The Nuix Ltd (ASX: NXL) share price was struggling today with a looming legal case from the company’s ex-CEO making news.

Adding to the downside, there are now two class action law firms looking at the investigative analytics and intelligence software provider.

By the market’s close, the Nuix share price was trading 6.83% lower at $3.41.

Nuix’s $200 million dark cloud

Between missing prospectus forecasts and heavy media scrutiny, Nuix has had a challenging start to its listed life – to say the least.

Yesterday, Fairfax publications questioned Nuix’s past financial reporting. Specifically, this related to options reportedly purchased by Blackall, an entity said to be controlled by former Nuix board member Tony Castagna.

Due to a lack of paperwork, questions have arisen surrounding whether the purchase was all above board.

But today is a new day, and with it brings a new controversy reported by The Age. The latest story concerns former Nuix CEO Eddie Sheehy and his options in the company.

The options in question were a part of Sheehy’s remuneration package in 2008. A condition of exercise was for Nuix to sell or list in an initial public offering (IPO) for over $40 million.

The core issue revolves around a 50 for 1 share split in 2017, which Nuix’s lawyers say did not apply to Mr Sheehy’s options. Additionally, Nuix lawyers argue that the December IPO does not meet the sale criteria for which the options were exercisable.

After the Nuix share price surged upon listing, Mr Sheehy’s options were valued at $250 million.

Commenting on the matter, as reported by The Age, Mr Sheehy said, “Currently, and by all accounts, Nuix is going to owe me over $200 million in damages. So, the big question for all shareholders is, where is Nuix going to find the funds to pay me? And, if it can’t find the funds, what happens next?”

Further pressure on Nuix share price

Former employees are not the only ones looking for Nuix blood. Missing prospectus forecasts within the first year of listing, among other revelations, has left some shareholders jaded.

Reportedly, at least two class action specialist firms are evaluating the potential for shareholder lawsuits. Both Quinn Emanual and Phi Finney McDonald are investigating Nuix, focusing on misleading and deceptive conduct or breaches of continuous disclosure obligations.

The barrage of negativity was temporarily masked earlier in the week by an apology from current CEO Rod Vawdrey. It seems the respite was short-lived, with the Nuix share price taking another hit from today’s developments.

More reading

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• Which ASX 200 shares withstood today’s selloff?
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• Why Appen, ELMO, Nuix, & Paradigm shares are pushing higher
• Nuix (ASX:NXL) share price up 6% despite fresh claims of bad business

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The Imugene Limited (ASX: IMU) share price hit an all-time high of 41 cents in intraday trade today, but with no news from the company since Tuesday, some market watchers are wondering why.

At the time of writing, the Imugene share price has retreated slightly, however, are still up 6.85%. Shares in the immuno-oncology company are swapping hands for 39 cents apiece.

The last time we heard from Imugene, it announced it had entered into a global patient license for a novel cancer therapy.

The following day (AEST), Imugene shared to its website that United States-based investment banking firm ROTH Capital Partners had given its shares a 12-month price target of 42 cents.  

Since then, the Imugene share price has gained 16.67%

Let’s take a closer look at the news that’s seemingly driving shares in Imugene.

Imugene’s good news day

On Tuesday, Imugene announced it had entered into an agreement with City of Hope, an independent cancer research and treatment centre, to license the patient for its CD19 therapy.

The technology under the license is an extension of chimeric antigen receptor (CAR) T cell cancer therapy. Currently, CAR T cell therapy can only be used to treat blood or liquid-based cancers. City of Hope’s technology has the potential to treat solid cancers.

Imugene’s first clinical trial of CD19 is planned to begin in 2022.

As a result of the news, ROTH Capital upgraded its guidance for Imugene shares to 42 cents yesterday.

ROTH Capital’s price target was based on a number of factors, including the projected future revenue of Imugene’s CHECKvacc, HER-Vaxx, and PD1-Vaxx.

The banking firm expects these products will bring in a combined $1.7 billion in royalties by the 2031 financial year.

