement to the ASX on Tuesday shows Mr Goudet’s company has been buying up stock since January 19.

Wheeler and dealer

Mr Goudet’s interest is of note, given his background in Europe as a buyer and seller of high-profile brands.

He is well known in European business circles as the former head of JAB Holding, which managed the wealth of Germany’s Reimann family.

While in that role, Mr Goudet spearheaded the takeover of companies including Krispy Kreme and Pret a Manger, and according to a report in The Australian, he also personally bought a chateau in Bordeaux with his wife in 2021.

Mr Goudet, who was also the former Chief Financial Officer at Mars, stepped down from JAB Holding in 2023.

Mr Goudet is getting his new shares at a relative bargain, with Treasury Wine shares well down on their highs of $10.88 over the past year.

Tough times in the wine trade

Treasury in mid-February announced half-year EBITS of $236.4 million, which was a 39.6% decline on the previous corresponding period, and a net loss of $649.4 million, including $751 million in non-cash write-downs of its US assets.

The company suspended its interim dividend to preserve capital, and reiterated that it had started strategic actions “to maintain brand strength and healthy sales channels across key markets, with reducing customer inventory holdings in the US and China a priority”.

Treasury Chief Executive Officer Sam Fischer said at the time:

Today’s results come at a time when we are already making meaningful progress with the decisive actions required to return TWE to a path of sustainable, profitable growth. Our focus is firmly on the future to strengthen execution and ensure we build a stronger, more resilient business for the long term. TWE Ascent is the key enabler of this reset. It is a disciplined, multi-year transformation program designed to sharpen our portfolio, simplify the organisation and optimise our cost base, and I am pleased with the progress we have made to date. Encouragingly, we are seeing our key brands continue to perform in the marketplace and resonate strongly with consumers, reinforcing confidence in the strength of our portfolio and our ability to deliver improved performance as we execute the transformation of the business.  

The post Which billionaire has upped his stake in Treasury Wine Estates? appeared first on The Motley Fool Australia.

More reading

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Motley Fool contributor Cameron England 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 Treasury Wine Estates. The Motley Fool Australia has positions in and has recommended Treasury Wine Estates. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The New Hope Corporation Ltd (ASX: NHC) share price is in focus after the company announced the extension of its on-market share buy-back program to 2 March 2027, aiming to enhance shareholder value through active capital management.

What did New Hope report?

• Extension of current on-market share buy-back program until 2 March 2027
• Buy-back conducted in ordinary course of trading on the ASX
• No specified limit on number of shares to be repurchased within legal thresholds
• Any shares acquired under the buy-back will be immediately cancelled
• No shareholder approval required for the extension

What else do investors need to know?

The extension continues New Hope’s focus on improving shareholder returns via flexible capital management. The buy-back will proceed at the company’s discretion, subject to share price, market conditions, and future capital needs.

The company has lodged a related Appendix 3C with the ASX and will provide daily notifications of any shares purchased, in line with ASX Listing Rules. The board may suspend or terminate the buy-back anytime if circumstances change.

What’s next for New Hope?

Looking ahead, the buy-back will remain part of New Hope’s ongoing capital management strategy. The company will weigh market factors, prevailing share price, and capital requirements before making any future buy-back decisions.

Shareholders should note there is no guarantee any shares will be repurchased, and the program may be altered or ended early if necessary.

New Hope share price snapshot

Over the past 12 months, New Hope shares have risen 23%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 11% over the same period.

View Original Announcement

The post New Hope extends share buy-back program to March 2027 appeared first on The Motley Fool Australia.

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Motley Fool contributor Laura Stewart 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. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

The Magellan Financial Group Ltd (ASX: MFG) share price is skyrocketing as investors show their support for the proposed merger with Barrenjoey Capital Partners.

Magellan announced today that it had completed a $130 million institutional capital raise to help fund the merger, which was announced yesterday.

Magellan shares came out of a trading halt this morning and are currently the biggest risers on the S&P/ASX 200 Index (ASX: XJO).

The Magellan share price opened at $9.91 on Tuesday, up 17%, and rose to an intraday high of $11.11, up 31%.

Magellan shares are now $10.52, up 24.4%.

On Friday, the Magellan share price closed at $8.46 prior to the merger news on Monday.

The investment manager said the institutional placement attracted very strong demand from current shareholders and new investors.

Magellan intends to raise a further $20 million from retail investors via a Share Purchase Plan (SPP) at the same price of $8.45 per share.

Magellan was a founding shareholder in Barrenjoey and already owns a 36% stake.

The investment manager will acquire the remaining shares in Barrenjoey for $903 million.

Barrenjoey launched in 2020 under the leadership of CEO Brian Benari, who had been CEO of Challenger Ltd (ASX: CGF) for 7 years.

The institutional placement and SPP will fund an initial increased stake in Barrenjoey.

The rest of the consideration will be funded through the issue of new Magellan shares to Barrenjoey shareholders.

What did management say?

Magellan chair Andrew Formica said:

We are very pleased to welcome a number of new highly respected investors to the register and view their participation as an endorsement of the merger and future prospects for the group.

We are also pleased with the outcome and thank our shareholders and new investors for their strong support for the Placement and the proposed merger with Barrenjoey.

We view the merger as transformative for MFG and are excited about the potential to create long-term value for our clients and
shareholders.

