Tag: Motley Fool

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a decent gain. At the time of writing, the benchmark index is up 0.75% to 7,183.3 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are charging higher:

ALS Ltd (ASX: ALQ)

The ALS share price is up over 2.5% to $12.08. This follows the release of the testing solutions company’s full year results this morning. ALS revealed a 23.9% increase in revenue to $2,182.3 million and a 42.1% jump in underlying net profit after tax of $264.2 million. The latter was at the top end of its $260 million to $265 million guidance range.

Costa Group Holdings Ltd (ASX: CGC)

The Costa share price is up 7.5% to $3.13. This morning the horticulture company released a trading update at its annual general meeting. That update was relatively positive throughout and revealed that Costa remains on track to deliver on its previous guidance for calendar year 2022.

Superloop Ltd (ASX: SLC)

The Superloop share price is up 4% to 82 cents. Investors have been buying this telco’s shares after it announced the acquisition of white label broadband provider Acurus for $15 million. The acquisition is expected to allow Superloop to expand white label broadband relationships and deliver profitable growth in its subscriber base. Acurus’ white label platform supports the internet offerings behind major brands such as Energy Australia and Officeworks.

Worley Ltd (ASX: WOR)

The Worley share price is up 2% to $15.04. The catalyst for this was the announcement of two new contract wins. The first is the award of a contract for the fourth expansion of an integrated polyolefins complex in Ruwais, United Arab Emirates. The other is a contract by Heartwell Renewables for field engineering services for a greenfield renewable diesel plant in Hastings, Nebraska.

The post Why ALS, Costa, Superloop, and Worley shares are charging higher appeared first on The Motley Fool Australia.

More reading

• ASX 200 midday update: BHP and Pilbara Minerals shares tumble
• 3 ASX All Ordinaries shares smashing multi-year highs on Tuesday
• These ASX All Ordinaries shares have the greatest margin risks from surging inflation: UBS
• 3 ASX 200 shares smashing multiyear highs on Wednesday

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended SUPERLOOP FPO. The Motley Fool Australia has recommended COSTA GRP FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/q5dwoSM

The S&P/ASX 200 Resources Index (ASX: XJR) is leaping 1.71% today, and ASX gold shares are part of the trend.

Gold shares rising today include Evolution Mining Ltd (ASX: EVN), Northern Star Resources Ltd (ASX: NST), OceanaGold Corp (ASX: OGC), Silver Lake Resources Limited (ASX: SLR) and
Mako Gold Ltd (ASX: MKG) .

So what is impacting ASX gold shares today?

Gold prices

At the time of writing, OceanaGold Corp shares are up 7.95%, while Evolution Mining is leaping 4.88%. Silver Lake is jumping 3.86%, while Northern Star is climbing 3.43%, and Mako Gold is up 2.47%.

Gold prices jumped in the United States overnight due to the US dollar weakening and lower treasury yields, CNBC reported.

US gold futures leapt 1% to $1,885.60 an ounce, while spot gold climbed 0.7% to $1,866.39 an ounce on Tuesday.

Commenting on the gold prices, City Index UK senior market analyst Matt Simpson said:

The weaker dollar has helped gold break back above its 200-day average… and we’re not yet convinced the greenback has seen a low.

Gold futures have since pulled back to $1,862 at the time of writing, but this is still the highest level since 9 May.

Meanwhile, Mako Gold today reported “exceptional drilling results” at the Gogbala Prospect in Côte d’Ivoire, West Africa. The company intersected high-grade gold mineralisation at 40 of 49 holes at the project.

In other news, OceanaGold released a sustainability report yesterday. President and CEO Gerard Bond described 2021 as a “remarkable year” both operationally and due to improving sustainability performance. The company aims to cut carbon emissions by 30% per ounce of gold by 2030.

Share price snapshot

OceanaGold Corp shares have surged 39% in the year to date, while Evolution Mining shares have slipped nearly 5%.

Silver Lake shares have descended 9% year to date, while Northern Star Resources have dropped 19%, and Mako Gold shares have slipped nearly 25%.