Imugene share price snapshot

On Tuesday, the day Imugene’s latest news broke, the company’s share price finished flat with its previous close.

Then, after ROTH Capital’s analysis yesterday it shot up to close 10.61% higher. It’s gained another 6.8% today.

The company’s share price gains this week add to what has been a fantastic performance on the ASX recently.

Currently, the Imugene share price is 285% higher than it was at the start of 2021. It’s also gained 1,183% since this time last year when its shares were trading for 3 cents.

The company has a market capitalisation of around $1.7 billion, with approximately 4.7 billion shares outstanding.

More reading

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If you’re looking at following in the footsteps of Warren Buffett by making buy and hold investments, then you might want to look at the shares listed below.

Both have strong market positions and long runways for growth over the next decade. Here’s what you need to know:

Nanosonics Ltd (ASX: NAN)

The first option to consider as a buy and hold investment is Nanosonics. It is a leading medical device company with a focus on infection prevention.

Nanosonics is the company behind the trophon EPR disinfection system for ultrasound probes. This technology is regarded as the best in its class and has been consistently winning market share in the United States and globally over the last decade.

In fact, at the last count, the company estimates that 80,000 patients are protected from the risk of cross contamination everyday thanks to its Trophon product.

Looking ahead, the company still has a large market opportunity to grow into for the trophon product. However, management isn’t settling for that. It is aiming to expand its portfolio in the coming years with the launch of new products targeting unmet needs.

One broker that is positive on the company is UBS. It currently has a buy rating and $7.00 price target on its shares

Temple & Webster Group Ltd (ASX: TPW)

Another ASX growth share that could be a good long term option is Temple & Webster. It is Australia’s leading online furniture and homewares retailer.

Temple & Webster was growing at a rapid rate before the pandemic, during it, and is expected to continue doing so after it. This is thanks to its strong market position and the shift to online shopping. The latter is largely in its infancy for furniture and homewares.

Credit Suisse is very positive on the company and is forecasting rapid sales growth over the coming years. It believes online penetration in the industry will grow strongly over the coming years.

As a result, the broker recently put an outperform rating and $12.54 price target on its shares.

More reading

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On Wednesday I looked at three ASX shares that brokers have given buy ratings to this week.

Unfortunately, not all shares are in favour with them right now. Three ASX shares that have just been given sell ratings by brokers are listed below. Here’s why these brokers are bearish on them:

AGL Energy Limited (ASX: AGL)

According to a note out of UBS, its analysts have retained their sell rating and slashed their price target on this energy company’s shares to $7.60. UBS has been looking at its separation plans and isn’t overly convinced with what it sees. The broker suspects that it may require upwards of $600 million of additional equity to support an investment grade credit rating for both businesses. In addition to this, it has concerns over lower wholesale electricity prices. The AGL share price is fetching $8.19 on Thursday.

Cochlear Limited (ASX: COH)

A note out of Citi reveals that its analysts have retained their sell rating and $200.00 price target on this hearing solutions company’s shares. According to the note, Citi has been looking over the results of major listed competitors, including Sonova and Demant. These results have been in line with expectations and point to the cochlear implant market recovering post-pandemic. And while the broker is forecasting a profit result in FY 2021 ahead of Cochlear’s current guidance, it still isn’t enough for a change of rating. The broker continues to believe that its shares are overvalued at the current level. The Cochlear share price is currently trading at $216.15.

St Barbara Ltd (ASX: SBM)

Analysts at Macquarie have downgraded this gold miner’s shares to an underperform rating and cut the price target on them to $1.80. This follows St Barbara’s update earlier this week that revealed a downgrade to its production guidance and an increase to its cost guidance. While the broker wasn’t surprised by the downgrade, it was still far greater than it expected. The St Barbara share price has fallen heavily this week and is now trading in line with this price target at $1.80.

More reading

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• Top brokers name 3 ASX shares to buy today
• ASX 200 rises, Nuix jumps, James Hardie drops

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In the sea of red across cryptocurrencies including bitcoin, stocks and commodities, gold has been one of few assets standing tall this week.

