Category: Stock Market

The Starpharma Holdings Ltd (ASX: SPL) share price is in focus today as the company reported a 145% jump in full-year revenue to $12 million and reduced its reported loss by 25% to $7.5 million.

What did Starpharma report?

• Revenue rose 145% to $12.0 million (FY25: $4.9 million), mainly from the Genentech licence agreement.
• Reported loss improved to $7.5 million, down from $10.0 million last year.
• Closed FY26 with $11.0 million in cash; post-year-end capital raising added $30 million to strengthen funding.
• Research and product development spending was $11.1 million (FY25: $8.4 million), after R&D tax incentive.

What else do investors need to know?

Starpharma strengthened its balance sheet after the reporting period, raising $30 million through a well-supported entitlement offer. This extends its funding runway into FY28, giving the company greater flexibility to advance its pipeline programs.

The company has continued to invest in its DEP® technology, with particular progress on its lead radiopharmaceutical asset, DEP® HER2-Lutetium, and next-generation oncology candidates. New and existing strategic partnerships further reinforce its commercial and research initiatives.

What did Starpharma management say?

Chief Executive Officer Cheryl Maley said:

During FY26, we significantly advanced our lead radiopharmaceutical asset, DEP® HER2-Lutetium, executed new strategic partnerships and strengthened existing ones, and further validated the broad potential of DEP® with a focus on targeted oncology treatments. We thank our shareholders for their continued support throughout the year. Our focus remains on building long-term shareholder value through the development of a pipeline of targeted oncology therapies enabled by our DEP® technology. The team is committed to executing on the milestones ahead and translating our scientific and commercial progress into meaningful outcomes for patients and shareholders.

What’s next for Starpharma?

Looking ahead, Starpharma is focused on advancing its clinical and preclinical DEP® pipeline, including further development of the DEP® HER2-Lutetium asset in targeted oncology. Management says the recently strengthened cash position supports the group’s research programs and continued progress of its key partnerships.

The company aims to deliver long-term value for shareholders by progressing its innovative dendrimer-based therapies, with a particular emphasis on expanding its presence in oncology and strengthening its commercial relationships.

Starpharma share price snapshot

Over the past 12 months, Starpharma shares have surged more than 500%, significantly outpacing the All Ordinaries Index (ASX: XAO).

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The post Starpharma: FY26 earnings reveal strong revenue growth and improved loss appeared first on The Motley Fool Australia.

More reading

• Arena REIT faces leasing challenge after Edge Early Learning enters administration
• DUG Technology scores US$9.3m software and HPC contract
• Down 56%: Has the market lost interest in Life360 shares?
• Inflation falls again, but could the RBA still raise interest rates?
• 3 reasons I’d buy the NDQ ETF now

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 Arena REIT (ASX: ARF) share price is likely in focus today after the ASX-listed property group announced its tenant, Edge Early Learning, has entered voluntary administration. Arena is working proactively with the administrator and exploring alternative leasing options to protect long-term shareholder value.

What did Arena REIT report?

• Edge Early Learning, a key tenant, has entered voluntary administration.
• The future of Edge’s leases across Arena-owned properties remains uncertain.
• Arena holds around $4 million in pooled bank guarantees as security over the Edge leases.
• The company is actively progressing discussions with possible replacement tenants.

What else do investors need to know?

Arena previously flagged its exposure to Edge Early Learning, and this latest update confirms that uncertainty for some properties in its portfolio is continuing. Arena’s management is engaging constructively with the administrator to seek the best outcome for its securityholders.

While the leases with Edge remain unresolved, Arena’s diversified tenant base across early learning and healthcare sectors may help to cushion some of the financial impact. The company is proactively seeking new leasing arrangements and will provide further updates as more information becomes available.

What’s next for Arena REIT?

Arena’s immediate focus remains on working with the administrator of Edge Early Learning and seeking to secure alternative tenants for any affected properties. The $4 million held in bank guarantees provides some protection to the REIT, but uncertainty remains until lease arrangements are clarified.

Shareholders can expect further updates from management as the situation evolves and discussions with potential replacement tenants progress.

