The oOh!Media Ltd (ASX: OML) share price is struggling today. At the time of writing, shares in the outdoor advertising company are trading more than 6% lower for the day. Shares in oOh!Media were down nearly 7% earlier, after hitting an intra-day low of $1.70.

Why is the oOh!Media share price dropping?

Since oOh!Media has not released any price-sensitive news, there are a few catalysts that could be causing the company’s share price to drop.

Given that the company specialises in ‘out of home’ advertising, COVID-19 lockdowns could explain the dropping share price. ‘Out of home’ advertising refers to marketing in trains stations, aeroplanes, shopping centres and accounts for approximately 75% of Group revenue.

oOh!Media operates in Australia and New Zealand, boasting an extensive network of more than 37,000 digital and static advertising locations. These locations include road, rail, airports, retail centres, universities and office buildings. With people staying home during the lockdown period, the subsector could be a potential casualty.

How has Ooh Media performed?

Earlier this year, oOh!Media revealed the devastation that the pandemic had caused in its financial results for 2020.  

For the year ending 31 December, the outdoor advertising company highlighted a 34% decline in revenue of $426.5 million. In addition, oOh!Media reported a net loss after tax excluding acquisition-related amortisation of $8 million. Underlying EBITDA also declined by 55% to $63.2 million, reflecting the decline in the company’s revenue.

The company also provided a snapshot of its performance in 2021 at its recent annual general meeting. For the first quarter FY21, oOh!Media saw total revenue in Australia decline by 22% compared to the prior corresponding quarter. This decline compares to an overall 24% decline in the broader Out of Home sector as measured by the Outdoor Media Association.

In New Zealand, first quarter FY21 revenue declined by 6% compared to an overall 8% decline for the Out of Home sector.

Snapshot of the oOh!Media share price

The tough trading environment was reflected in the oOh!Media share price which hit a 52-week low of 70.5 cents last year.

Following a strong recovery, shares in the out of home advertising company have remained flat in 2021. Despite the recovery, the oOh!Media share price is currently trading modestly lower from its 52-week high of $1.95.

The post COVID-19 lockdown hits oOh!Media (ASX:OML) share price appeared first on The Motley Fool Australia.

More reading

• Redbubble (ASX:RBL) share price surges 7% despite litigation outcome
• Why the Woolworths (ASX:WOW) share price is pushing higher today
• WAM’s WAR on the ASX! Wilson’s new LIC hits the share market
• Pilbara Minerals (ASX:PLS) shares are the most traded on the ASX 200 today
• Leading brokers name 3 ASX shares to buy today

Motley Fool contributor Nikhil Gangaram 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 oOh!Media Ltd. 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 Redbubble (ASX: RBL) share price has jumped 7.87% today to reach $3.70 at the time of writing.

Today’s gains come are a short-term reversal out of the red for Redbubble’s share price. Year-to-date, the company’s shares have dropped by 37.82%, whereas the S&P/ASX 200 Index (ASX: XJO) has posted a return of 11%.

However, over the past month, the Redbubble share price has gained 8.19% in 1 month, giving Redbubble a current market capitalisation of around $1 billion.

Share price gains amidst litigation outcome

Redbubble operates an online print-on-demand marketplace where artists can sell their own art and designs on a range of products.

On 24 June 2021, the company provided a litigation update in the case involving its US subsidiary Redbubble inc, originally commenced by US fashion retailer Brandy Melville.

The release outlined the company had received a verdict relating to alleged intellectual property infringement. The jury’s verdict included a reward of US$520,000.

In the statement, the company noted that:

Redbubble also notes that, in US court proceedings, this is but one step in the overall litigation and a number of possible steps remain before the claim is finally concluded. Redbubble believes that certain critical findings were not supported by the evidence offered at trial and will be asking the court for relief from the verdict on that basis. Redbubble remains confident in its position and will continue to vigorously pursue its defence of the claims.

Investors continue to reward Redbubble stock despite the litigation outcome. On Wednesday 24 June, Redbubble’s shares were trading at $3.27, and since this event, have gained 13.15%.

