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The Redbubble Ltd (ASX: RBL) share price has been under pressure for over a month now. The latest bout of pessimism began for the global online marketplace operator following its first-quarter trading update on 14 October. Since then, shares have diminished in value by nearly 24%.

On top of this, the company is partly shrouded in concerns of copyright infringement allegations. Despite the decline in October and the ongoing litigation concerns, one fund manager finds Redbubble ‘compelling’.

Addressing the copyright risk to Redbubble on the ASX

You might have noticed that Redubble is commonly featured in the 10 most shorted ASX shares. For instance, this week the company slotted in at the number three spot with 10.5% of short interest. Yet, EGP Capital — in a contrarian manner — remains a major advocate for the eCommerce giant’s potential.

In the fund manager’s October report, chief investment officer (CIO) Tony Hansen summarised the fund’s perspective on Redbubble. This included an admission of the negative growth for the eCommerce company in the June to September quarter compared to the prior corresponding period.

However, Hansen noted that this should be expected given the comparatively booming period last year. Instead, the CIO suggests that long-term investors look at the company’s gross transaction value (GTV) from 2016 to the present. This shows a marketplace that has grown GTV from $36.6 million to $142 million in the space of five years.

In addition, the fund manager addresses the copyright concerns ASX-listed Redbubble has been facing. While it remains a risk, Hansen explained that Redbubble has repeatedly outlined the protections for designs such as fan art. Furthermore, the company has stated that it has a good working relationship with the likes of Netflix Inc (NASDAQ: NFLX).

Discussing the potential legal risk for Redbubble, Tony Hansen wrote:

Rights ownership is clearly an enormous business risk to RBL, and in simple terms, with nearly 800,000 selling artists regularly uploading new work, there will inevitably be breaches happening every day. RBL will be able to defend such breaches provided they have robust systems in place to prevent breaching materials getting onto the site in the first place, and that swiftly remove offending images/artworks when they are reported in the event they are somehow missed at the time of uploading.

Skin in the game

Tony Hansen backs up the belief in ASX-listed Redbubble with capital. At the end of October, the EGP Concentrated Value Fund held Redbubble as its sixth-largest position. The fund has a 5.2% weighting towards the eCommerce company.

For reference, the only companies with a larger weight in the EGP Capital fund are:

• United Overseas Australia Limited (ASX: UOS)
• Cettire Ltd (ASX: CTT)
• PPK Group Limited (ASX: PPK)
• Li-S Energy Ltd (ASX: LIS); and
• Smartpay Holdings Ltd (ASX: SMP)

Unfortunately for the fund, Redbubble has fallen ~42% on the ASX since the beginning of 2021.

The post This fund manager isn’t worried about Redbubble’s (ASX:RBL) copyright concerns appeared first on The Motley Fool Australia.

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• 2 ASX tech shares that might be buys in November 2021

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. owns shares of and has recommended Cettire Limited. The Motley Fool Australia has recommended Cettire Limited and Netflix. 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.

What happened?

Shares of Zoom Video Communications Inc (NASDAQ: ZM) fell 14.7% on Tuesday after the cloud communications leader’s slowing growth troubled analysts and investors.

So what?

Zoom’s revenue jumped 35% year over year to $1.05 billion in its fiscal 2022 third quarter. That marked a significant deceleration from the 54% growth the video-chat company experienced in the second quarter and the staggering 367% growth it delivered in the third quarter of 2021. 

To offset the slowdown, Zoom has placed a point of emphasis on expanding its relationships with larger companies, with tools such as its Zoom Rooms video conference room solutions that make it easier for onsite and offsite employees to communicate.

Zoom had 2,507 customers contributing more than $100,000 in trailing 12-month revenue at the end of the third quarter, up 94% from the same period a year ago. These dynamics can also be seen in its net dollar expansion rate in customers with more than 10 employees, which checked in above 130% for the 11th straight quarter.

All told, Zoom’s adjusted net income increased 14% to $338.4 million, or $1.11 per share.

Now what?

Management expects fourth-quarter revenue of roughly $1.05 billion. That would represent a further deceleration in revenue growth, to 19%. The company also guided for operating income and adjusted per-share profits of approximately $362 million and $1.07.