Arena REIT share price snapshot

Over the past 12 months, Arena REIT shares have declined 41%, significantly trailing the All Ordinaries Index (ASX: XAO), which has risen 1% over the same period.

View Original Announcement

The post Arena REIT faces leasing challenge after Edge Early Learning enters administration appeared first on The Motley Fool Australia.

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• Arena REIT postpones FY2026 earnings result as Edge Early Learning seeks rent relief

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 DUG Technology Ltd (ASX: DUG) share price is in focus after the company announced a US$9.3 million software and HPC infrastructure contract, awarded by an undisclosed National Oil Company, with a two-year term set to commence in the first quarter of FY27.

What did DUG Technology report?

• Secured a US$9.3 million contract for software and hosted HPC infrastructure
• Two-year term beginning Q1 FY27
• Contract includes access to DUG Insight processing and imaging toolkit
• Client is a National Oil Company with strong financial and operational capability

What else do investors need to know?

This contract deepens DUG Technology’s relationship with the energy sector, demonstrating its capability to deliver high-performance solutions globally. The client will utilise DUG’s toolkit for advanced subsurface processing and imaging workflows, playing to DUG’s core strengths in geoscientific computing and cloud-based HPC services.

The deal continues DUG’s focus on sustainable, energy-efficient solutions, leveraging its proprietary immersion cooling systems. The company remains committed to innovation and helping clients minimise risk in complex data environments.

What’s next for DUG Technology?

DUG is expected to deliver both software and HPC infrastructure services over the next two years, supporting further expansion into energy and technology markets. Management will likely focus on growing relationships within the energy industry and scaling its advanced offering globally.

The company’s ongoing investment in R&D and sustainable computing positions it well to attract similar large-scale contracts and continue driving revenue growth in coming years.

DUG Technology share price snapshot

Over the past 12 months, DUG Technology shares have risen 24%, outperforming the All Ordinaries Index (ASX: XAO), which has risen 1% over the same period.

View Original Announcement

The post DUG Technology scores US$9.3m software and HPC contract appeared first on The Motley Fool Australia.

More reading

• Starpharma: FY26 earnings reveal strong revenue growth and improved loss
• Arena REIT faces leasing challenge after Edge Early Learning enters administration
• Down 56%: Has the market lost interest in Life360 shares?
• Inflation falls again, but could the RBA still raise interest rates?
• 3 reasons I’d buy the NDQ ETF now

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 recommended Dug Technology. 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.

Life360 Inc (ASX: 360) shares have fallen further into the red in Wednesday lunchtime trade.

At the time of writing, the shares are down around 1.5% and are changing hands for $20.67 a piece.

The latest decline means the shares are now down 36% year-to-date, and are 56% lower than 12 months ago.

What happened to Life360 shares?

The company’s shares were caught up in a tech-sector-wide sell-off over the past year, as investors sold their tech shares amid growing fears that companies’ core services could be replaced by AI.  

The rotation away from the tech sector saw the Life360 share price steadily tumble from an all-time high of $55.44 in early October, to an annual low of $17.91 in mid-April.

But it looked like the shares had bottomed out, and they rallied through June to early August on the back of a strong quarterly result in mid-May and renewed investor confidence.

But then the company posted an unimpressive second-quarter FY26 update two weeks ago, and it once again slashed investor sentiment.

Life360 recorded a 38% increase in revenue, to US$159 million, and a 53% increase in adjusted EBITDA, to US$31.1 million.

Global monthly active users increased by 4.6 million in the quarter, bringing the total to approximately 102.4 million – up 16% compared to the previous year.

Looking ahead, Life360 still expects FY26 revenue growth to accelerate between 33% to 40% year-on-year to between US$650 million and US$685 million. Adjusted EBITDA is also still expected to be between US$130 million to US$140 million.

Clearly, investors are displeased with the result. It appears that many shareholders expected another upward revision to FY26 revenue guidance.

Since that results announcement, Life360 shares have shed 30% of their value.

What do brokers tip for the shares next?

It looks like the experts are still bullish on Life360 shares, expecting a recovery over the next 12 months.

Market Index shows that brokers currently agree to a buy rating on the shares. The $31.73 average target price implies a potential 54% upside, at the time of writing.

