Anteotech Ltd (ASX: ADO) shares are shooting upwards today after the company announced it has received an important manufacturing contract. At the time of writing, the Anteotech share price is trading 10% higher at 33 cents. 

Anteotech is an Australian based biotech company that aims to solve global industry problems across a number of segments. In particular, the company operates in the life sciences, diagnostics, energy and medical devices markets.

What’s driving the Anteotech share price?

The Anteotech share price is soaring today after the company released news of an important agreement with Operon. To this point, the biotech has finalised and signed a manufacturing contract for its COVID-19 antigen rapid test (ART), EuGeni, with the Spanish company.

The announcement comes after the successful completion of the technology transfer in March, which also saw the Anteotech share price jump by 15%.

Moreover, under the terms of the agreement, the companies have agreed to an exclusivity period of three years. During the period, Operon has a manufacturing capacity of 8 million complete tests per annum, giving Anteotech the capacity to fulfil the expected demand for EuGeni.

Regulatory compliance

Anteotech is now a legal manufacturer of a medical device which means the company’s quality management system (QMS) needs to be compliant with both domestic and international regulatory authorities. As such, over the next 12 months, Anteotech will submit a range of tests to the TGA, FDA and Europe’s equivalents.

Furthermore, due to the emerging need to enhance its QMS, the company will also bring forward its Eugeni tests by 3 months, while delaying its TGA submission by the same time frame. This will allow findings from the trial to be included in the TGA submission. To this point, the deferral will not hinder the current roll-out and distribution of the ART internationally.

As stated by the company:

In fact, we believe the international markets provide a much stronger opportunity. To date, a high level of enquiries for the ART have been fielded from jurisdictions in which our CE Mark is accepted or where other regulatory approvals or emergency use authorisations are required.

About the Anteotech share price

The Anteotech share price has performed remarkably over the last 12 months. It’s gained an astounding 1,400% as the company saw interest in its products increase during the global pandemic.

The company’s validation-of-saliva samples for its rapid test are currently underway. Pending analysis and results of the saliva samples, Anteotech remains on track to provide an update in June 2021.

More reading

• Why AnteoTech, Domain, Flight Centre, & Nick Scali are sinking today
• The AnteoTech (ASX:ADO) share price is on watch. Here’s why.
• ASX stock of the day: AnteoTech (ASX:ADO) shares top ASX

Motley Fool contributor Daniel Ewing 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.

The post Why the Anteotech (ASX:ADO) share price is soaring 10% today appeared first on The Motley Fool Australia.

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

Threats by China’s regulators sent the iron ore price crashing, but can the Asian giant really control commodity prices?

The market doesn’t appear to believe it can. ASX iron ore shares are trading mostly higher along with the S&P/ASX 200 Index (Index:^AXJO) this morning.

But should ASX investors be worried? After all, you only need to see what happened to the A2 Milk Company Ltd (ASX: A2M) share price and Treasury Wine Estates Ltd (ASX: TWE) share price when China gets upset.

ASX mining shares staring down China

This doesn’t appear to faze the Fortescue Metals Group Limited (ASX: FMG) share price. Its shares jumped 1.1% to $23.05 at the time of writing.

The BHP Group Ltd (ASX: BHP) share price and Rio Tinto Limited (ASX: RIO) share price are also defying expectations for a weak opening today.

Blunt instruments to control commodities

This might be because most of the tools that China could use might not have a lasting impact on commodity prices.

Our biggest trading partner wants to derail the record bull run for many commodities as it sees surging prices as a threat to its growth. It doesn’t help that China has a distain for our political leaders as well.

Given this backdrop, it’s still useful to know what the Chinese could do to pour cold water on ASX mining shares.

Tightening liquidity and stimulus

UBS lists a couple of levers that Chinese authorities could pull to control commodities, but each have consequences.

China could tighten liquidity through monetary controls or curb the property market. That will lower demand for commodities, but it will also hurt its growth. Even the analysts at Bloomberg don’t think this outcome is likely.  

Other broad based tactics have unintended consequences

Another option is to encourage an increase in local supply of commodities. But this will conflict with the government’s environmental agenda, noted UBS. Furthermore, China doesn’t have iron ore resources of any significance.

The third option is for the Chinese to introduce a price ceiling. It did that for coal and it’s trying to do that for iron ore by warning steel mills and speculators to behave or else.

But history shows that artificial price caps don’t often work and the outcome from such a gamble is uncertain.