Multiple investment firms cut their price targets for Zoom’s stock following its third-quarter earnings release and Q4 guidance. For one, Evercore ISI analyst Peter Levine reduced his share price forecast from $255 to $235 on concerns that Zoom’s growth investments will weigh on its profit margins in the coming year. For another, Deutsche Bank analyst Matthew Nikam slashed his stock price estimate from $350 to $280, citing similar concerns.

“While we’re positive on Zoom’s strategic initiatives and investments in key growth areas, we find it tougher to like a stock with more sharply decelerating growth and incremental pressure on profitability,” Nikam said. 

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

The post Why Zoom shares plunged on Tuesday appeared first on The Motley Fool Australia.

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• Is the bull market in high-growth Nasdaq stocks over?

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Zoom Video Communications. The Motley Fool Australia has recommended Zoom Video Communications. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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

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The S&P/ASX 200 Index (ASX: XJO) is having a pretty bumpy time of it so far this Wednesday. At the time of writing, the ASX 200 is currently up by just 0.3% at 7,413 points after stints in both positive and negative territory over the trading day thus far.

But rather than trying to figure that out, let’s instead check out the ASX 200 shares that are currently topping the ASX trading volume charts so far today, according to investing.com.

3 most active ASX 200 shares by volume this Wednesday

Pilbara Minerals Ltd (ASX: PLS)

Our first ASX 200 share to check out today is the lithium producer Pilbara Minerals. This Wednesday has seen a sizable 12.96 million Pilbara shares trade hands so far. With no news or announcements out of the company, we can probably put this volume down to the volatility Pilbara shares have been exhibiting so far.

After dipping as low as $2.44 a share this morning after open, the Pilbara share price has been playing jump rope with the breakeven line all day. It’s currently at $2.52 a share, returning to the price it was at yesterday’s close. It’s this volatility that is probably behind this elevated trading volume.

Sydney Airport (ASX: SYD)

Sydney Airport is next up, with a hefty 21.22 million shares finding new owners on the ASX boards so far today. There’s not much in the way of news or announcements out of this ASX 200 infrastructure giant today either. The shares are currently down by 0.15% at $8.44.

But Sydney Airport has periodically been one of the highest trading ASX 200 shares ever since its acceptance of the takeover deal lobbed its way last month. At $8.44, Sydney Airport is still trading a good 3.7% or so from the takeover price of $8.75 a share. This could be a factor in this high volume today.

Spark Infrastructure Group (ASX: SKI)

And our final and most traded ASX 200 share of the day thus far goes to the renewables company Spark Infrastructure. Unlike the other two companies mentioned, we have something of a smoking gun as to why a whopping 30.72 million Spark shares have been bought and sold over the day so far.

This morning, the company announced that it has received approval from the Foreign Investment Review Board (FIRB) for the takeover offer put forward by a consortium led by Kohlberg Kravis Roberts and the Ontario Teachers’ Pension Plan earlier this year. The Spark share price is up 1.95% at $2.88 a share so far today. 

The post These 3 ASX 200 shares are topping the volume charts on Wednesday appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX shares today
• Here are the 3 heaviest traded ASX 200 shares this Tuesday so far
• 2 high-yielding ASX 200 dividend shares
• Why ASX shares are still good value: fund manager

Motley Fool contributor Sebastian Bowen 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 Bruce Jackson.

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Shares in marketplace lender Wisr Ltd (ASX: WZR) are moving southwards at pace, now fetching an intraday low of 23.5 cents.

The Wisr share price has lost ground today as the market responds to its AGM. In the presentation, Wisr outlined several investment highlights.

However, the company hasn’t caught any bids following the release – trading volume today is just 10% of its 4-week average, and shares are 8% down at last check.

What did Wisr announce?

Wisr reiterated its latest earnings update, where loan origination was a record $132 million in Q1 FY22. The company has now grown loan originations consecutively for 21 quarters in a row.

Loan book balance for Wisr Warehouse also surged 239% year on year and reached $451 million. At the time of its Q1 FY22 earnings, total loan originations for Wisr stood at $743 million.

