The Ainsworth Game Technology Limited (ASX: AGI) share price is up by 2.75% today after the company posted a 71% increase in revenue over the first half of this financial year.

At the time of writing, Ainsworth shares are trading hands for 82 cents apiece.

What did Ainsworth report today?

Earlier today, Ainsworth released its half year report and investor presentation for the period ended 31 December 2020. The company advised it earned $72.1 million in FY21 compared to $42 million over the corresponding period in FY20. Ainsworth designs and manufactures pokies and lottery machines, and gaming shut downs across the world due to COVID-19 continue to hurt the business.

The company registered a statutory loss after tax of $50.1 million and currency translation loss of $13.4 million in the first half of FY21. Its earnings per share fell to -14.9 cents and its earnings before interest, tax, depreciation and amortisation (EBITDA) was -$36.8 million.

Its biggest losses took place in Latin America, where it lost 85% of its revenue from July to December 2020. The company predicts this will continue to worsen as the region struggles to deal with COVID-19, but is beginning to shed its leased assets in the area.

In positive news for investors, its other international sales remain strong and contribute 73% of its revenue. 

Ainsworth also refinanced its $50 million loan facility with a US-based bank, Western Alliance Bancorporation on 18 February 2021 with a loan period of five years. Ainsworth reduced its total assets base by nearly $70 million from June 2020 to December 2020, primarily due to recognition of impairment losses related to property, plant equipment and leased assets. 

The company advised it will continue to suspend its dividend to increase its own cash reserves.

Ainsworth share price in a nutshell

The Ainsworth share price has a bullish price-to-earnings (P/E) ratio of 20.92.

Over the past 12 months, we’ve seen the Ainsworth share price rise from around 40 cents to over 70 cents per share, but that’s still a long way off its decade highs.

It was priced at $4.50 in 2013 and has steadily declined from that point until November 2020, when it began its current recovery.

Earnings gains backed by MTD Gaming acquisition

The company’s half year report says its acquisition of MTD Gaming has had an “immediate and positive impact on EBITDA”.

MTD is a developer and supplier of poker, keno and video-reel content. It provides Ainsworth access to multi-game and video lottery terminal markets and expands its existing hardware offering with the Apollo cabinet it manufactures.

Its Australian performance has improved on a small existing base, increasing revenue 118% compared to second-half FY20 of $8.8 million.

Ainsworth’s own outlook

The company believes its North American operations will gradually return to pre-COVID levels by the end of 2022, with Australia recovering quicker and Latin America more slowly.

Ainsworth is insistent that it will continue to cut its operational costs without affecting its deliverables market. It also aims to introduce six new brands and lottery games worldwide, while simultaneously re-entering the West Australian market.

More reading

• ASX stock of the day: Why ResApp Heath (ASX:RAP) shares are soaring
• ASX stock of the day: Ainsworth Game Technology (ASX:AGI) shares rise 11%

Motley Fool contributor Lucas Radbourne-Pugh 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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Novatti Group Ltd (ASX: NOV) shares were on the move today following the company’s launch of its Emersion platform in the United States. By market close, the Novatti share price was trading 3.06% higher at 50.5 cents. 

Let’s take a closer look at what the digital banking and payments company announced.

What pushed the Novatti share price higher?

Investors were pushing the Novatti share price towards its 52-week high today as the company begins to unlock its growth potential.

According to its release, Novatti has successfully rolled out its software-as-a-service platform, Emersion into the United States market. This completes the next step in the company’s international expansion plans to drive growth.

Emersion is a cloud-based subscriber billing, business automation and payments platform. It provides automated end-to-end business processes such as customer engagement, billing, collections, subscription management and payments, customer cash flow, and more.

Aside from the United States launch, Emersion is also available in Australia, New Zealand, and Singapore.

The platform was acquired by Novatti less than a year ago and has already made strides within the company. Revenue has consistently increased quarter-on-quarter, rising to more than $550,00 in the December FY21 period. In addition, recurring revenue has also surged, up almost 20%. On average, five new customers are secured each month, which represents a strong jump from the original two customers per month before the acquisition.

