It has been a disappointing start to the week for the Openpay Group Ltd (ASX: OPY) share price.

In afternoon trade, the buy now pay later provider’s shares are down 3.5% to $2.46.

Why is the Openpay share price dropping lower?

The Openpay share price has been on a very poor run of late and is now down 23% since this time in October. This is despite the company’s performance remaining strong during this period.

For example, in the middle of last month Openpay released a trading update for October and November to date.

That update revealed that active plans were up 233% in October compared to the prior corresponding period and active customers were up 143%. This underpinned a 101% increase in total transaction value (TTV) to $25.8 million for the month.

This positive form continued in November with Openpay achieving its strongest ever daily TTV of $915,000. This was thanks to Australian online sales initiatives including Click Frenzy and was an 11% increase on the company’s previous TTV record.

Management believes this bodes well ahead of the peak sales season of Black Friday, Cyber Monday, and Christmas.

That update also revealed that the company had signed major partnerships with US SaaS eCommerce group BigCommerce Holdings and online retailer Kogan.com Ltd (ASX: KGN).

Since then, the company has held its annual general meeting and spoke positively about current trading and its future prospects.

At the meeting, management commented: “To conclude, we have been extremely happy with our strategic delivery and strong operational performance, both in FY20 and in FY21 year to date. We have made significant progress in creating a great business and company, very much in line with our vision ‘to change the way people pay, for the better’ and with the pillars of our growth strategy.”

Is this a buying opportunity?

One broker that sees the recent Openpay share price weakness as a buying opportunity is Shaw & Partners.

Last month its analysts responded to its trading update by reaffirming their (high risk) buy rating and $5.00 price target.

They believe the company is well-placed for growth and note that its shares trade at a significant discount to the likes of Afterpay Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P).

More reading

• Why the Afterpay (ASX:APT) share price continues to dominate
• Top broker thinks the Openpay (ASX:OPY) share price is dirt cheap
• Is buy now, pay later (BNPL) giving Aussies a headache?
• Why the Openpay (ASX:OPY) share price is up and down today
• Afterpay (ASX:APT) share price underperforming after ASIC finds more BNPL customers falling behind

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 Kogan.com ltd and ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Kogan.com ltd. 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 Elders Ltd (ASX: ELD) share price is sliding today, down 2.33% in early afternoon trading.

At $12.07, the Elders share price hit its 2020 peak on 20 October. At the time, Elders shares were up 87% for the year. Since then, shares have retraced around 17%. Still, that leaves the share price up an impressive 56% year to date.

By comparison, the broader S&P/ASX 200 Index (ASX: XJO) is flat for the year.

And the latest data from the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) could see Elders continue to outperform into 2021.

We’ll look at that below. But first…

What does Elders do?

Elders Ltd provides a range of services to customers working in the agricultural industry. These services include finance, banking and home loans, real estate, insurance and rural services.

Founded in 1839, Elders has grown to become the country’s largest listed rural services provider and agribusiness. Elders shares first began trading on the Australian exchange in 1981.

What did ABARES report that could boost the Elders share price?

In its December quarter agriculture commodities report, ADARES forecast Australia’s farmgate value is likely to reach $65 billion in 2020/21. This comes following our second largest winter crop and with seasonal rainfall predicted to be promising.

Commenting on the findings, ABARES executive director Steve Hatfield-Dodds stated:

We’re expecting a near all-time high winter crop, the best ever in New South Wales, and a more favourable outlook for summer cropping than we have seen in recent years. Livestock prices have also stayed high with herd and flock rebuilding, and continued international demand.

While ABARES predicts that farm production will increase 7%, to $65 billion, it expects export values to fall by 7%, down to $44.7 billion.

Part of the export drop is attributed to the lingering effect of past dry seasons. But Hatfield-Dodds also points to trade uncertainties, particularly with China, as likely to drag on agricultural exports, saying, “There are a number of risks present for the rest of 2021 that remain a watch point, including wine trade with China and labour shortages for the horticulture sector.”

