The 5G Networks Ltd (ASX: 5GN) share price is charging higher on Thursday after announcing a new acquisition.

At the time of writing, the data network provider’s shares are up 4% to $1.63.

What did 5G Networks announce?

This morning 5G Networks announced that it has entered into a lease agreement for the ex-Pipe Networks Data Centre in Fortitude Valley.

According to the release, the company has agreed an all-cash consideration of $1.1 million, which includes all operating infrastructure at the facility.

Management advised that the acquisition will be funded from existing cash reserves, with a generous rent-free period on a 10-year lease.

It expects the facility to be operational January 2021, with the inclusion of the latest power redundancy equipment and cooling systems. Management notes that the data centre has the capacity to support 250 racks and access to 3MW of power on dual power grid, which offers the highest level of redundancy.

This acquisition means the company now operates data centres in each state on the east coast of Australia.

Why acquire this data centre?

Management advised that this strategic investment will allow 5GN customers to connect directly to the data centre via 5GN dark fibre once the new rollout is complete.

It notes that cross selling of infrastructure aligns with the company’s focused acquisition and growth strategy. It will also accelerate the continued execution of the 5GN wholesale channel strategy for infrastructure and data centre services.

5G Networks’s Managing Director, Joe Demase, commented: “We are really excited to be exploiting our advantage of being a DC operator and fibre network owner, I haven’t seen rack space and dark fibre product bundling from one provider before, but this is what our customers are asking for. It allows our partners to grow with a fixed cost model which also includes easy migration as a result of our 6-month rack offer.”

That offer will see rental charges waived and a complementary dark fibre cross connect to any data centre in Brisbane.

More reading

• Why 5G Networks, Cedar Woods, SEEK, & Tyro shares tumbled lower today

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends 5G NETWORK FPO. 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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Trading was suspended on Insurance Australia Group Ltd (ASX: IAG) shares on Thursday morning after a court ruling that could have dire consequences for the insurance giant.

On Wednesday, the New South Wales Court of Appeal ruled that rejecting business interruption insurance claims on the basis of COVID-19 losses is invalid.

The decision was a shock for the industry, which thought that including COVID-19 as a “quarantinable disease” as defined in the now-repealed Quarantine Act would be sufficient to decline claims.

The Insurance Council of Australia (ICA) argued that regardless of wording, the spirit of the policies were meant to exclude pandemics.

QBE Insurance Group Ltd (ASX: QBE), which was also represented by the council in the court case, did not suspend trading of its shares.

The company stated to the ASX that business customers still must jump through other hoops to make a successful claim.

“Notwithstanding the ruling, QBE notes that the particular wording of QBE business interruption policies require a number of policy triggers to be met in order for policyholders to be entitled to indemnity for business interruption.”

Business disruption claims were expected to be capped at $5 million per occurrence, QBE added.

ICA has stated it’s considering an appeal to the High Court.

IAG and QBE have not disclosed how much this decision could impact their bottom line. But Suncorp Group Ltd (ASX: SUN) earlier this week set aside an extra $125 million to cover themselves for COVID-19 claims.

Suncorp stated to the market that, overall, it has $195 million allocated for potential claims.

“While the group continues to review the judgment, the test case outcome is not expected to affect the total business interruption provision.”

Both IAG and QBE shares have climbed more than 12% in the past month. Suncorp has risen about 8%.

The court case specifically referred to a claim made by a business customer to its insurer, HDI. But it acted as a test case for the entire industry since most insurers use similar wording in their policies.

More reading

• Why the Downer (ASX:DOW) share price is outperforming today
• Suncorp (ASX:SUN) share price higher after trading update
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• Leading brokers name 3 ASX shares to sell today
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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. 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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Agrochemicals company Nufarm Limited (ASX:NUF) today reported a significant year-on-year revenue growth of 23% in the 2 months to the end of September. This growth was driven primarily by stronger sales in Australia and Europe.

At the time of writing, the Nufarm share price is trading up 1.45% at $4.21.

What else did Nufarm announce?

The company’s gross profit increased 9% on prior comparative period, while underlying earnings before interest, tax, depreciation, and ammortisation (EBITDA) was up by 18%.

In terms of geographical results, revenues in Australia and New Zealand increased 37%, with improved weather conditions in Australia driving good demand for herbicides. Meanwhile, revenues in Europe also lifted significantly by 38%. North America was up by just 4% after storms and bushfires impacted sales.