The Bitcoin (CRYPTO: BTC) crash is making headlines today, with the leading cryptocurrency sliding as much as 30% to intraday lows of US$30,000 overnight. Cryptocurrencies across the board from Ethereum (CRYPTO: ETH) to meme-inspired Dogecoin (CRYPTO: DOGE) marked losses as steep as 50% amidst China’s hard stance on cryptocurrency and account liquidations.

While cryptocurrency might arguably the gold of the modern era, here’s why it might be time for gold to shine.

Why its time to take a second look at gold

Its been a rather uneventful year for gold up until this month.

Looking back, the yellow metal staged a record-breaking rally last year from pre-COVID levels of US$1,650 to US$2,075 for the first time on record. Coupled with a plummeting Australian dollar / US dollar which reached lows of less than 60 cents, ASX gold miners were raking in cash, quite literally.

After reaching its peak of US$2,075 by early August 2020, gold has struggled to find headway. But after bouncing off lows of US$1,680 in both March and April, there are a number of factors that could put the topic of gold back on the table.

Dumping Bitcoin for gold

Analysts at J.P. Morgan Chase have reported that large institutional investors are dumping Bitcoin in favour of gold. The investment bank pointed that the sudden crash in Bitcoin has coincided with new inflows into the yellow metal.

JP Morgan cited open interest data in Bitcoin futures contracts, saying:

The Bitcoin flow picture continues to deteriorate and is pointing to continued retrenchment by institutional investors. Over the past month, bitcoin futures markets experienced their steepest and more sustained liquidation since the Bitcoin ascent started last October.

Rising inflation vs. rising yields

Rising inflation erodes the purchasing power of fiat money. Gold is commonly viewed as an inflation hedge, as its price tends to rise when the cost of living increases. More recently, the US recorded a surge in inflation to 4.2% in April compared to a year ago. The expectation that higher inflation is here to stay, could be a driving factor behind the renewed interest in gold.

However, working against rising inflation could be higher yields. Since gold doesn’t pay any dividends, higher yields typically push the gold price lower. Coinciding with gold’s selloff between August 2020 and April 2021, US 10-year treasury yields more than tripled from 0.50% to a high of 1.76%. On Wednesday, treasury yields once again edged 2.50% higher to 1.68%.

Despite treasury yields ticking higher overnight, gold has marked a sixth session of strong gains, from US$1,815 last Thursday to US$1,870 at the time of writing.

Foolish takeaway

The ASX is home to some of the world’s largest and lowest-cost gold producers including Evolution Mining Ltd (ASX: EVN), Northern Star Resources Ltd (ASX: NST) and Newcrest Mining Ltd (ASX: NCM).

While Bitcoin might continue to behave in a whipsaw like action, gold has steadily made its way back up to a 5-month high this week.

More reading

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• 56% of Aussies think Elon Musk invented Bitcoin

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There is a group of ASX dividend shares that have been increasing the dividend for shareholders for many years in a row.

COVID-19 didn’t stop the income increases for investors. The underlying profit and cashflow were high enough that it meant the businesses could continue to grow the payouts for investors.

These two ASX dividend shares have managed to keep growing the dividend payout:

APA Group (ASX: APA)

APA describes itself as a leading Australian energy infrastructure business. Its gas transmission pipelines span every state on mainland Australia, delivering approximately half of the nation’s gas usage.

The infrastructure energy business has direct management and operational control over its assets and the majority of its investments. Not only does it own a large amount of gas pipelines around Australia, it’s also one of the largest owners and operators of renewable power generation assets, with wind and solar projects across Western Australia, South Australia and Queensland.

APA recently announced its first hybrid energy microgrid at the Gruyere Gold Mine in Western Australia, combining solar energy with battery energy storage.

The ASX dividend share has increased its distribution every year for a decade and a half. New projects generate more cashflow, which provides the funding for higher distributions.

APA recently announced it had reached a final investment decision (FID) to commence expansion of transportation capacity on its East Coast grid, linking Queensland with southern markets by approximately 25% for a total investment of $270 million.

At the current APA share price, it has a distribution yield of 5.5%.

