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.

With the stock market recently closing at its highest level ever,  investors might be getting a little nervous that another crash is coming. Because of those nerves, they may be questioning whether now could be the right time to start building a cash position.

That raises a good question. Should investors be stashing cash right now? That’s an easy question to ask — and a somewhat tougher one to answer. The short version of an answer is that every investor should always have some cash available, and if you don’t, then a market high is a great time to raise a bit of it. Still, whether you should be stashing cash right now depends as much on your personal financial situation as it does on the current state of the market.

Why you need some cash

If something unexpected were to happen to you where you needed cash in a hurry — say a car wreck, an injury, or a job loss — how would you get hold of that cash?

If your answer is “I’d sell some stocks”, then you’ve got a problem. Because what happens if your stocks happen to be down when you needed to sell them? Your bills aren’t going away, after all.

You’d have to sell more shares to raise the same amount of cash, assuming you could even sell enough shares to raise what you need. That would mean you’d have that much less invested to take advantage of any subsequent recovery that happens.

By having a decent emergency fund in cash, you don’t have to worry about what the market is doing when you need to raise your cash. You’d already have it available. As a general rule of thumb, you’d want to keep around three to six months of your expenses in an emergency fund. If you’re not at that level yet, then the market being near an all-time high is as good a reason as any to raise some cash to get there.

Similarly, if you are expecting to cover costs from your portfolio within the next five years, you should make plans to get that money in something with higher certainty than stocks. Cash works for that purpose, but so do duration-matched CDs, Treasuries, or potentially even investment-grade bonds. This is for the same reason you don’t want to own stocks to cover your emergencies — when you need the money, you don’t want to be forced into selling your stocks when they’re down.

Why else might you want to raise cash?

Beyond those fundamental personal financial reasons, if the market’s rise has given you a gift, it’s perfectly OK to accept it. If an investment you own has skyrocketed past any semblance of its fair value, then holding cash might very well be a preferable alternative to continuing to own its shares. Similarly, if it has grown to be too large a portion of your holdings for your comfort zone, then selling a bit and holding cash can be a worthwhile use of your gains as well.

Additionally, if you’re investing for a key purpose — such as your kids’ educations — and the market’s recent gains have given you enough to reach that goal, then it’s OK to sell. Congratulations, you’ve accomplished what you set out to accomplish. Why take financial risks you don’t need to take? Celebrate your success, take the money you need to cover that cost, and enjoy the added freedom that comes from not having to worry about that particular objective anymore.

Finally, there’s nothing wrong with taking advantage of the market’s generosity and splurging a bit on yourself or your family or in donating a bit to charity if you’re so inclined. Just recognize that the market’s moods are fickle, and today’s gains could turn into tomorrow’s losses. As such, make sure you’re not taking on ongoing expenses based on what might only be one-time gains. Think in terms of things like a spectacular vacation or a one-time major gift.

So why stay invested?

The reasons to raise cash shared above are tremendously strong ones. If any of them apply to you, by all means, go ahead and convert some shares into cash and enjoy the benefits that come from the improved liquidity you have.

If, on the other hand, you’re just nervous because the market is up, you might want to think again before raising cash. Over the long haul, the market has provided investors with solid total returns from compounding of both growth and dividends. That growth over time means the market has regularly hit new highs in the past — and continued to grow after hitting them.

So don’t let the mere fact that the market is up drive you away from owning the stocks of great companies with strong long-term growth potential. Instead, evaluate those businesses based on their prospects and current market values. If the stocks’ recent gains simply mean that the market is finally beginning to recognize those business’ true potential, then you would likely be doing yourself a favor by continuing to hold.

Now is a great time to figure out what cash you need

Regardless of what you end up doing, a new high in the market does give you a great opportunity to evaluate where your cash position is compared with what you really need it to be. If it turns out you do need more cash, you’ll be able to get away with selling fewer shares than you would have before at a lower price. If, on the other hand, it turns out that you’ve got the cash you need, then that’s a good thing, too. It should help boost your confidence to ride out any market volatility.

So take advantage of the market’s recent rise to consider whether your cash reserves are where you need them to be. If you let that drive your actions, you’ll likely find yourself better prepared to handle whatever the market does next.

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

More reading

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• Why the Xero (ASX:XRO) share price can go even higher from here
• Should retirement savings be assumed bequests? Government says no

Chuck Saletta 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.

