The Bitcoin (CRYPTO: BTC) price broke into new 2022 highs overnight, reaching US$48,087 (AU$64,323).

The price has since retreated a touch, currently at US$47,444.

The Bitcoin price spike sent the token above levels last seen in the first days of January. And it’s now up 15% since this time last week.

That gives the world’s original and biggest crypto a market capitalisation of US$900.7 billion.

So, what’s driving the surge?

Why is the Bitcoin price charging higher?

Antoni Trenchev is the co-founder of crypto exchange Nexo.

Commenting on the Bitcoin price resetting its 2022 highs, Trenchev said (quoted by Bloomberg):

As we test the top of the 2022 trading range for the fifth time, this is another one of these Bitcoin moments when the narrative could swiftly change and investors pile in, propelling the Bitcoin price higher. It might just be time to awaken from the Bitcoin-sideways slumber that’s been 2022.

Michael Sonnenshein, CEO of crypto asset manager Grayscale, added:

It’s been a choppy start to the year, not just for crypto, but across all asset classes. So, I think certainly, it’s an exciting morning in the crypto community to see that year-long, so far, of losses erased, and also seeing Bitcoin break out above that psychological US$45,000 level.

Sonnenshein pointed out there are also “a couple of native crypto buyers like Terra buying for their own reserves”.

Just how much has Terra been buying?

The Luna Foundation is behind the stablecoin TerraUSD (CRYPTO: UST) and its blockchain.

And, according to eToro’s market analyst and crypto expert Simon Peters, the foundation’s major recent investments could be helping support the Bitcoin price.

“The Luna Foundation has accumulated fresh reserves of around 24,955 Bitcoins, worth roughly US$1.1 billion,” Peters said.

Peters continued:

The foundation is accumulating bitcoin in order to stabilise UST. Crypto community sleuths have followed a trail of Bitcoin buying in recent days that end with wallets believed to be held by the foundation…

It has previously bought around $2.2 billion-worth of Bitcoin meaning the foundation is now a serious whale in the market. The Luna Foundation’s goal is to build a US$10 billion bank of Bitcoin. So, the support this movement is providing to markets could continue for some time.

The Bitcoin price is still 31% below its 10 November all-time highs of US$68,790.

But that figure will likely be a lot more palatable to crypto investors than the 50%-plus losses it was sitting on just a few weeks ago.

The post The Bitcoin price just reached a new 2022 high. Here’s why appeared first on The Motley Fool Australia.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Bitcoin. The Motley Fool Australia owns and has recommended Bitcoin. 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 Recharge Metals Ltd (ASX: REC) share price exploded today before freezing in a trading halt.

The Australian explorer’s shares surged 280.77% before retreating slightly and grinding at a halt at 48 cents each. This is 269% more than yesterday’s closing price.

Let’s take a look at what Recharge Metals announced today.

Copper discovery

This morning, Recharge Metals informed the market it has intersected “significant” copper mineralisation at the Brandy Hill South Project. This is located within the Archaean Gullewa Greenstone Belt within the Murchison Province, Yilgarn Craton in Western Australia.

Since then, the company has announced trading will be temporarily paused pending another announcement.

Diamond drilling at the project intersected ultramafic/high-magnesium basalts in hole BHRCD019 from 92m to the end of the hole at 393m.

The company observed massive sulphide, brecciated zones of semi-massive sulphide, and disseminated visual copper sulphide mineralisation.

Within the BHRCD019 hole, the company found sulphides beyond the target zone and, therefore, drilled further than the planned depth of 300m to 393m.

The company said drilling intersected intense hydrothermal alteration, including carbonate, chlorite, epidote, quartz, and sericite throughout the lithological sequence.

Commenting on the copper find, Recharge managing director Brett Wallace said:

The diamond tail drilling program was planned to provide valuable structural and lithological information which will allow Recharge to evaluate the continuity of mineralisation and the nature of the primary mineralisation as well as the apparent supergene mineralisation.

It is an outstanding result to observe abundant copper sulphide mineralisation from 92m to end of hole at 393m.

We are very pleased with the observations made so far and we look forward to completing the remaining two diamond tails and receiving assay results.

Assay results for a 16 further drill holes are pending with further market updates to follow.