TradingView data shows something similar. Out of 13 analysts, 12 currently hold a buy/strong buy rating on Life360 shares. The average target price is $31.21, implying around a 51% upside at the time of writing. However, some think the shares could climb 97% to $40.76 a share over the next 12 months.

Bell Potter recently confirmed its buy rating and $34 price target on the location technology company’s shares. Ahead of the results and share price crash, the broker said it thinks the stock is trading at reasonable value.

The post Down 56%: Has the market lost interest in Life360 shares? appeared first on The Motley Fool Australia.

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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 positions in and has recommended Life360. The Motley Fool Australia has positions in and has recommended Life360. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Australia’s inflation rate fell again in July, although the latest figures came in slightly above economists’ expectations.

New data from the Australian Bureau of Statistics (ABS) shows the Consumer Price Index (CPI) rose 3.5% over the 12 months to July, down from 3.8% in June.

The annual rate is still moving in the right direction, although economists had been expecting inflation to come in at around 3.3%.

Prices also rose 1% during July, above forecasts for a 0.8% increase, while underlying inflation remained elevated.

So, is another interest rate hike back on the table?

What is still pushing prices higher?

Housing remained the biggest contributor to annual inflation, with prices across the group rising 5% over the year.

New dwelling prices increased 5.7%, rents were up 3.6%, and electricity prices rose 6.1%. Food and non-alcoholic beverages were also 3.2% higher, while recreation and culture prices increased 2.6%.

There were also some sizeable price moves during July.

Automotive fuel prices jumped 7.5% for the month after falling for 3 months in a row. The ABS said the increase was driven by higher global oil prices and the partial unwinding of the federal government’s fuel excise relief measures.

Domestic holiday travel and accommodation prices also rose 6.2% as demand picked up during the school holiday period.

The RBA will be keeping a close eye on the underlying inflation figures as well.

Services inflation was still running at 3.7% over the year, while non-tradables inflation was sitting at 4.4%.

Could the RBA raise rates again?

The key number for the RBA was trimmed mean inflation, which gives a better idea of what is happening with underlying price pressures.

It rose 0.5% in July and remained at 3.6% over the year, still above the RBA’s 2% to 3% target range.

That was also higher than expected, with economists forecasting a monthly increase of around 0.3%.

The RBA left the cash rate unchanged at 4.35% earlier this month after raising rates 3 times in 2026.

Minutes from that meeting showed the board considered another rate hike, but decided to keep rates on hold and wait for more data.

There are signs higher rates are already having an effect. Australia’s unemployment rate rose to 4.5% in July, while employment unexpectedly fell by 15,800.

This gives the RBA something else to weigh up as it tries to bring inflation down without slowing the economy too much.

Mark your calendar for 29 September, when the RBA will hand down its next interest rate decision.

The post Inflation falls again, but could the RBA still raise interest rates? appeared first on The Motley Fool Australia.

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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 Scott Phillips.

The Betashares Nasdaq 100 ETF (ASX: NDQ) is an ASX exchange-traded fund (ETF) I would be comfortable buying with a long-term view.

It gives investors access to many of the businesses shaping how technology is used around the world, without requiring them to decide which individual company will ultimately come out on top.

Here are three reasons I would buy it now.

It gives me exposure to businesses changing how the world operates

One reason I like the NDQ ETF is that many of its largest holdings sit behind technologies that are becoming increasingly important to consumers and businesses.

Nvidia, for example, has become central to the build-out of artificial intelligence (AI) infrastructure through its advanced chips.

Microsoft approaches the opportunity from another direction. Its cloud computing and software businesses give it the chance to bring AI tools directly into products already used by companies around the world.

Then there are businesses such as Amazon, where cloud computing, ecommerce, advertising, and automation all provide potential avenues for further growth.

These businesses are helping build the infrastructure, software, and services that could shape how we work, shop, communicate, and process information for many years.

I don’t have to pick the biggest winner

Artificial intelligence is a good example of why I like the broad exposure provided by the NDQ ETF.

There are several places where value could ultimately be created.