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Centuria Industrial REIT (ASX: CIP) shares are sliding lower despite the company announcing its acquisition of a modern distribution centre on Monday. At the time of writing, the Centuria Industrial share price is edging 0.29% lower to $3.39. For context, the All Ordinaries Index (ASX: XAO) is currently trading 0.19% lower for the day so far.

Despite today’s slump, Centuria Industrial shares have increased by nearly 10% year to date and are within around 10% of their all-time record high of $3.75 set on 25 February 2020. 

Centuria Industrial share price flat on acquisition news 

The Centuria Industrial share price is languishing on Monday despite the company’s $27 million acquisition of a distribution centre located in the tightly held infill industrial market of Arndell Park in Central West Sydney. The property includes 9,400sqm of generic industrial space within a 1.9-hectare site. 

Centuria fund manager Jesse Curtis commented on the company’s acquisition, saying: 

The acquisition is CIP’s second strategic, infill Sydney industrial transaction within seven weeks having recently completed on a Bella Vista warehouse. The high-demand Arndell Park market is characteristic of limited warehouse stock and benefits from its infill location, close to major infrastructure.

It increases CIP’s exposure to Sydney’s central western industrial market and supports the REIT’s strategy of securing high-quality industrial assets within infill markets.

The latest purchase brings the company’s acquisitions throughout FY21 to 13 assets, worth a total of $784 million. To add some perspective, the company had a $2.4 billion portfolio value based on its half-year results announcement. 

Quality tenants and earnings

According to Centuria Industrial, it has a simple strategy to deliver income and capital growth to investors from a portfolio of high quality Australian industrial assets. 

The company focuses on quality tenants in reliable industrial real estate sub-sectors such as manufacturing, distribution centres, transport logistics and data centres. 

In the company’s February half-year results announcement, it highlighted a 97.7% portfolio occupancy over the half, with less than 8.5% of the portfolio expiring in the 18 months to 30 June 2022. 

This has translated into stable earnings and a 5.20% dividend yield. The Centuria Industrial share price didn’t see much action throughout January and February, but the company’s shares have surged some 13% since March 1.

More reading

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• Why the Centuria Industrial (ASX:CIP) share price is gaining today

Motley Fool contributor Kerry Sun 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 Credit Clear Ltd (ASX: CCR) share price is on course to start the week with a solid gain.

In morning trade, the debt recovery solution provider’s shares are up 5% to 76 cents.

At one stage today, the Credit Clear share price was up as much as 10% to 79.5 cents.

Why is the Credit Clear share price storming higher?

Investors have been buying Credit Clear shares this morning after it announced a major new customer win and strong third quarter growth.

According to the release, the company has signed Suncorp Group Ltd (ASX: SUN) as its first major insurance sector client.

The company notes that the signing of Suncorp, for a fully integrated digital service, capped off a very strong third quarter of FY 2021 for Credit Clear.

During the quarter, the company’s unaudited revenue grew by more than 30% over the second quarter to over $2.7 million.

This was driven by a 245% year on year increase in digital communications to 2.8 million, with the company experiencing its first 1 million month during March. Management believes this indicates that customer acceptance of Credit Clear’s digital platform is continuing to accelerate.

Credit Clear provides businesses with a digital debt recovery technology platform that helps drive smarter, faster, and more innovative financial outcomes. It aims to achieve this by changing the way customers manage their payments through a user experience that the market demands in a digital age.

Credit Clear’s Chairman, Gerd Schenkel, said: “Credit Clear’s successful entry into the Australian insurance sector and the achievement of continued strong growth in the March quarter highlights the potential for the Company to play a major role in the multi-billion-dollar Australian receivables market.”

“Signing long-term fixed fee contracts with enterprise clients creates revenue certainty and shareholder value and demonstrates the flexibility of Credit Clear’s fully integrated, SaaS digital business model. We are committed to delivering a world leading interactive communications and digital payments platform for our clients across all major sectors.”

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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.

The post Credit Clear (ASX:CCR) share price jumps 10% on Q3 update and Suncorp contract win appeared first on The Motley Fool Australia.

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The Xero Limited (ASX: XRO) share price is pushing higher on Monday morning.

At the time of writing, the cloud-based business and accounting platform provider’s shares are up 1% to $140.49.

This means the Xero share price is now up 78% over the last 12 months.

Can the Xero share price go higher?

One broker that believes the Xero share price can still go higher from here is Goldman Sachs.

This morning the broker retained its buy rating but trimmed its price target slightly to $153.00.