Trade and labour issues will remain a wild card moving into 2021. But with a bumper winter crop and potentially strong summer crop, it will be interesting to see how the Elders share price performs moving forward.

More reading

• Exciting ASX shares rated as buys by top fundie
• These were the worst performing ASX 200 shares last week
• ASX 200 up 1.2%: Afterpay ASIC response, Elders result, CSL vaccine facility
• Why the Elders (ASX:ELD) share price is turning around today
• ASX 200 Weekly Wrap: ASX continues to hit post-COVID highs

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Elders Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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With so many shares to choose from on the ASX, it can be hard to decide which ones to buy.

The good news is that brokers across the country are doing a lot of the hard work for you.

Three top shares that leading brokers have named as buys this week are listed below. Here’s why they are bullish on them:

Afterpay Ltd (ASX: APT)

According to a note out of Credit Suisse, its analysts have initiated coverage on this payments company’s shares with an outperform rating and $124.00 price target. Credit Suisse believes Afterpay is well-positioned for growth and has the potential to grow its underlying sales materially over the next five years. This is thanks to the structural shift to online shopping, a decline in credit card use, and its exposure to younger demographics. The latter are expected to increase their spending in the coming years. The Afterpay share price is changing hands for $96.02 this afternoon.

Fortescue Metals Group Limited (ASX: FMG)

A note out of Macquarie reveals that its analysts have retained their outperform rating and lifted their price target on this iron ore producer’s shares to $23.00. The broker made the move in response to a significant rise in iron ore prices, which it believes will result in sizeable free cash flow yields. The broker has also lifted its earnings and dividend expectations for the next couple of years. The Fortescue share price is fetching $21.34 on Monday.

Qantas Airways Limited (ASX: QAN)

Analysts at UBS have retained their buy rating and increased their price target on this airline operator’s shares to $6.20. According to the note, the broker believes that Qantas’ balance sheet risk has significantly reduced recently. This is thanks to COVID vaccine developments, border re-openings, and its plan to increase capacity to 70% of pre-COVID levels. It also notes that Qantas appears to be winning market share domestically. The Qantas share price is trading at $5.46 this afternoon.

More reading

• RBA gives BNPL another blessing
• ASX 200 up 0.7%: Metcash impresses, BHP & Fortescue storm higher, Xero given buy rating
• Why Fortescue, Metcash, Nuix, & Xero shares are storming higher
• Why ASX iron ore stocks are set to rally today
• How to get a passive income of $50,000 per year from ASX dividend shares

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The three ASX dividend shares in this article are relatively small in size, but they have large dividend yields.

Here they are:

Baby Bunting Group Ltd (ASX: BBN)

Baby Bunting is the largest retailer of products for babies and small children. It sells a variety of items like prams, toys, clothes and car seats. According to the ASX, it has a market capitalisation of $554 million.

Its FY20 dividend per share was essentially double the size of the dividend from FY18. FY20 saw Baby Bunting deliver total sales growth of 11.8% to $405.2 million. Whilst comparable store sales growth was 4.9%, online sales growth was much higher at 39.1%.

Baby Bunting demonstrated economies of scale as its margins increased. The gross profit margin increased by 120 basis points to 36.2%. Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 24.1% to $33.7 million and underlying net profit after tax (NPAT) rose 34.1% to $19.3 million.

This growth allowed the ASX dividend share to grow its FY20 dividend by 25% to 10.5 cents per share. At the current Baby Bunting share price it offers a grossed-up dividend yield of 3.5%.

In the first six weeks of FY21, Baby Bunting saw same store sales growth of 20% – excluding Victoria same store sales went up 28.7%.

Pacific Current Group Ltd (ASX: PAC)

This business partners with quality fund managers and helps them with capital (by taking a stake) as well as helping with growing the business.