Addressable market opportunity

The managed global services market is expected to soar to US$329 billion between now and 2025. This reflects a jump of nearly 50% in the market in which Emersion operates.

Novatti noted that the United States market is significant, and several times larger than the Australian and New Zealand markets. This highlights the significant potential to capture new market share and amplify recurring revenues.

What did management say?

Novatti managing director Peter Cook commented:

Emersion’s strong, ongoing performance continues to reinforce Novatti’s strategic rationale for its acquisition last year. Emersion’s customer base across Australia, New Zealand and Singapore provides a solid foundation to continue its international expansion, starting with this launch in the US.

Emersion’s launch in the US comes ahead of significant growth forecast for its key market segments in the coming years. This presents a great opportunity for Novatti, with Emersion’s full SAAS platform expected to deliver high-margin, recurring revenues with each new client.

The Novatti share price has accelerated in value over the past 12 months, gaining around 460%. Novatti shares are also up by more than 90% year to date.

More reading

• Novatti (ASX:NOV) share price sinks 6% on collaboration news

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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“Hang on, mate,” I said “Let me write that down. You’ve given me the topic of my next article”.

We were catching up with friends on the weekend, and my mate and I had gone to grab sushi to bring back home. While we waited for it to be made, we stood out in the sun, chatting. He had a question:

“I should know this… but how do I make sure I’m in the right Super fund?”

It is a cracking question. For a couple of reasons.

First, Super is very opaque at the best of times. Unless you’re in the finance industry, can you name more than, say, three or four Super funds? And would you know where to go to compare them?

Second, despite plenty of advertising, most of us really only think about Super once a year when we get our statement in the mail. At that moment, we wonder “Do I have the best Super fund?”.

Then…

Well, that’s it. 

We move on. 

Until next year.

And so it goes.

I don’t have the stats, but I’d reckon maybe 90% of us who don’t have a Self-Managed Super Fund are in whatever default fund our employer chose for us when we joined that company.

Which would be fine… except that’s rarely the best fund for us.

Now, I can’t tell you how your employer chose your fund. But I have to say, based on the information I’ve seen, I would bet — a decent amount of money — that they didn’t choose the one they objectively thought was best for their employees.

Now, before you accuse me of being jaundiced and cynical, let me share two examples:

1. I’ve spoken to enough people who are in objectively terrible Super funds, that it stretches the laws of mathematics. Luck? Chance? To assume it could be otherwise.

But even if you think that’s possible, here’s the kicker:

2. I know, because I’ve been through it on behalf of the team here at The Motley Fool.

Here’s how it went, in our case:

US-based HR team: “We need a default Super fund. Let’s engage a Super expert to make some recommendations.”

Super expert: “Here are our best three options”

Me: “But where are the low-cost Industry Funds”

Super expert: “We’ve never been asked to include those before”

Me: “…”

Yes, seriously.

Neither that expert nor any of its previous employer clients had thought to even include non-profit funds in their ‘universe’ of available options, let alone short-list them.

(And the expert was only paid by us. They weren’t financially conflicted… they’d just never done it, and never been asked to!)

I am pleased and proud to say we included those funds and,  because my employer does care about our team, our HR team took our suggestion and chose an industry fund as our default choice.

Frankly, had our HR gurus not asked for involvement from some of us, they would have chosen from the short-listed group. And no-one would have been any the wiser.

But they— my colleagues, my fellow Fools — would likely have been poorer for it.

Because, as you likely know, at a large enough scale (think: pre-mixed investment options, measured across decades), it’s likely that investment returns roughly average out.

Which means, if you want to maximise your Super balance, you probably should — all else being equal — put fees first.

I can’t remember now what the difference was, but I think the cheapest fund we were recommended was double the cost — for the employee — of the industry fund we ended up choosing.

(I actually want to say it was closer to three or four times the price, but I’ll be conservative.)

You’ve seen the ‘compare the pair’ ads, right?

