The Incitec Pivot Ltd (ASX: IPL) share price has come under pressure on Monday morning.

At the time of writing, the industrial chemicals company’s shares are down almost 7% to $2.51.

Why is the Incitec Pivot share price under pressure?

Investors have been selling Incitec Pivot’s shares following a further update on the Waggaman ammonia plant.

Last month the company revealed that the recommencement of operations at Waggaman was being disrupted due to issues with a dry gas seal failure and vibrations in the turbine.

At that point, it warned that the delay would impact its earnings before interest and tax (EBIT) by $36 million.

What’s the latest?

According to today’s update, the Waggaman plant re-started again in the middle of April as expected.

It was operating successfully at nameplate capacity for a total of two weeks before the plant unexpectedly tripped upon the failure of a vibration probe.

Following repairs, the subsequent re-start process was stopped on 8 May due to a coupling failure on the refrigeration compressor, upon which the plant was safely shutdown.

Management advised that bringing the Waggaman plant back to full operation is its highest priority, with all appropriate internal and external resources being deployed to achieve this.

Earnings impact

The release explains that based on current information, repairs and re-start are expected to take two to three weeks.

The additional impact to FY 2021 EBIT from the initial trip to the expected re-start of the plant is estimated to be between $33 million and $42 million. This represents between $26 million and $33 million on a net profit after tax basis.

In all other respects, Incitec Pivot’s business performance remains in line with previous update.

Despite today’s decline, the Incitec Pivot share price is still up a solid 11% since the start of the year.

More reading

• Why the Incitec (ASX:IPL) share price is in the spotlight today
• Looming grocery price shock to impact on these ASX shares
• ASX 200 Weekly Wrap: ASX sees 7,000 points once more

Motley Fool contributor James Mickleboro 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 Bubs Australia Ltd (ASX: BUB) share price is sinking on Monday morning.

In early trade, the infant formula company’s shares are down 5% to a multi-year low of 35.5 cents.

This latest decline means the Bubs share price is now down 40% year to date.

Why is the Bubs share price sinking?

Investors have been heading to the exits this morning following the release of an update from one of its larger rivals.

Earlier today, A2 Milk Company Ltd (ASX: A2M) downgraded its FY 2021 guidance for the umpteenth time due largely to weakness in the daigou channel and significant inventory issues.

It is now targeting revenue of NZ$1.2 billion to NZ$1.25 billion for FY 2021 with an earnings before interest, depreciation and amortisation (EBITDA) margin of 11% to 12% (excluding MVM transaction costs). At the mid point of its guidance range, this will be EBITDA of NZ$140 million, down 74.5% on FY 2020’s result.

This compares to its previously downgraded guidance of revenue of NZ$1.4 billion and an EBITDA margin of 24% to 26% (excluding acquisition costs). It is also a long way from its original guidance of “strong revenue growth” and an EBITDA margin of 30% to 31%.

Unfortunately, management warned that it could take some time to rebalance inventory levels and restore channel health.

Judging by the performance of the Bubs share price today, this appears to have spooked investors. They may now be concerned that its own recovery could take longer than hoped as well.

Bubs’ appointment

As a result of the above, news that the company has made a new executive appointment has been overshadowed and failed to have a positive impact on the Bubs share price today.

That appointment sees Fabrizio Jorge join the company as its new Chief Operating Officer.

According to the release, Mr Jorge brings 24 years of experience in the global consumer goods and dairy industry. This includes nutritional and specialty milk powders.

Most recently, he was the General Manager for Fonterra Brands for Thailand, Laos & Myanmar. Previously from 2016 through 2020 he held full P&L responsibility for Fonterra Australia’s Ingredients business with sales to over 50 export markets. This followed a long association with Fonterra going back to 2009 covering South East Asia sales, Fonterra’s South America Ingredients operations, and as Product General Manager for nutritional and specialty formulated milk powders based in New Zealand.