Redbubble share price snapshot

Over the past 6 months, Redbubble shares have lost 37.82% (at the time of writing). The company’s 52-week price range is $1.86–$7.35, a 295% difference.

Shares made a quick run from $2 and change in June 2020 to the all-time-high of $7.35 in January 2021. However, since this time, the share price has retraced 49.66% back down to today’s level of $3.70 at time of writing.

Redbubble shares also currently have an earnings per share of 12.8 cents, and trade at a price-to-earnings ratio (P/E) of 26.81.

The post Redbubble (ASX:RBL) share price surges 7% despite litigation outcome appeared first on The Motley Fool Australia.

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• Is the Redbubble (ASX:RBL) share price a buy in June 2021?
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• Why Redbubble (ASX:RBL) is a bargain buy now: analyst

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 Woolworths Group Ltd (ASX: WOW) share price is in the rise this afternoon, trading up 2.79% at $37.81.

This follows its successful Endeavour Group Limited (ASX: EDV) demerger, in which Woolworths shareholders will receive one Endeavour share for every Woolworths share they own.

With the S&P/ASX 200 Index (ASX: XJO) trading down 0.06% today, let’s take a look at what’s helping the Woolworths share price outperform the market.

Lockdowns are back

New COVID-19 lockdowns and travel restrictions are sweeping across the country, with Greater Sydney entering a two-week lockdown until 9 July, and various border closures between states.

With social mobility coming to a grinding halt across many states, this could once again influence higher in-home consumption of supermarket staples.

Previously, in Woolworths’ FY20 full year results, the company cited:

In H2, total sales growth of 10.4% on a normalised basis was driven by COVID pantry-loading and higher in-home consumption through lockdown and community movement restrictions.

While Sydney’s lockdown is only for two weeks (for now), it could still have a notable impact on supermarket sales.

Take Victoria’s experience, for example.

The Australian Bureau of Statistics (ABS) reported a 1.5% increase in Australian food retailing turnover in May 2021, seasonally adjusted.

The jump in food retailing was led by Victoria, which reported a 4.0% increase after the state entered a COVID-related lockdown in late May. Within food retailing, the ABS noted a particularly strong supermarkets turnover.

COVID-19 winners running today

The Woolworths share price joins today’s resurgence of ASX COVID-19 winners.

Notably, ASX e-commerce shares including Temple & Webster Group Ltd (ASX: TPW), Kogan.com Ltd (ASX: KGN) and Redbubble Ltd (ASX: RBL) have rallied 10.33%, 6.23% and 8.02% respectively, possibly influenced by recent lockdown announcements.

The post Why the Woolworths (ASX:WOW) share price is pushing higher today appeared first on The Motley Fool Australia.

More reading

• Why Atomo, Metcash, Temple & Webster, & Woolworths are pushing higher
• Temple & Webster share price surges with other ASX COVID winners
• ASX 200 down 0.1%: Metcash results, Costa returns, travel shares sink
• ASX 200 Weekly Wrap: Share market breaks 5 week winning streak
• These were the worst-performing ASX 200 shares last week

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. owns shares of and has recommended Kogan.com ltd and Temple & Webster Group Ltd. The Motley Fool Australia owns shares of and has recommended Kogan.com ltd. The Motley Fool Australia has recommended Temple & Webster Group Ltd. 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’s WAR on the ASX. Wilson Asset Management’s (WAM) latest Listed Investment Company (LIC) has just debuted on the ASX share market today. WAM Strategic Value Ltd (ASX: WAR) makes its ASX entrance today after months of marketing and signing up new investors for the eventual IPO (initial public offering).

Since May, investors have been able to apply for shares in WAM Strategic Value for a placement price of $1.25 a share. Well today, those shares are trading on the market. So how is the old IPO going for WAM?

Well, not too badly, but perhaps nothing to write home about. WAR shares hit the ASX this morning and opened for $1.26 a share, 1 cent or 0.8% above its placement price. And that’s where the share price is hovering at, at the time of writing. So, this price gives WAM Strategic Value a market capitalisation of $226.8 million. That comes from WAM telling investors there will be 180 million WAR shares on the ASX upon its float.

