The NextDC Ltd (ASX: NXT) share price rocketed up to to all-time highs in June, pushing through the $10 barrier before falling slightly at month’s end. During June, the Australian data centre operator’s market cap exploded through the $5 billion mark, pushing it into the ASX 100 for the first time ever. The share price in June finished at $9.88, up above 70% since its lows in March.

Since the end of June, the NextDC share price has gone from strength to strength, reaching its highest ever price at $11.44. This represents a 73% increase for the year.

What does NextDC do?

NextDC is an Australian data centre operator that provides data centre outsourcing solutions, connectivity services and infrastructure management software to global cloud-computing businesses, enterprise and government clients.

The company has a strong focus on energy efficiency and sustainability through renewable energy sources and is aiming for its operations to be 100% driven by renewable energy. As such, NextDC’s corporate operations have been certified carbon neutral under the Australian Government’s Carbon Neutral Initiative.

Yet more contract wins

As recently as 1 July, NextDC announced another material customer contract win in NSW. The company advised that the contracted commitments at its NSW data centre facilities have now increased by approximately 4MW, to more than 36MW-with options to increase to 60MW.

This follows on from contract wins in May and March for Victoria. The company also completed a $672 million equity raise in April.

Commenting on the recent contract wins, CEO and managing director Craig Scroggie stated: “This reflects the nature of NEXTDC’s digital infrastructure business model, which continues to build long term value through contracted capacity and tangible asset backing.”

The pandemic and resulting rise in remote work arrangements has caused increased demand for NextDC’s services, which could help explain the stock’s meteoric rise. Brokers are evidently still keen on NextDC shares, with Goldman’s analysts retaining their buy rating in early July.

At the time of writing, the NextDC share price is continuing to break barriers as it surges upwards towards the $11.50 mark.

More reading

• 3 high quality ASX 100 shares to buy right now
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• Why NEXTDC and these high flying ASX shares just hit record highs
• 3 ASX tech shares to buy and hold
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Motley Fool contributor Daniel Ewing 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 Praemium Ltd (ASX: PPS) share price is rocketing higher on Thursday after announcing an agreement to acquire smaller rival Powerwrap Ltd (ASX: PWL).

At the time of writing the Praemium share price is up 13.5% to 42 cents and the Powerwrap share price is up over 51% to 26.5 cents.

What did Praemium announce?

Praemium and Powerwrap have entered into a bid implementation agreement under which the former will make an off-market conditional takeover bid for all of the Powerwrap shares it does not presently hold.

According to the release, Praemium has offered 7.5 cents per Powerwrap share in cash and 1 Praemium share for every 2 Powerwrap shares held.

Combined, this values Powerwrap at an indicative price of 26.44 cents per share or $55.6 million. This represents a 51.1% premium to the last closing price of Powerwrap shares.

What now?

The Powerwrap board of directors unanimously recommend that its shareholders accept the offer. They have indicated that they will be doing so with the shares they own, in the absence of a superior proposal.

The board notes that shareholders will have the opportunity to participate in the benefits of a merged group, which will be one of Australia’s largest independent specialist platform providers with combined funds under administration (FUA) of over $27 billion.

In addition to this, it feels Powerwrap shareholders will be able to participate in the expected upside from the realisation of potentially significant synergies. It expects full year EBITDA operating cost synergies on a preliminary basis to total $6 million by FY 2022.

Furthermore, it believes the likelihood of a competing proposal emerging is low given Praemium’s existing 15.1% interest in Powerwrap.

An “exciting opportunity”.

Praemium’s Chair, Barry Lewin, sees a lot of positives from the combination of the two investment platform businesses.

He said: “The merger is an exciting opportunity for Powerwrap and Praemium shareholders alike. For many years, Praemium has been on a growth trajectory with a recent history of generating steadily growing profitability. This merger adds increased scale and significant synergies. Powerwrap shareholders can now gain exposure to Praemium’s strong financial position and advanced technology, to realise compelling benefits via the creation of one of Australia’s leading independent specialist platform providers on a combined FUA basis.”

This view was echoed by Powerwrap’s Chair, Anthony Wamsteker.

He said: “The board of Powerwrap believes the Offer presents an excellent opportunity for Powerwrap shareholders to participate in the upside of a merged group that stands to benefit from significant potential synergies. With Powerwrap’s strong customer base and Praemium’s track record of profitability and cutting-edge technology, the benefits to Powerwrap shareholders are clear to the board and we encourage Powerwrap shareholders to take the next step in the company’s journey.”

More reading

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• Gold jumps to 9-year high with record highs in sight
• Will retail vacancies hurt the Vicinity Centres share price?

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 Praemium Limited. The Motley Fool Australia has recommended Praemium 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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On Wednesday, the S2 Resources Ltd (ASX: S2R) share price rose by 23.81% to $0.13 after the company announced that it had commenced drilling at its Finland site. 

What was in the announcement?

The company announced that initial diamond drilling had commenced at its 100% owned Aarnivalkea East gold target on the large Paana tenement in Finland. The mine is located 20km northwest of a 9 million ounce gold mine that is owned by another company.