Based on the current Xero share price, this implies potential upside of 9%.

What did Goldman say?

Goldman Sachs has been looking into Xero’s recent acquisition of both Planday and Tickstar.

The broker views both acquisitions as positive and expects them to accelerate Xero’s platform strategy through the broadening of its product offering into workforce management.

In addition, it notes that they provide a platform for Xero to launch its core accounting product in Scandinavia, which its sees as an attractive potential market.

Goldman Sachs estimates that there is a total addressable market (TAM) of 2.2 million subscribers for its accounting software in the region.

The broker also feels that the region has favourable market characteristics. These include limited competition, high GDP/capita supporting pricing power, high digitisation, VAT compliance, and supportive E-invoicing regulations.

What else did Goldman say?

In addition to the acquisitions, Goldman has been looking into industry data to see how Xero has been performing. Positively, it believes Xero’s strong form has continued.

Goldman said: “We consider recent data points, which are collectively tracking well. These include: (1) Accounting partner numbers continue to grow strongly, with annualized growth of c.20% in key markets, while the announced BDO partnership (5th biggest practice globally, offices in 171 countries) is a meaningful positive; (2) the number of apps in the ecosystem continues to increase, growing at an annualized rate of 25-32% p.a. across AU/UK/US; (3) XRO/QBO pricing has increased, while Freshbooks launched in AU; (4) Google trends data for XRO is mixed, performing well in AU/UK but lagging in the US.”

Why has the broker reduced its price target?

Despite the many positives listed above, readers may have noted that Goldman’s target on the Xero share price has been reduced.

It explained that this was due largely to a reduction in US software as a service (SaaS) peer multiples, impacting its valuation.

It explained: “We revise our FY21-FY23 EBITDA by +2-7% (-1 to +1% constant currency) driven by (1) the inclusion of Planday/Tickstar; (2) Accelerated Scandinavia rollout, and (3) AUD FX upgrades. Our 12mf TP decreases by -3% to A$153/share, with the earnings upgrades offset by lower US SaaS peer multiples (2x reduction to 27X) updated spot A$/NZ$ (1.08, from 1.05) and increased share base.”

More reading

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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 Xero. 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 Xero (ASX:XRO) share price can go even higher from here appeared first on The Motley Fool Australia.

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The Booktopia Group Ltd (ASX: BKG) share price is climbing this morning after the company unveiled a new strategic partnership at the market open.

Why is the Booktopia share price climbing?

Online book retailer Booktopia has announced the finalisation of a deal with global online education technology company, Zookal.

Booktopia will become the exclusive supplier and fulfilment partner for Zookal as part of the new deal. The online retailer will source, supply and distribute all Zookal’s physical book orders from “a range of approximately 185,000 titles”.

Zookal is forecasting annual book sales revenue of approximately $22 million this financial year, with the Booktopia deal set to start on 1 May 2021. According to today’s release, the agreement is revenue and earnings accretive for FY2022.

The Booktopia share price has jumped more than 4 per cent higher on the back of the news. Booktopia also reported a new record for academic sales as universities and schools return to the classroom in 2021.

The coronavirus pandemic disrupted in-classroom learning in 2020 and challenged earnings. However, Booktopia has achieved total academic and corporate book sales of approximately $53 million in the year to date. That figure represents more than 30 per cent on FY2020 figures of $40 million.

Booktopia CEO Tony Nash welcomed the deal, saying:

Our partnership with Zookal will ensure we are continuing to grow our penetration into this sector. Zookal has established a strong reputation for holding an extensive range of titles.

Foolish takeaway

The Booktopia share price is climbing higher this morning on the back of the new partnership agreement. Shares in the Aussie online retailer have jumped nearly 5 per cent at the time of writing, with a market capitalisation of $326 million.

That’s despite the broader market struggling to maintain last week’s momentum. The S&P/ASX 300 Index (ASX: XKO) has edged 0.2% lower to 6,969 points at the time of writing.

More reading

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Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Booktopia Group Limited. 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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A new analysis paper has questioned whether encouraging those over retirement age to spend all their retirement savings in their lifetimes is a good idea.

In his analysis paper, Terrence O’Brien states that the Australian Government’s Retirement Income Review implies policy directions that will encourage retirees to spend their life savings, including the equity in their homes, during retirement.

At this point in time, the Government’s Retirement Income Review is just a report. It’s purely a proposal looking at forward-moving measures and there’s no promise that any proposed policies will be initiated just yet.