Nufarm says the sales momentum has continued in all regions through October, providing the company with a good to start to FY21. 

What does Nufarm do?

With origins dating back more than 100 years, Nufarm is a global manufacturer of crop protection solutions and seeds. Nufarm’s products are designed to protect commercial crops from a variety of pests, weeds, and diseases, thereby maximising crop yields.  It first listed on the ASX in 1988. 

Nufarm share price performance this year

The Nufarm share price has lost almost 30% in 2020. The company recorded a statutory net loss after tax of $362 million. This was attributed to weak seasonal conditions faced in the first 6 months and the effects of COVID-19. The company has continued to suspend all dividends until further notice.  The board said it would revisit this decision in future based on the prevailing market conditions.

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Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. 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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Oil producer Oil Search Limited (ASX: OSH) today announced a significant 33% increase in contingent resources in its Pikka oil field in Alaska. This takes its total gross Alaskan North Slope 2C resources within Oil Search’s portfolio from 728 million barrels of oil to 968 million barrels of oil, a 93% increase from its original estimate in 2018. 

The Oil Search share price is down by 2.36% at the open of trade today to $3.73 amidst a broader fall in the ASX.

More details on the find

Oil Search told an investor conference this morning that the Pikka project was now well positioned for its Phase-1 single drill site in early 2021. The development will use a capital efficient approach that will deliver a breakeven cost of less than US$40/barrel, with gross capital costs of under US$3 billion.

Production from Phase-1 will support the funding for Phase-2, which will comprise the full field development incorporating two additional well pads. It expects first oil from this project in 2025.

Other news from the briefing

Oil Search said the COVID-19 pandemic had helped the company become more resilient as it made efforts to reduce its cost base.

Speaking at the conference this morning, Oil Search managing director Dr Keiran Wulff told investors:

The challenges posed by the pandemic and oil price downturn, combined with global trends and societal expectations, have been the catalyst for us to review our past performance and make sustained improvements to position Oil Search for long term success.

Mr Wulff said the company strategy included three disciplined phases: driving sustained low costs of its PNG operations, commercialising the Pikka development at a breakeven cost of less than US$40/bbl, and considering targeted complementary energy investments.

About the Oil Search share price in 2020

The Oil Search share price is a top performer over the past month, beating the overall energy sector’s performance on the back of coronavirus vaccine news. However, like all energy producers, it has not had a year to remember. In October, the company delivered disappointing third-quarter results, and said that it did not expect LNG demand to fully recover until 2027.

The Oil Search share price has lost 45% of its value this year. At today’s price of $3.73, it commands a market cap of $7.7 billion.

More reading

• Why Douugh, Mirvac, Oil Search, & Westpac shares are charging higher
• 3 shares that have strongly outperformed their sectors this month
• ASX 200 Weekly Wrap: ASX continues to hit post-COVID highs
• These were the best performing ASX 200 shares last week
• ASX 200 surges again on Wednesday

Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. 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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The Starpharma Holdings Limited (ASX: SPL) share price has been a very positive performer on Thursday.

At the time of writing, the dendrimer products developer’s shares are up 6% to $1.40.

Why is the Starpharma share price racing higher?

Investors have been buying Starpharma’s shares today after it released an update on its antiviral nasal spray active (SPL7013).

According to the release, additional testing has been undertaken and shows the potent antiviral activity of SPL7013 against human respiratory syncytial virus (RSV).

RSV is a common and very contagious virus that affects the lungs and airways. It is most problematic in the young and the elderly and those with weakened immune systems, or chronic heart and lung disease, including asthma. It is also one of the viruses responsible for the common cold.

The company notes that more than 177,000 adults are hospitalised and 14,000 of them die each year in the United States due to RSV infection.

Despite its prevalence and extensive efforts by pharmaceutical companies over the years, there are few strategies available to prevent or treat RSV infection. There are no vaccines and few therapeutics available to treat the infection. Furthermore, like influenza, RSV frequently mutates making vaccine development challenging.

This latest data further expands the antiviral spectrum of SPL7013 in respiratory viruses, which already includes SARS-CoV-2 (COVID-19) and H1N1 influenza.