The release also notes that in June 2021, Wisr’s Financial Wellness Platform was 88% more cost effective as a loan acquisition channel compared to direct and broker channels. Across the second half in total, cost efficiency in this domain improved 33%, lowering Wisr’s customer acquisition cost.

Over the longer term, revenue growth was up 280% in FY21 at $27 million, and operating expenditures (OPEX) also grew 43%. Note that Wisr already covered these figures in its FY21 earnings up date in August.

Wisr also had $55.1 million in unrestricted cash and liquid loan assets at the time of its report to ensure it is well capitalised.

Moving forward, Wisr states that it is set to pass its $1 billion loan book milestone in FY22. New milestones will also be set beyond the $1 billion loan book watermark.

It also wants to deliver 1 million customers to its proprietary platform, and potentially launch new products, thereby “creating new revenue streams and new market opportunities”.

Investors have sold Wisr today and the bears have it for now, with shares trending down 25% in the past 3 months.

The S&P/ASX 200 Financials Index (ASX: XFJ) is also down around 4% this past month, indicating weakness in the broad financial sector.

Wisr share price snapshot

The Wisr share price has gained almost 12% in the past 12 months after rallying over 20% this year to date.

Yet in the past month, it has reversed course and is down 14.5%, and has slipped another 2% in this last week.

The post Wisr (ASX:WZR) share price in hiding after AGM today appeared first on The Motley Fool Australia.

More reading

• Wisr (ASX:WZR) share price slumps 4% despite record quarter

The author has no positions 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 Bruce Jackson.

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Wednesday is proving to be a rough day for the Pinnacle Investment Management Group Ltd (ASX: PNI) share price after the company defrosted its stock this morning.

Pinnacle entered a trading halt yesterday as it underwent a $105 million capital raise. The funds were earmarked to go towards a new acquisition.

Unfortunately, the market reacted poorly to the happenings after the company’s stock was released from its freeze.

At the time of writing, the Pinnacle share price is $16.35, 6.57% lower than it was as of Monday’s close.

Let’s take a closer look at this week’s news from the investment management firm.

Pinnacle share price slides on barrage of news

The Pinnacle share price is suffering despite news the company is acquiring a 25% stake in venture capital and private equity company Fire V Capital.

The investment will cost Pinnacle $65 million. A further $10 million is contingent on a successful second fundraising for Five V’s venture capital strategy.

To cover its cost, the fund has raised $105 million through an institutional placement.

The $30 million remaining after the acquisition will help replenish its balance sheet following its 2019 purchase of 25% of Coolabah Capital Investments.

Under the placement, Pinnacle offered institutional investors the option to purchase Pinnacle shares for $16.70 apiece. That was a 4.6% discount on its share price as of Monday’s close. It was also 7.6% less than its 5-day volume-weighted average price.

Simultaneous to the placement, Pinnacle’s director Adrian Whittingham completed a sell-down of 875,000 Pinnacle shares. The holding was worth approximately $14.6 million at the placement price.

The fund is also planning to undergo a share purchase plan. During the share purchase plan, eligible shareholders will be able to purchase up to $30,000 worth of new Pinnacle shares.

Under the share purchase plan, shares will be offered at the placement price or the 5-day volume-weighted average price of Pinnacle shares up to 15 December, whichever is lower. It will open on 30 November.

As The Motley Fool Australia reported yesterday, Pinnacle also provided the market with an update on its funds under management (FUM) during its trading halt.

As of 31 October, Pinnacle was managing $90.9 billion of funds. Its aggregate affiliate FUM are also more than 30% higher than its average FUM for financial year 2021.

Right now, the Pinnacle share price is 130% higher than it was at the start of 2021.

The post Here’s why the Pinnacle (ASX:PNI) share price is falling 6% on Wednesday appeared first on The Motley Fool Australia.

More reading

• Why is the Pinnacle (ASX:PNI) share price frozen today?

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. owns shares of and has recommended PINNACLE FPO. The Motley Fool Australia owns shares of and has recommended PINNACLE 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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History was made on the ASX recently as the seemingly unbreakable cabal of the big four banks was broken.

On Wednesday afternoon, Macquarie Group Ltd (ASX: MQG) had a market capitalisation of $77.68 billion, eclipsing Australia and New Zealand Banking Group Ltd (ASX: ANZ)’s $76.87 billion.