Let’s look closer at what information the government report and the analysis paper contain.

What does the government’s report contain?

The Australian Government’s Retirement Income Review is an overview of the Australian retirement income system. It has found the system to be effective and broadly sustainable. Though, it has offered a number of suggestions to strengthen it. 

Three of the report’s suggestions are as follows.

Firstly, the report notes that the rate of super paid to employees is sufficient. But, retirees’ income from their super should be taxed more. 

Next it states some of its contributors believe the equity in a retiree’s home should be taken into account when applying for the age pension.

Finally, it suggests retirees might purchase a longevity protection product to avoid running out of money in retirement. 

The report says people worried about outliving their savings may make financial decisions which diminish their quality of living. Instead, retirees could purchase longevity protection plans that would provide them with an income after a certain age. 

O’Brien says these measures come a long way from what is a common Australian belief – that owning a home allows you financial freedom in retirement.

Would these measures be fair? O’Brien thinks not

O’Brien states that, if adopted, policies within the Retirement Income Review would encourage retirees to spend their entire life savings.

It would do so by placing higher taxes on superannuation withdrawals and decreasing access to the age pension for those who own their own homes. Thus, encouraging retirees to purchase new longevity protection products and spend the equity in their homes.

According to O’Brien, these measures combined might diminish retirement savings and inheritances.

O’Brien says if a house’s equity is taken into account when applying for the age pension, accessing the equity within their homes may become a necessity for retirees.

Further, purchasing a longevity protection product would rarely be necessary if policies don’t encourage more spending. O’Brien said:

In effect, preferred policy directions would incline each generation towards consuming fully its own lifetime savings.

Policies would be shaped by the idea that retirement income of 65% to 75% of the average of post-tax income earned in the last 10 years of work is adequate for the final 30-or-so years of life.

O’Brien goes on to say the government’s attitude to saving and placing equity in property has changed in recent times. To outline this shift, O’Brien quoted Robert Menzies’ 1942 argument for frugality and homeownership: “Frugal people who strive for and obtain the margin above… materially necessary things are the whole foundation of a really active and developing national life.”

O’Brien’s criticisms outline a question for the future.

Are policies shifting away from the idea of the ‘forever’ home – one to leave to those we love? Maybe, in the future, retirees will routinely downsize early in retirement.  

More reading

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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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The share prices of ASX mining giants BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) are in the red today.

However, the share prices of all three major iron ore miners have slipped by less than 1% at the time of writing.

Moody’s Investors Service analysts expect the global metals and mining industry’s earnings before interest, tax, depreciation and amortisation (EBITDA) to increase 30% through early 2022. But S&P Global reported the market value of all three miners fell through March.

BHP’s market capitalisation fell by 8.5%, Rio Tinto’s fell by 10.6%, and Fortescue’s fell by a substantial 17% from February to March. The Newcrest Mining Ltd (ASX: NCM) market cap also fell by 1.8%. 

Moody’s bullish on miners despite falls

The market value declines weren’t limited to Australian companies. They were largely replicated across the global industry, with Chinese heavyweights Zijin Mining Group and China Molybdenum falling by double digits.

S&P reported that overall, 11 of the largest 25 companies in the metals and mining sector decreased in market value during March. In brighter news for miners, every single company in the top 25 index had gained on its market value 12 months prior.

Moody’s believes the mining industry will continue to see revenue growth due to consistently high materials demand, as the global economy invests in stimulus measures following the coronavirus pandemic.

“The positive outlook for the global metals and mining industry stems mainly from rising demand and tight supplies for steel, iron ore and copper as economic activity picks up in the wake of the pandemic,” Barbara Mattos, a Moody’s senior vice president, said.

“Aluminum, nickel and zinc will remain in surplus in 2021, with aluminum seeing a slow recovery, while nickel and zinc supplies will grow as production levels normalise.”

Rio Tinto, BHP and Fortescue share price snapshots

At the time of writing, the BHP share price is falling 0.92% to $46.24 per share. It has gained nearly 10% in 2021 so far.

Rio Tinto’s share price is also down slightly to $115 per share, after gaining just over 1% in 2021. Fortescue is the only miner of the three that has increased its share price this month, up 0.5%.

However, it’s also posted the only loss in 2021, down more than 10%. The Fortescue share price is also falling today and is down 0.86%.

More reading

• Antipa (ASX:AZY) share price jumps 7%. Here’s why
• ASX 200 Weekly Wrap: ASX sees 7,000 points once more
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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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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.