According to the ASX, Pacific Current has a market capitalisation of $315 million.

As Pacific’s funds under management (FUM) and earnings grow, then it is able to fund higher dividends.

In FY20 it reached funds under management (FUM) of $93.3 billion at 30 June 2020. This was an increase of 52% when excluding the boutiques sold and acquired during the year. The asset manager GQG grew its FUM from US$25.1 billion to US$44.6 billion.

An 18% increase in underlying earnings per share (EPS) to $0.51 in FY20 allowed the board to increase the annual total dividend by 40% to $0.35 per share.

The ASX dividend share reported that in the three months to 30 September 2020 it saw total FUM go up by 14% to AU$106.4 billion. The vast majority of the FUM growth in the period came from GQG.

Pacific Current CEO Paul Greenwood said: “COVID-19 has certainly been disruptive to institutional fundraising and investor demand.” However, he went on to say at the time (at the end of October 2020) that it was still a long way from pre-pandemic levels of activity.

At the current Pacific share price, it has a trailing grossed-up dividend yield of 7.8%.

EQT Holdings Ltd (ASX: EQT)

This business is an independent specialist trustee company offering trustee and fiduciary services to private and corporate clients. According to the ASX it has a market capitalisation of $315 million. 

In FY20 the company saw funds under management, administration and supervision rise by 19% to $101 billion. This helped offset the downturn in the equity market, according to the company.

It grew revenue by 3.2% to $95.4 million. Net profit before tax fell by $1 million to $30.3 million. Underlying EPS declined by 5.5% to 102.66 cents.

Managing director Mick O’Brien said: “Our strategy of investing for growth is bearing fruit, with significant new business obtained during the adding, adding a range of new, high-quality clients. All of the areas of the business performed well and would have delivered even stronger results were it not for the equity market downturn.

“We have established businesses that are well suited for these challenging times, and we have a number of newer growth businesses, a pipeline of opportunities and a strong balance sheet.”

In FY20 it maintained its annual dividend per share at 90 cents, which equates to a trailing dividend grossed-up dividend yield of 4.7%.

More reading

• Here’s why the Baby Bunting (ASX:BBN) share price is edging higher
• 4 small cap ASX dividend shares with large yields
• 3 ASX shares with large dividend yields
• 3 ASX dividend shares with large and growing dividends
• Best and worst ASX retail stocks to own in the COVID recovery

Motley Fool contributor Tristan Harrison 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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Commodity prices have lifted across the board with both iron ore and copper running to 7-year highs and a strong recovery for oil prices. This has seen ASX mining shares including BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) delivering market leading returns. 

However, the Lynas Rare Earths Ltd (ASX: LYC) share price triumphs over its ASX 200 mining peers after soaring more than 30% in November. The Lynas share price is now up 77% year to date and more than 7% in December. 

Rare earth prices running to record highs 

Rare earth elements are a group of 17 metals, with China holding about 50% of the world’s economic resource. Lynas primarily produces the rare earth element, neodymium-praseodymium (NdPr). NdPr prices have soared in recent weeks to an 8-year high of CNY$635,000 (A$130,700) per tonne. The commodity dipped as low as CNY$307,000 (A$63, 200) in 2016 and bounced off a low of CNY$350,000 (A$72,050) in April 2020. 

Lynas advises that a full assessment of global rare earths demand will not be possible until the global COVID-19 situation is more stable. However, positive news continues to support the magnet market. The European Union (EU) recently decided to accelerate the decarbonisation of its economy, now targeting a 60% reduction in emissions by 2030 instead of the 40% previously targeted.

With road transportation responsible for more than 20% of CO2 emissions in the EU, this acceleration is expected to translate into a faster penetration of electric and hybrid vehicles. 

