Category: Stock Market

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a solid gain. At the time of writing, the benchmark index is up 0.8% to 7,382.5 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are storming higher:

Ausnet Services Ltd (ASX: AST)

The Ausnet share price is up almost 4% to $2.57. The catalyst for this was news that the electricity distribution networks company has accepted a takeover offer from Brookfield Asset Management. According to the release, Brookfield has tabled a binding proposal of $2.65 per share, which is up from its original offer of $2.50 per share. As part of the terms of the agreement, Ausnet has terminated its due diligence process with APA Group (ASX: APA).

Charter Hall Group (ASX: CHC)

The Charter Hall share price is up over 4% to $18.07. Investors have been buying this property company’s shares after it upgraded its post-tax operating earnings per security (OEPS) guidance. Charter Hall now expects OEPS of no less than 83 cents per share in FY 2022, which represents a minimum 36% year on year growth rate.

Codan Limited (ASX: CDA)

The Codan share price is up 4.5% to $10.51. This gain appears to have been driven by bargain hunters swooping in after the metal detector company’s shares were sold off last week. The Codan share price sank 23% last week following the release of its annual general meeting update.

Imugene Limited (ASX: IMU)

The Imugene share price has jumped 7% to 53 cents. This morning Imugene announced a strategic collaboration with Eureka Therapeutics. The collaboration will evaluate Eureka’s anti-CD19 Artemis T-cell therapy in combination with Imugene’s CD19-expressing oncolytic virus onCARlytics in solid tumours. Eureka Therapeutics is a US based clinical-stage biotechnology company focused on developing novel cancer T-cell therapies to treat cancers.

The post Why Ausnet, Charter Hall, Codan, and Imugene shares are storming higher appeared first on The Motley Fool Australia.

More reading

• Why the Imugene (ASX:IMU) share price is up 9% on Monday
• ASX 200 (ASX:XJO) midday update: Westpac sinks, Macquarie raises $1.5bn
• Ausnet (ASX:AST) share price jumps as Brookfield offers $2.65/share
• These were the worst performing ASX 200 shares in October
• These were the worst performing ASX 200 shares last week

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 Bruce Jackson.

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Shares in global medical device company Resmed Inc (ASX: RMD) are sliding in early afternoon trade today as the US-based entity released its Q1 FY22 earnings.

At the time of writing, Resmed shares are 5.27% into the red, sinking to $35.21 apiece.

Resmed share price slides despite 20% revenue growth in Q1

During the quarter, Resmed achieved a number of investment highlights, including:

• Revenue of US$904 million, a 20% year on year (YoY) growth pattern
• Gross margin of 56%, down from 57.2% year on year
• Income from operations increased by 21% from the same time last year to US$261.9 million
• Operating profit gained 18% from the year prior with net income up 14% YoY to US$203.6 million
• Diluted earnings per share of US$1.39, up from US$1.22 during the same period in FY21
• Declared quarterly cash dividend of US42 cents per share

What happened this quarter for Resmed?

The company announced its quarterly earnings update with the release of its 10-K form. This is the standard documentation required by US-listed or domiciled companies when reporting earnings.

Resmed came in with a quarter that was ahead of analyst expectations, exhibiting a period of decent growth throughout its income statement.

For instance, revenue grew by 20% YoY to US$904 million, around $46 million above the consensus of analyst estimates for its Q1 sales.

Yet, despite the growth, the company’s gross margins contracted by around 270 basis points to 56%. This was the result of higher shipping and manufacturing costs across the board during calendar year 2021 to date.

Geographically speaking, revenue growth in Europe and Asia was strongest for the company in Q1 with an average of 21% growth in gross earnings in these regions.

This carried vertically down the income statement for Resmed. Its income from operations also expanded by 21% YoY and net income gained 14% during the quarter (20% on non-GAAP accounting figures).