Starpharma is also testing SPL7013 against other respiratory viruses with the intention to add these to the product claims as data becomes available.

Starpharma’s CEO, Dr Jackie Fairley, commented: “We are pleased to announce the expanded use of SPL7013 in RSV. RSV is a common virus which has significant morbidity and mortality for the elderly and those with chronic disease.”

“What these results confirm, is that SPL7013 has broad spectrum antiviral activity, and that VIRALEZE could play an important role for future pandemic preparedness. The rapid development and commercialisation of SPL7013 as VIRALEZE antiviral nasal spray is on track, with the product set to be available in some markets as early as 1H CY2021,” she added.

More reading

• Vocus (ASX:VOC) share price lower on Vocus NZ IPO plans
• FlexiGroup (ASX:FXL) share price surges 10% higher on Mastercard deal and trading update
• Altium (ASX:ALU) share price pushes higher following AGM update
• 2 ASX growth shares predicting big growth this decade
• Why these ASX shares just stormed to 52-week highs

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 Starpharma Holdings Limited. The Motley Fool Australia has recommended Starpharma Holdings Limited. 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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The Vocus Group Ltd (ASX: VOC) share price has dropped lower on Thursday following the release of a major announcement.

At the time of writing, the telco provider’s shares are down slightly to $4.22.

What did Vocus announce?

When Vocus released its full year results in August, management mentioned that it would soon consider its capital allocation and longer-term corporate structure.

It commented: “The accelerating momentum of the core VNS business, together with the strong performance of New Zealand and well-progressed turnaround of Retail Consumer, means we are now in a strong position to strategically consider our options regarding capital allocation and longer-term corporate structure.”

This morning Vocus revealed that it has decided to take these considerations further and has appointed financial advisers to execute an Initial Public Offering (IPO) of its Vocus New Zealand business.

According to the release, the IPO is expected to be undertaken before the end of FY 2021, subject to prevailing market conditions.

The Vocus board believes that a successful IPO of Vocus New Zealand will provide greater balance sheet flexibility and allow the Vocus Network Services business to invest in core long-term strategic fibre opportunities to extend its network reach, build on its product capabilities, and cement its position as Australia’s specialist fibre and network solutions provider.

It will also provide the board with the ability to review its long-term dividend policy.

What is Vocus New Zealand?

Vocus New Zealand is a fully integrated telco and energy provider that owns a significant national fibre infrastructure network.

It is led by an experienced management team and is an established challenger that is very strongly positioned within the New Zealand market.

The business has delivered consistent revenue and EBITDA growth over the past five years. It has also developed a core competency on the acquisition and integration of businesses that add both customer scale and capability to the existing operation.

The Vocus board believes there are now significant opportunities for organic growth and market consolidation across all market segments that will be better realised if Vocus New Zealand is an independent entity.

No details were provided on how much Vocus expects to raise from the IPO. However, with its FY 2020 results, it revealed that the carrying value of its intangible assets were $298 million.

More reading

• Why these ASX shares just stormed to 52-week highs
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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. 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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The FlexiGroup Limited (ASX: FXL) share price has been a strong performer on Thursday.

In morning trade the financial services and buy now pay later company’s shares are up 10% to $1.18.

Why is the FlexiGroup share price surging higher?

Ahead of its annual general meeting this morning, FlexiGroup announced a partnership with payments giant Mastercard to expand the application and distribution of its bundll product.

Bundll is the world’s first buy now pay anywhere platform built by humm.

The bundll product, which is already live in Australia, allows customers to buy now pay later everywhere Mastercard is accepted and bundle their purchases into easy to manage instalments with inbuilt budgeting services.

According to the release, under the agreement, Mastercard will work with its partners to drive adoption and will support the development of the open-loop, work anywhere, pilot. Management notes that the platform is able to support different integration and commercial models to achieve scale in different markets.

The agreement is for five years and is expected to deliver a sustainable growth path for its humm business and expand the services that schemes can provide to customers.

FlexiGroup’s CEO, Rebecca James, commented: “The bundll platform is unique as it offers a turnkey but flexible solution to banks and other card issuers around the world. You don’t need to sign up merchants or integrate into legacy bank systems, and it will work in any regulatory environment.”

“Bundll’s proprietary affiliate programme also creates revenue sources globally, and creates a curated and unique shopping experience that is based on customer preference, not which retailer is paying for the click. Discussions are already well progressed with a number of banks under the strategic agreement,” she added.