More specific control measures

There are other more specific options that China could pursue. One is to restrict steel exports. That will slow its local steel industry, and in turn, lower demand for iron ore.

“But in our view, China steel prices are being pulled up by record international steel prices (US HRC >$1,500/t) & export premiums,” said UBS.

“With restocking likely to continue to drive strong ROW [rest of world] steel demand near-term, lower China exports could see ROW steel prices lift further.”

Finally, China could sell commodities from its strategic reserves. The threat of extra supply would be enough to dissuade speculators from bidding up the price of iron ore.

However, there is debate on how long the Chinese can hold the gates with such a tactic when the global demand outlook is this positive.

More reading

• Why the Strike Energy (ASX:STX) share price is charging higher
• ASX 200 up 0.45%: Carsales sinks 10%, Aristocrat Leisure jumps
• Why the Chorus (ASX:CNU) share price is moving higher
• Why our most popular ASX mining shares are set to tumble this morning
• ASX 200 Weekly Wrap: After record high, ASX dips on inflation fears

Motley Fool contributor Brendon Lau owns shares of BHP Billiton Limited, Fortescue Metals Group Limited, and Rio Tinto Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Can China really crash the iron ore price? appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3hu8UoK

The South32 Ltd (ASX: S32) share price is rising today. At the time of writing, shares in the miner are trading at $2.97 – up 1.37%. By comparison, the S&P/ASX 200 Index (ASX: XJO) is 0.43% higher.

The share price upswing comes after the company completed its divestment from coal mining in South Africa.

Let’s take a closer look at today’s announcement.

What’s affecting the South32 share price?

In a statement to the ASX, South32 says it is transferring its “100% shareholding in South32 SA Coal Holdings Proprietary Limited (South Africa Energy Coal) to Seriti Resources Holdings Proprietary Limited (Seriti) and two trusts for the benefit of employees and communities.” The company expects to complete the transaction by 1 June this year.

South32 says it expects to lose between US$125 million and US$175 million from the sale. Net cash balance for the group will reduce by US$180 million “to reflect the recognition of the vendor support package being provided to Seriti.”

As reported on 1 April, this support package includes a US$50 million loan facility and US$200 million over 10 years to fund rehabilitation works at the site.

Investors seemingly do not mind this incurred loss, judging by today’s South32 share price movement. The company also advised that the loss of sale will be excluded from underlying earnings in its full-year financial report for this year.

While South32 is rushing to exit the South African coal market, it is attempting to ratchet up production domestically. The mining giant is currently appealing a decision by the NSW Independent Planning Commission to reject an extension of its Dendrobium coal mine in the Illawarra.

Management commentary

South32 CEO Graham Kerr said:

When we made the decision to exit South Africa Energy Coal, we recognised the business would continue to play an important role in supplying South Africa’s energy needs for years to come.

With this in mind our vision was two-fold. First, we wanted to ensure that the business would be sustainable for the long-term, for the benefit of its employees, customers and local communities. Of equal importance was our objective for it to become a black-owned and operated business, consistent with South Africa’s transformation agenda. We believe Seriti is the right owner of South Africa Energy Coal and that the additional financial support package we have provided will underpin the future sustainability of the business.

For South32, completion of the divestment is an important milestone that will see us significantly simplify our business, reduce our capital intensity and improve our underlying operating margins. Looking forward, we remain focussed on reshaping our portfolio with a bias to the base metals important for a low carbon future by advancing our development options in North America and continuing to invest in greenfield exploration.

South32 share price snapshot

Over the past 12 months, the South32 share price has increased by around 60%. Only last week, the company hit a 52-week high of $3.09 per share.

South32 has a market capitalisation of approximately $14.1 billion.

More reading

• South32 (ASX:S32) share price rises amid coal mine decision appeal
• Blue chip ASX 200 shares breaking out into 52-week highs
• Brokers rate these ASX 200 shares a buy after quarterly results
• The South32 (ASX:S32) share price is up this morning. Here’s why
• History is on the side of the battered AMP (ASX:AMP) share price as it plans its demerger

Motley Fool contributor Marc Sidarous 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.

The post South32 (ASX:S32) share price lifts after coal fire sale appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/2SV0blr

Shares in BPH Energy Ltd (ASX: BPH) are soaring with news of its subsidiary’s Offshore Sydney Basin gas prospect. At the time of writing, the BPH share price has gained 21.9% as shares in the company trade for 8.9 cents.

BPH’s investee company, Advent Energy Ltd, has reviewed a Geoscience Australia research report that uncovered geophysical gas indications in the basin.

