The Suncorp Group Ltd (ASX: SUN) share price is outpacing the broader market after it sold its interest in a JV and announced a FY22 reinsurance placement.

The Suncorp share price jumped 0.3% to $11.21 during lunch time trade with the S&P/ASX 200 Index (Index:^AXJO) slumped 0.3% into the red.

Management announced today that it sold its 50% stake in RACT Insurance Pty Ltd (RACTI) to its JV partner, the Royal Automobile Club of Tasmania Ltd (RACT) for $83.8 million.

Suncorp share price lifts on possible capital return

The sale price equates to around a price-earnings multiple of 18.1 times based on the expected FY21 earnings.

Suncorp will book a pre-tax profit on the divestment of $65 million to $70 million. The total capital release is expected to be $50 million.

No word yet on what Suncorp intends to do with the surplus capital and investors will be hoping for some form of capital return. No doubt the Suncorp share price will rally if management handed back some of the cash.

The bank and insurance group last did a capital return in 2019 when it paid 39 cents a share on top of its regular dividends.

Downsizing to upside the Suncorp share price

The sale is consistent with Suncorp’s plan to streamline its business. It said the transaction was in the best interest of shareholders and customers.

“Suncorp and RACT have enjoyed a successful relationship in Tasmania since 2007,” said Suncorp’s chief executive Steve Johnston.

“We have mutually agreed that now is the right time for RACT to take full control of the insurance entity. This is consistent with our focus on simplifying the Group and driving improvement in our core insurance and banking businesses.”

The sale isn’t expected to be completed till late this calendar year and is subject to regulatory approval.

Reinsurance update brings relief

Suncorp also announced that it has placed its FY22 reinsurance program. Reinsurance is like insurance for insurance companies to protect them in the event of a major claim event.

Given the growing incidences of natural disasters linked to climate change, the news is welcomed by shareholders.

The structure of the main catastrophe program remains unchanged from FY21. There is an upper limit of $6.5 billion covering the Home, Motor and Commercial property portfolios across Australia and New Zealand.

Pleasingly, the cost of the FY22 reinsurance program and natural hazard allowance are in-line with management’s guidance. The natural hazard allowance for FY22 is expected to be $980 million and Suncorp’s maximum event retention remains at $250 million.

No unexpected bad news to rock the Suncorp share price here.

Another reason for shareholders to cheer

Investors will also be relieved about Suncorp’s underpayment controversy. The group completed its review into pay and leave entitlements of staff in Australia.

It said it will make remediation payments to current and former employees identified by the review from July 2021.

More importantly, it believes that the $60 million it has set aside in the FY20 results will be enough to cover all costs.

The post Suncorp (ASX:SUN) share price bucks market downtrend on ~$84m divestment appeared first on The Motley Fool Australia.

More reading

• Blazing it? How the top ASX cannabis shares performed in FY21
• How these top ASX biotech shares performed in FY21
• ASX 200 up 0.2%: Westpac asset sale, Ramsay increases Spire offer
• Why ASX energy shares are set to rise again today
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor Brendon Lau 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.

from The Motley Fool Australia https://ift.tt/3dMlRHM

The 2021 financial year was overall a very good one for ASX shares. The S&P/ASX 200 Index (ASX: XJO) managed to put on a performance of 24% for the 12 months to 30 June 2021. That makes FY2021 one of the best financial years ever for the Australian share market.

But some sectors inevitably performed better than others. That’s capitalism for you. And the sector we’re looking at today – ASX cannabis shares – certainly had its fair share of both winners and losers.

So let’s check out how this popular sector fared in the financial year that has just passed us by.

How did the top ASX cannabis shares fare in FY21?

Below is a table of how the ASX’s top cannabis shares performed in FY2021:

ASX Cannabis Share	% Gain/Loss for FY21
Creso Pharma Ltd (ASX: CPH)	351.6%
Little Green Pharma Ltd (ASX: LGP)	154.3%
Botanix Pharmaceuticals Ltd (ASX: BOT)	107.7%
Althea Group Holdings Ltd (ASX: AGH)	(6.3%)
Zelira Therapeutics Ltd (ASX: ZLD)	(20.4%)
Auscann Group Holding Ltd (ASX: AC8)	(26.7%)
Elixinol Wellness Ltd (ASX: EXL)	(29%)
Cann Group Ltd (ASX: CAN)	(57%)
Ecofibre Ltd (ASX: EOF)	(69.4%)

As you can see, it was something of a mixed bag. If you were lucky enough to hold Creso Pharma shares over the financial year, you would have enjoyed a very pleasing gain of more than 350%. However, if you were unfortunate enough to have money invested in Ecofibre, you instead would have had to cop a nasty near-70% loss for your time, effort and capital.