Share price snapshot

The Recharge metals share price has gained 140% in a year, while it has soared 259% year to date. In the past week, the company’s shares have rocketed 300%.

For perspective, the S&P/ASX 200 Index (ASX: XJO) index has returned about 10% over the past year.

The company has a market capitalisation of about $14.9 million based on the current share price.

The post This ASX miner just struck copper and its share price soared 280% before grinding to a halt appeared first on The Motley Fool Australia.

More reading

• Why is the Zip share price launching 7% on Tuesday?
• Expert reveals 3 ASX shares to watch following tonight’s federal budget
• Here’s why the Telix (ASX:TLX) share price is leaping higher today
• Tesla (NASDAQ:TSLA) share price rockets 8% on stock split news
• Ioneer (ASX:INR) share price lifts on lithium battery deal

Motley Fool contributor Monica O’Shea 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 Zip Co Ltd (ASX: ZIP) share price is in the green for the first time in nearly a week despite the company’s silence.

At the time of writing, the Zip share price is $1.54, 4.93% higher than its previous close.

However, earlier today, it reached an intraday high of $1.58 – representing a 7.48% gain.

Its surge follows 3 consecutive sessions within which the stock tumbled more than 2.5%. In fact, before today the Zip share price hadn’t recorded a gain since last Wednesday.

So, what’s driving the buy now, pay later (BNPL) giant’s shares upwards on Tuesday? Let’s take a look.

What’s boosting Zip’s stock today?

It’s a good day for ASX tech shares, and BNPL giant Zip (though, technically not a tech share) is among the winners.

Right now, both the S&P/ASX 200 Index (ASX: XJO) and the All Ordinaries Index (ASX: XAO) are up around 0.8%, with the tech sector coming in as one of the market’s major buoys.  

The S&P/ASX 200 Information Technology Index (ASX: XIJ) has launched 3.52% higher at the time of writing. Meanwhile, the S&P/ASX All Technology Index (ASX: XTX) has surged 2.73%.

The ASX 200’s best performing tech stock on Tuesday is Block Inc (ASX: SQ2) ­– the owner of former market favourite and Zip competitor, Afterpay. It’s currently up 7.61%.

Brushing elbows with the winner are Appen Ltd (ASX: APX) and Life360 Inc (ASX: 360), having gained 7.43% and 5.06% respectively.

Zip’s takeover target Sezzle Inc (ASXL SZL) is also in the green today, rising 4.12% to trade at $1.39.

The broader tech market’s gains might be helping to drive the BNPL stock upwards.

Additionally, the Zip share price’s surge might be a market correction after it was dragged 10.91% lower over the course of Thursday, Friday, and Monday.

Zip share price snapshot

Unfortunately, today’s gains haven’t been enough to drag the Zip share price out of its recent slump.

Right now, the BNPL company’s share price is 64% lower than it was at the start of 2022. It has also fallen 79% since this time last year.

The ASX 200 stock is also trading a whopping 85% lower than its 52-week high of $10.61, which it hit in April 2021.

The post Why is the Zip share price launching 7% on Tuesday? appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Appen Ltd, Block, Inc., Life360, Inc., and ZIPCOLTD FPO. The Motley Fool Australia owns and has recommended Block, 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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As Australia gears up for the Federal Government’s budget on Tuesday evening, many ASX shares are in the spotlight in anticipation.

Federal Treasurer Josh Frydenberg is expected to address issues of inflation, travel, costs of living and infrastructure, and, in particular, jobs.

It’s an interesting time for the Australian economy, with a number of tension points winding up from each end of the rope, so to speak.

Below is Australia’s terms of trade account, house price index, inflation-adjusted GDP growth and productivity trends since the year 2000.

What can we expect?

Frydenberg has said that while the employment rate was at a near-50-year low, the “budget will create an additional 40,000 jobs across Australia, building on our world-leading economic recovery”.

He is expected to deliver a large budget deficit, according to analysis from BDO Australia, although with “projections of a stronger-than-expected economic outlook, supported by sustained low unemployment rates and expected growth in real GDP”.

Prime Minister Scott Morrison also announced a package of around $18 billion for new and existing infrastructure projects, Bloomberg reports, “taking the government’s rolling 10-year investment pipeline to A$120 million”.