The company, which has several interests including gas and oil exploration, said the basin was the closest potential new gas source to the New South Wales gas market.

BPH also advised on the potential for Advent’s Baleen Well to be used for carbon capture and storage (CCS). Let’s take a closer look at the news announced by BPH today.

Offshore Sydney Basin’s potential 

According to BPH, the Australian government agency Geoscience Australia has found a high likelihood of striking gas in Advent Energy’s Offshore Sydney Basin.

Geoscience claimed the likely presence of gas was evident from a series of pockmarks.

Advent is part of a joint venture in the promising part of the Offshore Sydney Basin, offshore license PEP-11, located off the coast of Newcastle.

The PEP-11 joint venture is between Advent and Bounty Oil & Gas NL (ASX: BUY), with 85% of the license held by Advent and 15% is held by Bounty. 

According to BPH’s release, the development of Australia’s energy resources is critical for Newcastle’s industries, job creation, and power generation.

Further, Advent and Bounty believe a gas discovery in PEP-11 would be in line with the Federal Government’s ambition to find gas supplies to help the region transition to electric power.

Carbon capture and storage

BPH also updated the market on an additional objective of Advent and Bounty’s drilling in the Baleen Well, an area in the PEP-11 licence.

According to the company, the Federal Budget includes incentives for CCS technology.

BPH has previously announced the Baleen Well program could offer CCS for the greater Sydney and Newcastle area.

If successfully implemented, the Baleen Well would be the closest point of CCS to the area, producing approximately one-third of Australia’s carbon emissions.

BPH Energy share price snapshot

The BPH Energy share price is having a ripper year on the ASX so far, with today’s news bringing its latest boost.

Currently, BPH shares have gained 120% since the start of 2021. They’ve also gained 790% over the last 12 months.

The company has a market capitalisation of around $49.5 million, with approximately 664 million shares outstanding.

More reading

• South32 (ASX:S32) share price lifts after coal fire sale
• Why the Strike Energy (ASX:STX) share price is charging higher
• ASX 200 up 0.45%: Carsales sinks 10%, Aristocrat Leisure jumps
• Why the Ardent Leisure (ASX:ALG) share price is climbing 5%
• This is a surefire sign you shouldn’t invest in a stock

Motley Fool contributor Brooke Cooper 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.

The post Here’s why the BPH Energy (ASX:BPH) share price is up 22% today appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3btp0eM

The Strike Energy Ltd (ASX: STX) share price is moving higher, up 3% in morning trade.

Below we take a look at the ASX energy share’s latest field results.

What update did Strike Energy provide on its operations?

Strike Energy’s share price is moving higher after the company updated the market on its West Erregulla Appraisal Campaign on behalf of its EP469 Joint Venture.

Strike Energy and Warrego Energy Ltd (ASX: WGO) each hold a 50% joint venture interest in EP469. The gas project is situated in the North Perth Basin in Western Australia.

Reporting on its appraisal well operations, Strike said WE5 has “landed and cemented the surface casing string”. The well is now drilling ahead at a depth of around 2,785 metres measured depth (MD).

Production testing continues at WE4. Strike said the well is in the clean-up phase, reporting it has encountered pressure conditions similar to WE2 on initial flows.

According to the update:

The high reservoir quality seen at WE4 has been confirmed by core results from the laboratory, which show permeability up to 430mD (unconfined) and porosity of up to 19.9% in the Kingia Sandstones.

The company said it will gain additional data from the extended flowing of WE4, helping prepare for potential production operations at its West Erregulla Phase 1 development.

Looking ahead, Shrike plans to continue its WE4 flow test program “until the well is sufficiently cleaned up”. At that stage, expected to take several more days, the company will perform a full production test.

Work also continues apace at WE5, where Strike said it will continue drilling “the 12-1/4” intermediate hole section down to a nominal depth of ~3,750mMD, at which time wireline logs will be acquired.”

Running of the casing and cementing in place is expected to take place at WE5 after that.

Strike Energy share price snapshot

Strike Energy shareholders have enjoyed a banner year, with shares up 125% over the past 12 months. By comparison, the All Ordinaries Index (ASX: XAO) has gained 31% over that same time.

The Strike Energy share price has continued to outperform in 2021, with shares up 40% year-to-date.

More reading

• ASX 200 up 0.45%: Carsales sinks 10%, Aristocrat Leisure jumps
• Why the Chorus (ASX:CNU) share price is moving higher
• ASX 200 Weekly Wrap: After record high, ASX dips on inflation fears
• 5 things to watch on the ASX 200 on Monday
• 2 high-quality ASX 200 shares to buy

Motley Fool contributor Bernd Struben 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.