More reading

• Top brokers name 3 ASX shares to sell next week
• A2 Milk (ASX:A2M) share price falls as China suspends dialogue
• Leading brokers name 3 ASX shares to sell today
• The ASX’s China problem is getting worse… and quickly
• Why Bubs, IDP Education, ResMed, & Tyro shares are dropping today

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 BUBS AUST FPO. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool Australia has recommended BUBS AUST 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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Holders of dogecoin weren’t laughing as the price of the cryptocurrency tumbled after Elon Musk called it a “hustle” on a US comedy show.

The comment by the Tesla chief executive and crypto evangelist triggered a close to 30% crash in the value of dogecoin to a low of US47 cents.

It had been trading around US65 cents before the show, reported the Australian Broadcasting Corporation.

Dogecoin’s plunge is no laughing matter

Musk, who was impersonating a financial expert on a guest appearance of the highly-rated Saturday Night Live program, “struggled” to explain what dogecoin is.

He was asked this question several times, and each time he replied with simple facts about dogecoin without answering the question.

For instance, one of Musk’s replies was: “It’s the future of currency. It’s an unstoppable financial vehicle that’s going to take over the world”.

The dogecoin hustle is a difficult dance to master

Finally, when fellow cast member Michael Che asked if dogecoin was a “hustle”, Musk said “Yeah, it’s a hustle”.

Here’s another fun fact about dogecoin. It has surged more than 800% over the last month and is now the fourth largest digital currency.

Dogecoin’s market capitalisation is US$73 billion and it hit a high above US73 cents on May 6, according to CoinGecko.com.

Musk is dogecoin’s biggest supporter

Musk contributed to its meteoric rise with his mostly favourable Tweets on dogecoin, which started as a meme.

He’s trying to make it mainstream by accepting dogecoin payment for a trip to the moon aboard his SpaceX rocket.

Foolish takeaway

I think many people understand what cryptos are and can do, but struggle to put a value on the numerous coin offerings in the market.

Dogecoin is just one of many examples and it’s fall comes at a time when the world’s largest and best known crypto, bitcoin, is under pressure.

Talking about falling from grace, the Tesla Inc (NASDAQ: TSLA) share price has come into strife on its own recently.

The market wasn’t impressed with its record March quarter results. While Tesla’s earnings beat consensus expectations, the electric vehicle manufacturer made more money selling bitcoin than it did cars.

More reading

• How shares with massive PE ratios can be cheap
• Appen (ASX:APX) share price: Is the disruptor becoming the disrupted?
• One MASSIVE thing about Tesla and Afterpay that people forget
• This ASX tech ETF might be in the buy zone today. Here’s why
• Tesla boss: ASX lithium shares set to boom

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The Telix Pharmaceuticals Ltd (ASX: TLX) share price will be in focus today after the company announced its prostate cancer therapy has been approved for stage III clinical trials.

Shares in the company closed last session trading at $3.94.

The biopharmaceutical company’s prostate cancer therapy, TLX591, has been approved for a stage III trial by the Human Research Ethics Committee and the Australian Therapeutic Goods Administration.

TLX591 is designed to help treat those with metastatic prostate cancer.

Let’s take a closer look at the news Telix released this morning.

New stage III clinical trial

Telix shares will be on watch this morning after the company announced it’s now able to begin a phase III clinical trial of its targeted therapy in patients with advanced metastatic castrate-resistant prostate cancer.

The phase III clinical trial, named ProstACT, will be an international, multi-centre, randomised controlled trial.

Those involved in the trial will be patients with prostate specific membrane antigen- (PSMA) expressing metastatic castrate-resistant prostate cancer. TLX591 is said to use PSMA as a target for the therapy.

The ProstACT trial will involve around 390 patients, selected by imaging with Telix’s imaging technique, Illuccix.

The trial will compare standard of care therapies with the same therapies combined with TLX591.

The trial’s primary endpoint is progression-free survival, with its secondary endpoints including overall survival and quality-of-life assessments.

Telix has begun initiating sites for the Australian ProstACT trial. It will add more sites during the second half of 2021, subject to necessary approvals.