Lynas to expand production and footprint 

Lynas has selected Kalgoorlie as the location for its new rare earths processing facility. The Western Australia Government awarded the project ‘lead agency’ status, with a ‘major project’ status awarded by the Australian Government. The major project status formally recognises the significance of a project to the Australian economy with extra project support and streamlined project state and territory approvals. 

As announced on 27 July 2020, Lynas also signed a contract with the United States Department of Defence for Phase 1 work on a proposed US-based heavy rare earth separation facility. The asset is intended to provide an expanded product suite as well as the only source of separated heavy rare earths outside China. The facility will be using material sourced from the Lynas mine in Mt Weld, Western Australia. 

At the time of writing, the Lynas share price has increased 1.5% to $4.08 in trading today.

More reading

• The Lynas share price (ASX:LYC) rose 34% in November. Here’s why
• Why the Lynas (ASX:LYC) share price just hit a 52-week high
• ASX 200 events this week that could move the market

Motley Fool contributor Lina Lim 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 OceanaGold Corp (ASX: OGC) share price has surged after the gold producer announced the Philippines Government has agreed to finalise the renewal of its Didipio gold mine contract. At the time of writing, the OceanaGold share price has climbed by 33.16% to $2.53.

Why the OceanaGold share price surged on the news

OceanaGold has been the operator of the Didipio gold mine in the Philippines since 2013, a site which is 270km north of Manila.

The company has been operating the mine under a ‘Financial or Technical Assistance Agreement (FTAA)’ contract. In July 2019, the agreement was subject to a temporary order issued by the provincial governor to restrain activities of the mine, pending renewal of the FTAA contract.

The dispute was over the location of the mine, which was claimed by the indigenous people of the area as ancestral grounds.

The OceanaGold share price is today rocketing on news the company has been granted a Certification of Non-Overlap (CNO). This states that the FTAA area is outside the ancestral domain of the Indigenous Cultural Communities.

OceanaGold today advised its FTAA contract has strong endorsement from the residents in the local communities around the Didipio mine, including the indigenous peoples.

The company further reported it will continue engaging with the national government with the goal of finalising the FTAA renewal. 

OceanaGold also announced in today’s release that as “a contractor of the Philippines Government and a responsible multinational miner, the company is ready and waiting to restart the Didipio operations and to continue contributing to the Philippines’ post-COVID-19 recovery.”

How has OceanaGold performed in 2020?

Prior to the market update, the OceanaGold share price had lost around 30% of its value in 2020. Following today’s movement, however, OceanaGold shares are now down just 9% in year-to-date trading. Despite today’s gains, this still leaves the company’s share price a long way off its 52-week high of $4.29.

OceanaGold has, however, been making progress recently.

Just last week, the company announced it was given permits by the New Zealand Government. These related to OceanaGold’s Golden Point Underground Mine, Deepdell North Stage III open pit extension and Frasers West expansion. 

The company advised these permits would allow it to proceed with the development of underground mining opportunities in New Zealand, and to extend the mine life of its Macraes operation all the way to 2028.

Based on the current OceanaGold share price, the company commands a market capitalisation of $134 million.

More reading

• Watch out! ASX IPO boom may sink the ASX bull market in 2021
• The scariest thing in Boeing’s 10-year forecast
• Why Bapcor, Event, Money3, & Tyro shares are dropping lower
• The Etherstack (ASX:ESK) share price is soaring 10% higher today. Here’s why.
• The Nuix (ASX:NXL) share price rocketed a further 37% higher today

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. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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ASX investors are celebrating the spate of successful floats on the ASX recently as a sign that the bull run is alive and healthy.

The Nuix Ltd (ASX: NXL) share price and the Cashrewards Ord Shs (ASX: CRW) share price are among examples of the latest initial public offerings (IPOs) that are trading well above their issue price.

Other examples include the Booktopia Group Ltd (ASX: BKG) share price and the Maas Group Holdings Ltd (ASX: MGH) share price.