The post Why the Strike Energy (ASX:STX) share price is charging higher appeared first on The Motley Fool Australia.

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

At lunch on Monday, the S&P/ASX 200 Index (ASX: XJO) has followed the lead of US markets and is charging higher. The benchmark index is currently up 0.45% to 7,046.6 points.

Here’s what has been happening on the market today:

Carsales shares tumble

The Carsales.Com Ltd (ASX: CAR) share price has returned from its trading halt and is tumbling lower. This morning the auto listings company announced the successful completion of the institutional component of its $600 million pro rata accelerated renounceable entitlement offer with retail rights trading. Carsales raised $428 million at a 12.9% discount of $17.00. It will now seek to raise $172 million from retail shareholders. These funds are being used to acquire a 49% stake in United States-based business Trader Interactive.

Aristocrat Leisure earnings update

The Aristocrat Leisure Limited (ASX: ALL) share price is storming higher today after providing a first half update. For the six months ended 31 March, Aristocrat Leisure expects to report a 12% increase in normalised net profit after tax and before amortisation of acquired intangibles (NPATA) to $412 million. This has been driven by stronger than expected performances from both its Gaming and Digital businesses.

Incitec Pivot result disappoints

The Incitec Pivot Ltd (ASX: IPL) share price is sinking today after releasing a weaker than expected half year result. The industrial chemicals company reported a 6.7% decline in revenue to $1,724.1 million and a 30.8% decline in earnings before interest and tax (EBIT) to $110 million. According to a note out of Goldman Sachs, its analysts were expecting revenue of $1,825 million and EBIT of $171 million.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Monday has been the De Grey Mining Limited (ASX: DEG) share price with an 8% gain. This reverses a sudden and sharp decline on Friday on no news. The worst performer has been the Carsales share price with a 10% decline following its equity raising.

More reading

• Why the Strike Energy (ASX:STX) share price is charging higher
• Why the Chorus (ASX:CNU) share price is moving higher
• Carsales (ASX:CAR) share price down 7% after raising $428 million
• Incitec Pivot (ASX:IPL) share price sinks 5% on half year update
• Aristocrat Leisure (ASX:ALL) share price jumps 9% on profit update

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended carsales.com Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post ASX 200 up 0.45%: Carsales sinks 10%, Aristocrat Leisure jumps appeared first on The Motley Fool Australia.

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

The Ardent Leisure Group Ltd (ASX: ALG) share price is on the move today following a trading performance update.

During late morning trade, the entertainment company’s shares are swapping hands for 86.5 cents, up 4.85%. In earlier trade, the Ardent Leisure share price climbed as high as 90 cents before retreating to its current level.

Let’s take a closer look at what the company announced.

Strong revenue momentum

Investors are fighting to get a hold of Ardent Leisure shares after the company revealed robust trading conditions.

According to its release, Ardent Leisure’s recent trading performance for Main Event Entertainment is continuing to recover.

For the first week of May (fiscal week ending 11 May), constant revenue increased by around 8%. The lift was attributed to strong, ongoing walk-in revenue, which partly offset the soft end-of-year school event business. The latter represented roughly 25% of the revenue mix from Ardent Leisure in the prior corresponding period.

Contributing to the strong result, 42 of the 44 centres operated by Ardent Leisure have re-opened. The remaining 2 locations are set to re-open their doors this month and in June, subject to COVID-19 restrictions.

Pleasingly, Main Event has generated positive earnings before interest, tax, depreciation and amortisation (EBITDA) throughout the second half of FY21. Ardent Leisure highlighted that the outcome is due to its efficient cost management policies within its centres and head office.

Segmented EBITDA (excluding specific items) for March and April recorded US$23.7 million. In comparison, this is 79% higher than the same time period in FY19 (US$13.2 million). However, when including the months of January and February, the variance between the two time periods diminishes. FY21 for the four months ending April, achieved EBITDA of US$29.4 million as opposed to US$26.2 million for FY19.

Ardent Leisure stated that the business has a high EBITDA cash conversation rate. Significant operating cash flows are generated before new centre capital spend and repayment of debt. New centre net capital spend came to US$4.1 million during the current second-half.

Available cash to its United States business stood at US$80.8 million, with outstanding debt totalling US$163.5 million.

About the Ardent Leisure share price

Over the last 12 months, the Ardent Leisure share price has accelerated to post a gain of close to 170%. This is a stark contrast from when the company’s shares nosedived to an all-time low in February last year.