It is also investing “an additional $60 million to bring back international visitors to the regions hardest hit by international border closures”, according to a statement last week.

This includes $15 million for tourism in Tropical North Queensland and to promote the Great Barrier Reef, and $45 million for Tourism Australia “to get international tourists back in to key regional destinations heavily impacted by the loss of international tourism”.

Not only that, but the treasurer is expected to roll out a manufacturing package of more than $1 billion to speed up investment in new industry, The Australian reports.

So with that in mind, what stocks should investors pay attention to as the numbers are revealed this evening?

Which ASX shares to watch?

According to analysis from Jackie Edwards, equity markets Asia at Bloomberg, “Australian consumer and infrastructure-related shares will be in the spotlight”.

Utilising data compiled by Bloomberg’s proprietary artificial intelligence (AI) algorithms, Edwards notes several ASX shares that might be worth checking in reaction to tonight’s budget.

In travel and tourism, Edwards says to look at names like Qantas Airways Limited (ASX: QAN), currently trading up 0.58% at $5.17 apiece today. Qantas is front and centre of Australian travel, and is deeply entrenched into international and domestic travel lines.

Within infrastructure spending, she says the $18 billion planned expenditure could benefit names such as BlueScope Steel Limited (ASX: BSL), currently up 1.15% today at $21.96.

Bluescope shares have rallied hard in the past month and are now trading 4% higher for the year after climbing from deep lows.

Not only that, but Prime Minister Scott Morrison has laid out seven areas of high importance in domestic manufacturing, Edwards says, ranging from onshore manufacturing to pharmaceuticals.

This kind of manufacturing push is sure to benefit ASX shares such as CSL Limited (ASX: CSL), Edwards notes.

Analysts at JP Morgan agree with Edwards’ assessment and note CSL’s “market-leading position” in a recent note. It said this position remains unchallenged, and that it expects the company to print a strong rebound in sales for FY23.

The firm is overweight on CSL and values the company at $295 per share, around $30 per share upside at the time of writing.

Six-month returns for each of these ASX shares are plotted below.

The post Expert reveals 3 ASX shares to watch following tonight’s federal budget appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended CSL Ltd. 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 Telix Pharmaceuticals Ltd (ASX: TLX) share price is heading north during late morning trade following a company announcement.

At the time of writing, the biotechnology company’s shares are selling for $4.56 apiece, up 9.88%.

What did Telix announce?

Investors are pushing Telix shares higher after investors digest the company’s latest announcement to the ASX.

According to its release, Telix advised it has been granted Orphan Drug Designation (ODD) from the United States Food and Drug Administration (FDA) for its bone marrow conditioning treatment, TLX66.

Bone marrow conditioning is performed prior to hematopoietic stem cell transplantation (HSCT).

The latter is a procedure where a patient’s healthy stem cells are collected from blood or bone marrow before treatment. The stem cells are then safely stored, and given back to the patient after treatment.

The Orphan Drug Act was created by the FDA to motivate biopharmaceutical companies in developing potential medicines for rare or ‘orphan’ diseases. The ODD provides preferential treatment that enhances a company’s standing with the agency.

HSCT is being used increasingly in malignant hematological conditions, such as multiple myeloma and acute myeloid leukemia, and in non-hematological malignancies and rare/immune-mediated diseases.

In 2018, more than 22,700 HSCTs were performed in the United States.

The welcomed decision enables the company to receive special benefits of achieving incentivised targets. This includes eligibility for seven years of market exclusivity after FDA approval, discounted tax credits of 50% of drug testing costs, additional protocol assistance, reduced review times and specific marketing authorisation application fees waived.

Telix chief medical officer, Dr Colin Hayward added:

The granting of an Orphan Drug Designation by the FDA for TLX66, combined with recent encouraging data from prior studies in hematological malignancies and autoimmune disease provides a strong impetus to advance our development plans for TLX66.

This treatment has potential application in a number of hematological cancers and rare diseases and potentially also in the future for conditioning for cell and gene therapies.

Telix share price summary

It’s been a challenging couple of months for Telix shareholders, with the company’s share price down 42% in 2022.