 

Highs or red eyes for ASX cannabis?

While each company had its own individual trials, triumphs and tribulations, it’s worth noting this is a sector that often moves in tandem. This is due to the unique but uniform challenges ASX cannabis shares all face. The most prominent of these is, of course, the legal status of cannabis itself.

Whilst recreational use of cannabis/marijuana is still illegal in many countries, including Australia, recent changes have been happening.

Perhaps at the forefront of these changes is the ever-evolving regulatory landscape in the United States. As it currently stands, 18 US states currently allow recreational use of cannabis.

Most recently, we saw the state of New York ‘legalise it’ back in April. This saw an immediate boost to the values of ASX cannabis shares despite the Australian market implications being limited.There is also debate in Mexico over the potential legalisation of cannabis. If this went ahead, it could open up a market of nearly 130 million people.

Another headache…

On the other hand, ASX cannabis shares have seen some setbacks in this arena as well. Last October, New Zealand held a ‘reefer-rendum’ on legalising recreational use of cannabis across the ditch. It failed, meaning that, at least for now, recreational use of cannabis remains illegal in the Land of the Long White Cloud. This was a big setback for the ASX cannabis sector here in Australia.

But, as you may have noted, there were some clear winners in this space regardless. As we noted earlier, Creso Pharma was the top performer in its sector.

Creso managed to capture investor attention through its acquisition of Halucenex Life Sciences. Halucenex specialises in psychedelic compounds and stands to benefit if the US state of California legalises psilocybin (the active drug in ‘magic mushrooms’). This is still currently being debated in the Californian Congress but investors certainly seem optimistic.

It’s also worth noting that some of the worst-performing ASX cannabis shares of FY21 were once known as some of the best performers.

Companies like Althea and Xalra were top-performing companies as recently as last year. But the tide has definitely turned for some of these companies’ share prices. Mostly, complications surrounding the pandemic, as well as regulatory issues, are mostly to blame here for the woes of Ecofibre and Cann Group in particular.

The post Blazing it? How the top ASX cannabis shares performed in FY21 appeared first on The Motley Fool Australia.

More reading

• How these top ASX biotech shares performed in FY21
• ASX 200 up 0.2%: Westpac asset sale, Ramsay increases Spire offer
• Why ASX energy shares are set to rise again today
• 5 things to watch on the ASX 200 on Tuesday
• ASX 200 up, Sydney Airport soars, Airtasker rises

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/2VcIS0k

The Medibank Private (ASX: MPL) share price has hit a new 52-week high this afternoon.

At the time of writing, the Medibank Private share price is trading hands at $3.21, up 2.23%. The 52-week low was $2.45 on 9 September 2020.

Trading volume was about 40% higher than the 20-day average volume-at-time (AVAT) for the same time of day this morning.

Let’s take a look at the Medibank Private share price in closer detail.

The month so far for Medibank Private

Medibank’s share price has hit its 52-week high despite there being no company-specific or market-sensitive news today.

Medibank has had a busy month, however, which could explain the rise in share price seen recently. The big item on Medibank’s agenda has been the company’s premium relief payments policy.

On 29 June, the company announced that it will return approximately $105 million to customers impacted by the Covid-19 pandemic through premium relief payments.

The insurer said the premium relief program would cover approximately 2 million accounts.

Speaking on the program, Medibank chief executive officer David Koczkar said:

Covid-19 restrictions limited how our customers could use their health insurance.

The moves take the company’s total Covid-19 support package to $300 million. Medibank Private shares climbed from $3.16 to $3.21 following the announcement.

Medibank Private share price snapshot

The Medibank Private share price has had a bumpy year in 2021 but has jumped into the green by 6.6% since January 1.