Chipmakers may benefit from the initial infrastructure spending; cloud providers can supply computing power; software companies can develop applications for businesses; and consumer platforms may find entirely new ways to use the technology.

The balance between those opportunities could shift considerably over the next decade.

Owning the NDQ ETF lets me participate across that broader development rather than trying to predict today which company will capture the largest share of the profits.

The same thinking applies beyond AI.

Technology changes quickly, and I would rather own a collection of leading businesses than depend too heavily on my ability to identify the next major trend before everyone else does.

The fund can evolve without me doing anything

The way the index can evolve is probably one of the strongest reasons I could imagine holding the NDQ ETF for many years.

The NASDAQ-100 Index (NASDAQ: NDX) will not contain the same companies forever. Businesses that grow can become more important within the index, while others can lose influence or eventually be replaced.

That means the fund can gradually change as the corporate landscape changes.

I think this is especially valuable over a timeframe of 10, 20, or even 30 years. It would be unrealistic to expect today’s largest companies to remain in the same positions indefinitely.

Some will keep compounding. Others will eventually be overtaken by businesses that may still be relatively small today.

With the NDQ ETF, investors can participate in that evolution without continually rebuilding the portfolio themselves.

Foolish takeaway

I think the NDQ ETF gives ASX investors a simple way to own a collection of businesses positioned around some of the world’s most important long-term growth trends.

There will be periods when technology shares struggle, and the fund’s concentration in large growth companies means volatility should be expected.

But I like the idea of owning an investment that can keep evolving as new corporate leaders emerge.

The post 3 reasons I’d buy the NDQ ETF now appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino 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 Amazon, BetaShares Nasdaq 100 ETF, Microsoft, and Nvidia. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Amazon, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Westgold Resources Ltd (ASX: WGX) has more than doubled in value over the past year, but according to the team at UBS, there’s more upside to be had.

This week, the broker issued a new research report on Westgold, after the company put out an update on its Meekatharra expansion plan.

Before we get to the UBS valuation of the company, let’s have a look at what Westgold announced.

Processing expansion numbers stack up

Westgold released the results of a scoping study examining the expansion of capacity at the Meekatharra processing hub from 1.8 million tonnes per year to 2.9 million tonnes per year.

The company said regarding the plans:

The Meekatharra expansion plan is being advanced as a low-capital-intensity, brownfields expansion option that leverages Westgold’s existing Meekatharra infrastructure and long-lead equipment already procured. The preferred pathway is intended to remove an emerging processing constraint and create a larger, more flexible platform for the Murchison ore base, without the cost, risk or timeframe of constructing a new standalone processing plant.  

The expansion plan would add 47,000 ounces of gold production per year once commissioned, with total gold production to rise to 1.6 million ounces over 10 years.

Westgold said the project would cost about $100 million and have a payback period of nine months, with commissioning targeted for FY28.

Westgold Managing Director Wayne Bramwell said:

Meekatharra is the growth engine of Westgold’s Murchison business. As Bluebird–South Junction continues to expand and the Murchison open pit program ramps up, the hub is increasingly moving from being mine-constrained to processing-constrained. The MXP is a capital-efficient brownfields expansion option to address this emerging constraint. It utilises existing infrastructure and long-lead equipment already procured to increase processing capacity from 1.8Mtpa to 2.9Mtpa, without the capital intensity, execution risk or timeframe of building a new plant. Westgold will now commence feasibility-level work to confirm the engineering, capital estimate, delivery schedule and ore source assumptions ahead of a potential investment decision in late FY27.

ASX gold stock looking cheap

UBS said in a note to clients that Westgold could potentially increase gold production to 650,000 ounces per year by 2030, as a result of three separate expansion projects.

The UBS analysts said they visited Meekatharra in July and “could see numerous options for new mining fronts and potential for higher throughput”.

UBS has increased its price target on Westgold shares to $8.25 from $7.75, compared to $6.87 currently.

Westgold is valued at $6.19 billion.

The post This ASX gold producer could jump by 20%, according to UBS appeared first on The Motley Fool Australia.

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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 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.

Domino’s Pizza Enterprises Ltd (ASX: DMP) shares have crashed 12%, following the pizza chain’s FY26 results announcement this morning.