Operating profit also rose around 20% for the quarter when compared to Q1 FY21. However, it was impacted by a payment made to the Australian Tax Office (ATO) of US$284.8 million.

According to its earnings report, this was actually the settlement amount of US$381.7 million net of prior remittances for all prior years since 2009.

As a result of its earnings strength this quarter, the board declared its quarterly cash dividend of US42 cents per share, payable on 16 December 2021.

Although this is in US currency, Australian holders of Resmed’s ASX-listed shares will receive the equivalent in Aussie dollars with an ex-dividend date of 10 November.

What did management say?

Speaking on the announcement, Resmed CEO Mick Farrell said:

Our first-quarter results demonstrate strong performance across our business with double-digit growth in both top-line and bottom-line metrics, driven by ongoing high demand for our sleep and respiratory care products, and steady growth across our software-as-a-service business.

He added:

It is through the extraordinary efforts of our global ResMed team that we were able to deliver products and solutions to our customers amid unprecedented supply chain challenges that continue to restrict access to critical electronic components.

What’s next for Resmed?

Resmed has previously stated a full-year revenue outlook of US$300 million to $350 million.

However, it also concurrently stated on its earnings call that it does not generally give specific ‘quantitative’ guidance.

When probed by analysts, the company reiterated its US$300–$350 million figure without going into too much detail.

Overall, it’s been a choppy year for Resmed shareholders who have still enjoyed a share price increase of 30% since January 1.

Over the last 12 months, the Resmed share price has climbed 26% into the green, roughly in line with the benchmark S&P/ASX 200 Index (ASX: XJO)’s gain of just under 25% in that time.

The post The Resmed (ASX:RMD) share price is falling 5% on Monday. Here’s why appeared first on The Motley Fool Australia.

More reading

• Why HT&E, JB Hi-Fi, Reece, and ResMed shares are charging higher
• ASX 200 (ASX:XJO) midday update: Macquarie doubles profit, ResMed jumps
• ResMed (ASX:RMD) share price jumps 7% on Q1 earnings beat
• 5 things to watch on the ASX 200 on Friday
• 3 buy-rated ASX shares

The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended ResMed. The Motley Fool Australia has recommended ResMed Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in biotech company Imugene Limited (ASX: IMU) are lifting in afternoon trade today and are changing hands 9.09% higher at 54 cents.

Imugene’s share price has been gaining ground today after the company announced a strategic partnership with Eureka Therapeutics, Inc.

Here are the details.

What did Imugene announce today?

Imugene gave in-depth coverage of its strategic partnership with clinical stage biotechnology Eureka Therapeutics, including an investor presentation of the data and collaboration itself.

The collaboration will “explore the therapeutic potential of a combination of Imugene’s CD19 oncolytic virus onCARlytics in combination with Eureka’s anti-CD19 ARTEMIS T-cell therapy for the treatment of solid tumours”.

For reference, Imugene has a novel hypothesis that it uses to treat solid tumours using its onCARlytics platform, by priming tumour cells for destruction with a tumour marker called CD19.

Imugene states that Eureka’s T-Cell therapy may be superior to CAR-T cells – a kind of bio-engineered T-Cell designed to specifically attack cancer cells, that Imugene is currently studying.

It reckons that based on head-to-head preclinical trials, Eureka’s ARTEMIS T-Cell therapy may be a better fit as a combination therapy with onCARlytics instead of CAR-T therapy, in order to eradicate solid tumours in eligible patient groups.

This is because ARTEMIS T Cells “demonstrated superior efficacy, enhanced tumour infiltration, and less T-cell exhaustion” in the aforementioned studies.

Eureka already has a number of clinical partnerships on its books with the likes of French biopharma company Sanofi S.A, and oncology giant Lyell Immunopharma Inc (NASDAQ: LYEL).

In fact, it has also eclipsed the top 10 mark in terms of the world’s best ‘CAR-T Patent Assignees Worldwide’ with its ARTEMIS asset in 2020, per the release.