Sonic Healthcare Ltd (ASX: SHL)

Sonic Healthcare is another ASX dividend share that has been increasing the payout to shareholders, every year since 2013.

The company has built a global portfolio of pathology businesses. Around 40% of revenue is being generated in Europe and the UK, another 25% in the US and the rest coming from Australia (and a very small contribution from New Zealand).

Long-term profit growth has helped send the dividend higher and higher.

FY19 saw the ASX dividend share’s net profit rise 15.6% and the dividend increased 3.7% to $0.84. FY20 saw underlying net profit growth of 6.5% with the full year dividend rising 1.2% to $0.85. The HY21 result showed net profit growth of 166%, with a steady 6% increase of the half-year dividend to $0.36 per share.

Why was the HY21 result so strong? It has seen significant revenue and earnings contribution from COVID-19 testing, leveraging existing infrastructure. More than 18 million COVID-19 PCR tests have been performed. It has seen margin improvements in both laboratory and imaging operations.

Management said that the volumes and quality of testing it has been able to achieve in such a short timeframe was a result of investments it has made over the years. That includes specimen collection facilities, courier networks, laboratories and other facilities, equipment, IT management, staff and supply chains. At the current Sonic share price it has a partially franked dividend yield of 2.5%.

More reading

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• 2 buy-rated ASX dividend shares with attractive yields

The post 2 ASX dividend shares that could provide steady passive income appeared first on The Motley Fool Australia.

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The Seven Group Holdings Ltd (ASX: SVW) share price is tracking in the red today. This comes after the company announced an update to its share purchase plan (SPP).

During late afternoon trade, the diversified investment company’s shares are being exchanged for $19.90 apiece, down 1.31%.

Let’s take a closer look at Seven Group’s latest news.

What did Seven Group announce?

Investors are pushing the Seven Group share price lower, most likely as a result of the impending share dilution.

According to its release, Seven Group advised it has successfully completed its SPP, raising around $33.14 million. This will result in more than 1.68 million new ordinary shares being issued to participating shareholders.

The price listed is $19.73 per share, which reflects a marginal discount of less than 1% on the Seven Group share price’s current level. However, Seven Group noted from the time of the offer, the SPP is a 2.5% markdown on the volume-weighted average price (VWAP) for the 5 days ending 17 May.

In total, the company received 2,164 valid submissions from shareholders, representing an average amount of $15,314 per application.

The SPP follows a recent $500 million underwritten institutional placement that Seven Group launched last month. With the latest SPP included, the company has raised a total of $533.14 million.

Funds will be used to reduce the outstanding net debt, while restoring strength in its balance sheet to pursue opportunities.

Settlement of the newly created shares is expected to occur on 25 May, with commencement of trading the day after.

Seven Group share price summary

It’s been an interesting year for Seven Group shares, with the Seven Group share price having performed strongly during late 2020. In the past 12 months, the company’s share price has increased close to 30%, however, its year-to-date performance is down 15%.

On valuation grounds, Seven Group commands a market capitalisation of roughly $7.2 billion, with approximately 361 million shares outstanding.

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The post Seven Group (ASX:SVW) share price eases on capital raising efforts appeared first on The Motley Fool Australia.

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The financial markets are going through some turbulence at the moment. Yes, the S&P/ASX 200 Index (ASX: XJO) is enjoying a day in the green today, up 1% to 7,000 points. But over the past month, the ASX 200 has been rather volatile. Just in the past 10 days alone, the ASX has gone from making a new record high of 7,172 points, to falling as low as 6,919 points yesterday.

Volatility abounds

The large US indexes are also showing some volatility. Although the Dow Jones Industrial Average (INDEXDJX: .DJI) is only ~2.5% off of the all-time high it hit earlier in the month, we have seen some significant gyrations in recent days. The tech-heavy Nasdaq Composite (INDEXNASDAQ: .IXIC) Index has been far more tempestuous. After hitting its own record high back on 26 April, the Nasdaq has given up around 6% of its value since then. In just the past week, this index has gained 3% and lost 3%.