Mastercard Australasia’s Division President, Richard Wormald, spoke positively about the agreement with FlexiGroup.

He said: “While there are lots of BNPL platforms around the world, this latest development for bundll is differentiated in the way it is able to partner with existing banking systems and provide BNPL technology and products without needing to sign up local retailers, while still generating a sustainable revenue stream. With the growth of BNPL, Mastercard understands that many issuers around the world are looking to solve for this increasing consumer preference.”

Trading update.

FlexiGroup took this opportunity to provide the market with an update on its performance so far in FY 2021.

It revealed that its portfolio continues to perform strongly with a downward trend in the 30+ days arrears performance for all segments during the first quarter. This was the result of a prudent approach to credit risk and approvals.

In light of this improved credit performance and cost management, the company expects its first half cash net profit after tax to be ahead of the $34.5 million it achieved in the prior corresponding period.

More reading

• Afterpay (ASX:APT) share price underperforming after ASIC finds more BNPL customers falling behind

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended FlexiGroup Limited. 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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The Altium Limited (ASX: ALU) share price is on the move on Thursday following the release of its annual general meeting update.

At the time of writing, the electronic software design platform provider’s shares are up 2.5% to $37.03.

What happened at the annual general meeting?

At the event, the company’s CEO and Chair spoke about its performance in FY 2020, its plans for the future, and trading so far in FY 2021.

In respect to the future, the company’s CEO, Aram Mirkazemi, spoke about the shift to the cloud through its Altium 365 platform. He believes this shift is all positive with no negatives thanks to its unique strategy of transformation through dominance.

He commented: “This strategy de-risks Altium’s move to the Cloud by extending our current value proposition to our customers and, at the same time, this strategy raises the bar and reinforces Altium’s position of absolute market dominance in PCB design. This combination will set a resonance that has the potential to bring about industry transformation.”

“While dominance and transformation are part of one journey, this strategy sets up two engines of growth for value creation. Our strong software business drives our dominance engine, and our new cloud platform Altium 365, is the basis of our transformation engine. From a business perspective, these two engines provide independent drive, and at the same time are complementary and reinforce each other,” he added.

The chief executive expects the shift to significantly increase renewal rates for maintenance subscription and reduce churn. He feels this should have the most dramatic impact on its revenue and its climb to 100,000 subscribers by 2025.

What about FY 2021?

Altium revealed that it is continuing to be impacted by COVID-19. However, it has been seeing positive signs in the last two months and is gaining confidence about the strength of its second half performance.

In light of this and based on its historic 45/55 revenue split between the halves, management has reaffirmed its guidance for FY 2021.

FY 2021 revenue is expected in the range of $US200 million to US$212 million (6% to 12% growth) and earnings before interest tax, depreciation and amortisation (EBITDA) is forecast to be US$76 million to US$89 million (38% to 42% growth).

Mr Mirkazemi commented: “Traditionally, our first half EBITDA margin is always lower than our second half as a stronger second half revenue positively impacts our EBITDA. I expect this to be exaggerated this year by COVID but confident that full year EBITDA margin will remain well within the range.”

More reading

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• 5 things to watch on the ASX 200 next week

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 and recommends Altium. 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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There are some ASX growth shares that have big growth goals for this decade.

Here are two examples:

Pushpay Holdings Ltd (ASX: PPH)

The Pushpay share price has fallen 22% since the US election. However, the digital donation business still has its main goal.

The ASX growth share is aiming for annual revenue of US$1 billion. This is a multiple of its recent revenue numbers. In FY20 it generated a total of US$129.8 million, which was up 32%. Pushpay’s total processing volume in FY20 was US$5 billion, up 39%. Pushpay made progress in its FY21 half-year result, with processing volume rose by 48% to US$2.2 billion and operating revenue going up 53% to US$85.6 million.

Pushpay said that it expects to see continued revenue growth as the business executes on its strategy, achieves increased efficiencies and gains further market share in the US faith sector.

The ASX growth share continues to report growing profit margins. In the half-year result it saw its gross profit margin increase from 65% to 68%. Although the gross margin is typically weaker over the second half of the year, management expects the gross margin to stabilise around the current levels over the remainder of the current financial year.