Based on today’s prices, Ardent Leisure presides a market capitalisation of about $426 million, with approximately 479 million shares outstanding.

More reading

• Ardent Leisure (ASX:ALG) share price slides on development plans
• Why the Ardent Leisure (ASX:ALG) share price is surging 7%

Motley Fool contributor Aaron Teboneras 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.

The post Why the Ardent Leisure (ASX:ALG) share price is climbing 5% appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3uVqkP3

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Let’s say you stumble across a stock you’ve never heard of before that has generated amazing annual returns of 20% or more year after year. Would you immediately add it to your portfolio? If you’re smart, you’d answer no. What if Warren Buffett recommended it? Your answer should still be no.

The reasoning is simple: If you’ve never heard of the company before, you probably don’t have any idea how it makes its money. You might be thinking, “Big deal. Look at those returns!” But I promise you, it is a big deal, and below, we’ll look at why.

Why you need to know how a company makes its money

When you purchase a stock, you’re investing in a company and betting on its future success. But if you don’t know how it makes its money, you won’t be able to tell when it’s headed for a fall. 

Understanding a company’s business model can help you better predict how its leadership’s decisions and industry trends could affect the company’s stock price. For example, let’s say in a bizarre parallel universe, Netflix (NASDAQ: NFLX) decides to go back to its old way of doing things, foregoing the streaming service we’ve all come to know and love and instead shipping old-fashioned DVDs to your door. 

As someone who presumably understands how Netflix works and why it’s so successful, you would be able to tell that that move is going to be bad for business and that Netflix’s stock price is probably going to drop. But if you had never heard of Netflix and weren’t able to guess what it does from the company name, you might not realize its leaders have just made a terrible mistake. If you buy its stock just to hop on the bandwagon with everyone else, you could find yourself facing huge losses in this scenario. 

Understanding how a company makes its money can also help you identify when it’s doing well and when it might be time to buy even more of its stock. If Apple releases the iPhone 13 later this year to rave reviews, that could clue you in to the fact that the company is doing a great job at producing products people want — and that could be a good time to invest more in its stock.

How to choose the best stocks for you

Investing only in companies you know well is what Warren Buffett refers to as investing in your “circle of competence.” If you’re new to investing, you may not think that’s very large, but it’s probably bigger than you think. You don’t need to understand every business decision a company has ever made. You just need to have a general idea of how it makes money.

If you’ve ever used Netflix — or even if you’re just familiar with what it does — that falls into your circle of competence. Same goes for the manufacturers of the groceries and household items you buy every day. You probably also know how airlines, auto makers, and retail stores make their money, so they’re potentially good investments for you too.

Your job might also open up more companies you can add to your circle of competence. For example, if you work in the tech industry, you might know about some more obscure tech stocks that an outsider may not be familiar with. These are all good places to start when deciding what you’d like to invest in.

What if I want to invest in a company I don’t understand?

To return to our fictional company stock with the 20% annual returns, let’s say you’re interested in possibly investing in it but you’re not familiar with what the company does. That doesn’t mean you can’t add it to your portfolio. It just means you shouldn’t do so right away. 

You need to do your research first to familiarize yourself with how the company operates, why it’s been so successful to date, and whether its stock has the potential to continue providing these outstanding returns in years to come. 

There’s no magic stat that can tell you whether a company’s worth investing in. There are many factors to consider, including a stock’s price-to-earnings (P/E) ratio, its debt-to-earnings ratio, its management team, and industry trends. As you become a more experienced investor, you’ll learn how all these factors play into one another and how to identify the truly valuable stocks from the ones that aren’t worth the hype. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• Nasdaq slump: will ASX tech shares face selling pressure today?
• This ASX tech ETF might be in the buy zone today. Here’s why
• Netflix’s downbeat earnings explained
• Netflix’s pandemic boost is over — but here’s why I’m not worried
• Netflix wins big at the Oscars

Kailey Hagen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Apple and Netflix and recommends the following options: short March 2023 $130 calls on Apple and long March 2023 $120 calls on Apple. The Motley Fool Australia has recommended Apple and Netflix. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post This is a surefire sign you shouldn’t invest in a stock appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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

The Chorus Ltd (ASX: CNU) share price is moving higher, up 2% in morning trade.

Below we take a look at the New Zealand based telecommunications infrastructure company’s latest revenue proposal.

What revenue did Chorus submit?