You know the sorts of savings you can make on fees over decades.

And yet many — maybe even most — employers either don’t know or don’t care enough to make sure you’re getting the best possible deal.

Which is an indictment, particularly on companies that are large enough to know better (and to be resourced to make those decisions).

And an indictment on the experts who don’t bother to include not-for-profit funds on their short-lists.

Now, I’ll give most employers the benefit of the doubt. It’s complex, and most aren’t finance experts. 

They probably just didn’t know better.

Until now.

It’s also why my mate’s question was so important.

“I’m still with [Underperforming Retail Fund] because that’s who my employer chose as my default fund.”

“How can I find the best one?”

Now, to be clear, I have nothing against fees, per se.

But they’re like taxes.

I have no issue paying tax. In fact, I want to pay a LOT of tax, if it means I’ve made a LOT of capital gains.

And I’m happy to pay fees if I’m getting above-average returns for the privilege.

Because it’s not the fees themselves that matter — it’s the return you get, net of fees, that counts.

But, if you accept my premise that, over time, pre-mixed Super options (‘Conservative, Balanced, Growth’ etc) are likely to tend toward average…

… isn’t it likely that, in these generic areas, the best thing we can do is maximise our potential returns by minimising fees?

I mean, it’s possible that your chosen Super fund outperforms for the next 10, 20 or 30 years — but it’s also possible that it’ll underperform.

And if you don’t know… then at least control what you can — and that’s fees.

So that’s what I told my mate: I reckon your best choice is probably to look for a large, reputable, low-cost industry fund.

For the record, we chose AustralianSuper for our team.

That was a few years ago, and we’re probably due to do a review, but you could do much, much worse than going with them — or another large industry fund.

So, if your employer doesn’t already have a low-cost industry fund as their default choice, here’s two things you can do today:

1. Jump onto the AustralianSuper (or other large industry fund) website and open an account, then roll over your fund; and

2. Speak to your HR team, and ask them to review their default fund, and ask them to ensure the review includes low-fee options.

(And if you’re an employer or work in HR, here’s a free tip: changing your default fund to a lower-cost option is a great way to give your team more benefits at little-if-any cost to you! Who said you don’t get anything for free?)

Here’s to a more comfortable retirement!

More reading

• Airtasker and Zip were among the most traded ASX shares last week
• Sezzle (ASX:SZL) share price lifts on B Corp certification
• Brokers think these 2 top ASX shares are buys in April 2021
• Recce Pharmaceuticals (ASX:RCE) share price tumbles despite positive update
• Macmahon (ASX:MAH) share price sinks on contract news

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Australia’s leading investment platform provider CommSec has released data on the most traded ASX shares on its platform from last week.

Here’s the data:

Airtasker Ltd (ASX: ART)

Airtasker shares may have only been listed on the Australian share market for four days last week but they were still far and away the most traded shares on CommSec. Over the period, the jobs marketplace provider’s shares accounted for a massive 7.9% of trades on the platform, with buyers accounting for 72% of them. The Airtasker share price finished the week 122% higher than its IPO price of 65 cents.

Zip Co Ltd (ASX: Z1P)

Zip shares were popular with investors again last week and accounted for 2.5% of trades on the platform. And although 53% of these came from buyers, it couldn’t stop the Zip share price from sinking 6.5% lower over the five days. This was the fifth week in a row of declines for the buy now pay later provider’s shares.

Freedom Foods Group Ltd (ASX: FNP)

This diversified food company’s shares accounted for 2.1% of trades last week, with buyers responsible for 68% of them. Those buyers may have been bargain hunters swooping in after the Freedom Foods share price crashed lower after returning from a nine-month suspension. The company’s shares fell 83% over the five days.

88 Energy Ltd (ASX: 88E)

88 Energy shares were popular last week. The energy company’s shares were responsible for 2% of trades on CommSec. From this, buyers made up 59% of the trading volume. These investors will have been delighted to see the 88 Energy share price jump 82% over the week. This appears to have been driven by optimism over its Merlin-1 project in Alaska.