News of the collaboration sent Imugene’s share price higher, and today’s trading volume is already 122% of its 4-week average after just a few hours of activity.

What did management say?

Speaking on the announcement, Imugene’s CEO Leslie Chong said:

T-cell and CAR-T therapies have not achieved much success in solid tumours in part because of a lack of tumour specific targets. By using our proprietary oncolytic technology to force the tumour to express the CD19 target, we now have the ability to address this shortcoming. We believe the synergy between our onCARlytics platform and Eureka’s anti-CD19 ARTEMIS T-cells has the potential to shift the cellular medicine paradigm in treating solid tumours.

Imugene share price snapshot

It’s been a terrific year for Imugene and its share price, having posted an outsized return of 440% this year to date.

This extends its run into the green to over 800% in the past 12 months, a galaxy away from the benchmark S&P/ASX 200 index (ASX: XJO)’s gain of around 25% in the same time.

The post Why the Imugene (ASX:IMU) share price is up 9% on Monday appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX shares today
• Here are the top 10 ASX shares today
• Which ASX 300 shares are the biggest winners and losers on Tuesday?
• Why is the Imugene (ASX:IMU) share price lifting 7% today?
• These were the best performing ASX biotech shares in September

The author Zach Bristow has no positions 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 Bruce Jackson.

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The Westpac Banking Corp (ASX: WBC) share price is down more than 6% after the bank released its FY21 result and announced its final dividend.

On top of the dividend, Westpac announced a $3.5 billion off-market share buy-back.

Regarding the buy-back, Westpac Chair John McFarlane said:

Our improved operating performance and positive progress on our strategic priorities, including the completion of a number of divestments, have strengthened capital and allowed us to announce this buy-back. The board carefully evaluated several options and believes this is the most value-enhancing option to distribute part of the group’s capital and franking credits.

Westpac dividend

The board decided to pay a final, fully franked dividend of $0.60 per share, to be paid on 21 December 2021.

That brought the total dividend for the 2021 financial year to $1.18 per share, representing a 62% payout ratio of cash earnings, excluding notable items. That represents an increase of 280% compared to FY20.

Westpac says that after its shareholder payouts of the dividend and buy-back, it will still have a strong capital position to respond to uncertainties, and to support growth and its customers.

The bank also noted that the capital position, together with the potential for further asset sales, creates flexibility for the board in its ongoing considerations on capital management.

Westpac noted that when combined with the final dividend for 2021, the bank delivered a total return to shareholders of $5.7 billion.

At the current Westpac share price, it has a trailing dividend yield of 4.9%. When grossed-up to include the franking credits, it increases to 7%.

What about the Westpac result?

In FY21, the business experienced an impairment benefit of $590 million. This reversal from a cost to a benefit helped statutory profit jump 138% to $5.46 billion, whilst cash earnings increased 105% to $5.35 billion. Excluding notable items, the cash earnings went up 33% to $6.95 billion.

The net interest margin (NIM) fell by 4 basis points to 2.04%, though the return on equity (ROE) increased by 372 basis points to 7.6%. Excluding notable items, the ROE increased 212 basis points to 9.8%.

In terms of the actual number, Westpac’s balance sheet saw the CET1 capital ratio improve by 119 basis points to 12.32%.

Outlook

A company’s thoughts on the outlook could have ramifications for the Westpac share price and the dividend.

Westpac is confident that the Australian economy will rebound over the next 12 months. Whilst uncertainty remains, the major bank thinks that most industries will begin to recover as Australia’s two biggest states re-open.

The Westpac CEO, Peter King, said:

Consumer spending will likely increase significantly as states re-open and pent-up demand is released, particularly supported by consumer optimism and sizeable savings.

We expect the Australian economy to expand by 7.4% in 2022, with credit growth expanding 6.8%. Demand for housing is likely to remain elevated but home price increases should moderate to 8% next year.