What is WAM Strategic Value?

The latest in WAM’s LIC stable, WAM Strategic Value is headed up by WAM founder Geoff Wilson himself. In the company’s ASX WAR prospectus, he tells investors that WAM Strategic Value will focus on “identifying and investing in $1 of assets for 80 cents”. The LIC will do this by “[taking] advantage of market mispricing opportunities, including securities trading at discounts to assets or net tangible assets (NTA), corporate transactions and dividend yield arbitrages with franking credit benefits”.

Here’s some more of what Wilson told investors in its prospectus:

Our experience and expertise in managing closed-end vehicles provides us with a unique methodology to identify and benefit from LIC and LIT market mispricing opportunities and engage proactively with boards, management teams, investors and other stakeholders. This primary focus will be complemented by other market mispricing opportunities arising within the corporate sector. Such as takeovers or capital raisings, where we are able to utilise our position as an institutional investor responsible for more than $4 billion of shareholder capital.

ASX hears the drums of WAR

So put simply, WAM Strategic Value is primarily going to be in the business of buying other LIC and Listed Investment Trust (LIT) assets for less than they are actually worth. So what kind of leads do we have on this new LIC? It has presumably invested in a fair bit so far with its $200 million-plus backing, after all.

Well, WAM has yet to give us an official update. But we can gather some valuable information from other sources. The Magellan High Conviction Trust (ASX: MHH) seemed to be an early target. As my Fool colleague Mitchell Lawler flagged at the time, Magellan’s High Conviction Trust may have had some interest from WAM Strategic Value. Its units were trading at a 12.2% discount to their underlying NTA value back then. The High Conviction Trust unit price has since rallied to somewhat close this NTA gap.

But some additional ASX releases that came out alongside the IPO today give us a broader picture. According to these ASX releases, WAR shares might represent ownership in LICs and LITs including NAOS Small Cap Opportunities Company Ltd (ASX: NSC) and Pengana International Equities Ltd (ASX: PIA). As well as Templeton Global Growth Fund Ltd (ASX: TGG) and Westoz Investment Company Limited (ASX: WIC).

We’ll have to wait for WAM’s first investment updates to find out more about this new LIC. But the picture is now a lot clearer on ASX’s new WAR LIC.

The post WAM’s WAR on the ASX! Wilson’s new LIC hits the share market appeared first on The Motley Fool Australia.

More reading

• Is WAM going ham on Magellan High Conviction Trust (ASX:MHH)?

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

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Shares in Pilbara Minerals Ltd (ASX: PLS) are, once again, the most traded among all those in the S&P/ASX 200 Index (ASX: XJO) today. However, it’s not good news for the lithium miner’s shares.

The Pilbara Minerals share price is currently trading at $1.44 – 3.03% lower than Friday’s close.

At the time of writing, over 12.3 million Pilbara shares have been traded today. That’s approximately $17.7 million worth.

And all that has happened despite Pilbara Minerals releasing no news to the ASX today.

As The Motley Fool reported earlier today, demand for lithium is increasing alongside demand for electric vehicles and renewable energy – 2 sectors that rely on lithium-ion technology. But that doesn’t seem to be helping Pilbara shares today.

And it’s not only lithium shares investors are fleeing from today. Qantas Airways Limited (ASX: QAN) shares are being traded at an impressive rate – with almost 10.7 million having changing hands so far today. The Qantas share price is falling by almost 4% as COVID-19 flares plague Australia once more.

Let’s take a look at the last time the market heard from Pilbara Minerals.

The latest news

On Friday, Pilbara Minerals announced the company’s board had voted in favour of restarting lithium production at the Ngungaju plant.

Operations at the plant are expected to begin once more in the final quarter of 2021.

The plant will likely produce between 180,000 and 200,000 dry metric tonnes (dmt) of lithium by the middle of 2022.

According to Pilbara Minerals, that will result in a significant increase in its Pilgangoora project’s production, which is set to increase from 560,000 dmt to 580,000 dmt.

The company expects the restart to cost around $39 million.