That means ANZ is now the fifth largest bank while Macquarie takes its seat among the big four.

Australian competition authorities have long held the belief that the four majors — ANZ, Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB) and Commonwealth Bank of Australia (ASX: CBA) — had such unassailable leads in the market that they would never be allowed to merge or even cooperate.

So how did Macquarie sneak in?

Macquarie shares have skyrocketed this year

A major contributor is that Macquarie shares have climbed up almost 50% so far this year. The stock started January at $140 but traded for $204.59 on Wednesday afternoon.

This has much to do with how most of its business is in investment banking rather than retail — and the market thus treats it as a growth stock.

Meanwhile, it’s been many years since ANZ, Westpac, NAB and CBA shares have been considered anything but value (or income) stocks. This is due to their long-established stranglehold in low-margin consumer banking.

To demonstrate, the ANZ share price is lower now than its highs before the global financial crisis 14 years ago. It’s the same case for NAB stock.

Macquarie is having its cake and eating it too

Ironically for regulators, Marcus Today founder Marcus Padley told Livewire recently Macquarie has relatively little competition in the Australian market.

“In the US, the competition amongst the investment banks is savage. You have a choice. But not in Australia.”

But it’s now starting to also eat into the consumer market that the big four have dominated for so long.

“Their recent foray into the domestic mortgage market, the citadel of the big high-street banks, has grabbed market share and hurt their unimaginative competitors,” Padley said.

“I have a Macquarie mortgage. They are so much better to deal with. They have something quite unique in my personal banking experience — something called customer service. There is nothing they cannot do.”

Making the right bets

According to analysts, Macquarie has also done well to invest in infrastructure and businesses that are on the right side of a world moving to net-zero emissions.

“Macquarie is a ‘picks and shovels’ play on decarbonisation,” Fidelity International portfolio manager Kate Howitt told The Motley Fool this month.

“We know that over the next 25 years, the global economy has to spend at least $100 trillion to decarbonise… Macquarie has just been setting itself to be right at the heart of a huge and growing investment pipeline that the world’s got.”

Macquarie is one of Howitt’s 2 largest holdings.

“They have been focusing their recruitment… on scientists, engineers — if they understand the real nuance of how these new and emerging technologies work, then they’ll be better placed to assist on the financing of that,” she said. 

“So that just has a very, very long runway of growth ahead of them.”

The post Macquarie (ASX:MQG) is now a ‘big four’ bank appeared first on The Motley Fool Australia.

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• Macquarie shares are very well placed for the long term: fund manager
• After falling 15% in a month, is the Westpac (ASX:WBC) share price good value?
• Is the CBA (ASX:CBA) share price premium relative to other big banks justified?
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Motley Fool contributor Tony Yoo owns shares of Macquarie Group Limited. 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 Macquarie Group Limited and Westpac Banking Corporation. 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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Shares in resources giant Rio Tinto Limited (ASX: RIO) are struggling to find range today. At the time of writing, the Rio Tinto share price is $94.58, after rallying as high as $95.71 and slipping as low as $94.38 in early trade.

Zooming out, Rio shares are swimming in a sea of red across all time frames, even if prices have just bounced from 3-month lows.

Despite this downtrend, analysts are split on the future direction of Rio Tinto’s share price. Let’s take a closer look.

What’s up with Rio Tinto shares lately?

Rio shares have been drifting lower these past few months. The trend began after the mining giant released its 3rd quarter results.

As advised by Rio at the time, it had another difficult quarter after struggles dealing with the pandemic. Ore shipments were barely afloat, growing just 2% for the 12 months. Much of the headwinds came from weakening iron ore prices across 2021.

As Chinese demand for steel’s main ingredient slowed, the price of iron ore rapidly fell from a high of US$229.50/tonne in May to now trade at US$92.50/tonne – a staggering 60% decline.

The results meant Rio also lowered its target output across major commodities such as iron ore, titanium dioxide, bauxite, aluminium and mined copper.

Investors responded poorly to Rio’s quarterly update and sent its share price backtracking where it hit 52-week lows two weeks ago.

Can the Rio Tinto share price climb to $133?