Strong ASX IPO market a danger sign for bulls

Who cares that the doomsayers ringing the warning bells as the S&P/ASX 200 Index (Index:^AXJO) kicked off the week with strong gains? The buoyant IPO market gives confidence to the bulls that the party will last long past New Year’s Day.

But it might be a case of be careful for what you wish for. The level of IPOs and capital raisings could be the proverbial canary in the coalmine for equities, reported Bloomberg.

The report found a strong correlation between share market performance and the demand and supply of shares.

Demand and supply of ASX shares

IPOs and capital raisings increase the supply of shares as companies sell equity to shareholders. Inversely, ASX stocks that undertake share buybacks and those that are acquired remove the supply of shares on market.

The IPO party isn’t confined to Australia. The number of new floats in the US is also high with the likes of Snowflake Inc (NYSE: SNOW) and Warner Music Group Corp (NASDAQ: WMG).

While listed US companies typically back-back more shares than they sell, Bloomberg found that 2020 is different.

Capital raisings add to supply glut

The supply of shares isn’t only coming from IPOs. Companies most battered by COVID‐19, such as travel stocks and airlines, have been frantically selling shares to beef up their balance sheets.

US-listed companies have announced plans to raise about US$510 billion through initial and secondary share offerings this year. That’s 50% higher than a year ago, according to data from EPFR that’s reported by Bloomberg.

“For the first time since the 2009 crisis year, that matches the amount that companies announced they’d remove via buybacks and takeovers,” noted Bloomberg.

“For context, an average of $3 was bought back for every $1 raised over the past decade.”

Impact of excess ASX shares on issue

Why should investors care? Over the past 20 years to 2015, listed companies boosted net equity demand in 15 different years. Twelve of those 15 years saw the S&P 500 rise, a study by EPFR showed.

On the flipside, in the five years when supply of shares increased, the equity benchmark fell 60% of the time.

If the demand and supply doesn’t balance out better in 2021, the market bulls could be in for a rude shock.

The study may have been undertaken in the US, but I won’t be surprised if the ASX follows a similar pattern. After all, our market has always walked in the shadow of its US counterparts.

More reading

• The Nuix (ASX:NXL) share price rocketed a further 37% higher today
• After record breaking ASX share price rallies, what next in 2021?
• ASX 200 up 0.7%: Metcash impresses, BHP & Fortescue storm higher, Xero given buy rating
• Why Fortescue, Metcash, Nuix, & Xero shares are storming higher
• Why ASX iron ore stocks are set to rally today

Brendon Lau has no position in any of the stocks mentioned. Connect with me on Twitter @brenlau.

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Snowflake Inc. 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.

Boeing (NYSE: BA) issued its annual forecast for the commercial jet market in October. Not surprisingly, the aerospace giant reduced its estimate for global aircraft deliveries over the next 20 years – and especially for the current decade – relative to its 2019 outlook.

Despite slashing its long-term forecast, Boeing still may be overestimating the level of aircraft demand between 2020 and 2029. However, the scariest thing in its updated outlook is that even if its demand forecast is accurate, Boeing has virtually no path to getting back to pre-pandemic production levels during the current decade.

What the forecast says

Boeing estimates that manufacturers will deliver 18,350 new aircraft between 2020 and 2029, including 1,240 regional jets: a market segment that Boeing and Airbus (OTC: EADSY) don’t participate in. That puts the estimated addressable market for Boeing and its chief rival at 17,110 aircraft over the 10-year forecast period.

Unsurprisingly, Boeing expects single-aisle mainline jets (like the Boeing 737 MAX) to continue to account for the vast majority of demand, with 13,570 deliveries between 2020 and 2029. Wide-body passenger jets and freighters represent the other 3,540 projected deliveries.

Most of these deliveries are spoken for

The scary thing for Boeing is that most of these projected deliveries have already been sold – and mostly not by Boeing. This is particularly true for narrow-bodies: the high-volume segment of the market.