Pilbara Minerals also announced it anticipates a record spodumene shipment for the June quarter. The shipment’s expected to be around 96,000 dtm.

Despite the seemingly good news, the Pilbara Minerals share price also fell on Friday to close 3.26% lower than its previous session.

Pilbara Minerals share price snapshot

2021 has been a good year so far for the Pilbara Minerals share price, which has gained around 65% year to date.

It has also gained a whopping 492% since this time last year.

The company has a market capitalisation of around $4.15 billion, with approximately 2.9 billion shares outstanding.

The post Pilbara Minerals (ASX:PLS) shares are the most traded on the ASX 200 today appeared first on The Motley Fool Australia.

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• Here are 3 of the most heavily traded ASX 200 shares today

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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Our share market has yet to fell the full impact of the skills shortage, but that could soon change and JPMorgan warns the ASX shares of this company could be most at risk.

The broker’s latest research note on this topic comes after over a quarter of Australian businesses were having trouble finding staff.

The findings from the recent ABS Business Conditions and Sentiment survey found that medium to larger businesses were struggling more to find skilled workers.

Skills shortage pain increasing most in construction

The most impacted roles include hospitality workers, engineering professionals, drivers and building trades.

“The industries most impacted include: Accommodation and Food Services, Utilities, Manufacturing and Construction with the Construction industry seeing the biggest increase in difficulties over the past six months,” said JPMorgan.

“In Dec-20, only 18% of Construction respondents reported an inability to recruit staff compared to 32% in Jun-20.”

Early signs of stress can be seen among some ASX engineering and constructions shares. They have been underperforming the S&P/ASX 200 Index (Index:^AXJO) recently while the rest of the market is unperturbed.

ASX shares feeling the jobs squeeze

For instance, the NRW Holdings Limited (ASX: NWH) share price has halved since the start of 2021. Meanwhile, the Monadelphous Group Limited (ASX: MND) share price and Emeco Holdings Limited (ASX: EHL) share price have fallen 24% and 11%, respectively.

In contrast, the ASX 200 has rallied 11% over the same period.

But the ASX shares that is most negatively impacted by skills shortages and potential wage rises aren’t in this group, warned JPMorgan.

The ASX shares most at risk from skills shortage

The broker reckons that the Downer EDI Limited (ASX: DOW) share price has most to lose. In fact, JPMorgan is so concerned that it downgraded the Downer share price to “underperform” (equivalent to “sell”) due to this risk factor.

The market may not have woken up to this threat. The Downer share price is up around 5% since January and has gained more than 30% over the past year. That’s materially ahead of the other contractors listed in this article.

Perhaps Downer’s greater exposure to infrastructure construction explains its outperformance. But if JPMorgan is right, the gap between the Downer share price and the sector could shrink substantially in the coming months, if not sooner.

Are there ASX buying opportunities?

This raises the question about whether now is the time to be selling Downer and buying one of the laggards.

Coincidentally, the analysts at Macquarie Group Ltd (ASX: MQG) reiterated their “outperform” recommendation on the Emeco share price on the same day JPMorgan downgraded the Downer share price.

Macquarie’s bullish call on Emeco comes as the company successfully raised $250 million via senior secured notes at 6.25%.

It also helped that management reiterated its FY21 operating earnings before interest, tax, depreciation and amortisation (EBITDA) guidance of $235 million to $238 million.

Macquarie’s 12-month price target on the Emeco share price is $1.30 a share.

The post The ASX shares most impacted by Australia’s job squeeze appeared first on The Motley Fool Australia.

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• ASX 200 Weekly Wrap: Share market breaks 5 week winning streak

Motley Fool contributor Brendon Lau owns shares of Emeco Holdings Limited, Monadelphous Group Ltd, Macquarie Group Limited . Connect with me on Twitter @brenlau.

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.

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With so many shares to choose from on the ASX, it can be hard to decide which ones to buy. The good news is that brokers across the country are doing a lot of the hard work for you.