For perspective, the ASX 200 Resources Index has jumped nearly 11% year to date.

The post Why are ASX gold shares leaping today? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• 5 things to watch on the ASX 200 on Tuesday
• 5 things to watch on the ASX 200 on Monday
• Here are the top 10 ASX shares today
• 5 things to watch on the ASX 200 on Thursday

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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 Scott Phillips.

from The Motley Fool Australia https://ift.tt/3IqaMZJ

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.

What happened

Long-suffering tech stock investors had to endure yet another painful trading session on Tuesday. Apple (NASDAQ: AAPL) shareholders saw their company lose nearly 2% of its value. That performance was relatively good on a day when a profit warning from Snap Inc (NASDAQ: SNAP) resulted in the social media stock’s worst trading day ever, crumbling by 43% and dragging many other tech titles deep into the red along with it.

So what

Limiting the damage to Apple was a glowing research note from Bank of America. The big lender’s analyst Wamsi Mohan reiterated his buy rating on the star tech stock, and his $200 price target.

Mohan believes that the company has several strong tailwinds, including growth in user count and App Store revenue improvement.

The analyst was particularly encouraged by developments with the App Store. Revenue for the mobile marketplace rose a robust 7% year over year in the January-through-April period of 2022.

Much of this comes from the Chinese market, which is apparently home to a great many eager Apple users in search of something good to play. Mohan cited data indicating that gaming apps alone have seen growth of 13% to date in the company’s current quarter.

Now what

The analyst explained in his note that the “Chinese government lifted its nine-month new gaming licensing ban, approving 45 titles”.

Therefore, he concluded, “Given the slightly favorable stance from regulators and ongoing lockdowns in China, we potentially see upside to the China App Store growth in [the fiscal second half of 2022].”

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

The post Why Apple escaped Tuesday’s Nasdaq meltdown appeared first on The Motley Fool Australia.

More reading

• Why Apple stock jumped on Monday
• If you’d invested $1,000 in Apple in 2010, this is how much you would have today
• Why Apple stock slipped on Thursday
• Why Apple Stock is falling today
• The single greatest investing lesson I ever learned

Bank of America is an advertising partner of The Ascent, a Motley Fool company. Eric Volkman has positions in Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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

from The Motley Fool Australia https://ift.tt/Zh2fGvw

What a journey the Lynas Rare Earths Ltd (ASX: LYC) share price has been on over the past few years. This was a company that was worth 80 cents a share five years ago. Today, Lynas shares are going for $9.39 at the time of writing after hitting a new all-time high of $11.59 last month. That puts the share price down around 8% year to date in 2022, but still up 76% over the past 12 months.

So if you still own Lynas shares, you most certainly aren’t alone. Much has been made of the company’s strategic position as the largest producer of rare earth minerals outside China. And that could be partly why some big institutional investors have been drawn into Lynas shares. Let’s check them out.

As it is obliged to do, Lynas lists its largest shareholders in its annual report. Unfortunately, Lynas’ last annual report was delivered back in September last year which is getting a bit far away now. But, still, let’s see what this report revealed about Lynas’ institutional ownership.

Largest investors in Lynas shares revealed

So Lynas’ 2021 annual report lists the company’s 20 largest shareholders. By far the largest of these was the bank HSBC, which owned almost 288 million shares, or 31.91% of the company’s total, as of the 2021 annual report. HSBC’s fellow bank JPMorgan was next with close to 114 million shares, or 12.64% of the total. Citicorp, another bank, had the bronze medal with 101.72 million shares (11.28%).

Other substantial Lynas shareholders included BNP Paribas, Merril Lynch, and Argo Investments Ltd (ASX: ARG). Lynas CEO Amanda Lacaze is the largest single investor, owning 2.63 million shares (0.29%) through a partnership.

So these institutional investors are some of the largest shareholders of Lynas Rare Earths. No doubt these investors would be basking in the afterglow of Lynas’ stellar past 12 months today.