In the first 10 months of 2020, Airbus delivered 355 single-aisle jets. It ended October with an enormous backlog of 6,517 unfilled narrow-body orders across its A220 and A320 families. Airbus’ 2020 deliveries and current firm orders account for 51% of what Boeing projects will be delivered over the entire decade in the single-aisle market. Meanwhile, due to the 737 MAX grounding, Boeing has only delivered 13 narrow-bodies year to date (mainly military variants). Its backlog for the 737 family – its only entry in the single-aisle market – totals 3,365 orders.

Furthermore, while Boeing and Airbus dominate the commercial jet market, they aren’t the only players. Russia’s Irkut had 175 firm orders for its MC-21 jet as of September. Meanwhile, China’s COMAC claims to have 815 orders for its C919 jet, although only around 300 of those appear to be firm orders. Both new models had their first flights in May 2017, and both manufacturers expect to begin deliveries in late 2021, although it’s certainly possible that the timeline will slip to 2022.

In short, more than 10,700 single-aisle jets have been delivered in 2020 or are on firm order today. The 737 MAX accounts for less than a third of that figure. Meanwhile, fewer than 3,000 additional single-aisle jets would need to be ordered to meet the market’s projected demand through 2029.

Unless Boeing secures the lion’s share of those orders – which would mark a big turnaround from recent history – it is virtually locked into its current position as a distant No. 2 in the most important part of the commercial jet market.

To be fair, Boeing is in better shape for wide-bodies, where it still has leading market share. It has delivered 98 wide-bodies this year – including passenger, freighter, and military variants – compared to just 58 deliveries for Airbus. Boeing ended October with 910 outstanding firm wide-body orders, versus Airbus’ 860. However, wide-bodies (including freighters) will account for just 20% of aircraft deliveries this decade, according to Boeing’s forecast. Moreover, that projection could still be too generous.

A new normal for Boeing

In 2018, Boeing delivered 806 commercial jets: 580 737s and 226 wide-bodies. Meanwhile, Airbus delivered 800 jets: 646 narrow-bodies and 154 wide-bodies.

Airbus’ current narrow-body backlog equates to an average of more than 700 annual deliveries between 2021 and 2029: more than what it delivered in 2018. Boeing’s current backlog wouldn’t even support an average of 400 annual 737 deliveries. Since there are potentially fewer than 3,000 additional orders up for grabs for narrow-body deliveries this decade, the aircraft manufacturer would need to capture a disproportionate share of that business to get back to building nearly 600 737s annually.

Getting even 50% of the incremental order volume could be challenging. Airbus’ A220 is smaller than the smallest 737 MAX model, giving it lower trip costs, while the A321XLR has significantly more range than any 737 MAX. Thus, Airbus addresses market segments that Boeing doesn’t participate in today. Additionally, Irkut and COMAC are virtually guaranteed to capture additional orders because of their status as national champions. COMAC in particular is poised to tap into the enormous Chinese airline market.

As for wide-bodies, even if Boeing’s forecast is accurate and it maintains a modest market share advantage, annual deliveries would remain firmly below its 2018 tally. Barring some unexpected event that causes a rapid shift in the market share landscape, Boeing will struggle to make a full recovery from the double-whammy of the 737 MAX grounding and COVID-19 pandemic.

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

More reading

• Amaero (ASX:3DA) shares in trading halt after Boeing order
• 10 most searched shares in Australia
• Here are the US shares that CommSec customers are buying
• This cheap ASX share is supplying US giants: fundie

Adam Levine-Weinberg 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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In afternoon trade the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a gain. At the time of writing, the benchmark index is up 0.3% to 6,654.9 points.

Four shares that have failed to follow the market higher today are listed below. Here’s why they are dropping lower:

Bapcor Ltd (ASX: BAP)

The Bapcor share price is down 3.5% to $6.84 despite there being no news out of the auto parts retailer. This latest decline means the Bapcor share price is now down a disappointing 16% since this time last month. Investors appear concerned that the COVID tailwinds it was experiencing may now ease given the prospect of vaccines being released in the near future. These tailwinds include an increase in domestic tourism and increased vehicle usage during the pandemic to avoid public transport.