Three top ASX shares that leading brokers have named as buys this week are listed below. Here’s why they are bullish on them:

Afterpay Ltd (ASX: APT)

According to a note out of Ord Minnett, its analysts have retained their buy rating and $150.00 price target on this payments company’s shares. This follows news that it is expanding its pay anywhere offering in the United States to cover 12 major retailers. Collectively, these retailers account for almost half of all online retail volume in the lucrative market. Ord Minnett is a fan of Afterpay’s plans and sees opportunities to improve on similar and clunky offerings by rivals. The Afterpay share price is fetching $119.64 today.

Charter Hall Group (ASX: CHC)

A note out of Citi reveals that its analysts have retained their buy rating and lifted their price target on this property company’s shares to $17.50. This follows a funds under management update by Charter Hall last week which has Citi believing that there could be further upside to its guidance in FY 2021. In addition to this, the broker is a fan due to its strong business and undemanding valuation. The Charter Hall share price is trading at $15.68 today.

Origin Energy Ltd (ASX: ORG)

Another note out of Ord Minnett reveals that its analysts have retained their buy rating and $5.75 price target on this energy company’s shares. While Ord Minnett acknowledges that electricity prices were soft during the summer due to mild weather and COVID-19, it appears optimistic that they will soon improve. And of the two major listed energy retailers, Ord Minnett believes Origin is best positioned to benefit from rising prices. The Origin share price is trading at $4.71 this afternoon.

The post Leading brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

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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 AFTERPAY T FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. 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 Infinity Lithium Corporation Ltd (ASX: INF) share price is on the move today. This follows the lithium explorer signing of a Memorandum of Understanding (MOU) for the offtake of lithium hydroxide (LiOH).

At the time of writing, Infinity shares are up 6.10% to 8.7 cents.

Infinity progresses lithium hydroxide development

In a statement to the ASX, Infinity advised it has entered into a non-binding MOU with LG Energy Solution.

Based in South Korea, LG Energy Solution is a global leader that is focused on producing advanced lithium-ion batteries. The eco-friendly company services the electric vehicles, mobility & IT applications, and energy storage systems market.

The collaboration will seek to form an agreement for the long-term supply of battery grade LiOH from the San José Lithium Project.

The terms of the MOU are set out below:

• Potential supply of LiOH for an initial 5-year period with the potential to continue for a further 5 years;
• First right to 10,000 tonnes per annum of LiOH product with additional volumes under the MOU subject to negotiations and agreement;
• The purchase price for LiOH set to be set at market prices, pending approval by both parties.

Infinity noted that it aims to have the MOU formed into a binding offtake agreement within the next 12 months. 

Infinity CEO and managing director, Ryan Parkin said:

We are delighted to announce the commencement of a long-term commercial relationship with tier one partner LG Energy Solution, welcoming the potential to support a global leading lithium-ion battery producer to secure essential facets of the supply chain.

About the Infinity share price

From the beginning of 2021 to mid-February, Infinity shares rocketed higher to reach a multi-year high of 28 cents. However, since then, its shares plummeted 67% after being suspended from trading on the ASX in April.

At today’s price, Infinity commands a market capitalisation of around $35 million, with over 402 million shares outstanding.

The post Here’s why the Infinity share price is powering 6% higher today appeared first on The Motley Fool Australia.

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• These 3 ASX biotech shares are all up at least 120% in a year
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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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is fighting hard to carve out a small gain. At the time of writing, the benchmark index is up ever so slightly to 7,308.8 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are sinking:

Afterpay Ltd (ASX: APT)

The Afterpay share price is down 7.5% to $119.33. This decline appears to have been driven by profit taking from investors following a very strong gain last week. That gain was driven by news that the buy now pay later provider is expanding its pay anywhere offering in the US to retail giants such as Amazon and Nike.

Gold Road Resources Ltd (ASX: GOR)

The Gold Road share price is down almost 8% to $1.31. Investors have been selling the gold miner’s shares after it revealed that it will fall short of its guidance in 2021. Gold Road blamed this on disruptions caused to processing plant operations. It now expects production at the low end of its 260,000 to 300,000 ounces range with an all-in sustaining cost of $1,325 to $1,475 per ounce. The latter compares to prior guidance of A$1,225 to A$1,350 per ounce.