However, when looking at the past 12 months, the company’s shares are hovering around 2% higher.

On valuation grounds, Telix presides a market capitalisation of roughly $1.4 billion.

The post Here’s why the Telix (ASX:TLX) share price is leaping higher today 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 Bruce Jackson.

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The Crown Resorts Ltd (ASX: CWN) share price is in the green after Blackstone’s proposed takeover of the casino operator was given a major tick of approval.

Today, the casino operator announced the Australian government’s Foreign Investment Review Board (FIRB) has given the $8.9 billion transaction the thumbs up. Although, the takeover isn’t a sure thing just yet.

At the time of writing, the Crown share price is $12.74, 1.11% higher than its previous close.

Let’s take a closer look at the news moving the casino operator’s stock lately.

Crown share price higher on FIRB tick of approval

The Crown share price is gaining on Tuesday after the FIRB gave its approval of Blackstone’s takeover proposal.

The private equity firm’s offer is still contingent on conditions including approvals from gaming regulators and Crown’s shareholders.

Blackstone’s latest takeover proposition – the first to be approved by Crown’s board – saw the casino operator offered $13.10 cash per share.

That’s a 10.5% increase on the firm’s first offer of $11.85 per share, posed in March 2021.

The successful bid represents “an attractive outcome for shareholders”, according to Crown chair Ziggy Switkowski.

Switkowski said that, despite the company making “good progress” on challenges born from the COVID-19 pandemic and various regulatory issues, ongoing uncertainty made the takeover offer appealing.

Both Crown and Blackstone expect the takeover to go to a shareholder vote in the current quarter.

The so-far-successful bid follows many posed to Crown in 2021.

Blackstone put forward three unsuccessful bids, respectively worth $11.85 per share, $12.35 per share, and $12.50 per share, last year.

Fellow ASX-listed casino operator Star Entertainment Group Ltd (ASX: SGR) also posed a merger offer for Crown in May 2021.

Additionally, Oaktree Capital Management put forward a funding commitment worth approximately $3 billion last April.

Right now, the Crown share price is 6.5% higher than it was at the start of 2022. It has also gained 8% since this time last year.

The post Crown (ASX:CWN) share price gains as $8.9b takeover gets a green light appeared first on The Motley Fool Australia.

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• Here’s why all eyes will be on the size of Crown’s (ASX:CWN) potential AUSTRAC fine

Motley Fool contributor Brooke Cooper 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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It might seem like deja vu, but electric vehicle and battery manufacturer Tesla Inc (NASDAQ: TSLA) is planning a stock split. Yes, another one.

It was only back in August 2020 that Elon Musk’s company undertook its last stock split. But the company’s share price growth has clearly elicited the company to undertake a second split in as many years.

Since its last split was announced, Tesla is up more than 130%. Tesla made the announcement last night, which promptly saw the Tesla stock price leap an extraordinary 8% or so. The company began US trading at US$1,010.64 a share, but closed this morning (our time) at US$1,091.84, up 8.03%.

So what did the company actually say? Not too much as it turns out. Here’s some of what Tesla’s SEC filing stated:

On March 28, 2022, Tesla, Inc… announced its plan to request stockholder approval at the upcoming 2022 Annual Meeting of Stockholders… for an increase in the number of authorized shares of common stock… in order to enable a stock split of the Company’s common stock in the form of a stock dividend. Tesla’s Board of Directors… has approved the management proposal, but the stock dividend will be contingent on final Board approval.

We don’t yet know what or when the exact split will be. But we know that it has certainly made a good impression on investors, or at least it did overnight.

Tesla stock price soars on latest stock split

Stock splits have been all the rage in the US tech sector in recent years. Tesla kicked off this trend back in 2020 when it first announced its last split. This saw a five-for-one division of Tesla shares. This was followed by Apple Inc (NASDAQ: AAPL) announcing its own four-for-one split soon after. More recently, we have seen both Alphabet Inc (NASDAQ: GOOG)(NASDAQ: GOOGL) and Amazon.com Inc (NASDAQ: AMZN) announce 20-for-1 splits of their own. These haven’t been initiated yet.