At the current tLynas share price, this ASX rare earths producer has a market capitalisation of $8.44 billion.

The post Own Lynas shares? So do these big institutional investors appeared first on The Motley Fool Australia.

More reading

• The Lynas share price has surged 15% in 2 weeks. What’s the deal?
• Here are the top 10 ASX shares today
• Why is the Lynas share price powering ahead today?
• Falling ASX 200 mining shares ‘an opportunity to invest in sector leaders’: broker
• Why is the Lynas share price storming higher today?

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Sebastian Bowen has positions in JPMorgan Chase. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended HSBC Holdings. 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 Scott Phillips.

from The Motley Fool Australia https://ift.tt/iySUwaD

The Minbos Resources Ltd (ASX: MNB) share price is on fire on Wednesday.

In afternoon trade, the phosphate and green hydrogen focused exploration and development company’s shares are up 21% to 15.7 cents.

Why is the Minbos share price shooting higher?

Investors have been bidding the Minbos share price higher today after the company announced the completion of the sale of its interests in the Ambato Rare Earths Project in Madagascar.

According to the release, the company has received sale proceeds of A$2.46 million from ALS (Hong Kong) from the divestment.

These proceeds will now be used to complete the definitive feasibility study (DFS) for the Cabinda Phosphate Project and studies for the Capanda Green Hydrogen-Ammonia Project. Both projects are based in Angola.

Management believes the Capanda Green Hydrogen-Ammonia Project will become another key value driver for the company. Particularly given its supply agreement with RNT-EP, Angolan’s power network operator.

Minbos previously revealed that it has agreed in principle to supply RNT-EP with 200MW of Zero-Carbon hydro electrical power from the project. This appears to have caught the eye of other parties, with Minbos revealing the receipt of a number of unsolicited enquiries from potential technical, offtake and investment partners today.

Finally, the company also revealed that it has received initial in-bound enquiries on the ability to use phosphate from the Cabinda Phosphate Project for the production of Lithium Iron Phosphate batteries.

Management commentary

Minbos CEO, Lindsay Reed, was pleased with the news. He said:

Our hard work and persistence in Angola is starting to pay dividends, with multiple potential business opportunities on the table that we believe will quickly overtake our phosphate project in relation to returns for shareholders.

Our positioning with the Green Hydrogen-Ammonia Project puts the Company ahead of most, if not all, other ASX listed peers giving Minbos a significant time, infrastructure spend and power pricing advantage. These advantages cannot be underestimated.

The post Minbos share price rockets 21% on green hydrogen news appeared first on The Motley Fool Australia.

More reading

• Why Apple escaped Tuesday’s Nasdaq meltdown
• Own Lynas shares? So do these big institutional investors
• Could Tabcorp’s newly demerged Lottery Corporation become a takeover target?
• The ASX 200 share with ‘hidden value’: fund manager
• Could the new Labor Government herald better days for Treasury Wine shares?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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 Scott Phillips.

from The Motley Fool Australia https://ift.tt/n04gV9Z

There is little attention being paid to the Lottery Corporation Ltd (ASX: TLC) share price today with it trading flat. However, only one day into its listed life and investors are already discussing the potential of the Tabcorp spin-off becoming a takeover target.

As the clock ticks past midday, shares in the recently demerged lottery company are uneventfully sitting at $4.70.

Could a buyout be on the radar?

As a quick recap, the Lottery Corporation encompasses what was formerly the lottery and Keno businesses under Tabcorp Holdings Limited (ASX: TAH). Management made the decision to split this division off in a bid to create value for shareholders.

Now that the Lottery Corporation is destined to walk its own path, there are a few prime ways for it to fulfill its goal of creating further shareholder value, these include:

• A re-rating in the price-to-earnings (P/E) ratio the market is willing to pay
• Driving a higher share price through strong earnings growth
• Returning excess capital via dividends to shareholders; or
• Pursuing a takeover from another party.