The team at Macquarie seem to think so. Analysts at the firm recently retained their valuation of $133/share and retained an outperform rating on Rio’s share price.

One factor Macquarie highlights in reasoning is Rio’s recent efforts to bump up its ESG framework. This includes a collaboration with US-based nonprofit, Resolve, to re-purpose mining waste from Rio’s legacy mine sites.

The agreement spawns a company called Regeneration, and Rio has already made an equity investment of $2 million. Macquarie also notes Rio’s $87 million investment to build 16 new posts using AP60 technology in Canada as a positive step towards its ESG credentials.

Aside from this, the broker likes Rio’s free cash flow generation, that was spurred on by record iron ore prices achieved in early 2021.

Meanwhile, Citi believes it’s time to revisit the valuations of iron ore shares, especially with Chinese monetary policy and political risks softening. The broker says “with the recent share price corrections, we see value across the Australian iron-ore sector”.

JP Morgan thinks there is “still plenty of valuation support and free cash flow yield in the space” as well, and forecasts a 10% free cash flow yield in fiscal 2022 for Rio. The broker reckons that other commodities, such as coal and copper, will also jump in to offset iron ore weakness.

Or could Rio Tinto fall to $87?

Whilst the teams at these leading brokers are heavily bullish on its direction, others aren’t as optimistic. The team at Jefferies disagree on the valuation front and are cautious on the entire metals/mining space.

It reckons that ASX iron ore shares still aren’t cheap – even with the large pullbacks of late. As such, it retains a hold rating and a $100 share price target.

Investment bank Morgan Stanley also cautioned investors on Rio’s situation in a note released to clients today. It reckons that Rio will take a hit if the Mongolian government gets its way from talks on the Oyu Tolgoi project.

Basically, the Mongolian government wants Rio to cover additional costs and cancel the debt on its 34% share of the Oyu Tolgoi project.

Oyu Tolgoi, in the South Gobi region of Mongolia, is one of the largest known copper and gold deposits in the world, according to Rio. When the underground is complete, it will be the world’s fourth largest copper mine. Rio owns the remaining 66% of Oyu Tolgoi through a company vehicle, Turquoise Hill Resources.

The broker estimates the accumulative burden for Rio to be $700 million if Mongolia’s debt is waived and another $700 million to cover the government’s share of costs if it goes ahead.

Morgan Stanley has a $101 price target on the Rio Tinto share price which it updated yesterday after staying equal weight on its rating.

The lowest price target on the list of analysts covering Rio Tinto is $87 from RBC Capital Markets, whereas Evans and Partners reckon that shares can hit $146. As such, the spread between all valuations is around 68% or $59 per share.

In the past 12 months, the Rio Tinto share price has fallen over 8.5% after sliding another 17% this year to date.

The post Here’s why Macquarie sees 39% upside in the Rio Tinto (ASX:RIO) share price appeared first on The Motley Fool Australia.

More reading

• Only a few ASX 200 companies have received this honour and Scentre (ASX:SCG) just joined them
• Why this mining analyst is upbeat on the iron ore price forecast
• Fortescue’s push to axe diesel subsidies could cost ASX miners billions
• Why has the Rio Tinto (ASX:RIO) share price fallen in a hole over the past month?
• Top brokers name 3 ASX shares to buy next week

The author Zach Bristow has no positions 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 Bruce Jackson.

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The Serko Ltd (ASX: SKO) share price isn’t going anywhere today following the release of the company’s FY22 half-year results.

The online travel booking and expense management provider’s shares are frozen at $7.42 apiece.

Serko share price on ice following mixed performance for H1 FY22

The Serko share price is in a trading halt after the company delivered its half-year FY22 results for the 6 months ending 30 September 2021. Here are some of the key financial highlights for the period:

• Total operating revenue of $9.2 million, up 81% on the prior corresponding period (H1 FY21 $5.1 million)
• Earnings before interest, tax, depreciation and amortisation (EBITDA) loss of $11.8 million, up 76% (H1 FY21 $6.7 million loss)
• Underlying net loss after tax (NPAT) of $15.2 million, up 50% (H1 FY21 $10.1 million loss)

What happened to Serko in H1 FY22?