Brainchip Holdings Ltd (ASX: BRN)

This artificial intelligence technology company’s shares returned to the top five after accounting for 1.5% of trades. And although 57% of trades came from sellers, the BrainChip share price fell less than 1%. Earlier this month the company announced the surprise exit of its CEO with immediate effect.

More reading

• ASX growth shares will be VERY slow to recover. Here’s why
• 5 things to watch on the ASX 200 on Tuesday
• Here’s why the 88 Energy (ASX:88E) share price is accelerating 12% today
• Afterpay (ASX:APT) share price sinks despite new product launch
• Why is the Zip (ASX:Z1P) share price down 30% this month?

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 ZIPCOLTD FPO. The Motley Fool Australia has recommended Freedom Foods 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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The Sezzle Inc (ASX: SZL) share price is edging higher in late afternoon trade after the payment technology company announced it has received B Corp certification.

At the time of writing, the Sezzle share price is trading 0.28% higher at $7.09. For context, the S&P/ASX 200 Index (ASX: XJO) is currently 0.46% lower for the day so far.

What it means to be a B Corp

B Corp certification means a for-profit company meets the highest standards of verifiable social and environmental performance, public transparency, and legal accountability to balance profit and purpose. This certification is awarded and regularly reassessed against stringent criteria by the non-profit B Corporation.

The purpose of the certification is to drive change for an inclusive and sustainable economy through for-profit businesses.

🎉 Happy B Corp Month! 🎉

In March, we’ll be joining our global community of almost 4,000 #BCorps to celebrate our movement to transform the global economy to benefit all people, communities, and the planet. pic.twitter.com/SL7HgqrDfV

— B Corporation (@BCorporation) March 1, 2021

https://platform.twitter.com/widgets.js

Recognisable Australian businesses that Sezzle will be joining include 4 Pines Brewing Company, ethical investing app provider Goodments, speciality tea store operator T2 Tea, and toilet paper supplier Who Gives A Crap.

What makes Sezzle B Corp worthy?

Sezzle states its mission is to ‘financially empower the next generation’, going beyond profits and Sezzle share price returns alone. The approval of filing requirements by BLab also solidifies the payment company’s ethos of ‘payments with purpose’ into its corporate governance structure. However, these feel-good quips alone are not sufficient for Sezzle to become B Corp certified.

The B Corp initiatives proposed by Sezzle include the following five commitments:

1. Planting a tree for every new, active user.
2. Being carbon neutral with certification from Climate Neutral, reducing the company’s carbon footprint.
3. Giving a full annual scholarship to the University of Minnesota to a disadvantaged student and launching a new national scholarship.
4. Providing free financial literacy and needed tools via Sezzle U.
5. Creating a non-profit fund to support causes as they arise that are in line with the company’s social mission.

Furthermore, both Sezzle’s leadership team and stakeholders see the company as helping all ages effectively manage personal finances without incurring high-interest finance charges.

Why is the Sezzle share price not doing better?

Despite receiving the certification, the Sezzle share price is not exactly setting the world on fire today and, in earlier trade, was actually falling. The payment instalment sector has suffered a challenging month or so. As fears surrounding possible overvaluation and tighter competition from the likes of Commonwealth Bank of Australia (ASX: CBA) grow, markets have sold off the space. The collateral damage for Sezzle has been a 27% share price fall in the last month. 

Some analysts are also predicting consolidation in the buy now, pay later (BNPL) space, before returning to growth longer term. Sezzle will no doubt be hoping its B Corp certification might assist the company to stand out from its peers during that process. 

More reading

• Is the Affirm share price dragging ASX BNPL shares lower?
• Is the Sezzle (ASX:SZL) share price about to sizzle?
• The Afterpay Ltd (ASX:APT) share price on watch after launch in France, Spain and Italy
• Here’s why the Sezzle (ASX:SZL) share price is crashing 5% today
• Can ASX BNPL companies like Afterpay (ASX:APT) compete with Paypal?