Next year we expect to reduce our cast base as we had towards our $8 billion cost target from completion of programs under our Fix priority and realise the benefits from divestments.

Whilst the bank is expecting lending growth, it’s expecting net interest margins to remain under pressure from low interest rates and competition.

Commsec numbers suggest that the Westpac full year dividend could increase by around 6% to $1.25 per share.

The post Here’s everything to know about the Westpac (ASX:WBC) dividend after its earnings update appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: Westpac sinks, Macquarie raises $1.5bn
• Can the Macquarie (ASX:MQG) share price break new highs over $200?
• Westpac (ASX:WBC) share price sinks 6% despite doubling cash earnings
• Westpac (ASX:WBC) share price on watch amid earnings jump and $3.5bn buyback
• 5 things to watch on the ASX 200 on Monday

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 Bruce Jackson.

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The GR Engineering Services Ltd (ASX: GNG) share price is racing higher on Monday. This comes after the engineering company announced an update on its full-year revenue guidance for FY22.

During late morning trade, GR Engineering shares are fetching $1.885, up 7.10%.

GR Engineering eyes strong growth for FY22

Investors are driving up GR Engineering shares following the release of upgraded revenue guidance by the company.

In its statement, GR Engineering advised that favourable trading conditions have continued to run into the new financial year.

As a result, the company upgraded its revenue guidance for the period ending 30 June 2022. It expects its full-year revenue to come in between $540 million and $560 million, reflecting a sizeable increase.

Originally, GR Engineering had forecast FY22 revenue for the same period to be around $440 million to 460 million.

The company seems to have avoided the impact of the recent constriction of the labour market in Australia. It says it has managed to navigate its way through COVID-19, increasing its workforce to meet demand and deliver on projects.

GR Engineering managing director Geoff Jones touched on the company’s improved revenue guidance, saying:

GR Engineering is forecasting significant growth on the record results achieved in FY21. The pipeline of ongoing and near-term work is growing and provides increased revenue and earnings visibility for both FY22 and FY23, enhancing GR Engineering’s ability to deliver returns to its shareholders.

GR Engineering share price summary

Over the past 12 months, the GR Engineering share price has soared, representing an 85% gain for shareholders. Throughout the year, the company’s shares have continued on an upwards trajectory.

It’s worth noting that the GR Engineering share price is currently a whisker away from its multi-year high of $1.96.

Based on today’s price, GR Engineering commands a market capitalisation of roughly $302 million with approximately 160.88 million shares outstanding.

The post GR Engineering (ASX:GNG) share price storms 7% higher today on FY22 guidance update appeared first on The Motley Fool Australia.

More reading

• Why the Imugene (ASX:IMU) share price is up 9% on Monday
• Here’s everything to know about the Westpac (ASX:WBC) dividend after its earnings update
• These are the 10 most shorted ASX shares
• This ASX share is a ‘cheap’ way to invest in green energy transition
• How did the NAB (ASX:NAB) share price perform in October?

Motley Fool contributor Aaron Teboneras 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 Bruce Jackson.

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Once a week 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:

• Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest jump week on week to 12.1%, making it the most shorted ASX share once again. Short sellers are not giving up on this travel agent giant despite borders reopening.
• Redbubble Ltd (ASX: RBL) has short interest of 10.2%, which is up slightly since last week. This ecommerce company’s recent quarterly update disappointed the market. Short sellers don’t appear to believe things will be improving in the near term.
• Webjet Limited (ASX: WEB) has short interest of 9.1%, which is down slightly week on week. This online travel agent’s shares remain a favourite for short sellers despite the improving travel market outlook. This could be due to valuation concerns.
• Kogan.com Ltd (ASX: KGN) has short interest of 8.9%, which is flat week on week. This ecommerce company’s shares have been targeted due to inventory issues and its softening sales growth.
• Mesoblast limited (ASX: MSB) has seen its short interest remain flat week on week at 8.9%. This high level of short interest appears to be due to concerns over this biotech company’s balance sheet. Another capital raising may be necessary in the near future based on its cash burn.
• Electro Optic Systems Hldg Ltd (ASX: EOS) has 8.4% of its shares held short, which is up meaningfully week on week. Much to the delight of short sellers, this defence and space company’s shares tumbled lower last week after it downgraded its earnings guidance.
• Inghams Group Ltd (ASX: ING) has 8.3% of its shares held short, which is up week on week. There are concerns that high grain costs could be putting pressure on this poultry producer’s margins.
• Zip Co Ltd (ASX: Z1P) has seen its short interest remain flat at 7.8%. Short sellers are holding firm with Zip despite it revealing a record quarterly performance last month.
• Cooper Energy Ltd (ASX: COE) has 7.5% of its shares held short, which is up week on week. A disappointing performance from Cooper’s Sole Gas operation has been weighing on sentiment.
• BHP Group Ltd (ASX: BHP) has seen its short interest rise week on week to 6.9%. Short sellers may believe falling iron ore prices will continue to drag on its performance. Though, it is worth noting that strong prices of other commodities are currently offsetting much of this.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

More reading

• Why has October been such a lousy month for the Webjet (ASX:WEB) share price?
• These were the worst performing ASX 200 shares last week
• Morgans tips Zip (ASX:Z1P) share price to jump 30%
• 2 very unpopular ASX shares that’ll keep rising: expert
• 2 beaten-up ASX shares that could be buys in November

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. owns shares of and has recommended Electro Optic Systems Holdings Limited, Kogan.com ltd, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended Electro Optic Systems Holdings Limited, Kogan.com ltd, and Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Glasgow Climate Summit has now kicked off, with the Australian government only just signing off on a 2050 net-zero target to take to the conference.

If you think green energy is inevitable as the world tries to slow man-made climate change, there is one ASX share that a trio of experts has nominated as a cheap way of gaining exposure.

And it’s a stock that, at face value, is not obvious as a “green” investment.

According to Wilson Asset Management portfolio managers Catriona Burns, Matthew Haupt, and Oscar Oberg, their WAM Leaders Ltd (ASX: WLE) portfolio currently holds South32 Ltd (ASX: S32) shares.

South32 is a Perth mining company that extracts a variety of metals in locations around the world.

A mining company as a green investment?

A recent transaction by this ASX share piqued the interest of the Wilson team.

“Recently, South32 announced the acquisition of a 45% interest in the Sierra Gorda copper mine in Antofagasta, Chile,” the portfolio managers said in a memo to clients.

“Antofagasta is known as one of the largest international copper mining regions, with prime access to people, suppliers, and infrastructure. 90% of the power requirements of the region are generated from renewable energy sources.”

South32 has published a strategy to reshape its investments for a low-carbon future. Burns, Haupt, and Oberg said the Chile buyout fits into this narrative.

“Following completion, over 40% of South32’s earnings will come from base and precious metals, which are experiencing unprecedented demand from electric vehicles and renewable power, infrastructure, transmission, and storage,” they said.

“Over 35% of earnings will be attributed to the aluminium value chain, which is a lightweight metal used for electric vehicles and construction.” 

They added that close to 20% of earnings will be from manganese, which is “required for steel production and recycling, with emerging demand in electric vehicles”. 

“The balance (less than 5%) will be from metallurgical coal which is required to support emissions reduction targets in the steel sector.”

The acquisition makes financial sense too

The Antofagasta buyout also makes financial sense for the ASX share, according to the Wilson team.

“The transaction is expected to be immediately earnings accretive for South32 and consideration paid was at a discount valuation to both South32 and comparable pure-play copper peers.”

South32 shares also provide a reliable dividend income, and the portfolio managers remain bullish on them.