The first drill test had revealed gold grades of up to 10.7 grams per tonne, accompanied by arsenic and bimuth, which can help in identifying a path to gold.

Drilling had been scheduled to start in March but had been delayed due to the effects of the coronavirus pandemic. The drilling is being undertaken by the company’s European-based workers, with virtual oversight by its Australian personnel until they are able to resume international travel.

The initial drilling program will consist of approximately ten diamond core holes, these are to be drilled on 3–4 traverses across the previously identified trend. The initial drilling will take about 3–4 weeks to be completed. According to the announcement, the site can be accessed year round for follow up drilling. 

About the S2 Resources share price 

S2 resources is a greenfields gold and base metals explorer. The company has exploration activities in Australia and Finland. According to the company, its exploration is based in mine-friendly areas. The S2 team primarily consists of former directors from Sirius Resources, which had success in nickel exploration.

The company recently discovered two gold prospects in Finland, one of which is being drilled currently.

At the end of the March quarter, S2 resources had $7.3 million cash plus 31% ownership of Todd River Resources Ltd (ASX: TRT). The company continued drilling for gold in Finland while drilling for nickel at two sites in Western Australia.

The S2 Resources share price is up 97% from its 52 week low of $0.066, and while it is flat on the start of 2020 it is up 18% since this time last year.

More reading

• Todd River Resources share price up 50% in 2 days after acquisition news

Motley Fool contributor Chris Chitty 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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If you’re planning to invest your money into the Australian share market, then one of the shares listed below could be worth considering whether you’re looking for growth, income, or value.

Here’s why I think these shares are in the buy zone:

Lendlease Group (ASX: LLC)

I think this international property and infrastructure company could be a top option for income investors. Although it has just released its unaudited results for FY 2020 and revealed a sharp decline in profit, I’m confident that the worst is now behind the company. In light of this, I think investors should focus on its long term outlook, which looks very positive thanks to its burgeoning global development pipeline. One broker that is positive on the company is Goldman Sachs. It recently declared its shares as a buy and forecast a 57 cents per share dividend next year. Based on the current Lendlease share price, this equates to a 4.8% dividend yield.

Telstra Corporation Ltd (ASX: TLS)

This telco giant could be a good option for value investors. At approximately 20x estimated full year earnings, I think Telstra’s shares are trading at an attractive level. Especially given its improving outlook and generous dividend yield. In respect to its outlook, I believe a return to growth could be on the cards in the near future thanks to its T22 strategy and the easing NBN headwind. In the meantime, I’m confident its 16 cents per share fully franked dividend is sustainable for the foreseeable future. Based on the latest Telstra share price, this works out to be a generous 4.7% dividend yield.

Xero Limited (ASX: XRO)

Finally, if you’re a growth investor, you might want to consider buying this cloud-based business and accounting software provider. I believe Xero is one of the best growth shares on the ASX and capable of generating very strong returns for investors over the 2020s. This is thanks to its high quality and sticky platform, high retention ratio, and massive global market opportunity. Combined, I expect them to result in strong earnings growth in the coming years.

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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Xero. The Motley Fool Australia 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 PointsBet Holdings Ltd (ASX: PBH) share price has been a strong performer on Thursday.

In morning trade the sports betting company’s shares are up over 10% to $6.09.

Why is the PointsBet share price storming higher?

Investors have been buying PointsBet’s shares after it announced an agreement with BetMakers Technology Group Ltd (ASX: BET). That agreement will see it offer fixed odds betting on horse racing in New Jersey, subject to the receipt of all necessary regulatory and other approvals.

This follows BetMakers signing an exclusive 10-year agreement with New Jersey Thoroughbred Horsemen Association and Darby Development in February to deliver and manage fixed odds horse racing in New Jersey.

According to the release, the agreement sees Pointsbet offer fixed odds betting to New Jersey clients on all Monmouth Park race meetings. After which, it intends to expand the offering into New Jersey to include races and vision from other domestic and international jurisdictions, as and when such content is approved.

In addition to this, the agreement also provides the option for PointsBet to offer fixed odds betting on horse racing to clients in other US states via BetMakers in the future should the opportunity arise.

“Significant opportunity.”

PointsBet Group CEO and Managing Director, Sam Swanell, was pleased with the agreement.

He said: “Securing an agreement with BetMakers is a major step in what we believe to be an important strategy for our US plans. As a Company, we understand thoroughbred, harness and greyhound racing and we intend to capitalise on the expertise we have gained in Australia as we roll out racing products into the US market where legal, starting in New Jersey.”

“We see this as a significant opportunity. Annually, there are twice as many horse races in the US as there are in Australia, with a much larger total prize pool, however the amount wagered per capita in the US on horse racing remains a fraction of that in Australia,” he concluded.

BetMakers CEO, Todd Buckingham, spoke positively on the agreement. He commented: “BetMakers sees Pointsbet as a perfect partner to launch Fixed Odds in the US. We have a great working relationship with Pointsbet, which is one of the fastest growing bookmakers in Australia and the burgeoning US market.”

This news has gone down well with BetMakers shareholders as well. At the time of writing the BetMakers share price is up over 10% to 42 cents.