According to Telix, prostate cancer is the second most common cancer in men. Around 1.4 million men were diagnosed with prostate cancer last year. Telicx stated the rate of diagnosis is improving, with the highest number of new prostate cancer cases found in the United States, Europe, Australia and New Zealand.

Commentary from management

Telix CEO Dr Christian Behrenbruch commented on the trial’s approval, saying:

The commencement of the ProstACT Phase III study for TLX591 marks a major corporate milestone for Telix that brings the company a step closer to delivering on a major unmet medical need for treatment options in this patient population… TLX591 has demonstrated promising and competitive clinical potential that we believe warrants further confirmation in this second-line disease setting. It is also noteworthy that Telix’s differentiated approach to integrating molecular imaging with PET alongside therapy, enables a comparatively streamlined study that we believe will support efficient patient enrolment and study execution.

Telix Pharmaceuticals share price snapshot

Investors will be hoping today’s news provides a boost for Telix Pharmaceuticals shares. Currently, the Telix share price is 1.75% lower than it was at the start of 2021. Although, the company’s shares have gained around 162% over the last 12 months.

The company has a market capitalisation of around $1.1 billion, with approximately 281 million shares outstanding.

More reading

• The Telix (ASX:TLX) share price is wobbling today
• Top brokers name 3 ASX small cap shares to buy
• Why the Telix (ASX:TLX) share price is storming 5% higher

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.

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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.

If you’re on a mission to become a better investor, your secret weapon is closer than you think.

Books and teachers are great, but nothing compares to the sage advice that mothers typically dole out. Although some words may have gone in one ear and out the other, you’ll look back and be able to unravel some of Mum’s lengthy list of do’s and don’ts as precious gems to live by today. And believe it or not, it can be extremely helpful when it comes to investing. 

As a tribute to all the mothers (and mother figures) out there, we’re going down memory lane to extract Mum’s collection of jewels that you can apply on your investing journey.  

1. Don’t fall for FOMO 

Mum probably didn’t use those exact words, but she may have warned you about FOMO (fear of missing out) somewhere down the line. You may have wanted the latest gadgets, apparel, or look because everyone was raving about it. But carrying that mindset always leaves you on the edge of your seat chasing the next big thing. 

This is true even in the investing world. If you’re always hunting for the hottest stock because of FOMO, you may end up being an emotional wreck if things don’t go your way. Instead, take Mum’s advice and focus on having clear goals and a strategy so you’ll never have to worry about missing out on anything. 

2. Don’t buy the first thing you see 

If we all just pressed the buy button when an investing opportunity popped up on our radar, we’d most likely be in a ton of trouble in the markets. Luck could work in your favor, but the downside of an investment decision that you’re clueless about could leave you sweating bullets at night. 

Do what many mums do: compare and proceed with care. They do their due diligence before they purchase products, performing some form of research and comparison analysis to ensure they are getting the best bang for their buck. So before you purchase your next stock, allow this motherly wisdom to replay in your mind. 

3. Create a shopping list 

Mums hardly ever head to the store without a shopping list.

That shopping list was Mum’s version of a watch list. It gives you a point of reference to focus your attention and get familiar with the price movement of assets you are interested in. 

Creating your watch list of stocks can allow your brokerage firm to notify you if there was an increase or decrease in the price of an asset so that you can move accordingly. Most importantly, keeping a list of what you want and tracking the stock activity of a few stocks can help you to be more efficient in the markets. 

4. Think long term 

Mums are often five steps ahead of the game. If Mum ever said no to the candy, piercing, or tattoos, chances are there was a reason behind it. Most often, it was probably just her way of thinking about your future.

Even in the stock market, there will be all types of temptations that come your way — from selling a stock that skyrocketed in value overnight to acquiring the latest penny stock recommendation from your barber. But you have to be able to step back and consider the long-term implications of your investing decisions. You want to think about how your investment decisions can allow you to take advantage of compound interest and maybe even help you to become the millionaire next door. 

5. Be patient 

This may be one of the hardest lessons to digest. Being patient is not as glamorous as instant gratification, but it has the potential to produce sweeter rewards later. 