Mitchell Lawler owns shares of Commonwealth Bank of Australia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia has recommended Sezzle Inc. 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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Australia’s leading brokers have been searching the ASX share market for opportunities to buy.

Share prices are always changing, so some businesses may become opportunities whilst others become a bit too expensive to be called buys.

At the moment, these two ASX shares are liked by a few brokers:

Baby Bunting Group Ltd (ASX: BBN)

Baby Bunting is still strongly rated as a buy. The ASX retail share is rated as a buy by at least five brokers, including Citi which has a price target of $6.22.

The broker is a fan of the growing count of stores, efficiencies and economies of scale. Citi thinks that Baby Bunting can add $13 million of income if it adds 20 stores in New Zealand over time. The ASX retail share only just announced its expansion plans at the half-year result to go to the new market.

Citi likes that Baby Bunting is generally more defensive than other ASX retail shares.

Baby Bunting had a strong first half of FY21, with comparable store sales growth of 15% (or 21.8% excluding Victorian stores). The gross profit margin increased by 41 basis points to 37.4% and pro forma net profit after tax (NPAT) increased by 43.5% to $10.8 million.

The CEO and managing director of Baby Bunting, Matt Spencer, said:

Maternity and baby goods are essential products for parents and parents-to-be and are less discretionary in nature. Our strong comparable store and total sales growth performance demonstrates that we continue to deliver on our strategy of growing market share.

Pinnacle Investment Management Group Ltd (ASX: PNI)

Pinnacle is an ASX share that’s also liked by at least three brokers right now, including Ord Minnett.

The broker was impressed by the FY21 half-year, which led it to an increase of the broker’s profit expectations for the funds management business over the next couple of years. One stand out feature was the reduction of costs during this period of uncertainty.

Ord Minnett has a price target of $9.68 on Pinnacle Investment Management and it thinks it’s trading at 28x FY21’s estimated earnings.

Pinnacle is invested in some of the leading Australian fund managers including Firetrail, Spheria, Coolabah and Antipodes.

In the FY21 half-year result, Pinnacle reported that earnings per share (EPS) increased by 116% to 16.7 cents and the interim dividend was increased by 70% to 11.7 cents.

This performance was driven by both a high level of performance fees as well growing funds under management (FUM) from its investments. Aggregate affiliate FUM was $70.5 billion at 31 December 2020, which was up 20% from 30 June 2020.

Net inflows for the first half was $5.5 billion, including $1.9 billion from retail investors.

Despite a number of uncertainties such as the COVID-19 pandemic, Brexit, China-US tensions, Pinnacle said that it’s “confident that our business is well placed and there is cause for optimism for what lies ahead.” It also said it’s ready to take advantage of any opportunities that may appear.

More reading

• These top 2 ASX shares should be on your watchlist
• 2 ASX shares that may be hit by Australia’s declining birth rate
• 2 ASX shares rated as strong buys by brokers
• 2 ASX shares rated as buys by many brokers
• Will the ASX share e-commerce boom last?

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Baby Bunting. 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 Telstra Corporation Ltd (ASX: TLS) share price came one step closer to breaking its 52-week high in trading this morning. Telstra shares opened at $3.42 today and rose as high as $3.47 a share just after 11am. That puts Telstra a whisker away from its 52-week high of $3.54 that we saw last July. However, it’s still ways off of the near-$4 levels that we saw at the start of 2020, just before the pandemic hit.

Even so, it’s been a dramatic ride for the Telstra share price over the past few months. It was only back in late October last year that Telstra was getting dangerously close to an all-time low when it hit $2.66 a share. Today’s moves mean that Telstra is now up 28% from those lows. For an old blue chip share like Telstra, expanding a market capitalisation by a third in five months is no small feat.

So why have Telstra shares been climbing to new highs?

3 reasons why Telstra shares are climbing

Well, it seems a large part of the market’s optimism when it comes to Telstra shares is stemming from the company’s announcement last week. Last Monday, Telstra told investors that it would break up the company into four separate divisions by the end of the year. These divisions would still trade under a combined ‘Telstra Group’, but would be structurally and regulatorily separate.

