APA Group (ASX: APA) held its annual general meeting (AGM) today, which focused on the resilience of the company’s revenue streams and the drive to a lower emissions future. In fact, much of the company’s future plans revolved around reaction to the economy’s transition to lower emissions. APA Group owns and manages a network of natural gas pipelines.

Financial performance

Revenue was up 4.8% on the previous year, while earnings before interest, taxes, depreciation and amortisation (EBITDA) increased 5.1% year on year. Consequently, the company was able to declare full year distributions of 50 cents per security. This is an increase of 6.4% on FY19. For long-term investors, total securityholder returns since APA’s listing 20 years ago in June are now 2,203%. 

The transition to low emissions economy is a significant area of focus for the company. While natural gas will undoubtedly remain critical , there are also significant opportunities in new energy sources, as well as opportunities to continue growing the company’s renewable portfolio. In addition, the company is now Australia’s 6th largest owner of renewable power generation assets, with just over half of its power generation coming from wind and solar.

For example, the Australian Renewable Energy Agency (ARENA) announced $1.1 million of funding for a renewable methane pilot project. The project seeks to determine whether it’s possible to create methane using solar powered electricity, water and CO2 from the atmosphere on an industrial scale. 

A pathway to low emissions growth

In April, the company published its Climate Change Position Statement. In further commitment to low emissions, it has also delivered its first Climate Change Resilience Report. This is a comprehensive analysis of the resilience of APA’s current asset portfolio under three divergent climate scenarios to 2050. Moreover, the company continues to play its critical role in addressing the urgent energy challenges of today. For instance, the government has specifically highlighted the gas sector in supporting Australia’s recovery from COVID-19.

With a forecast 2023 winter gas supply shortfall, the company is working to ensure capacity is not a constraint. To this end, it advised it will invest up to $700 million to increase capacity by up to 50% from its Wallumbilla Gas Hub in Queensland to southern markets.

Company Managing Director and CEO, Rob Wheals, commented: “As we’ve said before, we see over $4 billion of domestic growth opportunities over the next five to 10 years. Of these as much as $1 billion of projects are in active discussion with customers for decisions and/or delivery over the next two to three years.”

APA share price performance

The APA share price is down by around 3% since the start of the year. It currently trades at a price-to-earnings ratio of 39.6, and has a trailing 12-month dividend yield of 4.6%.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of APA Group. 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 Austal Limited (ASX: ASB) share price fell slightly as the shipbuilder refuted any wrongdoing over a corruption allegation involving the Australian Border Force (ABF). Austal’s share price closed 0.93% lower at $3.19.

What happened?

Austal cited a story in The Age regarding an investigation into the conduct of ABF employees. The issue concerned an outstanding milestone payment by ABF for the Cape Class program in 2015.

While Austal noted it did not usually respond to media articles or speculation, the company felt the need to in this case as the story had the potential “for adverse, misleading and incorrect inferences to be drawn against the company as a result”.

Austal said the “success fee” mentioned in the article was paid as a result of partial satisfaction of a contractual milestone payment obligation. Rather than, as the article suggested, “corruption inside the ABF”.

The article also suggested that the investigation uncovered evidence that the company “misled markets”. However, the shipbuilder denied the allegation, claining it was not aware of any such evidence.

Austal said in the announcement the investigation was over, but journalist reports said that the investigation was ongoing, albeit in a different form.

Austal has had no contact with the investigation board –the Australian Commission for Law Enforcement Integrity.

About the Austal share price

Austal is Australia’s largest defence exporter and shipbuilder. The company owns shipyards in Australia, the US, Philippines and Vietnam with service centres worldwide, including the Middle East.

Furthermore, it has grown to become the world’s largest aluminium shipbuilder and is Australia’s largest defence exporter.

More reading

• Why Austal, Challenger, Orocobre, & Whitehaven Coal are dropping lower
• Why is the Austal (ASX:ASB) share price on the move?
• Top brokers name 3 ASX shares to buy today
• Potential ASX winners from government’s $1.5bn manufacturing blueprint

Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Austal Limited. 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 Coca-Cola Amatil Ltd (ASX: CCL) share price outperformed on Thursday on speculation that it’s about to make a sizable acquisition.

The CCL share price jumped 2.8% to a seven-month high of $10.75. In contrast, the S&P/ASX 200 Index (Index:^AXJO) shed 0.3% of its value.