So why do investors like stock splits? Well, that is somewhat unclear. A stock split has very little real benefit for a company or its investors. It simply results in a re-division of a company’s shares into smaller parcels. Think of it as cutting a pie into smaller sized slices. The pie itself doesn’t change size, but its slices do. For example, Tesla’s last stock split was done at a five-to-one ratio. That means that an investor who held 10 shares before the split held 50 shares after the split, with each share worth approximately 20% of what an old one was worth.

But even though it’s just ‘recutting the pie’, stock splits still have arguable benefits. A lower share price increases a company’s liquidity. It also could increase the appeal for smaller, retail investors. That’s because it’s a lot more affordable to buy a share worth US$200 than US$1,000.

So we’ll have to wait and see what this new split will look like when Tesla releases more details. But it looks as though there are about to be a lot more Tesla shares on the markets. At last night’s close, Tesla shares are up 78.6% over the past 12 months and an eye-watering 1,862% over the past five years.

Tesla’s market capitalisation now stands at US$1.13 trillion.

The post Tesla (NASDAQ:TSLA) share price rockets 8% on stock split news appeared first on The Motley Fool Australia.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen owns Alphabet (A shares), Amazon, Apple, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Alphabet (A shares), Amazon, Apple, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Alphabet (C shares) and has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, and Apple. 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 Ioneer Ltd (ASX: INR) share price is in the green today on the back of the company’s latest lithium battery agreement.

Its shares are currently swapping hands at 56 cents, a 3.7% gain. For perspective, the S&P/ASX 200 Index (ASX: XJO) is up 0.86% today.

Let’s take a look at what this lithium miner revealed today.

Nevada lithium agreement

The Ioneer share price is gaining after the lithium explorer revealed it had completed a memorandum of understanding (MOU) with NexTech Batteries in the United States.

Ioneer owns the Rhyolite Ridge lithium-boron project in Nevada, USA. This is said by the company to be the only known lithium-boron deposit in North America. Ioneer hopes to produce more than 22,000 tonnes of lithium materials per year from this project. The deposit is about 225 miles (362km) northwest of Last Vegas.

NexTech batteries is a lithium-sulphur battery technology company based in Carson City, Nevada.

The companies have “expressed mutual interest” in using lithium carbonate and/or lithium hydroxide from the Ioneer project to supply NexTech’s production facility.

Commenting on the MOU which may be pushing up the Ioneer share price today, managing director Bernard Rowe said:

As Ioneer focuses on producing the materials needed for sustainable and clean technologies, it’s important for companies like NexTech to develop and produce those technologies domestically, and sustainably.

The US and Nevada have prioritised the need for a domestic battery supply chain, and with little current supply, development of Rhyolite Ridge will be crucial to meeting this important goal.

The Northern Nevada Development Authority helped facilitate the introduction between the two companies.

Ioneer share price snapshot

The Ioneer share price has surged 40% over the past year, but it is down nearly 31% year to date.

For perspective, the benchmark S&P/ASX 200 Index (ASX: XJO) has gained nearly 10% in the past 12 months.

The lithium explorer’s shares have climbed 2.8% in a month, while they have jumped 1.8% in a week.

Ioneer has a market capitalisation of about $1.16 billion based on its current share price.

The post Ioneer (ASX:INR) share price lifts on lithium battery deal appeared first on The Motley Fool Australia.

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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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There’s no doubt the conflict in Eastern Europe has triggered higher commodity prices, credit re-ratings, and jittery stock markets.

So much so that there’s even been talk of a return to the 1970’s style ‘stagflation’ where there’s an economic recession and inflation at the same time, as Bloomberg speculated.

“A scenario analysis of 1973-1975 that saw prices soar and economies stall suggests commodities would hold out with sovereign bonds, the Swiss franc would surge 22%, the yen would slump with the Australian and New Zealand dollar,” Bloomberg writers opined.

“Global equities would tumble 14%. The resilience of stocks after Russia’s invasion of Ukraine will be put to [the] test as Federal Reserve Chair Jerome Powell said he is willing to act more aggressively to get ahead of inflation.”

Analysts from investment bank Macquarie Group Ltd (ASX: MQG) are keen to take advantage of the trend and have opted to “position as if it’s a commodity boom”, as they stated in a recent note.