Ultimately, all of these ways will require newly appointed CEO Sue van der Merwe to drive growth in the business. However, the odds are already in favour of the Lottery Corporation receiving a bid in the next few years of being a standalone company.

An analysis conducted by investment group Perpetual of 28 demergers showed that in nearly 65% of cases one of the two separated companies ended up being acquired within three years of breaking apart.

The appetite for relatively defensive ASX companies has been somewhat insatiable lately. Already this year companies such as Ramsay Health Care Limited (ASX: RHC), Uniti Group Ltd (ASX: UWL), and Cimic Group (ASX: CIM) have all been targeted by private capital.

What do analysts think of the Lottery Corporation share price?

Take-up of coverage by analysts for the Lottery Corporation is only beginning to trickle in. Yet, Morgan Stanley has been one of the first to share the possible future for this ASX share.

This morning, analysts at Morgan Stanley stuck an ‘overweight’ rating on Lottery Corporation shares. The broker believes the company holds “monopoly positioning” across the regions in which it operates.

Further explaining its bullish sentiment, Morgan Stanley stated that the company provides a rare mix of defensiveness, growth, and yield.

For these reasons, the broker holds a $5.15 price target. This would suggest an 8.5% upside from the current Lottery Corporation share price.

The post Could Tabcorp’s newly demerged Lottery Corporation become a takeover target? appeared first on The Motley Fool Australia.

More reading

• Tabcorp share price slumps another 7% following demerger
• Why Nufarm, Sayona Mining, Tabcorp, and TechnologyOne shares are falling
• Here are the 3 most traded ASX 200 shares on Tuesday
• Here’s what you need to know about the Tabcorp demerger
• The Lottery Corporation share price debuts on the ASX boards

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Ramsay Health Care Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/KFuc82p

It’s not often you find hidden value in an S&P/ASX 200 Index (ASX: XJO) share.

Generally, you’re more likely to find undiscovered value in the smaller end of the market, which receives a lot less analyst research and coverage.

So, when we hear about an ASX 200 share that could have hidden value, we pay attention.

The ASX 200 share with hidden value

The ASX 200 share in question is News Corp (ASX: NWS), among Australia’s largest media organisations.

Among its other ventures, News Corp is a majority shareholder in global online real estate advertising company REA Group Limited (ASX: REA), which operates realestate.com.au.

Commenting on potential tailwinds for the News Corp share price on Livewire, head of investment strategy at Wilsons David Cassidy said, “we still think there is hidden value” in the ASX 200 share.

“We’ve always had a view there that you’re getting an REA for quite a cheap price,” he said. “We think it’s even more the case now, given the weakness in News Corp over the last week or so.”

According to Cassidy:

We think at current levels, let’s call it $24, $25, News Corp is undervalued, particularly because of that REA piece, which has been under pressure, but we do think either you’re getting REA cheaply or you’re getting the rest of News Corp and there are some good assets outside of REA for quite a cheap price at the moment.

So that’s another sort of hidden value situation, if we’ve got an REA demerger. I’m not sure if we’re going to get it, but if we did, that’ll be a potential catalyst to release that value out of News Corp.

News Corp share price snapshot

The News Corp share price has come under selling pressure this year, with the ASX 200 share down 23.5% since the opening bell on 4 January. By comparison, the ASX 200 is down 5.5% year-to-date.

News Corp shares pay a 1.1% trailing dividend yield, unfranked.

The post The ASX 200 share with ‘hidden value’: fund manager appeared first on The Motley Fool Australia.

More reading

• 3 ‘disruptive’ ASX companies Aussies now can’t live without
• Brokers name 2 ASX 200 blue chip shares to buy
• Buy these 2 ASX shares on sale right now: top broker
• Thursday thrashing: ASX tech shares tumble
• Here are the top 10 ASX shares today

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended REA Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/9HeDasV

Treasury Wine Estates Ltd (ASX: TWE) shares have suffered against Chinese tariffs in recent years. The company has even decided to produce its famous Penfolds wine in the nation to avoid them.

But could Chinese sanctions change alongside Australia’s government?