“South 32… has a strong balance sheet and is an inexpensive way of gaining exposure to the green energy transition.”

The South32 share price has gained more than 44% this year so far and closed on Friday at $3.57, down 0.28% on the day.

The post This ASX share is a ‘cheap’ way to invest in green energy transition appeared first on The Motley Fool Australia.

More reading

• These 3 ASX 200 shares are topping the volume charts on Friday
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• 2 excellent ASX dividend shares rated as buys
• These 3 ASX 200 shares are topping the volume charts on Wednesday
• Could the South32 (ASX:S32) share price reach $4.50 by Christmas?

Motley Fool contributor Tony Yoo 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 Bruce Jackson.

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The National Australia Bank Ltd (ASX: NAB) share price was a strong performer in October.

What happened to the NAB share price in October?

During October, the banking giant’s shares hit a new 52-week high of $29.45 before ultimately ending the month at $28.71.

This means the NAB share price rose approximately 3.2% during the period, which compares favourably to the S&P/ASX 200 Index (ASX: XJO). The benchmark index ended the month slightly lower than where it started it.

Why did its shares outperform?

Investors were bidding the NAB share price higher last month despite there being no major news out of it.

However, the bank was the subject of a bullish note out of Goldman Sachs last month.

According to the note, ahead of the company’s full year results release, the broker retained its conviction buy rating and lifted its price target to $30.84.

Based on the current NAB share price, this implies potential upside of 7.8% for investors.

And with Goldman forecasting a $1.44 per share fully franked dividend in FY 2022, the total potential return stretches to almost 13%.

What did the broker say?

Goldman is positive on the NAB share price for a number of reasons. This includes its cost management initiatives and its margin management.

The broker explained: “Our preference for NAB (Buy, on CL) is premised on i) NAB’s cost management initiatives, which seem further progressed relative to most of its peers and should drive productivity benefits sooner and free up investment spend to be directed more towards customer experience, as opposed to infrastructure; ii) given NAB’s position as the largest business bank and investment in its mortgage capability, we believe it is strongly positioned to benefit from the current recovery in both housing and commercial volumes; iii) NAB continues to effectively manage the balance between volumes and margins.”

Shareholders will no doubt be hoping for more of the same in November.

The post How did the NAB (ASX:NAB) share price perform in October? appeared first on The Motley Fool Australia.

More reading

• Can the Macquarie (ASX:MQG) share price break new highs over $200?
• ASX 200 (ASX:XJO) midday update: Macquarie doubles profit, ResMed jumps
• NAB (ASX:NAB) share price lower following director announcement
• NAB (ASX:NAB) share price hits 2-year high, CEO welcomes net zero commitment
• The NAB (ASX:NAB) share price is outperforming its rivals this month: Is it a buy?

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 Bruce Jackson.

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The Seven West Media Ltd (ASX: SWM) share price is climbing higher on Monday after announcing the acquisition of Prime Media Group Limited (ASX: PRT).

At the time of writing, shares in the media company are swapping hands for 50 cents apiece, up 9.9%. As a result, the company’s share price is now 18.6% away from its 52-week high.

Let’s take a look at the latest price moving announcement.

What’s moving the Seven West Media share price today?

Investors are getting excited about Seven West Media on Monday as the company looks set to expand its media presence through an acquisition. The entity being acquired is the Australian-based and fellow ASX-listed media corporation, Prime Media Group.

According to the release, Seven West is acquiring Prime Television, Seven Affiliate Sales, and all its subsidiaries. At present, Prime operates the regional television network Prime7 in eastern Australia and GWN7 in regional Western Australia.

In turn, Seven West believes the acquisition will create a broadcasting, video, and news powerhouse — reaching more than 90% of the Australian population every month.

Furthermore, the bid for Prime Media’s business values it at $131.9 million. Based on the current number of shares on issue, this equates to 36 cents a share. Meanwhile, Prime Media was going for 23 cents per share at the end of Friday.