Medibank shares are also up around 1.2% over the previous 1 month and remain in the green over the previous 5 trading sessions.

The company’s share price has posted a 12-month return of ~6% which has lagged the S&P/ASX 200 Index (ASX: XJO)’s return of 21.88% over the same period.

At the current share price, Medibank Private has a market capitalisation of $8.8 billion and trades at a price-to-earnings ratio of around 24.

The company pays a dividend of 12 cents per share, fully-franked, and the dividend yield is 3.77% at the current market price. Medibank also has earnings per share of 13.1 cents from its most recent filing.

The post Medibank Private (ASX:MPL) share price sets new 52-week high today appeared first on The Motley Fool Australia.

More reading

• Medibank (ASX:MPL) share price up as customers get millions in support
• ASX 200 up 0.35%: SEEK upgraded, Afterpay lower

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.

from The Motley Fool Australia https://ift.tt/2V5UHoR

In early afternoon trade on Tuesday, the S&P/ASX 200 Index (ASX: XJO) has given back its morning gains and is sinking. At the time of writing, the benchmark index is down 0.3% to 7,294.9 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are racing higher:

Bigtincan Holdings Ltd (ASX: BTH)

The Bigtincan share price is up 4.5% to $1.18. Investors have been buying the sales enablement platform provider’s shares after it announced a major contract extension. According to the release, US based telco giant T-Mobile has extended its contract by $6.3 million in total contract value over a two-year period. This means the T-Mobile total contract value now stands at $18.4 million since its initial deployment.

Oil Search Ltd (ASX: OSH)

The Oil Search share price is up 4% to $4.05. There have been a couple of catalysts for this rise. One is a jump in oil prices overnight and the other is a broker note out of Morgans. In respect to the latter, the broker has upgraded the energy producer’s shares to an add rating with a $4.40 price target. This follows an upgrade to Morgans’ medium term oil price forecasts.

Opthea Ltd (ASX: OPT)

The Opthea share price has jumped 9.5% to $1.38. This morning the biotech revealed that it has received Fast Track designation from the US Food and Drug Administration for its product to treat patients with neovascular (wet) age-related macular degeneration (AMD). In addition, Opthea noted that it may also be eligible for accelerated approval and priority review as long as it meets the needed criteria.

Xref Ltd (ASX: XF1)

The Xref share price has stormed 22% higher to 45 cents. This follows the release of the human resources technology company’s fourth quarter update. According to the release, Xref expects to report record sales of $6.37 million and cash receipts of $5.93 million for the quarter. Management notes that COVID-19 has accelerated the global demand for remote working. This has led to organisations seeking better ways to perform candidate verification, leading to growing demand for its self-serve platform.

The post Why Bigtincan, Oil Search, Opthea, & Xref shares are racing higher appeared first on The Motley Fool Australia.

More reading

• Here’s why the Opthea (ASX:OPT) share price is soaring 8%
• Why the Xref (ASX:XF1) share price is rocketing 32% to a record high
• Bigtincan (ASX:BTH) share price storms higher on T-Mobile contract update
• Why ASX energy shares are set to rise again today
• ASX energy shares in hotseat as OPEC+ struggles to contain crisis

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 BIGTINCAN FPO and Xref Limited. The Motley Fool Australia owns shares of and has recommended BIGTINCAN FPO. The Motley Fool Australia has recommended Xref Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3Au3Esl

The Strategic Elements Ltd (ASX: SOR) share price is soaring today on news the company’s subsidiary will be making an autonomous vehicle in collaboration with the Australian Department of Defence.

At the time of writing, shares in Strategic Elements are up 3.49% ­ – trading for 22.3 cents apiece.

Let’s take a closer look at today’s news from the exploration and information technology development fund.

Autonomous vehicle collaboration

Strategic Element’s subsidiary, Stealth Technologies, will be designing and delivering an autonomous drone-carrying vehicle to help the Australian Defence Force adopt autonomous technology faster.

The project will be in collaboration with the Department’s Defence Science Technology Group (DSTG).

The vehicle will be able to deliver drones and sensors to a target location, automatically detecting and sensing chemical, biological, radiological, and nuclear (CBRN) agents on the way.

The vehicle will use Stealth Autodrive Hardware and Stealth OS Software to navigate through environments. It will also be able to launch a drone with CBRN detection and sensing abilities and have it land back in the vehicle.