Mum may have tested our patience when she had presents under the tree that couldn’t be unwrapped until Christmas or when you were prompted to wait to take a course in driving. Now, you’ll have to relive the wait again as you work to build a portfolio that funds your retirement. 

Patience pays off. While your stocks have the potential to grow in value over time, you can also enjoy a recurring stream of income from stocks that pay dividends. 

Give Mum some credit 

When you think about it, a mother figure’s advice can be golden on your investing journey — even if it’s not dressed up in the fancy financial lingo investors use today. Mums touch on the basic principles of investing that you’ll need to achieve financial success: Do your research, develop goals, and be patient enough to see your long-term vision become reality. 

If you ever start to panic as an investor, just think about this timeless advice to keep you going strong. Mums have survived many unexpected situations and thrived. Chances are, you can achieve your investing goals if you keep these words of wisdom in your back pocket. 

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

More reading

• Why the Cleanaway (ASX:CWY) share price will be in the spotlight today
• The ASX miners caught in the FOMO trade as copper smashed record highs
• Top broker tips REA Group (ASX:REA) share price to rise 20%
• Is good news bad news or is it actually good news?
• What’s happening with the Pointerra (ASX:3DP) share price?

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

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The Cleanaway Waste Management Ltd (ASX: CWY) share price will be one to watch on Monday morning. This follows the waste management company’s announcement of a new appointment to its senior leadership team.

At Friday’s market close, the Cleanaway share price was trading at $2.80.

What did Cleanaway announce?

Cleanaway shares will be in focus this morning after the company advised it has appointed Mark Schubert as its new CEO and managing director.

Mr Schubert’s appointment comes after having served 4 years as integrated gas executive general manager for Origin Energy Ltd (ASX: ORG). Prior to that, he held a number of senior positions over 18 years within the industry.

Management highlighted Mr Schubert’s track record of operating and transforming major assets, including world-class LNG projects and oil refineries.

Cleanaway executive chair Mark Chellew recognised Mr Schubert’s proficiency, saying:

…Mark brings a wealth of senior executive experience, has proven his ability to lead large and complex businesses, and is a strong fit with our strategy and culture.

Mark will work with our executive team to build on the momentum in our business including our recently announced asset acquisitions from Suez.

Incoming CEO and managing director Mr Schubert went on to add:

I am really looking forward to working with the Cleanaway team across Australia that every day deliver essential services to the communities that they serve. Cleanaway is not only a well performing business but excitingly is also ideally positioned to capture emerging waste streams and future re-use opportunities.

The engagement of Mr Schubert will take effect in the new financial year (after 30 June 2021). Mr Chellew will remain as executive chair until then and continues to be supported by chief operating officer Brendan Gill.

While the official leadership change is a couple of months away, Mr Schubert’s announced appointment will make the Cleanaway share price one to watch today.

Cleanaway share price performance

Since May 2020, the Cleanaway share price has been largely moving in circles. The company’s shares, however, took off last month after it provided notice of an acquisition on the Suez business.

Overall, Cleanaway shares are up almost 50% from this time last year and are around 20% higher year to date.

Cleanaway commands a market capitalisation of roughly $5.7 billion, with approximately 2 billion shares outstanding.

More reading

• ASX 200 Weekly Wrap: Shares have average week but a great month
• These were the best performing ASX 200 shares in April
• These were the best performing ASX 200 shares last week
• The Cleanaway Waste (ASX:CWY) share price is at a new 52-week high
• Downer (ASX:DOW) share price may only be at start of a capital return cycle

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.

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ASX copper miners will be in the spotlight this morning after the price of the red metal hit a new record high on the weekend.

COMEX copper futures in New York jumped 3.2% to US$4.75 a pound, reported The Wall Street Journal.

That’s above the last peak of US$4.63 per pound during the last commodity super-cycle in early 2011.

Copper poised to break new record highs again

The copper price also broke records on the London Metal Exchange. The price for the commodity for delivery in three months hit US$10,417 a tonne – or US$257 above its previous all-time high set in February 2011.