The beverages group may have found favour for its relatively defensive business model during a risk-off day.

After all, the Treasury Wine Estates Ltd (ASX: TWE) share price and Woolworths Group Ltd (ASX: WOW) share price held up better than most.

COVID leaves CCL share price tasting flat

But that’s only a small part of the story. I believe investors got excited on an Australian Financial Review report that CCL is readying to lob a bid for some of Asahi’s assets.

There’s nothing like merger and acquisition (M&A) action to get the blood pumping. Despite selling staple products, the COVID‐19 panic hasn’t played out in CCL’s favour.

A big driver for demand for its drinks come from dine-in consumers. With cafes and restaurants forced only offer takeaway during social restrictions, sales have been as appetising as flat Coke.

Coca-Cola Amatil share price regains fizz on M&A

But Coca-Cola Amatil is hoping to turn its fortunes around with a substantive acquisition. It appears that the group tested the appetite of its biggest shareholders for a capital raising to help fund a possible transaction.

The AFR reported that Macquarie Group Ltd (ASX: MQG) is riding beside Coca-Cola Amatil and would underwrite the sale of new shares.

Coca-Cola Amatil is leaving all options open. It’s considering funding any asset purchase via debt or using a mix of debt and equity.

Asahi acquisition details

The ASX group is one of two known bidders for Asahi’s portfolio, which includes a handful of beer and cider brands. The other keen suitor is reported to be global beer giant Heineken.

Asahi has to divest brands like Stella Artois, Beck’s and Strongbow to get regulatory clearance for its takeover of Carlton & United Breweries.

Will Coca-Cola Amatil undertake a rare capital raise?

Investors don’t get many chances to participate in a capital raise with Coca-Cola Amatil. The group has not sold new shares in decades.

Given that stuck-at-home Aussies are increasing their intake of alcohol to help overcome the worst economic crisis in living memory, I suspect any cap raise by CCL will be well received. This is particularly so in the current environment of cheap money and ample liquidity.

Speaking of which, it will probably be a lot cheaper for Coca-Cola Amatil to use debt to fund any purchases.

This is of course assuming lenders are willing to provide it with more debt. The group is already holding around $1.7 billion in net debt.

More reading

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• Why Ardent Leisure’s (ASX:ALG) share price is up 46% from 28 September
• Broker updates are mixed on these 6 high profile ASX 200 shares
• ASX 200 down 0.75%: Big four banks drop, Healius hits record high, Zip slides lower
• Why the OZ Minerals (ASX:OZL) share price hit a 10-year high today

Motley Fool contributor Brendon Lau owns shares of Macquarie Group Limited and Woolworths Limited. Connect with me on Twitter @brenlau.

The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited and Treasury Wine Estates Limited. The Motley Fool Australia owns shares of Woolworths 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 S&P/ASX 50 index isn’t as well-known as the S&P/ASX 200 Index (ASX: XJO), but it is arguably just as important.

The index is home to 50 of the largest companies on the Australian share market.

While not all the shares on the index are ones that I would recommend investors buy, there certainly are some quality options.

Two ASX 50 shares that I rate highly are as follows:

CSL Limited (ASX: CSL)

The first ASX 50 share I would buy is CSL. I think the biotherapeutics giant is a great long term investment option due to the quality of its CSL Behring and Seqirus businesses. CSL Behring is the biotech business behind immunoglobulins products such as Privgen and Hizentra, and haemophilia products Idelvion and Afstyla. Whereas the Seqirus business is the second-largest player in the influenza vaccines industry and is assisting with the development and manufacture of a COVID-19 vaccine.

Although the pandemic is causing headwinds for plasma collections and thus increasing the production costs of immunoglobulins, strong demand for flu vaccines looks set to offset this. So much so, CSL recently revised its FY 2021 earnings growth guidance range higher.

Beyond this year, I believe  CSL is in a strong position for growth thanks to its current product portfolio and its significant investment in research and development. In FY 2021, for example, CSL is expecting to invest approximately US$1 billion in its R&D activities. I expect this to ensure its pipeline remains full of potentially lucrative therapies and keeps the company at the top of the game over the long term. Overall, I think this makes it a must-buy for investors today.