The Western Australian Defence Science Centre (DSC) will provide $150,000 for the autonomous vehicle’s development and an investigation into whether it could be manufactured in Western Australia.

DSTG, DSC, the University of Western Australia, and Stealth Technologies will each put $350,000 towards the collaboration.

DSTG will also provide personnel, existing CBRN search algorithms, facilities, equipment, and support.

Stealth Technologies will retain all intellectual property and commercialisation rights for CBRN detection and other defence force-related applications.

Stealth Technologies will eventually demonstrate the vehicle’s abilities to the DSTG and the Army.

The company will also look into using technology to fulfil other Defence needs. These may include resupplying or intelligence, surveillance, or reconnaissance missions.

The autonomous vehicle and drone launch and land system’s initial concept design is expected this quarter.

According to Strategic Elements, the global market for CBRN Defence was estimated to be worth US$16.2 billion in 2020. It’s expected that will increase to US$21.9 billion by 2027.

Strategic Elements share price snapshot

Today’s good news hasn’t been enough to get the Strategic Elements share price back into the green.

It’s currently 6% lower than it was at the beginning of 2021. However, it has gained 221% since this time last year.

The company has a market capitalisation of around $86 million, with approximately 388 million shares outstanding.

The post Strategic Elements (ASX:SOR) share price up on Defence Force collab appeared first on The Motley Fool Australia.

More reading

• Strategic Elements (ASX:SOR) share price soars with air-powered battery

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.

from The Motley Fool Australia https://ift.tt/3jZAhZp

As we’ve covered extensively on the Fool over the past week, the S&P/ASX 200 Index (ASX: XJO) had a very successful year over the last financial year that has just passed us by. Over FY2021, the ASX 200 managed to add a very healthy 24%, making it one of the best financial years ever for ASX 200 shares. But that’s old news now. So today, we’re checking out how some of the ASX’s top biotech shares performed over FY21. Here’s the tea:

5 top ASX biotech shares in FY21

Healius Ltd (ASX: HLS)

Healius is an ASX biotech company that works in the pathology, imaging and medical centres spaces. It has also recently branched out into COVID-19 testing. Healius had a rather successful FY2021. Healius started the financial year at approximately $3.05 a share. It finished up last Wednesday at $4.63 a share, putting its FY21 gains at a very robust 51.8%. A positive trading update that Healius delivered back in May seems to have lit a fire under the company’s shares over the back half of the financial year in particular. This update showed quarterly revenue growth of 8%, as well as the company reaching the milestone of 3 million COVID-19 tests in total.

Pro Medicus Limited (ASX: PME)

Pro Medicus is another ASX biotech share that performed rather well in the financial year just gone. This compnay started FY21 at $26.4 a share, but ended up last week at $58.66. That’s a 12 month gain of 121.7%. Pro Medicus is in the imaging and diagnostic space as well. It also provides radiology information systems, communication services and visualisation to hospitals, medical centres and other health care facilities.

A series of positive announcements over FY21 seems to have been the primary catalyst here. Back in May, Pro Medicis announced an 8-year contract with The University of Vermont Health Network, which locks in a revenue stream for the company. Further, Pro Medicus also announced in June that it had inked a long-term collaboration agreement with Mayo Clinic.

Telix Pharmaceuticals Ltd (ASX: TLX)

The Telix share price might be having a rough time today (down 2.8% at the time of writing). But that doesn’t take away from the fact that this company had an outstanding FY2021. Telix started the financial year at just $1.28 a share. It finished up last Wednesday at $6.08 a share, marking its FY21 gains at a very pleasing 375%. So what went so right for Telix?

Well, Telix is a biotech company that is working on molecularly-targeted radiation therapy to assist cancer patients. Again, it was a series of positive updates that seemed to be at work here. Back in May, Telix announced that its bone marrow conditioning drug TLX66 had “met study objectives” in patients during a clinical trial. That wasn’t the only piece of good news either. Back in January, Telix reported that the US Food and Drug Administration (FDA) had approved the recruitment of patients in a study looking at Zirconium Imaging in Renal Cancer Oncology (ZIRCON).