At the time of writing, the shares are trading for $17.70.

They’re now down around 19% for the year-to-date and are 8% lower than trading levels 12 months ago.

What has spooked investors today?

The company reported a 11.2% decrease in revenue, and a statutory NPAT loss of $134.2 million, including $255.7 million in non-cash write-downs and impairments. These were mainly for its France and Taiwan businesses, and also included technology assets and some underperforming corporate stores.

Domino’s underlying NPAT was up 4% for the 12-month period, and in line with guidance, but EBITDA fell 6.1%.

The company also cut its total FY26 dividend by 25.3% to 57.5 cents.

Going forward, Domino’s said it is planning to return to profitable growth in FY27 after a period of resetting its store network and business model. 

Domino’s also confirmed plans to roll out a revised pricing and operating model across Australia, focusing on long-term franchisee profitability and less reliance on aggressive discounting. The move follows a positive trial in Western Australia.

It’s clear that investors weren’t impressed with the results and many have rushed to sell up their shares this morning.

It’s been a difficult year for the fast food operator. The latest decline follows the company’s FY26 half-year result, which it announced in February this year. That half-year result was also a miss for investors and sent the share price crashing.

The shares dropped to a decade-low in mid-May but began recovering through late July after Domino’s posted its preliminary FY 2026 results ahead of today’s announcement. Most of those gains have been shed so far today.

Earlier this month, the company also revealed that Andrew Gregory has commenced as Group Chief Executive Officer and Managing Director. Jack Cowin has also resumed his former position as Non-Executive Chair.

Is the stock a buy, sell or hold now?

I expect that some market experts may revise their outlook on Domino’s shares in the coming days, following today’s results announcement.

But at the time of writing, analysts are still on the fence about the outlook for Domino’s shares this year.

TradingView data shows that out of 18 analysts, three have a buy or strong buy rating and 10 have a hold rating. Another five have a sell/strong sell rating.

The average $18.94 target price implies potential upside of around 7% over the next 12 months, at the time of writing.

But the difference between the maximum and minimum is wide. Some analysts think the shares could rise 46% to $26 per share. Meanwhile, others expect them to sink another 33% to $12 per share, at the time of writing.

The post Domino’s shares crash 12%: Are the shares a buy, sell or hold today? appeared first on The Motley Fool Australia.

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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 positions in and has recommended Domino’s Pizza Enterprises. The Motley Fool Australia has recommended Domino’s Pizza Enterprises. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Two popular ASX growth shares are being heavily sold off on Wednesday after releasing their latest results.

DroneShield Ltd (ASX: DRO) is down around 10% to $1.75, while WiseTech Global Ltd (ASX: WTC) has fallen around 6% to $42.88.

For me, both declines are creating an opportunity to look beyond today’s market reaction and focus on what these businesses could become.

DroneShield shares

DroneShield remains a higher-risk investment, but I think the growth opportunity is becoming harder to ignore.

The counter-drone specialist generated record first-half revenue of $125.8 million, representing growth of 74% over the prior corresponding period. More importantly for me, recurring revenue increased 229% to $11.5 million.

Recurring revenue is still a relatively small part of the business, so I would not make too much of it yet. But it shows DroneShield is beginning to build revenue that can continue after the initial hardware sale.

I also like what the company is doing to prepare for much greater demand.

DroneShield completed its new Sydney production facility during the half and established operations in Europe, where more than half of first-half revenue was generated. It finished June with $180 million of cash and term deposits, giving it significant resources to keep investing in production, software, and new products.

The next generation of AI-enabled hardware and software is very interesting to me. Counter-drone technology needs to keep evolving as the threats themselves change, and DroneShield is investing heavily to stay near the front of that development.

At $1.75, I think the sell-off offers an attractive entry point for investors comfortable with considerable risk.

WiseTech shares

WiseTech is a much more established business, but I think today’s result shows there is still plenty for long-term investors to look forward to.

CargoWise sits at the centre of the company’s opportunity. It provides software that helps global logistics companies manage the movement of goods across borders, including freight forwarding, customs, warehousing, and other complex processes.