Share Purchase Plan for Magellan investors

Magellan investors on the register as of 7pm last Friday will be eligible to participate in the SPP.

Shareholders can apply for a maximum of $30,000 worth of new Magellan shares at $8.45 apiece, subject to a scale-back if necessary.

Magellan expects to launch the SPP next Thursday, 12 March, and close it at 5pm (Sydney time) on Wednesday, 25 March.

Magellan will issue an SPP booklet on or around next Wednesday.

More details on the deal

The merger will combine Magellan’s investment management business with Barrenjoey’s strengths in corporate finance, equities, fixed income, and capital markets.

The deal is subject to conditions, including shareholder approval at an Extraordinary General Meeting to be held next month.

Magellan said the combined group would benefit from a broader client offering and a stronger balance sheet to support growth.

Magellan released a presentation on the deal yesterday.

Barrenjoey Independent Non-Executive Chair, David Gonski AC, said:

Joining forces provides an ideal platform for our next phase of growth together as a top tier financial services group, while ensuring our clients and our people remain at the centre of everything we do.

The merger deal gives Barrenjoey an implied value of $1.62 billion on a 100% equity basis.

In CY25, Barrenjoey took in revenue of $522 million and reported adjusted NPATA of $108 million.

The merger is valued at 15x P/E based on the past 12-month result, prior to expected synergies.

Upon completion, Magellan will own 100% of the issued capital of Barrenjoey. Magellan shareholders will take 58.2%, institutional placement shareholders will own 5.3%, Barrenjoey parties will own 31.7%, and Barclays will own about 4.9%.

Who will run the new company?

Barrenjoey CEO, Brian Benari, will be Group CEO, and Gonski will be board chair.

Andrew Formica will be Deputy Chair, and Paul Compton, Chair of Investment Banking at Barclays, will join the Magellan board.

Matthew Grounds and Guy Fowler will continue as Co-Executive Chairs of Barrenjoey Capital Partners.

Sophia Rahmani will continue as Magellan’s CEO.

Magellan Non-Executive Director, David Dixon, will retire on completion of the merger.

Magellan share price snapshot

The Magellan share price is now up 24% over the past year but down 73% over the past five years.

The post Magellan share price soars 31% on completed capital raise for Barrenjoey merger appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Tuesday
• Magellan Financial Group unveils merger with Barrenjoey
• Magellan requests trading halt ahead of major announcement
• Should you buy Digico, Magellan, and Ramelius shares?
• 16 ASX shares going ex-dividend next week

Motley Fool contributor Bronwyn Allen has positions in Magellan Financial Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Barclays Plc. The Motley Fool Australia has recommended Challenger. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Jewellery retailer Michael Hill International Ltd (ASX: MHJ) recently delivered a solid profit result for the first half, sending its shares to a fresh 12-month high.

But the team at Jarden has run the ruler over the results and thinks that if the company continues to execute well, the shares could lock in even more gains.

Solid earnings increase

Firstly, let’s look at the profit result. Michael Hill reported group sales of $371 million, up 3% on the previous corresponding period, but comparable EBIT was up 28.6% to $31 million. Net profit was up 32% to $22.3 million.

The company’s gross margin was steady at 61.2%, with increases in the gold and silver price offset by “overall product mix and focused promotional activity”.

And the company’s net cash position was $20.7 million, $30.5 million better than for the previous period.

Michael Hill did not declare a dividend but indicated that the board did intend to pay a full-year dividend, “subject to current trading conditions continuing and in line with the company’s dividend policy”.

And, encouragingly, same-store sales for the group for the first eight weeks of the current half were up 6% on the previous corresponding period.

Michael Hill Chief Executive Officer Jonathan Wecker said regarding the results:

Since joining the business in August, I have spent most of my time in stores and with our teams and customers. The feedback was consistent, that when we simplify how we operate, stay close to the customer and focus on retail fundamentals, performance improves. Over the half, we acted on that by tightening our product focus, improving our go-to-market, clarifying expectations in stores, and improving how we communicate across our teams. Momentum built through the Christmas trading period, and we saw that come through in stronger sales and improved comparable EBIT. This consistent customer-centric focus has also delivered organic growth across the network, resulting in a broader customer base choosing Michael Hill. Pleasingly, positive sales performance has continued into the first eight weeks of the second half, with group same store sales up 6%.

Shares looking cheap

The Jarden team analysed the first-half results for the ASX retail company and said the uptick in same-store sales was a sign of a shift in momentum.

They added:

The improvement in sales momentum is now evident across multiple periods in all markets and is an encouraging sign of: 1) a healthier operating backdrop; and 2) the brand refresh ⁄ product innovations resonating with customers.

Jarden said they had increased their forecast for full-year earnings at Michael Hill by 21%, “driven by better-than-expected contributions in Canada and Australia”.

Jarden has lifted its 12-month price target on the shares from NZ$0.70 to NZ$0.80, which would be a 50.3% return including expected dividends.

Michael Hill’s Australian shares were last trading at 46 cents, not far off their 12-month high of 47.5 cents.

The post This ASX retailer, trading near its 12-month highs, could add another 50% Jarden says appeared first on The Motley Fool Australia.

More reading

• Michael Hill shares hit 12-month high after first-half profit jump
• 35 ASX All Ords shares with ex-dividend dates next week

Motley Fool contributor Cameron England 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.