Imugene Limited (ASX: IMU)

And at last, we get to the best performing ASX biotech share in Imugene. Imugene was also the best performing ASX share in the All Ordinaries Index (ASX: XAO) over FY21 as well, incidentally. Imugene shares started the financial year at just 3.1 cents a share, but finished up last week at 35.5 cents. That’s a gain of a whopping 1,045%. Why was Imugene such a powerful biotech gainer in FY21? Well, in April, it informed the markets that its clinical trials for the treatment of gastric cancer had proved successful. Soon after, Imugene announced in May that it would be conducting further clinical trials for the treatment of cancerous tumours with oncolytic virus and cell therapy technology.

CSL Limited (ASX: CSL)

This one is a bit of a bonus, but we couldn’t miss the ASX’s largest biotech company (and the third-largest ASX share overall by market capitalisation). CSL, in contrast to the companies above, didn’t have a great FY21. Investors might remember the cracking growth CSL shares became known for over the past decade. But 2020 and 2021 has seen this growth stall somewhat. CSL shares started out FY21 at $287 apiece.

But by the end of the financial year, they hadn’t strayed too far, ending last week at $285.47. That’s a loss of 0.53% for the preceding 12 months. Nothing terrible happened to CSL over the year that caused this stagnation. But ongoing problems with the company’s formerly lucrative plasma collections business, mostly due to the pandemic, can perhaps be blamed here. A rising Aussie dollar over the financial year wouldn’t have helped either (CSL reports in US dollars).

The post How these top ASX biotech shares performed in FY21 appeared first on The Motley Fool Australia.

More reading

• ASX 200 up 0.2%: Westpac asset sale, Ramsay increases Spire offer
• Why ASX energy shares are set to rise again today
• 5 things to watch on the ASX 200 on Tuesday
• 2 ASX healthcare shares analysts rate highly
• ASX 200 up, Sydney Airport soars, Airtasker rises

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended CSL Ltd. and Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3jRNMu5

The EML Payments (ASX: EML) share price is trading in the green today, extending the previous 5 trading sessions’ gains.

At the time of writing, the EML share price is ~5% in the green, reaching an intraday high of $3.80 before retracing to the current price of $3.73.

Let’s take a closer look at shares in the payment card technology company.

What’s happened to the EML share price lately?

There have been no company-specific or market sensitive announcements to impact the company’s share price today.

Nonetheless, EML shares remain in the money, outpacing the S&P/ASX 200 Index (ASX: XJO)’s return of 0.22% intraday.

The company’s share price has had a volatile year-to-date. It’s slipped ~11% into the red since January 1 behind the S&P/ASX 200 Index’s return of 9.7% over the same period.

Recent volatility

During the previous 12 months, EML shares have gained 1.6% versus the Index’s 21.6% at the time of writing.

Recent volatility in EML shares comes after concerns raised by the Central Bank of Ireland on EML’s Prepaid Financial Services card services segment, citing issues with anti-money laundering and counter-terrorism compliance.

EML shares took a 42% nosedive immediately following this event and haven’t fully recovered since. However, these recent gains put the share price closer to its previous highs.

The company also released its 3rd quarter trading update in June, demonstrating that sequential revenue had expanded 65% to $143.5 million.

The company also posted earnings before interest, tax, depreciation and amortisation (EBITDA) of ~$44 million, a 62% advancement.

Volatility has crept in following both of these events and the 52-week range for EML shares is $2.47 – $5.89, a 138% spread.

EML share price snapshot

The EML share price has begun its walk northwards. Over the previous 1 month, EML shares have posted a return of 11%, reclaiming some of the returns given away after the loss in May.

The company’s shares are also in the green by 4% after the previous 5 trading sessions, continuing the gains seen over the last month.

At the current share price of $3.73, EML has a market capitalisation of $1.3 billion. EML does not pay a dividend and has negative earnings per share.

The post The EML Payments (ASX:EML) share price surges 5% today appeared first on The Motley Fool Australia.