Qantas Airways Limited (ASX: QAN)

The Qantas share price has fallen 4% to $4.53. Qantas and a number of travel shares have come under pressure amid concerns over the spread of COVID-19 through Sydney and into other states. This has the potential to derail the travel market recovery, which was just beginning to return to relatively normal.

Talga Group Ltd (ASX: TLG)

The Talga share price has sunk 8.5% to $1.30. This is despite the company revealing that LKAB and Mitsui have extended a Letter of Intent (LOI) for Talga’s Swedish graphite anode project. Investors may be disappointed that the two parties didn’t come to a decision on whether to co-develop the project prior to the previous LOI expiry.

The post Why Afterpay, Gold Road, Qantas, & Talga shares are sinking appeared first on The Motley Fool Australia.

More reading

• The Qantas (ASX:QAN) share price is sinking today
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• Afterpay (ASX:APT) share price tumbles nearly 7%
• Gold Resources (ASX:GOR) share price sinks 7% on production update
• Temple & Webster share price surges with other ASX COVID winners

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 AFTERPAY T FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. 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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To say that ASX data analytics company Nuix Ltd (ASX:NXL) has had an underwhelming start to life on the Australian share market is probably an understatement. Since listing at around $8 in December, the embattled tech company’s shares have plunged around 70% lower and are now trading at just $2.415.

Let’s take a look at the reasons why Nuix shares have already been sold off so heavily so soon after first listing on the ASX.

Company Background

First, we ought to find out what it is that Nuix actually does.

Nuix’s proprietary data processing software allows its clients to convert massive amounts of “messy” data into actionable information. The Nuix data engine can sift through data as diverse as social media posts, emails and other human-generated content to deliver more meaningful real-world solutions.

Nuix works with clients across the corporate, government and legal sectors (among others) to provide services as diverse as data privacy, digital forensics, fraud and corruption investigations, as well as data analytics. It has already racked up a long list of top-tier international clients, including the American Express Company (NYSE: AXP), Amazon.com, Inc. (NASDAQ: AMZN) and our very own Commonwealth Bank of Australia (ASX: CBA).

So, what went wrong?

This all sounds pretty good so far: a junior software company operating in a niche field with an already growing list of major international clients. So how come the Nuix share price been stuck in a perpetual nosedive?

Well, there are at least a few reasons.

Financials

First – and perhaps most important – are the financials. Nuix underperformed in the first half of FY21, falling short of its prospectus forecasts. Revenues for the half came in at $85.3 million, a decline of 4% versus the prior comparative period and just 44% of the prospectus forecast for FY21.

Since the release of its first half results, Nuix has been forced to make a number of earnings downgrades – the most recent of which was communicated to the market at the end of May. Nuix advised that it now expects full-year revenues in the range of $173 million to $182 million (a long way off its original prospectus forecast of $193.5 million).

Legal Concerns

There are also legal concerns surrounding the company. Most of these are related to infighting amongst its current and former executives around the validity of options issued as part of its IPO. It has become so serious that Nuix’s Sydney offices were raided last week.

In response, Nuix released a statement acknowledging the raid by the Australian Federal Police, while commenting that “the warrant does not relate to any allegation of wrongdoing by the Company.”

People

Finally, there have also been some recent people movements at Nuix. While hiring new leadership staff can bring about plenty of positive change for a company, in the short term it can often create unwanted uncertainty around the company’s strategy and direction.

CEO Rod Vawdrey has announced that he will retire from the company once a replacement is found. The company is also on the lookout for a new Chief Financial Officer, after long-term CFO Stephen Doyle resigned earlier this month.

The post Nuix (ASX:NXL) shares continue to tumble on financial, legal concerns appeared first on The Motley Fool Australia.

More reading

• ASX 200 Weekly Wrap: Share market breaks 5 week winning streak
• These were the worst-performing ASX 200 shares last week
• Why New Hope, Nuix, Pilbara Minerals, & Woolworths shares are dropping
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Motley Fool contributor Rhys Brock owns shares of Nuix Pty Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Nuix Pty Ltd. The Motley Fool Australia has recommended Nuix Pty Ltd. 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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