One development that caught my attention is that more than 95% of CargoWise customers have now moved onto WiseTech’s new Value Packs commercial model. This is designed to move the company further towards charging for the value and transactions flowing through CargoWise rather than traditional seat-based pricing.

I think that could become increasingly valuable as WiseTech adds more automation and AI to the platform.

The e2open acquisition also gives the company a much larger presence across global trade and supply chains. WiseTech has already achieved substantial cost savings from integrating the business, while free cash flow increased 43% to US$410.7 million in FY26.

The outlook gives me another reason to remain positive.

Management expects underlying EBITDA to grow by 12% to 21% in FY27, with the underlying EBITDA margin rising to between 49% and 51%.

That suggests WiseTech could continue getting more profitable as it integrates e2open, rolls out new products, and uses AI to improve both its software and internal operations.

At around $42.88, I would be happy to use today’s weakness to build a long-term position.

Foolish takeaway

In both cases, I can see businesses investing heavily today to pursue opportunities that could be substantially larger several years from now.

DroneShield carries considerably more risk and would warrant a smaller position in my portfolio. WiseTech has a more established business and stronger cash generation.

But after Wednesday’s falls, I think both shares are worth buying with a long-term view.

The post Why I’d buy the dip on DroneShield and WiseTech shares appeared first on The Motley Fool Australia.

More reading

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• Why Woolworths, Domino’s and DroneShield shares are turning heads on Wednesday
• Why are WiseTech shares crashing 8.5% today?
• DroneShield share price in focus as record revenue meets interim loss
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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 WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Shares in EBR Systems Inc (ASX: EBR) are languishing near their 12-month lows despite the company making good progress on its commercialisation plans.

The analyst team at Morgans believe the shares are deeply undervalued at this point, and has a very bullish share price target on the company which I’ll get to shortly.

First let’s have a look at a recent announcement on the company’s business.

Solid progress on take-up of technology

EBR has developed a system called WiSE which it says is designed to overcome the limitations of conventional cardiac resynchronisation therapy and, “is the only leadless left ventricular endocardial pacing (LVEP) device”.

The company recently released a quarterly report and said that it had surpassed its hundredth commercial WiSE implant, “with multiple sites performing their first WiSE implants and numerous sites performing their 2nd, 3rd, 4th, and greater cases”.

EBR Chief Executive Officer John McCutcheon said:

We are extremely pleased with this quarter on multiple fronts. Commercially, EBR surpassed its 100th commercial WiSE implant, with multiple sites performing their first WiSE implants and numerous more experienced sites continuing to treat patients with WiSE. We secured master purchasing agreements with HCA Healthcare, Advocate Health, and CHRISTUS Health, validating the clinical and economic benefit of WiSE in major U.S. healthcare networks. In support of our future commercial efforts, the U.S. Centers for Medicare & Medicaid Services (CMS) further advanced WiSE through the Transitional Coverage for Emerging Technology (TCET) program by formally initiating the National Coverage Determination process for WiSE.

The company also fully transitioned to its new manufacturing facility in California, Mr McCutcheon said.

During the quarter, EBR had operating cash outflows of $25 million, but also completed a $150 million capital raise.

Shares in this ASX biotech looking very cheap

Morgans said in its note to clients issued this week that they believed the commercial roll out, “has progressed further than the headline implant numbers suggest, but execution capacity has temporarily become a key variable”.

Morgans added:

Management is now deliberately de-emphasising new site contracting and physician training to focus on repeat utilisation within existing accounts. This should reduce the administrative burden on the field organisation and allow trained representatives to spend more time supporting procedures. Thus, we view implant productivity per activated account rather than the number of contracted hospitals as the key near-term variable. With 17 sites already having completed ≥3 cases, we see an opportunity for utilisation to compound as physicians gain experience and WiSE becomes embedded in clinical workflows.

Morgans said the company had moved beyond the question of whether hospitals would buy WiSE, to proving whether they could generate repeat sales.

They added, “we view the existing footprint as adequate to provide substantial gains not reflected in the current share price”.

Morgans has a share price target of $1.95 on EBR shares compared to 30.5 cents currently.

The company is valued at $214.7 million.

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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 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.