More reading

• The 3 ASX shares that top brokers just upgraded to “buy”
• Here are the 5 worst performing ASX 200 tech shares from FY21
• The EML Payments (ASX:EML) share price zoomed 4% higher today
• Here’s why this fund manager decided to sell its EML (ASX:EML) shares
• M&A rumour fires up the Iress (ASX:IRE) share price today

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended EML Payments. The Motley Fool Australia owns shares of and has recommended EML Payments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/36ht4eR

BlueBet Holdings Ltd‘s (ASX: BBT) first few days on the ASX have been a rollercoaster. Luckily for those who bought into the action, its shares are gaining today.

Right now, the BlueBet share price is trading at $1.83, up 4.57%, after hitting an intraday high of $1.87 earlier this morning.

It’s still 16% lower than its highest price of $2.10, however, which it touched shortly after its initial public offering (IPO) on Friday.

Let’s take a look at how the betting services provider’s first week on the ASX is panning out.

A quick refresher

IPOs are always exciting and BlueBet’s has kept us on our toes.

BlueBet’s IPO saw it raise $80 million by selling 70.2 million shares for $1.14 apiece.

As a result, the company started its time on the ASX with a market capitalisation of $228.1 million. It also walked away from its IPO with an extra $44.7 million in its coffers after covering the offer’s costs.

Now that it’s listed, BlueBet will be looking to expand its Australian operations, push into the US market, and develop its platform and technology suite.

How is the Bluebet share price tracking so far?

The BlueBet share price soared a whopping 85% on the opening of its first day on the ASX. Unfortunately, it ended Friday’s session 11.25% lower than where it started. Its very first close was at $1.78, which still saw those who bought shares in its IPO with an off-the-bat gain of 56%.

Yesterday’s session was a volatile one for the BlueBet share price. At one point it dipped 8% to hit $1.63, its lowest point yet. However, it gained back its losses to close at $1.77 – just 0.28% less than Friday’s close.

At the moment, today looks promising to break the short-lived stagnation. We’ll be keeping a close eye on the BlueBet share price for any more adrenaline-inducing movements.

BlueBet now has a market capitalisation of around $355 million, with approximately 200 million shares outstanding.

The post What’s up with the BlueBet (ASX:BBT) share price? appeared first on The Motley Fool Australia.

More reading

• 2 exciting small cap ASX shares you should be watching closely
• ASX 200 Weekly Wrap: ASX finishes FY21 on a high
• BlueBet (ASX:BBT) share price rockets 84% higher following IPO

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.

from The Motley Fool Australia https://ift.tt/3xkeuPz

Sydney Airport Holdings Pty Ltd (ASX: SYD) shares are taking a breather today following a massive 33.9% jump yesterday.

The Sydney Airport share price took flight on Monday after the company received a $22.6 billion all-cash buyout offer from a consortium of infrastructure investors.

Interestingly, the offer of $8.25 per share represented a 42% premium to the company’s Friday closing price. This is despite the airport’s May traffic performance showing total passengers were 59.1% below pre-pandemic levels.

Looking beyond the lockdowns

The consortium of infrastructure-focused investors consists of IFM Investors, Global Infrastructure Management, and QSuper. Yesterday’s bid from the partnership has been interpreted by many as a big bet on Australia’s travel future.

While no one really knows exactly when, or to what extent travel will resume – IFM and partners clearly have a positive perspective. Otherwise, the deal would look expensive based on the airport’s current performance.

Sydney Airport’s 2020 full-year results delivered earnings before interest, tax, depreciation, and amortisation (EBITDA) of $508.1 million. Based on that, the consortium would be paying a 44.5 times EBITDA multiple.

However, it wouldn’t be so farfetched for the company’s earnings to return to pre-pandemic levels if the global vaccine rollout is successful.

For that reason, it might be more valuable to look at the airport’s performance prior to COVID-19. In Sydney Airport’s 2019 full-year report, EBITDA came in at $1,336.3 million. That would put the consortium’s bid at roughly 17 times 2019 EBITDA.

Furthermore, analysts from Macquarie have said the bid is towards the upper end for airport offers globally. Though the offer remains quite distanced from the most expensive. They commented:

SYD should trade at a premium to peer assets, reflecting it has a high number of international passengers and better duty-free allowances. It has a light-handed regulatory regime, which provides flexibility, and opportunity to grow the nonaeronautical assets base.

Could Sydney Airport be leaving the ASX?