Unsurprisingly, shares in Prime Media have skyrocketed today on the significantly higher offering. At the time of writing, they are trading 69.57% higher at 39 cents a share.

Seven West shareholders will likely be distributed cash on the balance sheet of the acquired companies. Moreover, this spare cash is expected to be in the realm of $10 million from Prime and its various subsidiaries.

Additionally, accounting for the cash and share of distributions, Seven Media’s net investment is expected to be roughly $72 million. This would suggest a payment 2.9 times enterprise value to FY21 earnings before interest, tax, depreciation, and amortisation (EBITDA) for the acquisition.

Management commentary

Commenting on the acquisition, Seven West Media CEO James Warburton stated:

This proposal is an important step forward for both companies. SWM and PRT are great partners and have a long, successful relationship. Together, they will offer the best content for our national audience and unmatchable premium revenue opportunities for our clients.

The proposed transaction is an exciting and transformative development for advertisers and media buyers. It means we will be able to give advertisers easy and seamless access via a single platform to capital city and regional markets.

The market is showing enthusiasm for the Seven West Media share price with cost synergies expected. In fact, an estimated $5 million to $10 million cost synergies are anticipated on an annualised basis. These are forecast to be realised within 12 to 18 months from the acquisition completion.

Finally, the Seven West Media share price is up 196% in the last year.

The post Seven West (ASX:SWM) share price lifts 10% amid Prime Media acquisition appeared first on The Motley Fool Australia.

More reading

• What’s sending the Seven West Media (ASX:SWM) share price up 6% on Friday?

Motley Fool contributor Mitchell Lawler 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 Bruce Jackson.

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At lunch on Monday, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a solid gain. The benchmark index is currently up 0.55% to 7,364.8 points.

Here’s what is happening on the ASX 200 today:

Westpac full year results disappoint

The Westpac Banking Corp (ASX: WBC) share price is sinking on Monday following the release of its full year results. Although the banking giant doubled its cash earnings in FY 2021, this was still a touch short of expectations. In addition, Australia’s oldest bank announced a $3.5 billion off-market share buyback. A note out of Morgans reveals that its analysts were forecasting a $5 billion buyback

Macquarie share price returns

The Macquarie Group Ltd (ASX: MQG) share price has returned from its trading halt and is edging lower. The investment bank’s shares returned to trade today after completing a $1.5 billion institutional placement. These funds were raised at $194.00 per new share, which represents a discount of just 1.9%. The new capital provides Macquarie “with additional flexibility to invest in new opportunities where the expected risk-adjusted returns are attractive.”

Ausnet accepts Brookfield offer

The Ausnet Services Ltd (ASX: AST) share price is storming higher today after accepting a takeover offer from Brookfield Asset Management. According to the release, Brookfield has tabled a binding proposal of $2.65 per share, which is up from its original offer of $2.50 per share. As part of the terms of the agreement, Ausnet has terminated its due diligence process with APA Group (ASX: APA).

Best and worst ASX 200 performers

The best performer on the ASX 200 on Monday has been the Codan Limited (ASX: CDA) share price with a 6% gain. This appears to have been driven by bargain hunters swooping in after its shares were sold off last week. The worst performer has been the Westpac share price with a 6% decline following its full year results release.

The post ASX 200 (ASX:XJO) midday update: Westpac sinks, Macquarie raises $1.5bn appeared first on The Motley Fool Australia.

More reading

• Can the Macquarie (ASX:MQG) share price break new highs over $200?
• Westpac (ASX:WBC) share price sinks 6% despite doubling cash earnings
• Ausnet (ASX:AST) share price jumps as Brookfield offers $2.65/share
• Macquarie (ASX:MQG) share price falls after completing $1.5bn capital raising
• These were the worst performing ASX 200 shares in October

Motley Fool contributor James Mickleboro owns shares of Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended APA Group and Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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