Event Hospitality and Entertainment Ltd (ASX: EVT)

The Event share price has fallen 4% to $10.48 after providing an update on the sale of its Cinestar business. That update revealed that Vue International is seeking to renegotiate the terms of the acquisition of the Cinestar business. Vue also advised that it has stopped the divestment process of some of its sites. These divestments are required by regulators to complete the Cinestar purchase.

Money3 Corporation Limited (ASX: MNY)

The Money3 share price is down 2.5% to $2.89 after completing a capital raising. The consumer finance provider raised $45 million at an 8.8% discount of $2.70. It will now push ahead with a share purchase plan to raise a further $7 million. The proceeds will be used to fund the acquisition of Automotive Financial Services and loan book growth in Australia and New Zealand.

Tyro Payments Ltd (ASX: TYR)

The Tyro share price is down 4.5% to $3.34. This is despite the release of a positive weekly trading update this morning. According to the release, the payments company processed $366 million of payments during the first four days of December. This represents a 16% increase on the prior corresponding period. During November, payment volumes were up 13% to $2.159 billion.

More reading

• Event Hospitality (ASX:EVT) share price falls on Cinestar update
• Got money to invest? Here are 3 ASX dividend shares to buy
• 2 turnaround ASX shares to buy
• Why the Afterpay (ASX:APT) share price and these ASX stocks could get a boost next week
• 2 turnaround ASX shares rated as buys by leading fundie

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 Tyro Payments. The Motley Fool Australia owns shares of and has recommended Bapcor. 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 Etherstack PLC (ASX: ESK) share price is soaring higher today on news the company’s subsidiary, Etherstack Pty Ltd scored a major contract win with the Australian Department of Defence. At the time of writing, the Etherstack share price is up 9.3% to 71 cents.

Etherstack operates in wireless communications technologies for customers in the public safety, defence, utilities and mining industries. The company’s protocol stacks are exported globally and licensed by leading radio manufacturers.

Its Australian solutions partner and subsidiary, Auria Wireless, manufactures complete digital radio networks using Etherstack software.

What’s driving the Etherstack share price up?

The Etherstack share price shot up today after the company advised that it has entered a technology licensing contract with the Australian Department of Defence. The local deal bolsters the company’s track record of delivering its products to allied defence organisations and radio manufactures in Europe and North America.

Under the agreement, Etherstack will supply its technology and associated delivery services to the Australian government. The first stage of the proposed multiple work packages is estimated to be worth $4.1 million. Most of the revenue from the initial phase will be included into the company’s FY21 report.

In light of this, Etherstack expects a modest contribution to the current financial year ending 31 December.

While future work packages are not guaranteed, the company expects to meet its performance-based targets, thereby leading to continued business.

Management commentary

Etherstack CEO David Deacon welcomed the news, saying:

This program builds upon existing Etherstack technology and creates a significant Australian export opportunity to both other nations and international military equipment manufacturers.

The supplied solution is repeatable and the first of its kind that will be compliant to a specific military standard. Etherstack expects interest from existing and new radio manufacturer customers internationally, as well as other nations, and will attempt to rapidly capitalise through licensing the solution to other countries.

Etherstack share price summary

If investors picked up Etherstack shares at 12 cents before its Samsung partnership announcement in June, shareholders would be sitting on gains of 500%. The Etherstack share price reached an all-time high $3.70 on 1 July, the day after the Samsung deal.

However, investors quickly took profit off the table, sending its share price lower again, to hover between 60 and 70 cents.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post The Etherstack (ASX:ESK) share price is soaring 10% higher today. Here’s why. appeared first on The Motley Fool Australia.

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