Sydney Airport’s chair, David Gonski, has recommended shareholders take no action on the offer. Meanwhile, the board is evaluating whether the proposal aligns with the underlying value of the company. In a release to the ASX yesterday, the company stated:

The indicative proposal has been made during a global pandemic which has deeply affected the aviation industry and the Sydney Airport security price. The indicative price is below where Sydney Airport’s security price traded before the pandemic.

Macquarie analysts expect the offer price may be bumped higher in order to unanimously win over the Sydney Airport board.

Looking forward, if the deal were to be approved by the board and receive all the regulatory thumbs-ups, the ASX might have to wave goodbye to Sydney Airport shares. However, we shouldn’t get ahead of ourselves. Between now and then, there are still plenty of events to occur.

Finally, Sydney Airport shareholders are now sitting on a 40% share price gain from a year ago. The Sydney Airport share price traded between $5.50 and $6.30 for much of the past 12 months.

The post Sydney Airport (ASX:SYD) takeover bid indicates funds are looking forward appeared first on The Motley Fool Australia.

More reading

• ASX 200 up, Sydney Airport soars, Airtasker rises
• Here are 3 ASX 200 shares making moves on the share market today
• Auckland Airport (ASX:AIA) share price jumps 6% on travel bubble news
• These ASX shares are the latest to be hit by broker downgrades
• Why A2 Milk, Airtasker, BetMakers, & Sydney Airport shares are storming higher

Motley Fool contributor Mitchell Lawler owns shares of Macquarie Group Limited. 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 Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3qMem9c

The Raiz Invest Ltd (ASX: RZI) share price is on the move this afternoon, climbing 8.98% to $1.76.

Shares in the investment platform are pushing higher after the company announced a business update for June.

Raiz share price jumps on June update

Investors are driving the Raiz share price higher on Tuesday after the company announced a strong finish to the financial year.

According to the update, the company recorded a 4.5% month-on-month and 86.7% year-on-year (YoY) increase in active global customers to 456,927 as at 30 June.

Raiz said the growth was underpinned by growing momentum in the Australian market, delivering a year-on-year increase of 22.0% in active customers to 272,976 and 76.3% increase in funds under management to $799.64 million.

The company launched in Indonesia in March 2019 and Malaysia in June 2020. Both regions are in their early days, reporting a respective 117,923 and 66,028 active customers.

Management commentary

Raiz Invest managing director George Lucas was pleased with the company’s growth in FY21, saying:

Raiz finished the 2020-21 financial year on a high note. We remain well placed to hit our target of $1 billion in Funds under Management (FUM) by the end of calendar 2021. We are very pleased with the 30 June 2021 FUM of $800 million that is above budget. In the past 12 months, FUM has grown 76.3%.

Lucas shed light on the company’s strategy to grow key metrics.

The introduction of new products, such as custom portfolios and opening up the platform to self managed super funds (SMSFs), have helped accelerate FUM growth which is growing faster than active customers. It means we are growing the life-time value of each customer by increasing revenue per customer, demonstrating the benefits of the Raiz team delivering on our stated growth strategy.

In addition, he said Raiz was focused on growing the “favourable market opportunity in Southeast Asia”.

We also saw growth pick up in Southeast Asia in June, with both Indonesia and Malaysia enjoying double digit increases as they move on from the fasting month. Indonesia saw active customers grow 10.0% to 117,923, with Malaysia seeing growth of 10.6% to 66,028. We remain confident our long term strategies for both countries are on track.

Raiz share price snapshot

The Raiz share price has rallied a solid 75% year-to-date, with most of its gains occurring at the start of the year between January and February.

The company’s shares experienced sharp selloffs in late February and late April, coinciding with the broader weakness of the S&P/ASX 200 Info Tech Index (ASX: XIJ) index.

The Raiz share price has rallied strongly today, touching a 3-month high of $1.76.

The post Up 9% to a 3-month high, the Raiz (ASX:RZI) share price is surging. Here’s why. appeared first on The Motley Fool Australia.

More reading

• Selling some ASX shares before tax time? Here’s what you should know
• This tumbling ASX fintech should be 3 times current price: analyst
• Here’s why the Raiz (ASX:RZI) share price has gained 5% today

Motley Fool contributor Kerry Sun 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.

from The Motley Fool Australia https://ift.tt/3yp5WHj