The new structure has also opened the door to the possibility that the InfraCo Fixed division may be able to bid for the government’s NBN network when it is eventually privatised.

But institutional investor optimism may also be helping. According to the Australian Financial Review (AFR), broker Morgans has upgraded Telstra shares to ‘overweight’, with a price target of $4 a share. That price target comes from the value that the broker sees in separating out the company. It’s also a significant upgrade from the former ‘underweight’ price target of $3 a share.

A final factor that might be in play is the news that came out of Telstra competitor TPG Telecom Ltd (ASX: TPG) last week. As we reported at the time, the long-term founder and chair of TPG, David Teoh, resigned from the company with immediate effect on Friday. Teoh was regarded as a top ASX leader and a pillar of TPG’s success. So it stands to reason that his departure is good news for any TPG competitor.

It’s likely that a combination of these reasons is behind Telstra’s recent share price success. Perhaps the next stop is Telstra’s 52-week high…

More reading

• Where to reinvest your Commonwealth Bank (ASX:CBA) dividends
• TPG Chair resignation: Is this good news for the Telstra (ASX:TLS) share price?
• Is the Telstra (ASX:TLS) share price a buy today?
• ASX 200 Weekly Wrap: ASX 200 gets its mojo back
• Top brokers name 3 ASX shares to buy next week

Motley Fool contributor Sebastian Bowen owns shares of Telstra Limited. The Motley Fool Australia owns shares of and has recommended Telstra 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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Not even the release of a positive announcement has been able to stop the Recce Pharmaceuticals Ltd (ASX: RCE) share price from dropping today.

In afternoon trade, the biotechnology company’s shares are down 2.5% to 94 cents.

What did Recce announce?

This afternoon Recce Pharmaceuticals announced that the European Patent Office has granted patents relating to Recce 327 (R327) and Recce 529 (R529).

R327 has been developed for the treatment of blood infections and sepsis derived from E. coli and S. aureus bacteria. This includes their superbug forms.

Whereas R529 is a new synthetic polymer formulation with indication against viruses. Recce is currently undertaking initial studies of R529 to indicate any potential therapeutic effect against COVID-19.

What were the patents?

According to the release, the European Patent Office granted claims relating to the composition/method of manufacture of RECCE anti-infectives, the administration of R327 or R529 by oral, injection, inhalation, and transdermal dose applications, and the use of R327 or R529 for the treatment of viruses having a lipid envelope or coat. These includes coronaviruses, influenza viruses, HIV, hepatitis, Ross River and herpes viruses.

Management believes this is a big positive given the size of the European market. It notes that Europe represents one of the largest anti-viral therapies markets in the world, valued at US$11.40 billion (A$14.93 billion) in 2019. It is expected to reach US$21.12 billion (A$27.66 billion) by 2027.

Recce’s Chief Executive Officer, James Graham, said: “Recce’s intellectual property portfolio continues to grow in-line with our business strategy and the unprecedented global infectious disease crisis before us. Our market-monopolies reinforce our unique opportunity among a significant-range of both bacterial and viral pathogens.”

Today’s decline means the Recce share price is now down by 14% since the start of the year. Though, it is worth noting that it is up 275% over the last 12 months.

More reading

• Here’s why the Recce (ASX:RCE) share price is racing higher today

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 Macmahon Holdings Limited (ASX: MAH) share price is sinking in early-afternoon trade despite being awarded a new contract. At the time of writing, the mining services company’s shares are fetching for 19.7 cents, down 3.9%.

Contract award

Investors selling their positions on Macmahon shares despite the company’s positive announcement.

According to its release, Macmahon advised it has been selected for a surface mining contract with Anglo American.

Under the agreement, Macmahon will provide an array of surface mining services at the Dawson South mine, located in Queensland. Furthermore, this will see the provision of drill and blast, bulk and selective mining, crushing, screening, train loading, and other services.