Telstra Corporation Ltd (ASX: TLS)

The second ASX 50 share that I would buy is Telstra. After several disappointing years due to the NBN rollout, Telstra’s outlook is becoming increasingly positive. This is being underpinned by its T22 strategy, which is stripping out costs and simplifying its business.

Another big positive is the status of the aforementioned NBN rollout. While the rollout still has a bit longer to go, the headwinds it is causing are now peaking. In light of this, a return to growth doesn’t appear far away. Especially given rational competition in the industry and the arrival of 5G internet. The latter should be a big boost to the average revenue per user metric in its key Mobile segment.

Finally, with the Telstra board intending to do what it can to maintain its dividend, the company’s shares look set to yield very generous dividends in the coming years. Based on the current Telstra share price, I estimate that it offers investors a 5.8% fully franked dividend yield.

More reading

• 3 super reasons to buy ASX 200 shares today
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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 CSL Ltd. The Motley Fool Australia owns shares of and has recommended Telstra 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 Resapp Health Ltd (ASX: RAP) share price has stormed higher today following a positive announcement regarding its software.

During mid-afternoon, shares in the digital health company reached an intra-day high of 14 cents. Since then, the ResApp share price has slightly retreated to 12.5 cents, up 19%, at the time of writing.

What does ResApp do

ResApp is a digital health company that specialises in developing smartphone application for the diagnostics and management of respiratory diseases. Machine learning algorithms use sound to detect and measure a variety of breathing conditions, such as breathing, snoring and coughing.

What did ResApp announce?

ResApp advised it has built a new smartphone application which has been non-exclusively licenced to biotech company, AstraZeneca Japan.

Developed over the last 12 months, the cough counting application is designed to identify coughs and background noises in everyday settings. The software records the number of coughs from the user and uploads the data in a form of time and date stamps. This is then accessible to medical and healthcare professionals to monitor in real-time.

The company noted that cough frequency is a key factor in respiratory disease progression and management. Traditional methods such as self-reporting or listening to audio recordings are said to be costly, inaccurate and labour-intensive.

The software will be used in a clinical study to monitor patients who suffer from lung cancer.

What’s the deal?

Under the agreement, AstraZeneca will pay a monthly licence fee for each patient enrolled in the initial study. In addition, a monthly support fee for the duration of the study will also be included. The program is set to start early next year and will run for two years.

ResApp noted that the number of patients and the length of their participation remains uncertain. It does not expect to generate material revenue from the program.

Looking ahead, the company is confident that the new partnership will lead to future product applications. ResApp is currently seeking new opportunities to integrate its software into a range of hardware devices. Discussions with large industry customers are ongoing and the company will update the market in due course.

What did management say?

Welcoming the development, ResApp CEO and managing director Dr Tony Keating said:

To have our technology licensed by a company of AstraZeneca’s reputation is a major achievement and provides significant validation of ResApp’s products and capability. They have some of the world’s leading scientists and researchers running clinical trials and treatment programs and we are confident that their input will enhance our technology for future commercial applications and deployments.

ResApp continues to build a strong foundation of commercial partners and this agreement is another example of the company’s ability to attract industry leaders that can assist in rapid scale well into the future.

More reading

• The ResApp (ASX:RAP) share price is soaring 10% today. Here’s why.

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. 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 RPMGlobal Holdings Ltd (ASX: RUL) share price has dropped today despite the company announcing a new product. The mining software provider’s share price is currently trading 1.35% lower at a price of $1.09.

What’s new?

RPMGlobal introduced its newest integrated mine planning and scheduling product, Underground Potash Solution (UGPS). As the name suggests, it has been specifically tailored for the underground potash (potassium-bearing minerals or compounds) industry.

The product has been designed alongside a number of potash miners to address the unique challenges of their operations. It enables miners to utilise a single integrated mine planning and scheduling package. It can be used for design, reserving and scheduling (from strategic to short term).

RPMGlobal CEO Richard Mathews explained:

Unlike other 2D design tools on the market, UGPS undertakes detailed modelling of the potash deposit in 3D, creating a complete mathematical model of the mine. Moreover, users are able to import existing designs, create new designs or use a combination of both.”

Transition to SaaS

Midway through last week, RPMGlobal also announced the releasee of its first software-as-a-service (SaaS) offering. The product gives mining companies the capability to undertake haulage calculations in a cloud environment.