Macquarie’s portfolio changes

According to the note, Macquarie is positioning itself to capitalise on the rally across commodity markets. It’s beefed up exposure to the sector through positions in South32 Ltd (ASX: S32), Newcrest Mining Ltd (ASX: NCM), lithium player Pilbara Minerals Ltd (ASX: PLS), and Northern Star Resources Ltd (ASX: NST).

Meanwhile, it trimmed down in QBE Ltd (ASX: QBE), Amcor Plc (ASX: AMC), Cochlear Ltd (ASX: COH), Aristocrat Leisure Ltd (ASX: ALL), and Ramsay Healthcare Ltd (ASX: RHC).

Other changes include reductions in Resmed Inc (ASX: RMD) and Janus Henderson Plc (ASX: JHG).

As is clear, Macquarie is positioned to benefit from the ever-soaring commodities sector that’s been spurred on by a number of macroeconomic catalysts.

Analysts at Jefferies reckon the bank will benefit from the volatility in commodity and energy markets as well.

The broker recently updated its FY22 projections for Macquarie and also thinks recent weather events could inflect positively on these forecasts.

It values the Macquarie stock at $245 per share with a buy rating. That’s alongside seven other brokers who’re urging their clients to get a hold of Macquarie shares, according to Bloomberg data.

The consensus price target is $220.14 per share from this list.

In the last 12 months, the Macquarie share price has spiked 33% but has dipped into the red this year to date.

The post Here’s how Macquarie (ASX:MQG) is changing its portfolio of ASX shares in response to the Ukraine crisis appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Cochlear Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended ResMed. The Motley Fool Australia owns and has recommended Amcor Limited. The Motley Fool Australia has recommended Cochlear Ltd., Macquarie Group Limited, Ramsay Health Care Limited, and 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 Electro Optic Systems Holdings Ltd (ASX: EOS) are rocketing 14% in morning trade following a positive company announcement.

At the time of writing, the defence contractor’s shares are swapping hands for $3.14 apiece, up 14.18%.

This means that in the past month, the company’s share price has soared more than 50% in value.

SpaceLink receives financial backing

In today’s statement, Electro Optic Systems advised that SpaceLink has received conditional finance support from Export Finance Australia (EFA).

Based in the United States, SpaceLink is a wholly-owned Electro Optic Systems subsidiary that specialises in space and communications.

The non-binding letter of support will see up to US$80 million of debt funding for the initial satellite communications constellation (Block-0a) launch.

Late last month, Electro Optic Systems announced an initial funding requirement from US$700 million to US$240 million for Block-0a. This is because the constellation is a lower-cost design solution.

As a result, the latest offer will bring the projected launch date in line with Federal Communications Commission licensing requirements.

The US$80 million support represents one third of SpaceLink’s total initial funding requirements for its US$240 million initial Block-0a constellation.

EFA funding is subject to a number of conditions, however. This includes:

• An independent technical review of SpaceLink’s feasibility
• A comprehensive funding plan for SpaceLink
• Meeting EFA’s eligibility criteria, credit and risk requirements
• Satisfactory ongoing financial and trading performance for Electro Optic Systems
• SpaceLink complying with EFA’s environmental and social risk policies

Electro Optic Systems share price snapshot

Despite today’s astronomical gains, it has been a difficult 12 months for Electro Optic Systems shares, down 40%.

The company’s shares reached a 52-week low of $1.605 early this month, before rebounding over 100% within two weeks.

Electro Optic Systems commands a market capitalisation of roughly $467.83 million.

The post This just caused the Electro Optic (ASX:EOS) share price to soar 14% appeared first on The Motley Fool Australia.

More reading

• Electro Optic (ASX:EOS) shares down 12% today but up 40% in a month
• Electro Optic (ASX:EOS) share price surges again, up 50% in 7 days. Here’s why
• Why is the Electro Optic (ASX:EOS) share price rocketing 16% today?
• What’s impacting the Electro Optic (ASX:EOS) share price this week?
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Motley Fool contributor Aaron Teboneras owns Electro Optic Systems Holdings Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Electro Optic Systems Holdings Limited. The Motley Fool Australia owns and has recommended Electro Optic Systems Holdings 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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