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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 Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. 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 gold price hit a nine-year high and could re-test its record highs later this year even as growing risk appetite pushed share markets higher in overnight trade.

The positive trading session on Wall Street sets up the S&P/ASX 200 Index (Index:^AXJO) for early gains with the futures market tipping a 0.8% rally.

It’s not normal for gold to run higher when risk assets are in vogue, but we aren’t living in normal times.

Gold heading to new highs

The price of the precious metal gained over a dollar to trade at US$1,810 an ounce, the best it’s been since 2011.

This means commodity has returned a little over 30% over the past year, and that’s a little ahead of the outperforming tech-laden Nasdaq Composite (INDEXNASDAQ: .IXIC).

If it can consolidate around the US$1,800 mark, there’s a good chance it can push towards its all-time peak of US$1,920 an ounce that it reached in September of that year.

COVID-19 cure won’t kill the gold bull

I think there’s a good chance we could see the precious metal try to re-take the record over the coming months.

Even if the COVID-19 pandemic was to die down, I don’t think that’s enough to kill gold’s bull run!

Don’t get me wrong, the devastating impact of COVID-19 on the world’s economy is a big supportive factor for the safe haven asset.

The fact that no one knows how the coronavirus playbook ends will continue to put the yellow metal on a pedestal.

Bigger drivers for ASX gold stocks

However, the pandemic is not the biggest driver for the gold price, which was already on an uptrend since late 2018 – long before anyone’s even heard of COVID.

What’s really driving gold is low interest rates and big cash injections by central banks into the financial system.

These stimuli will remain long after a vaccine for the virus is found because the path to economic recovery always takes longer than the fall into recession.

Why gold can keep outperforming post crisis

What will take even longer to fix are government deficits and debt. I am not referring only to Australia but to the US, and that will weigh on the US dollar, particularly once the coronavirus emergency is over.

I believe this explains why the gold price only peaked more than two years after the GFC as the greenback remained weak for a number of years after the financial crisis.

The outlook for the Newcrest Mining Limited (ASX: NCM) share price, Evolution Mining Ltd (ASX: EVN) share price and St Barbara Ltd (ASX: SBM) share price shines bright.

But don’t just buy one or two gold miners. You should buy a basket of them as production issues and company-specific risks can cause you to lose money even if you got the macro call right.

More reading

• Will retail vacancies hurt the Vicinity Centres share price?
• 5 things to watch on the ASX 200 on Thursday
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• Why it’s time to rotate out of JB Hi-Fi share price and these popular ASX stocks: Macquarie

Motley Fool contributor Brendon Lau owns shares of Evolution Mining Limited and Newcrest Mining Limited. Connect with me on Twitter @brenlau.

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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Retail vacancies are on the rise in Australian cities, but will this hurt the Vicinity Centres (ASX: VCX) share price this year?

Are retail vacancies really climbing in 2020?

They are according to an article in yesterday’s Australian Financial Review. The Australian Retailers Association says vacancy rates hit record levels of more than 20% in Melbourne’s Chapel Street and Bridge Road shopping strips.

Sydney hasn’t been immune either, with vacancies climbing in Oxford Street among other areas.

CEO of the Association, Paul Zahra, said retail strip landlords were ‘living in a different world’ and had ‘continued to hike up rents’.

So, are rising retail vacancies a red flag for retail real estate investment trusts (REITs) in 2020?

What does this mean for the Vicinity Centres share price?

Vicinity Centres shares have been under pressure in 2020. In fact, after slumping 3.7% lower in yesterday’s trade, the Aussie REIT is down 47.2% for the year. That means Vicinity is significantly underperforming the S&P/ASX 200 Index (ASX: XJO).

I don’t necessarily think rising vacancies in retail strips is a worrying sign for Vicinity Centres. The REIT owns and operates large shopping centres including Chadstone in Melbourne and DFO Homebush in Sydney.

On the other hand, it is quite likely these trends are a symptom of wider difficulties for Aussie retail. There is certainly an accelerating trend of online shopping due to the coronavirus pandemic. However, we could also see shopping centres capture some trade from retail strips if vacancies continue to climb.

So.. it’s all good news for Vicinity Centres?

Not so fast. While rising retail strip vacancies could be a minor positive for Vicinity Centres shares, there are still plenty of headwinds.

Retail REITs like Vicinity and Scentre Group (ASX: SCG) are struggling in 2020. Investors are wary of buying in with so much uncertainty surrounding operations and shopper demand on the horizon.

I think it’s hard to see a strong rebound in Aussie retail REIT funds from operations (FFO). That’s especially the case with Victoria re-entering lockdown as of last night. I’d expect to see a careful approach towards re-opening retail stores to their full capacity over the next 12-24 months.

Coronavirus restrictions are certainly a headwind for the Vicinity Centres share price in 2020. Less foot traffic means more trouble for tenants and their landlords. There’s also the unknown around consumer spending patterns in the short to medium term.

Given the Aussie REIT is trading down 47.2% this year, a significant discount has been baked into the price. However, I’m not bullish enough on retail real estate to buy in, given the uncertainty facing the industry right now.

More reading

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Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Scentre 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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