Importantly, the transition gives customers the flexibility to utilise multiple desktops. Under the new SaaS model, customers are able to write their own applications to interact with the program – Haulage as a Service (HaaS). 

Moreover, the calculation engine enables users or customer applications to undertake travel time calculations on demand.

About the RPMGlobal share price

The RPMGlobal share price has dropped today despite the product launch.

The mining consulting company was listed on the ASX in 2008 and is involved in the provision and development of mining software solutions, advisory services and professional development to the mining industry.

RPM boasts history stretching back to 1968. The company has been trusted by mining companies of all sizes and commodities to support their growth.

More reading

• ASX 200 recovered throughout today, but finished 0.3% lower
• Crown Resorts (ASX:CWN) share price edges upward after AGM results
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• Why the Carbon Revolution (ASX:CBR) share price soared 14% higher today
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Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of RPMGlobal Holdings. The Motley Fool Australia has recommended RPMGlobal Holdings. 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) finished today lower by 0.3% to 6,174 points, however it was actually down around 1.2% earlier in the day.

Here are the highlights from the ASX today:

Westpac Banking Corp (ASX: WBC) and Zip Co Ltd (ASX: Z1P)

Westpac announced yesterday that it was going to sell its 10.7% stake in Zip through a fully underwritten bookbuild to institutional investors.

The offer price for the shares was $6.65, which equated to a discount of around 6% to the last closing price.

The major ASX bank said that this decision reflected Westpac’s approach to simplifying its business and ensuring the efficient use of capital. The sale will add around 8 basis points to Westpac’s CET1 capital ratio.

Westpac chief information officer Gary Thursby said: “Larry Diamond, Peter Gray and the management team of Zip have done a tremendous job growing the company, including expanding globally. We look forward to seeing them continue to grow a global customer franchise.

“We are continuing to explore opportunities with Zip, including working to integrate their buy now pay later functionality into our mobile banking apps across Westpac and our regional bank brands. This would expand our offering to customers and broaden the customers Zip can reach.

“We are also working with Zip on other opportunities for consumer, business and corporate customers that we believe could be mutually beneficial, while continuing to develop our banking relationship with Zip.”

Today, Westpac confirmed the sale went ahead, the Westpac share price dropped 1%. But the Zip share price fell 5% in reaction – it was one of the worst performers in the ASX 200.

Australian Pharmaceutical Industries Ltd (ASX: API)

API reported its FY20 result today to investors.

The pharmacy business reported that its total revenue rose by 0.2% to $4 billion. However, there was a shift away from higher margin products to value products which hurt profitability.

Underlying earnings before interest and tax (EBIT) fell 40.1% to $56.3 million and underlying net profit after tax (NPAT) dropped 42.6% to $32.5 million.

Reported EBIT was $4.4 million and it saw a net loss of $7.9 million after writing down the value of the Soul Pattinson Chemist brand name by $37.5 million (pre-tax) as well as including $12.3 million of post-tax tax relating to restructuring and reorganising.

API said that half of its revenue came from its retail businesses, so it was exposed to the impact of the mandatory lockdowns of non-pharmacy Priceline stores and Clear Skincare clinics. Pleasingly, Clear Skincare has performed very well in the states that have reopened and it continues to invest in new clinics.

As part of its cost reduction program, it closed two distribution centres which reduce its cost of doing business to 10.2%, a reduction of 70 basis points.

The API board decided to declare a dividend of 2 cents per share, representing a payout ratio of 33% of underlying net profit.

AMP Limited (ASX: AMP) suffers again

The AMP share price was one of the worst performers in the ASX 200 today after dropping around 5.5% in reaction to its third quarter update.

Australian wealth management (AWM) assets under management (AUM) increased by 0.3% to $121.4 billion, supported by improved investment markets.

However, AWM suffered net cash outflows of $1.95 billion (broadly flat compared to last year). The North platform achieved $818 million of net cash inflows.

AMP Capital AUM fell by 0.4% to $189.2 million after seeing net external cash outflows of $1.1 billion due to redemptions.

AMP Bank deposits rose by $52 million to $17 billion, though the total look book decreased by $303 million to $20.6 billion.

The AMP portfolio review continues alongside its transformation strategy to rejuvenate the business.