What’s more, several commodity forecasters believe copper could be heading higher over the next few months.

ASX miners riding on record copper prices

That’s great news for ASX copper miners. The two largest pure-play copper shares on our market are the OZ Minerals Limited (ASX: OZL) share price and Sandfire Resources Ltd (ASX: SFR) share price.

Mining giants like the Rio Tinto Limited (ASX: RIO) share price and BHP Group Ltd (ASX: BHP) share price will also benefit. But copper makes up only a small fraction of their group profits, so they aren’t seen to be the best way to gain exposure to the surging copper price.

What’s driving the copper super-cycle

Among the metals, copper is uniquely placed on the current boom, in my view. This is because the metal is benefiting from both economic growth and the renewable energy transition.

The global economic rebound from massive government stimulus will lift industrial production and construction, which drives copper demand.

Even as countries like India struggle to contain the resurgence of COVID-19, investors are confident that this will not derail the sharp economic rebound around the world.

On the other side of the demand equation, the rise of electric vehicles, solar and wind power are creating a second tailwind.

Copper price forecasts for 2021

There are other metals that are also leveraged to both these thematic, such as nickel. But no other base metals have the same reach as copper. This is why copper is affectionately referred to as “Dr Copper” by the market as it’s a bellwether for the group.

Meanwhile, there may not be enough of the good Doctor to go around. This prompted London-based hedge fund Commodities World Capital LLP to predict that the metal will climb to between $11,500 and $12,000 a tonne in the coming months, reported the WSJ.

Miners have been underinvesting in finding and developing new copper projects, which take years to bring to production.

But this doesn’t mean the rally will be smooth. Markets almost never go up in straight lines. Nonetheless, buoyant copper prices could be with us for some years yet.

More reading

• ASX 200 Weekly Wrap: Bank shares push ASX 200 towards all-time high
• 5 things to watch on the ASX 200 on Monday
• Iron ore price hits another record high as tensions with China increase
• A2 Milk (ASX:A2M) share price falls as China suspends dialogue
• Brokers say “buy” these 3 ASX shares even as they trade near 52-week highs

Motley Fool contributor Brendon Lau owns shares of BHP Billiton Limited, OZ Minerals Limited, Rio Tinto Ltd, and Sandfire Resources Ltd. Connect with me on Twitter @brenlau.

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 REA Group Limited (ASX: REA) share price has been a strong performer over the last 12 months.

Since this time last year, the property listings company’s shares are up a sizeable 67%.

Can the REA Group share price keep climbing?

The good news for investors is that Goldman Sachs believes the REA Group share price can keep on climbing.

In response to its third quarter update last week, the broker has retained its buy rating and lifted its price target on the company’s shares to $187.00.

Based on the current REA Group share price of $156.05, this price target implies potential upside of 20% over the next 12 months.

What did Goldman say?

Goldman was pleased with REA Group’s performance during the third quarter and expects more of the same in the future. Particularly given its belief that it is winning market share from rival Domain Holdings Australia Ltd (ASX: DHG).

It commented: “For REA, we see a strong near-term earnings outlook, given: (1) April listings +98% yoy (+33% vs. Apr-19), with listings strength continuing into May/Jun (and FY22E) in our view; (2) Strong yield growth, with +8%/+6% price rises in FY22/23E (in line with GSe); (3) Ongoing depth penetration (Premiere All traction, new products gaining strong traction); (4) Share gains vs. DHG – We estimate REA Australia revenue grew +13-14% (Resi > +15%, given +8% listings, > +7% yield) vs. DHG Digital +8% (Resi +11%, with +4% listings, +7% yield); and (5) strong cost discipline, with FY21E costs now marginally higher (was flat) given stronger revenues.”

This led to Goldman upgrading its earnings forecasts for FY 2021 through to FY 2023 and its price target accordingly.

Don’t forget Move

The broker also advised investors not to overlook the value of REA Group’s investment in US-based Move.