Newly elected Prime Minister Anthony Albanese apparently won’t be letting such trade bans slide, slamming Chinese tariffs on Australian goods at this week’s Quad meeting.

At the time of writing, the Treasury Wine share price is 0.87% higher than its previous close.

Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is boasting a 0.78% gain.

Let’s take a closer look at what Albanese’s latest comments might mean for Treasury Wine shares.

Albanese slams Chinese tariffs

Treasury Wine shares could be in for a good run if Albanese sticks to his staunch stance against Chinese trade bans.

The Chinese Ministry of Commerce slapped Treasury Wine’s products with a massive duty rate back in 2020.

Prior to the hike, China accounted for around 30% of all Treasury Wine’s earnings. Their implementation understandably devastated the company’s bottom line.

Now, Australia’s new Labor Government’s apparent push against such tariffs could bring brighter days for the Treasury Wine shares.

Albanese slammed Chinese trade sanctions this week, saying the country should drop tariffs on Australian goods to improve the relationship between the two nations.

The comments came after Chinese Premier Li Keqiang sent a letter congratulating Albanese on his election win.

“The Chinese side is ready to work with the Australian side … to promote the sound and steady growth of the China-Australia comprehensive strategic partnership,” the letter stated.

But the olive branch wasn’t accepted unconditionally by Australia’s new leader. Speaking to press in Tokyo, Albanese said:

Australia seeks good relations with all countries. But it’s not Australia that’s changed, China has.

It is China that has placed sanctions on Australia. There is no justification for doing that. And that’s why they should be removed.

Treasury Wine share price snapshot

The Treasury Wine share price has suffered through 2022 so far. Though, things might not be as bad as they seem.

While the company’s stock has tumbled 6% year to date, it’s trading relatively in line with the broader market. Right now, the ASX 200 is 5% lower than it was at the start of 2022.

Additionally, the wine maker’s stock has outperformed the index over the last 12 months, gaining around 3% against the ASX 200’s 1% rise.

The post Could the new Labor Government herald better days for Treasury Wine shares? appeared first on The Motley Fool Australia.

More reading

• Treasury Wine share price beating the sell-off amid ‘made in China’ push
• Can a new $165m ‘state-of-the-art facility’ help restore the Treasury Wine share price?
• Broker tips the Treasury Wine share price to pop 23% higher
• Broker names 2 of the ‘best’ blue chip ASX 200 shares to buy now
• Broker names the best ASX shares to buy right now

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Treasury Wine Estates Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/0P1avzG

The Fortescue Metals Group Limited (ASX: FMG) share price has surged in the past week, despite the recent market volatility.

Since this time last Wednesday, the iron ore mining outfit’s shares are up 10% buoyed by upbeat investor sentiment.

And today, Fortescue shares are currently adding to those gains to edge 1.49% higher to $21.08.

For context, the S&P/ASX 200 Index (ASX: XJO) is also in the green, up 0.80% to trade at 7,186 points.

Let’s take a closer look at what’s driving the miner’s shares upwards lately.

Iron ore prices rebound

After hitting a near 3-month low of around US$123 on 18 May, the price of iron ore has suddenly rebounded.

Courtesy of Trading Economics, the steel making ingredient is trading at US$130 per metric tonne at the time of writing. This represents an increase of roughly 5.6% compared to last Wednesday’s closing price.

Nonetheless, the uptick in iron ore prices will have a positive impact on Fortescue’s bottom line.

The company reported industry leading C1 costs of US$15.28 per wet metric tonne for H1 FY22.

C1 costs refer to the ‘direct’ production costs incurred in mining and processing the iron ore.

What’s causing iron ore prices to surge?

A major driving force that’s rallying up the iron ore price rise is China’s latest move to cut borrowing rates and reduce stockpiles of the steel making ingredient. This has led to optimistic sentiment in which futures have climbed across overseas markets.

To support economic growth, Chinese banks slashed interest rates for long-term loans by a record amount last week. Inevitably, this lessens mortgage costs for consumers and thus supports demand to take up new loans.