That’s just shares though. Other financial markets have been far more volatile. The bond market has been fluctuating wildly in recent months. According to CNBC, the yield on 10-year US Treasuries was around 1.56% on 6 May. By 12 May, it had risen to almost 1.7%, and is going for 1.66% at the time of writing. That might not sound like a big deal, but it does indicate a decisive shift in what markets are pricing in.

And we haven’t even got to cryptocurrencies yet. Bitcoin (CRYPTO: BTC) prices are currently at a 3-month low after cratering more than 22% in the past week alone. Since topping out at just over US$60,000 a coin in mid-April, Bitcoin is now priced at US$38,000.

All of this is connected to two things: interest rates and inflation. Well, more just interest rates, but the two usually come hand in hand and inflation normally comes first.

Interest rates and inflation

Until about a month ago, the markets were very content with both the US Federal Reserve and the Reserve Bank of Australia (RBA)’s complacency on inflation. Both central banks committed to only raising rates when inflation was comfortably above 2%, and both full employment and positive wage growth achieved.

Rates would not be going up for years, both banks said. And quantitative easing (QE) programs would also stay in place. 2024 was the year most floated as the earliest a rate hike might happen. In other words, both banks were telling us that markets could keep rising until then.

Today, those sunny skies are growing clouded. Said cloud is the inflation figures the US economy recorded for the month of April. The consumer price index (CPI) number, measuring price increases for American goods and services, rose by 0.9% for the month of April. That was the largest monthly rise since 2009. And it was also not what the Fed was predicting. At the time, Fed officials said that the rise was likely to be “transitory”.

But perhaps things are changing. The Fed has just released the minutes from its April meeting. While the bank reiterated its commitments in line with what we discussed above, it stated the following toward the end of its release:

In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals. The Committee’s assessments will take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

The fickle Fed?

Now that sounds like the Fed is keeping the door open on adjusting monetary policy earlier than it otherwise has flagged. It’s certainly a departure from the iron-clad commitment to near-zero rates and QE until 2024. It all depends on future US inflation numbers if the April rise was indeed ‘transitory’ or the start of an inflation surge.

If it’s the latter scenario, it’s likely the US economy will see rate hikes before 2024. And if the US is hiking rates, it’s very likely our own RBA would have to follow suit. If this comes to pass, we can expect to see a lot of volatility on the ASX share market, as well as on global markets.

Interest rates change the game for shares. They make other assets, particularly ‘risk-free’ government bonds, more attractive to hold as investments. Many investors won’t be interested in a US government bond that pays an interest rate of 1.66% (around where it is today), even if it is risk-free. If that same bond is yielding 4, 5 or 6%, it’s a whole different kettle of fish. In the past, this has resulted in lower share prices.

Foolish takeaway

All of this is hypothetical. None of us truly know when the Fed, or the RBA, is going to adjust monetary policy. Or the impact such an adjustment might have on ASX shares. But the past does give us some clues, and they indicate that rates rising would be bad news for shares. So although this isn’t the most enthralling area to watch, it might still be well worth watching for every ASX share investor.

More reading

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Afterpay Ltd (ASX: APT) shares have been struggling recently in the wake of broader market volatility, the underperformance of tech shares and sharp selloffs in the buy now, pay later (BNPL) sector.

Today, the Afterpay share price has managed to work its way up to a 7.25% gain. But at its current level of $92.74 on Thursday, it’s still a long way off from its February highs of around $160.

With the company promising continued international expansion and hoping for explosive levels of growth, could the Afterpay share price be a bargain at current price levels? Here’s what Macquarie had to say on Thursday.

Macquarie upgrades Afterpay shares from neutral to outperform

Macquarie has come out with a bold upgrade for the Afterpay share price, retaining a $120 target price and outperform rating.

What’s surprising is that Macquarie’s upgrade comes not that long after its grim near-term commentary for the BNPL industry on 24 March. This was when the broker acknowledged the explosive growth of the sector but said that an “excessive number of participants has entered the industry in the near term resulting in industry overcapacity”.