It commented: “Despite the strong YTD performance, we still do not believe the market is fully appreciating the value of Move. For example, although: (1) our FY21 revenue for Move of US$615mn is equivalent to 85% of REA FY21E; (2) it is growing materially faster (i.e. +30% in FY21E vs. REA +10% cc); (3) it is meaningfully lower margin, Move should see margin expansion (we expect Move EBITDA margin to increase from 3% in FY20 to c.15% in FY21E vs. REA 58% to 62%). However, despite these strong financial metrics, our above consensus US$6.9bn Move valuation is only 40% of our REA valuation.”

More reading

• ASX 200 rises, Macquarie falls, Magellan declines
• How shares with massive PE ratios can be cheap
• ASX 200 up 0.45%: Macquarie full year results & REA Group Q3 update
• REA (ASX:REA) share price on watch after third quarter results
• 2 stellar ASX growth shares rated as buys

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended REA 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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Share markets have been funny the past few years.

For much of last year, while COVID-19 first raged (and for a few years prior), US and ASX shares have counter-intuitively shot upwards whenever the economy looked suppressed.

Bad news meant good news.

Nucleus Wealth head of investments Damien Klassen said this is because share markets are “driven by narrative”.

“Bad economic news meant bond yields fell and inflation expectations cratered. However, it also meant more central bank intervention. Growth stocks boomed,” he said in a memo to clients.

Of course, this led to some absurd consequences.

“In a time of no growth, any stock that did exhibit 6 months of growth would ‘therefore’ grow forever. Even better if the stock didn’t make any profit!” 

“A lower bond yield meant investors could pay more for those stocks. In the land of the blind, the one-eyed man became king.”

ASX shares like Afterpay Ltd (ASX: APT) and Tesla Inc (NASDAQ: TSLA) ended up as the poster children for this trend last year.

Good news is good news

The story took a sharp turn in November.

Coronavirus vaccines started to show promise of worldwide rollout, and a change of government in the US revived hope for the global economy.

Good news was, all of a sudden, good news.

“Good economic news meant higher profits,” said Klassen.

“Value stocks became the new leaders, and growth stocks sank. Banks, cyclicals, commodities all shot higher on the expectation of rising economic growth.”

Good news is bad news

Since this year started, the prospect of rising inflation triggered by the post-COVID recovery started worrying markets.

Ten-year bond yields actually rose in both the US and Australia.

Good news was now bad news.

“It is basically the reverse of the first narrative,” Klassen said.

“It assumes that the rising bond yields and inflation will burst the stock market bubble.”

While there has been some correction to the fast-growing ASX shares of 2020, it’s still uncertain which narrative will dominate for the rest of this year.

Where are the markets headed this year?

Klassen reckons the least likely to win out this year is the “good news is bad news” narrative.

“Not only do I think that the inflationary pressures will be temporary, but… central banks do not want bond yields to rise to the point where they damage economic growth,” he said.

“The Australian and European central banks have expressly commented on this. The US Fed has avoided explicitly commenting, and so maybe markets will test their resolve. This could lead to short term pull-backs, but these are more likely to be buying opportunities.”

Klassen’s team predicts that as inflation rises, growth in profits will reduce overvaluation of shares.

There may be some “violent rotational rotations under the equity hood”, but overall the market will not experience a breakdown.

“So, the focus right now is on the ‘good news is good news’ argument,” Klassen said.

“Deflation and disinflation are likely to take over in the coming months, but that is a theme for later.”

He warned this is not a “set and forget” time for fund managers like himself.

“My favoured narrative, ‘good news is good news’, is the only non-contradictory semantic. However, the categorisation probably over-trivialises the other narratives,” said Klassen.

“They are genuine possibilities. I am closely watching for signs that growth is tapering and deflationary forces are again reigning supreme.”