Pushpay also reported in the HY21 result that its earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) margin increased from 17% to 31%. This partly occurred because total operating expenses, as a percentage of operating revenue, improved from 50% to 38%.

Management said it expects significant operating leverage to accrue as operating revenue continues to increase, while growth in total operating expenses remains low.  

It’s targeting a 50% market share of the medium and large church segment in the US, which is key for achieving its US$1 billion revenue goal.

According to Commsec, it’s trading at 24x FY23’s estimated earnings.

Altium Limited (ASX: ALU)

Altium is an electronics PCB software business that counts businesses like Space X, Tesla, Apple, Amazon, Google, Microsoft, Disney, Broadcom and Qualcomm as clients.

The Altium share price has fallen around 10% over the past four weeks. COVID-19 has affected its revenue growth over the past six months, which is why management think it may take a little longer – an extra six to twelve months – to reach its US$500 million revenue goal. But that’s still the goal.

The ASX growth share is aiming to reaching global market leadership of the electronic PCB software space by reaching 100,000 Altium Designer subscribers by 2025.

In FY20 the company saw its EBITDA margin climb from 38.9% to 40%, its profit before income tax increased by 12%, its cash balance rose by 16% to US$93 million and its dividend per share increased by 15% to AU$0.39 per share.

Altium recently announced that it was pivoting its organisational structure toward the cloud. It said that the successful launch and strong early adoption of its cloud product, Altium 365, led to its decision to split its cloud operations from its software business.

The company explained that it will allow the cloud business to develop in a different way, and to form a software-as-a-service-like organisational structure. One strategic benefit from this change is that is that it will allow the separation of high-volume sales from high-touch sales to support Altium’s journey to 100,000 subscribers. Executive director Sergey Kostinsky will be in charge of driving the rapid development and adoption of Altium 365.

According to Commsec, Altium is currently trading at 47x FY23’s estimated earnings.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Down 22% in 3 weeks, is the Pushpay (ASX:PPH) share price a buy?
• 2 ASX shares targeting huge growth during the 2020s
• These ASX shares have been unstoppable in FY 2021
• 2 fast-growing ASX tech shares to buy

Tristan Harrison owns shares of Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of PUSHPAY FPO NZX. The Motley Fool Australia has recommended PUSHPAY FPO NZX. 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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The S&P/ASX 200 Index (ASX: XJO) has been in fine form recently thanks to optimism over the development of potentially effective COVID-19 vaccines.

While this leaves the ASX 200 trading at its highest levels in nine months, some shares are doing even better.

Two ASX shares that have just hit new 52-week highs are listed below. Here’s why they are on fire:

Costa Group Holdings Ltd (ASX: CGC)

The Costa share price hit a 52-week high of $4.16 on Wednesday. When the horticulture company’s shares hit that level, it meant they had gained an impressive 66% since the start of the year. Investors have been fighting to get hold of its shares this year after it finally turned around its performance after a very disappointing 18 months filled with underperformance and countless earnings guidance downgrades.

During the first half of FY 2020, Costa posted a 6.8% increase in revenue to $612.4 million and a 12% lift in net profit after tax to $45.8 million. This was driven by a very strong performance from its international business. In addition to this, improving trading conditions in the domestic market appear to indicate that the worst is now behind the company.

Vocus Group Ltd (ASX: VOC)

The Vocus share price continued its positive run and climbed to a 52-week high of $4.32 yesterday. This stretched its year to date gain to a sizeable 49%. The catalyst for this strong share price performance was a solid result in FY 2020 despite the pandemic and its positive guidance for the year ahead.

In FY 2020, Vocus recorded earnings before interest, taxes, depreciation and amortisation (EBITDA) of $360.5 million, which was up slightly year on year. Pleasingly, management recently confirmed at its AGM that the company is on track to achieve its guidance of EBITDA in the range of $382 million to $397 million in FY 2021. The high end of its guidance range represents 10% growth year on year.

More reading

• Why the Primewest (ASX:PWG) share price is soaring 6% higher today
• Costa (ASX:CGC) share price lower despite appointing new CEO
• 3 small cap ASX shares with large dividends
• Leading brokers name 3 ASX shares to buy today
• Vocus (ASX:VOC) share price drops lower despite positive AGM update

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended COSTA GRP FPO. 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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