The e-commerce behemoth is clearly a more exciting company than the grocery store chain. On a risk-adjusted basis, however, both Amazon (NASDAQ: AMZN) and Kroger (NYSE: KR) have proven heroic over the course of the past year. The latter’s same-store grocery sales improved 14% in 2020, with the company answering the call by stepping up its online shopping and curbside pickup games. Amazon was of course already prepared for the demands of the pandemic, reporting top-line growth of 38% and nearly doubling the year’s net income. Both companies are expected to continue thriving going forward even if the most frenzied growth is in the rearview mirror.

If there’s only room for one of these names in your portfolio right now, it’s got to be Kroger. But not for the reasons you might think.

Why not Amazon?

Don’t misread the message. Amazon is still a juggernaut no retailer wants to tangle with. Kroger, for all its strengths, is still just a grocer. The industry doesn’t lend itself to great growth.

Stock-picking is all about balancing risk, growth, and price, and on a relative basis, investors may be overpricing Amazon by underestimating a couple of key risks ultimately working against its growth.

One of these risks is still gelling. That’s the effort to form a first-ever Amazon worker union for the 5,800 employees at a warehouse in Bessemer, Alabama. Those votes are being tallied right now.

The implications are enormous. If successful, those workers in Bessemer could embolden the creation of unions at more of Amazon’s facilities, changing working conditions in each of them in a way that costs the company more while potentially crimping current productivity. And even if Bessemer employees decide not to unionize, the effort to form unions at other Amazon warehouses has been growing. If not now, unionization could still happen later.

The other risk Amazon faces is more philosophical, although it’s becoming more tangible by the day. That is, the federal government is increasingly leaning on big corporations — and big technology companies in particular.

The movement is coming in lots of forms. President Biden, for instance, is looking to hike corporate tax rates from 21% to 28%. Moreover, some state courts now say Amazon itself can be held liable for damages caused by faulty or counterfeit goods sold via its e-commerce platform. Then there’s the headwind that never seems to go away — Amazon is still in antitrust regulators’ crosshairs, domestically and abroad. A national coalition of small businesses is renewing this scrutiny this very month.

None of these challenges are new to the company. But they’re seemingly gaining more traction than they had in the past. The risk to Amazon’s stock isn’t so much results that reflect these growing headaches but rather, results that fall short of expectations because of these complications.

Why Kroger

Meanwhile, Kroger faces no such headwinds. If anything, it enjoys support from consumers who appreciate what it does and how it’s doing it. Investors in the meantime are underestimating the potential growth in store once the impact of the pandemic wears off.

Like most other stocks, Kroger shares bounced out of the March 2020 market-wide lull once it became clear COVID-19 was a problem that could be worked around. Shares have strangely underperformed since then and are only up 32% from that low versus the S&P 500‘s 82% gain for that twelve-month stretch. Unlike most other stocks, Kroger shares are still trading below their 2016 peak. It’s a not-so-subtle sign that investors don’t see much growth in its future above and beyond the grocery industry’s inherent growth.

That’s a stance, however, that underestimates Kroger’s plan for the post-pandemic environment.

The company laid this plan out with some decent detail a week ago, explaining during a virtual investor day event how fresh foods will be a focal point going forward; digital sales will remain a key growth engine; and more private-label goods are in the works. Investors collectively shrugged. Analysts weren’t exactly thrilled either. Shares actually fell following the presentation, yet at $37 they still linger above the consensus price target of $35.71.

That doubt in Kroger’s future is a big mistake — for a couple of reasons.

First, there’s arguably no name better at the private-label grocery business than Kroger. Of last year’s top line of $132.5 billion, $26.2 billion of it came from homegrown “Our Brands,” like Simple Truth and Private Selection. These in-house brands can be on the order of 25% to 30% more profitable than national brands.

Second, while more and better fresh food may not seem a game-changer in the grocery business, it’s a part of the business that’s become surprisingly important. An effort to eat healthier was well underway before COVID-19 took hold. Deloitte notes that between 2000 and 2017, fresh fruits and vegetables saw the most sales growth among all food categories. The pandemic only accelerated interest in smarter diets. Meanwhile, fresh meat sales are projected to grow on the order of 7% through 2025, snapping the segment out of a long-lived lull. That’s huge for the food business.

Point being, Kroger is pressing consumers’ most important buttons.