On the other hand, iron ore stockpiles at major Chinese ports fell for the eighth consecutive week.

The country’s strict COVID-19 zero policy and well documented property slump have weakened demand in the construction sector.

However, while government restrictions have weighed down on market confidence, iron ore consumption is expected to return to normal levels. This is based on stimulus packages released to the public to spur economic activity.

Fortescue share price snapshot

It’s been a rollercoaster ride for Fortescue shares, having moved unpredictably over the past 12 months. Its shares are down almost 2% since this time last year.

Based on valuation metrics, Fortescue presides a market capitalisation of approximately $63.77 billion.

The post Why has the Fortescue share price gained 10% in a week? appeared first on The Motley Fool Australia.

More reading

• Can Rio Tinto shares deliver 20% growth AND a juicy dividend yield in the coming year?
• ASX shares paid out a record $98b in dividends in the 12 months to March. Which are the star performers?
• Better buy, BHP or Fortescue shares?
• Here’s why the Fortescue share price is surging on Monday
• How are ASX 200 mining shares responding to the election outcome?

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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 Scott Phillips.

from The Motley Fool Australia https://ift.tt/13vSpjJ

The Airtasker Ltd (ASX: ART) share price is currently up by 8% after the business received the go-ahead to buy Oneflare.

Both Airtasker and Oneflare are local service platforms. A few weeks ago, Airtasker announced that it was going to buy the Oneflare business, using a capital raising to fund the deal. However, an enquiry by the Australian Competition & Consumer Commission (ACCC) halted the process.

ACCC update

Airtasker told the market today that the acquisition of Oneflare will proceed on 25 May 2022.

The ASX tech share told the market that the delay was due to queries from the ACCC about the acquisition.

The ACCC’s response? It confirmed that it does not intend to conduct a public review of the acquisition in regards to the Competition and Consumer Act 2010.

With that response, Airtasker will complete the acquisition and settle the private placement that it told the market about. That’s an underwritten placement of approximately 14.5 million new shares at $0.43 per share. The plan is to raise approximately $6.25 million. This will be used to fund the cash part of the deal, the FY23 estimated investment in Oneflare, and acquisition and placement costs.

What about the share purchase plan (SPP) Airtasker had planned for regular investors? This is the company’s answer:

Given the current share price is below the 43 cents price per share agreed for the placement, the board has decided to withdraw the SPP, noting that current shareholders can acquire shares in the company on-market at a lower price than the price previously anticipated for the SPP offer.

What is Oneflare?

Airtasker says that Oneflare is Australia’s third-largest local services platform with a strong presence in trades, home improvement and professional services.

Oneflare serves more than 540,000 customers and 14,500 verified businesses each year.

It has 480,000 unique visitors to Oneflare’s platform per month, with more than 50,000 posted jobs per month. The average task price is more than $2,300.

Why is Airtasker buying Oneflare?

There are three main factors that Airtasker points to.

First, it can strengthen network effects. Customers of both platforms will gain access to a wider range of skills and faster response times. Meanwhile, the taskers/businesses will get access to more job opportunities.

Next is that it can unlock the high-value trade opportunity. Airtasker said both platforms will gain access to a suite of features designed to empower ‘service pros’ in high-value service categories like trades, home improvement and professional services.

The third point was a single technology platform. It noted that operating a single technology platform to serve a significantly larger user base will create a range of technology, data, brand and financial synergies.

Airtasker share price snapshot

While the business is seeing a large rise today, the Airtasker share price has fallen by 26% in the last month amid the volatility for technology stocks on the ASX and internationally.

The post Here’s why the Airtasker share price is leaping 8% on Wednesday appeared first on The Motley Fool Australia.

More reading

• Where I’d invest $10,000 into ASX shares this week
• Buy these great value 2 ASX growth shares: experts
• Why is the Airtasker share price edging higher today?
• Airtasker share price dives 6% as trading resumes
• Analysts say these small cap ASX shares have big futures

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Airtasker Limited. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/H3guyRl