The broker also said it expects this period to be followed by “a few years of industry consolidation (i.e., pain for all players) before industry normalisation at a healthier supply/demand equilibrium”.

In terms of a timeline, Macquarie’s research report said “the period of pain typically lasts for 1-2 years, followed by a year or so of recovery before share prices return to levels prior to oversupply”. By the industry normalisation stage, the broker believes that “not only does the industry come out more robust but typically the strong emerge stronger whilst the weak, weaker”.

In today’s broker note, Macquarie observed that there is limited brand loyalty among BNPL players in the United States. The broker’s survey reveals that an estimated 70% of users would prefer to sign up with a different BNPL provider rather than switch stores.

Macquarie does believe, however, that Afterpay could have an edge in the all-important US market given its large two-sided network of merchants and users. The broker’s findings rank Afterpay as the highest among its peers in the context of merchant/user networks.

The broker also shed light on brand perception in the US, ranking PayPal, Affirm and Afterpay in the top three, in that order, among the brands surveyed.

Foolish takeaway

Shareholders will no doubt be encouraged to see a previously cautious broker update its rating of Afterpay shares from neutral to outperform.

However, the recent drivers of the Afterpay share price have largely been outside of the company’s control. Factors such as the S&P/ASX 200 Info Tech Index (ASX: XIJ) falling 15% year to date, the Affirm share price sitting around record lows and smaller ASX-listed BNPL shares such as Laybuy Group Holdings Ltd (ASX: LBY) and Openpay Group Ltd (ASX: OPY) sliding more than 50% in the last 12 months are likely to have dragged on the Afterpay share price.

More reading

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The post Is the Afterpay (ASX:APT) share price cheap? Here’s what 1 broker thinks appeared first on The Motley Fool Australia.

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The Advanced Human Imaging Ltd (ASX: AHI) share price has been a very strong performer on Thursday.

 In afternoon trade, the software company’s shares are up over 15% to $1.82.

Why is the Advanced Human Imaging share price surging higher?

Investors have been buying the shares of Advanced Human Imaging, formerly known as MyFiziq, following the release of an announcement today.

According to the release, the company has signed a binding terms sheet with US based on-device blood pathology company Jana Care.

The release explains that Jana Care has developed and patented an on-device blood screening tool called Aina. The patented Aina device is capable of providing rapid, accurate readouts of key blood chemistry elements in several chronic disease categories – cardiovascular, renal and metabolic (CVRM). It is used in over 1,500 clinics by over 10,000 health workers with more than 200,000 patients.

The company notes that the device delivers rapid, accurate readouts that are extremely valuable for healthcare partners and patients that have deployed personal health management apps via their carers, life/health insurers, wellness managers, fitness organizations, and telehealth doctors/facilities.

Furthermore, the device avoids the need for the patient to go to a medical facility or phlebologist to provide blood and then wait for the results.

What now?

The Aina device diagnostic solution will be provided by Advanced Human Imaging via its CompleteScan app to its partners for their onward use by selected persons whose blood chemistry information is needed on a timely and accurate basis.

The first demonstratable product is expected to be made available in the third quarter of 2021.

Advanced Human Imaging’s Chief Executive Officer, Vlado Bosanac, commente: “The commercial distribution arrangement we have undertaken with Jana is an extremely important addition to the remote care and health assessment platform we are delivering to our partners and the vast communities they service around the world. The work Jana has and is doing in the care and identification of chronic disease is of paramount importance and a perfect addition to our offering.”

“The use case is powerful, when a user performs a FaceScan or a BodyScan we are able to detect a number of potential risk parameters that relate to chronic diseases. These markers are not dissimilar to the checks a doctor would perform when a patient is attending the doctors practice. If the performed scans identify any of the markers, this will assist the care provider in the need to facilitate a blood test, at which time via the Aina device we will facilitate the draw, analysis and diagnostic reports for both the patient, doctor and care provider.”

More reading

• Advanced Human Imaging (ASX:AHI) share price is sinking, but why?
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• What’s with the Advanced Human Imaging (ASX:AHI) share price today?

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