Kroger looks appetizing

If you own Amazon and don’t particularly want to swap it out for Kroger, don’t sweat it. As was noted, both companies are winners in their own right.

However, if you’re looking for an underappreciated consumer staples name to fill a void in your portfolio, Kroger is it. You’re collecting a 2% dividend while you wait for everyone else to connect the dots.

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

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. James Brumley 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 Amazon and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia has recommended Amazon. 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 Anteotech Ltd (ASX: ADO) share price surged 8% higher at the open after a key update on European regulation for its rapid COVID-19 test.

At the time of writing, the AnteoTech share price is trading at 27 cents, up 6%.

Why is the AnteoTech share price surging?

AnteoTech announced that it had received Conformite Europeenne (CE) Mark registration for its EuGeni Reader and in vitro rapid diagnostic test, COVID-19 Antigen Rapid Test (ART).

The EuGeni COVID-19 ART is a single-use rapid test for health professionals to test for suspected COVID-19 infection. The proprietary test has an overall sensitivity of 97.3% and specificity of 99.6%, according to AnteoTech.

The CE Mark registration means the EuGeni Reader and the COVID-19 ART conform with health and safety standards for the European Economic Area (EE) and the United Kingdom. It’s an important step forward for the Queensland-based Aussie biotech company.

That’s been reflected in the AnteoTech share price surge we’ve seen this morning. Thanks to the CE Mark registration news, shares in the biotech company have rocketed 8% higher at the open.

What it means

With the latest approvals, AnteoTech can now sell its EuGeni Reader and COVID-19 ART. The company hopes to “deliver a high performing and high sensitivity test”.

AnteoTech CEO Derek Thomson said the company was “delighted to have achieved this significant milestone in our strategy to become a legal manufacturer of rapid tests”. There are also other strategic plans in the works. AnteoTech hopes to support sales with a “saliva use case and new COVID-19/Flu A/Flu B Multiplex test”.

The AnteoTech share price has continued to search higher amid the pandemic. Before Monday’s open, shares in the Aussie biotech had surged 1,228.9% higher to $0.25 per share. That includes a 31.6% surge in the last month amid strong testing results for its proprietary detection tests.

Foolish takeaway

The AnteoTech share price has been surging higher to start the year. This morning is no exception on the back of receiving approvals for its EuGeni COVID-19 ART for sale in Europe and the United Kingdom.

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Motley Fool contributor Ken Hall 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 Allegiance Coal Ltd (ASX: AHQ) share price is rocketing this morning after the company announced that global investment house Global Energy and Resources Limited (GEAR) has taken a $15.5 million private placement in the company.

At the time of writing, the Allegiance Coal share price is up 14.2%, trading at 12 cents.

GEAR has also agreed to provide US$27 million in funding to New Elk Coal Company, a wholly-owned subsidiary of Allegiance Coal located in the US state of Colorado.

The Allegiance Coal share price is 10.5 cents at the time of writing.

Allegiance Coal is an Australia-based company engaged in the acquisition and exploration of coal tenements. The company’s projects include Telkwa Metallurgical Coal, Tenas Metallurgical Coal, Back Creek Project, New Elk Mine, and the Kilmain Project.

Allegiance Coal and GEAR’s partnership

GEAR’s US$27 million funding for New Elk Coal is for the reconstruction of the 27-mile rail spur from a main rail line to the New Elk Mine.

Allegiance Coal says this is a crucial investment, as it removes the restriction on production tonnes allowed to be trucked on the road and instantly reduces cash costs by US$6 per tonne.

These investments underwrite Allegiance’s growth plans for the New Elk Mine. They are currently budgeted to be funded from retained earnings generated from the first production unit, which is expected to start mining later this month.

GEAR’s $15.5 million placement in Allegiance Coal is priced at $0.09 per share.

Funds raised under the placement will be used to accelerate production at the New Elk Mine and, in particular, to refurbish the second production unit, which would have otherwise been funded from retained earnings.

What Allegiance Coal management said

Allegiance Coal chair Mark Gray welcomed the investment, saying:

I am delighted to announce this investment, and welcome GEAR as a shareholder, in our company.

While we are fully funded in our plans to recommence mining at New Elk, the insurance that GEAR’s investment and commitment provides our company in terms of its growth and development, is of enormous comfort to the board.

Allegiance Coal share price snapshot

The Allegiance Coal share price has returned 52% over the past 12 months and is up 13% against the basic materials sector. It’s also up 26% against the S&P/ASX 200 Index (ASX: XJO). 

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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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