The Dawson South mine forms part of the Dawson Mine, which is an open-cut metallurgical mine. The facility is responsible for producing coking, soft coking, and thermal coal. The mine is a joint venture agreement by Anglo American and Japan’s Mitsui Group.

The contract will have a 3-year term and is expected to generate around $200 million in revenue for Macmahon.

Both parties are yet to formally sign the mining services agreement, however, it is anticipated to occur in the near future.

Commencement of works is scheduled for July 2021.

Macmahon CEO and managing director Michael Finnegan commented:

We are very pleased to be selected for the Dawson South operation by Anglo American, a leading global mining company. We look forward to working very closely with our new client to ensure a smooth transition period and continuity of safe operations. This new project further strengthens our growing east coast presence.

Macmahon share price summary

The Macmahon share price has lifted close to 20% in the past 12 months. However, it is down 25% year-to-date. The company’s shares reached a 52-week high of 28.7 cents late last year.

Based on valuation grounds, Macmahon presides a market capitalisation of roughly $424.5 million, with over 2.15 billion shares outstanding.

More reading

• ASX quarterly rebalance: HUB24 joins ASX 200, Brainchip into ASX 300
• Why the Red 5 (ASX:RED) share price is soaring higher today
• ASX 200 rises, Rio chair will leave, Nine gets a new CEO
• Why the St Barbara (ASX:SBM) share price will be on watch today

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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Apparently last week was the best week for the Australian property market since 2018. That’s according to a report from analytics company CoreLogic, which also outlined how national auction clearance rates hit 84% last weekend.

As usual, that is great for Australians who own properties, and not so good for those who want to (or don’t want to for that matter).

But property has looked hot for months now. And yet no one from the government seems too concerned. Especially the Reserve Bank Of Australia (RBA).

Here is an excerpt from the RBA’s minutes of its meeting earlier this month on the matter:

Members concurred that housing market conditions warranted close monitoring in the period ahead…. Members also discussed the effect that low interest rates have on financial and macroeconomic stability. They acknowledged the risks…  linked to higher leverage and asset prices, particularly in the housing market…. The Board concluded that there were greater benefits for financial stability from a stronger economy, while acknowledging the importance of closely monitoring risks in asset markets.

That doesn’t sound like anyone at the RBA is panicking. And there might be a good reason for that. Like it or not, higher house prices help the economy. And not just for the ASX banks like Commonwealth Bank of Australia (ASX: CBA) that write out home loans.

Higher house prices mean new stuff

See, house prices are intrinsically tied to something economists like to call ‘the wealth effect’. Put simply, this refers to the phenomenon that if people feel richer, they are more likely to spend money. Or even borrow more money. And nothing makes an average Australian citizen feel richer than being told their house is now worth $100,000 or $200,000 more than it was a year ago.

Suddenly, that new TV, front deck or car is looking a whole lot more tempting. And viable.

And if more consumers are feeling richer and spending more, it means more cash is going into the economy. And when more cash goes into the economy, the beneficiaries are the businesses that also operate in that economy. ASX shares, in other words. Remember, it’s Eagers Automotive Ltd (ASX: APE) that might be selling those new cars. Or JB Hi-Fi Limited (ASX: JBH) supplying that new TV.

That might be what the RBA means when it says, “The Board concluded that there were greater benefits for financial stability from a stronger economy”.

So if you have money in the ASX share market, you should be welcoming higher house prices. If you already have a house, that’s a double-win. Even though rising property prices reveal a set of challenges of their own, the RBA doesn’t seem too worried. And that’s probably why.

More reading

• BlueScope (ASX: BSL) share price could get cut of Biden’s US$3tn boost
• Leading brokers name 3 ASX shares to sell today
• US markets just hit an all-time high. Is the ASX 200 next?
• Which is the better investment: An ASX share portfolio or an index fund?
• ASX 200 down 0.15%: AGL to split into two, NAB’s 86 400 acquisition receives ACCC approval

Motley Fool contributor Sebastian Bowen 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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