More reading

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• Star (ASX:SGR) and Crown (ASX:CWN) shares on watch amid $12bn merger proposal
• Is the NEXTDC (ASX:NXT) share price in the buy zone?
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Tony Yoo owns shares of AFTERPAY T FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Tesla. The Motley Fool Australia owns shares of 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 Pointerra Ltd (ASX: 3DP) share price has been on something of a rollercoaster ride recently. Just a few short weeks ago, shares in the junior ASX tech company were trading for 52 cents, their lowest price since early February. But from there they went on a sudden tear, surging as high as 75.5 in just over a week – a gain of 45%!

Sadly, the rally didn’t last. Last week, Pointerra shares plummeted back down to earth, wiping out just about all those recent gains. By the close of trade on Friday, Pointerra shares were valued almost back where they started a couple of weeks ago, at just 55 cents. So, what exactly was behind the big swings in its share price?

Company background

First, a brief explanation of what Pointerra actually does.

Pointerra develops software that helps companies in industries like utilities and resources (among others) manage and analyse large 3D datasets. Pointerra’s software allows users to capture, store and visualise data with up to one-millimetre accuracy. As you can imagine, tools like this can come in handy when you are trying to plan and manage large-scale construction and mining projects.

The company operates a data-as-a-service (DaaS) business model. This is similar to the software-as-a-service (SaaS) business model employed by other tech companies like Altium Limited (ASX: ALU) and Bigtincan Holdings Ltd (ASX: BTH), where software developers sell subscription-based licenses to users which are then granted access to the software via a web browser. Pointerra just adds data hosting services on top of that. This means users can access their data from anywhere in the world – and also seamlessly share it with their employees and stakeholders.

Recent movements in the Pointerra share price

The initial jump in the Pointerra share price coincided with the release of the company’s March quarter activities report. Pointerra reported record quarterly cash receipts from customers of $1.37 million (a quarter-on-quarter increase of almost 115%).

The company also stated that development projects designed to spur economic growth post-COVID were driving increased demand for Pointerra’s data visualisation platform from the architecture, engineering and construction sectors.

Investors seemed to like what was in the report, and the Pointerra share price rocketed higher. That was until the release of two further announcements made by the company at the end of April.

The first was Pointerra’s enterprise sales and annual contract value (ACV) update. The company stated that the annual value of its contracts with customers had increased by US$1 million (to just under US$8 million) during the period from 29 January 2021 to 29 April 2021.

The increase in Pointerra’s ACV wasn’t quite as dramatic as the uplift in quarterly cash receipts, but it may provide a more accurate view of the company’s underlying growth rate. As Pointerra itself noted in the report, “quarter-on-quarter cash receipts may continue to be variable as new customers are onboarded with a variety of different payment cycles.” ACV, on the other hand, ignores variability in the timing of these cash receipts.

The second announcement Pointerra made was its planned acquisition of US-based company Airovant. The company operates a similar DaaS model to Pointerra, but uses drone technology to collect aerial imagery data for customers in the construction and energy sectors.

What’s next for Pointerra?

Where to next for the Pointerra share price is up for debate. Along with ASX industry peer Nearmap Ltd (ASX: NEA) – which also saw its share price tumble last week, though for entirely different reasons – Pointerra remains an exciting company operating in a niche industry. It is also still only a small company, with limited revenues and a market capitalisation of under $400 million – meaning it remains a speculative investment.

Pointerra has given the market a lot to digest over the last few weeks and, clearly, investors are still struggling to work out how to price it all in. While that could mean more volatility is on the way, it still makes the Pointerra share price an interesting one to watch this year.

More reading

• Why Beach Energy, Bigtincan, Pointerra, & ResMed are sinking today
• Pointerra (ASX:3DP) share price plummets 10% on acquisition news
• What’s happening with the Pointerra (ASX:3DP) share price?
• 3 growing small cap ASX shares to watch
• Why Megaport, Pointerra, Regis Resources, & Zip are charging higher

Rhys Brock owns shares of Pointerra Limited, Altium, BIGTINCAN FPO, and Nearmap Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends BIGTINCAN FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Nearmap Ltd. and Pointerra Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Altium. The Motley Fool Australia owns shares of Altium. The Motley Fool Australia has recommended BIGTINCAN FPO, Nearmap Ltd., and Pointerra 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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