Chorus’ share price is gaining after the company tendered its maximum allowable revenue submission (MAR) to New Zealand’s Commerce Commission for the 2022–2024 regulatory period.

The submission is based on the starting Regulated Asset Base of NZ$5.5 billion (AU$5.9 billion) submitted to the Commission in March. Chorus stated this is conservative and doesn’t properly reflect the costs of building its ultra-fast broadband (UFB) network.

The submission is forecast to deliver NZ$720–$820 million in revenue during the period. Chorus’ CEO JB Rousselot said this was consistent with the company’s forecast fibre revenues during the first regulatory period.

Rousselot added:

We want to encourage fibre uptake, investment and innovation, consistent with the goals of our public-private partnership with government and our desire to help more New Zealanders realise the benefits of fibre broadband.

The MAR proposal includes the use of tilted depreciation to ensure a smooth transition into the new regulatory regime and properly reflect the commercial risks we face.

Chorus said it remains in talks with the Commission on various aspects of the new regulatory framework in New Zealand. It is strongly advocating that the Regulated Asset Base “reflect the true costs” of its UFB public-private partnership requirements. Chorus believes this would see Regulated Asset Base outcomes of up to $6 billion.

Chorus share price snapshot

It’s been a challenging year for Chorus shareholders, with shares down 15% over the past 12 months. By comparison, the S&P/ASX 200 Index (ASX: XJO) is up 29% at that same time.

Chorus has continued to struggle in 2021, with shares down 20% year-to-date.

At the current share price of $5.82, Chorus pays an annual dividend yield of 4%, unfranked.

More reading

• ASX 200 Weekly Wrap: After record high, ASX dips on inflation fears
• 5 things to watch on the ASX 200 on Monday
• 2 high-quality ASX 200 shares to buy
• These were the worst performing ASX 200 shares last week
• These were the best performing ASX 200 shares last week

Motley Fool contributor Bernd Struben 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.

The post Why the Chorus (ASX:CNU) share price is moving higher appeared first on The Motley Fool Australia.

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

The Elders Ltd (ASX: ELD) share price is in the red today. The agribusiness comes into focus after releasing its half-year results for the six months to 31 March 2021.

At the time of writing, shares in the company are trading for $11.87 – down 2.95%. By comparison, the S&P/ASX 200 Index is 0.54% higher.

Let’s take a closer look at the results and what they mean for the Elders share price.

Elders half-year results

In today’s release, Elders reports underlying profit after tax is up 31% on the prior corresponding period (pcp) to $68.2 million. Total sales for the six-month period are $1.1 billion, which is 22% higher than the first half of FY20.

Underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased 28% to equal $94.3 million. Underlying earnings per share (EPS) are up 38% on the pcp to 42.9 cents. The company will pay a 20-cent interim dividend per share to shareholders, 20% franked. In the first half of FY20, the company paid a 9-cent dividend, fully franked.

The biggest drivers of the growing profit were an $18 million increase in the margin of retail products and $11.9 million for wholesale products. Costs were up $16.5 million on the pcp. Elders attributed this to “acquisitions, higher insurance costs, investment in strategic areas and systems modernisation expenses”.

Despite these positive figures, the Elders share price is heading south today.

In a separate statement to the ASX, Elders said the results were due to a variety of factors, including a backward integration strategy that boosted retail sales, encouraging weather conditions (which it expects to continue in the short term), and favourable commodity prices.

The Australian Bureau of Statistics (ABS) supports this view of favourable growing conditions when compared to the previous financial year.

In FY20, the total value of crops produced decreased by 5% compared to the previous year. This was driven largely by a 20% drop in the value of wheat production and a 78% fall in the value of cotton production. Operating cash flow was down 13% on the pcp to $23.9 million. Total cash flow for the period was a $21.2 million outflow. In the pcp, it was a total inflow of $55.4 million. Elders says the drop in operating cash flow is due to increased working capital in rural production. Financing cash flows fell 115% into the red (-$19.8 billion) to drive the total cash flow loss.

Elders share price snapshot

Over the past 12 months, the Elders share price has increased 23.7%. Only last week, Goldman Sachs put a buy-rating on Elders shares, with a target price of $15.00.

Elders has a market capitalisation of $1.8 billion.

More reading

• Leading broker names 5 emerging ASX shares to buy today
• Nufarm (ASX:NUF) share price rises ahead of next month’s profit results
• Looming grocery price shock to impact on these ASX shares

Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Elders Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Elders (ASX:ELD) share price slips on half-year results appeared first on The Motley Fool Australia.

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