More reading

• Why Ardent Leisure’s (ASX:ALG) share price is up 46% from 28 September
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• Why the Australian Pharmaceuticals (ASX:API) share price is lower today

Tristan Harrison 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 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 Crown Resorts Ltd (ASX: CWN) AGM was always going to be a tense affair with pressures building over the past few weeks. Accordingly, the Crown share price has fallen by 9% over the past month to yesterday. After today’s AGM, however, the share price has been on the rise.

Crown Resorts chair Helen Coonan and CEO Ken Barton opened the meeting with apologies, acknowledgements of failure and the drive to improve. Nonetheless, it was still a blood on the walls affair with institutional investors seeking retribution for the current situation. Prior to the meeting, Ms Coonan acknowledged  a significant protest vote ahead of the company’s AGM.

Moreover, Mr Barton apologised in writing, stating there was no “intention to mislead” the current inquiry over relations with Consolidated Press Holdings Pty Ltd (CPH), majority shareholder James Packer’s private company. There was also a formal announcement yesterday of the termination of all agreements between Crown and CPH. 

What is moving the Crown share price?

During the motions to re-elect three directors, CPH abstained from the vote on directors and on the remuneration report, citing it as the right thing to do. This had the effect of ensuring the re-election of directors, but allowing a ‘first strike’ vote against the remuneration report.

As observed by the chair earlier, there was a large protest vote against Crown directors Jane Halton, Professor John Horvath, and in particular against Guy Jalland. Guy Jalland is connected to CPH, an issue which appears to have caused some consternation and impacts on the Crown share price. 

After winning re-election with 68.54%, Prof Horvath stated he would likely resign from the board. He commented at the time: “The proxy position displayed on the screen indicates that without the vote of CPH, shareholders are not supporting my re-election today as a director.”

This was later confirmed in a release from the company. Ms Halton said she also considered resigning due to the proxy vote, but believed that overall she had “sufficient support” from shareholders.

Meanwhile, the first strike vote Crown received against the company’s remuneration report is significant. The two strikes system helps shareholders control the remuneration of directors. A first strike occurs if more than 25% of shareholders oppose a remuneration report. The second strike occurs if 25% or more of the shareholders oppose a subsequent remuneration report. 

The board is then subject to a spill motion. This is where 50% or more of the votes will force all directors to stand for re-election within 90 days. 

The road ahead

Ms Coonan apologised unreservedly for any failings during the AGM. She said the company intended to strengthen its risk management procedure, as well as its anti-money-laundering and compliance departments. The chair also pledged changes to the Crown board, adding:

In the area of board renewal, the board accepts that there needs to be an injection of new perspectives and expertise on our board… These changes need to be undertaken in a considered and thoughtful manner to ensure an orderly transition.

After a faltering start to the day, the Crown share price momentum has reversed and it is now up by 2.27% at the time of writing. Investors have clearly displayed a level of discontent with the performance of the board. Its response, the actions taken, and the promise of further action, appear to have calmed the waters. 

More reading

• Broker updates are mixed on these 6 high profile ASX 200 shares
• How will the Crown Resorts (ASX:CWN) share price fare at today’s AGM?
• 5 things to watch on the ASX 200 on Thursday
• 5 ASX 200 events to watch for this week
• ASX 200 rises 1%, Cimic (ASX:CIM) up 8% on sale

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Crown Resorts 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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Next Thursday the Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price will be on watch when the banking giant releases its full year results.

Ahead of the release, I thought I would take a look to see what the market is expecting from the bank following a turbulent year.

What is expected from ANZ?

According to a note out of Goldman Sachs, its analysts expect ANZ to report second half cash earnings (before one-offs) of $2,667 million. This will be an 8% decline on the prior corresponding period.

For the full year, this will mean cash earnings (before one-offs) of $4,080 million, down 37% on FY 2019’s result.

The broker is also expecting the bank to declare a final 40 cents per share partially franked dividend, bringing its full year dividend to 65 cents per share.

What else should you look out for?

Goldman has suggested that investors keep an eye on the bank’s asset quality.

It commented: “We forecast a moderation of 2H20E BDDs/TL to 40bp from 55bp in the previous half and will be keeping a close eye on asset quality commentary.”

“Whilst ANZ’s overall loan deferrals as a % of total loans (<10% as of Aug-20) sit at the lower end vs peers, unlike peers, ANZ’s cumulative net new mortgage deferrals in Jun/Jul/Aug-20 as a % of the May-20 balance has actually deteriorated,” the broker added.

Another metric to watch will be its loan growth, which has been improving in recent months.

Its analysts explained: “We currently forecast FY20E loan grown of 4% and particularly note the recent improvement in ANZ’s domestic housing momentum. Post the onset of “responsible lending” regulations, ANZ’s conservative response led to a notable drop in their lending growth and by extension market share.”

“However, in the three months to Aug-20, they achieved the highest total lending growth vs the peer group driven by outperformance in housing lending (ANZ’s average growth in the 3-month period came in at 10.5% vs peers CBA at 4.3%, NAB at -2.2%, WBC at -0.2%),” it added.

Finally, the broker will be looking for commentary on the bank’s costs.

Goldman expects its second half expenses to rise 1.9% on the prior corresponding period to bring its full year total to $9,187 million or $8,800 million excluding one-offs.

However, it believes the bank is well-placed to cut its costs materially in the future and offset the deteriorating revenue environment.

The broker notes: “ANZ’s performance on costs in recent years has been superior to peers and while management remains committed to its A$8 bn expense ambition, timing around when such a target can be reached will continue to evolve subject to how the current crisis plays out. We expect to receive more detail on this issue at the result.”

Goldman Sachs has a neutral rating and $20.99 price target on ANZ’s shares.

More reading

• ASX 200 flat: Big four banks push higher, Afterpay drops, Megaport sinks 10%
• Are ANZ (ASX:ANZ) shares a buy for dividend income today?
• ASX 200 Weekly Wrap: Promises of easy money push ASX 200 to post-crash high
• ASX 200 up 0.9%: Big four banks rise, Pro Medicus jumps, miners charging higher
• ASX 200 jumps more than 1%, big ASX banks rise

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 Carbon Revolution Ltd (ASX: CBR) share price was soaring 14% higher today on the release of its quarterly activities report this morning.

A relative newcomer to the ASX, the Carbon Revolution share price hit an all-time high of $4.47 per share on 24 January. Then the coronavirus pandemic struck and by 23 March the share price had plummeted by 82%.

The company has come back strongly since then, with today’s gains bringing the share price up 254% from the 23 March lows.

Year-to-date, the share price is down 17%. By comparison the All Ordinaries Index (ASX: XAO) is down 6% in 2020.

What does Carbon Revolution do?

Carbon Revolution is an Australian company that innovates and commercialises carbon fibre wheels for the global automotive industry. The company designs and manufactures high-performing wheels for some of the fastest street cars and top-quality brand names in the world.

Carbon Revolution’s shares first began trading on the ASX in November 2019.

Why is the Carbon Revolution share price soaring?

Despite noting that the pandemic continued to cause disruptions as the virus impacted customers, Carbon Revolution reported quarterly recognised revenue of $11.8 million. That’s up 45.9% on the previous quarter and up 26.3% on the previous corresponding period (pcp).

Commercialisation of the company’s new “fascia” technology has also begun with initial customer approval. According to the report, the technology “dramatically improves the conversion of moulded wheels to sold wheels and, in turn, drives a significant reduction in labour cost per wheel”. The company expects its first deliveries will start in the next quarter.

In addition, Carbon Revolution announced that upgrades to its high-pressure moulding equipment and installation of a new automated face layup line have been completed. This provides it with enough moulding capacity for its contracted programs (both announced and unannounced).

The company’s cash balance at the end of this quarter was $19.6 million. It said the business was funded for its FY21 operational goals.

Looking ahead, the company expects strong sales growth in the 2021 financial year. In addition, over the next 3 quarters, net cash flow from operating activities will be positive. The report also noted that the Federal Government JobKeeper package should support a proportion of wages while the company remained eligible under the JobKeeper scheme.

The Carbon Revolution share price has retreated slightly since its 14% morning high. It is now trading at $2.80, up 11.55% at the time of writing. On a day the All Ords is slipping, it appears that investors are happy with the company’s quarterly performance.

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Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Carbon Revolution Limited. The Motley Fool Australia has recommended Carbon Revolution 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.

The post Why the Carbon Revolution (ASX:CBR) share price soared 14% higher today appeared first on Motley Fool Australia.

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