Serko reported a challenging first half of the year, tempered by the impact of COVID-19 on other markets. In addition, the strict lockdowns experienced during the second quarter affected its performance in New Zealand and Australia.

Total travel bookings rose on Serko’s platform to 1.3 million, up 157% from the same period a year ago. The segment was more heavily weighted towards the first quarter, lifted by more limited lockdowns in both counties.

While travel gradually began to recover, the proportion of travel platform versus expense management revenue changed compared to FY21. This resulted in a lower average revenue per booking of $7.38 compared to $8.76 during the full-year FY21.

EBITDA losses amplified, reflecting a slow return to travel globally, combined with an increase in investment in the Serko platform.

The company ended the first half with cash and short-term deposits of $62.3 million, down on the $79.9 million at 31 March 2021. The cash burn over the 6-month period averaged $2.9 million per month. Management continued to prudently conserve cash, whilst balancing investing for revenue-generating opportunities.

What did management say?

Serko CEO and co-founder Darrin Grafton commented on the result:

We are poised for growth out of this pandemic and the investment to date has proven our ability to grow from a regional leader to a truly global player. Our focus is now on scaling the business to activate the opportunities we have ahead of us.

We continue to advance our vision of the ‘connected trip’ with enhancements to our product and the addition of new content. These include tools that allow businesses to deliver on their sustainability commitments and better discharge the duty of care they owe to their travellers, such as informing them of COVID-19 protection measures.

What’s next for Serko in H2 FY22?

Looking ahead, Serko is confident that business travel will return over time. It believes that the target of reaching $100 million in revenue in the mid-term remains achievable.

However, the disruptions to global business travel arising from the pandemic and other factors continue to delay the timing.

Serko anticipates full-year revenue and other income of between $21 million and $25 million. This outlook assumes a general reduction of domestic travel restrictions within Australia and New Zealand and no significant lockdowns in Europe or North America.

Serko launches capital raise

In addition to the results announcement, Serko advised it has launched a NZ$85 million (A$81.47 million) equity raise.

The company plans to undertake a NZ$75 million (A$71.89 million) fully-underwritten placement, and a NZ$10 million (A$9.59 million) non-underwritten retail offer.

The offer price is NZ$7.05 (A$6.76) per share, representing a 10.2% discount to the last closing price on 23 November.

Proceeds from the equity raise will go toward a number of activities. These include investing for growth with Booking.com for Business, developing global marketplace strategy, and accelerating global expansion opportunities.

Adding to his previous comments, Mr Grafton said:

Despite the ongoing impacts of the COVID-19 pandemic on the travel industry, Serko has continued to maintain a strong market position in Australasia, invest in the Booking.com for Business global opportunity and increase market presence in North America. Serko is now poised to enter the next phase of growth – to scale up and progress our long-term strategy of becoming a global business travel marketplace.

The post Serko (ASX:SKO) share price halted amid H1 FY22 results and cap raise appeared first on The Motley Fool Australia.

More reading

• 3 exciting small cap ASX shares for your watchlist

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. owns shares of and has recommended Serko Ltd. The Motley Fool Australia has recommended Serko 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 Envirosuite Ltd (ASX: EVS) share price is among the green league on Wednesday.

In afternoon trade, the environmental management software providers’ shares are up 4.65% to 22.5 cents. The company’s share price is now just shy of its 52-week high of 24.5 cents.

Why is the Envirosuite share price climbing higher today?

Market participants are bidding up the Envirosuite share price today following the release of a strategic agreement announcement.

According to its announcement, Envirosuite has entered into two strategic agreements with the consulting group GHD. These agreements with the Australian consulting firm involve the use of Envirosuite’s EVS Water software. Specifically, the agreements with GHD for the water software is to:

• Implement and scale the solution for water facilities
• Leverage GHD’s global network to refer EVS Water to prospective clients

The development marks a new phase in the company’s rollout of its water-focused environmental software solution.

This software allows clients to create a digital twin of water treatment plants, powered by machine learning and deterministic modelling.

Through partnering with a large company such as GHD, with 200 offices across five continents, Envirosuite aims to grab a large hold of the water market. The referral program will focus on drinking water, desalination, and industrial water treatment industries. This potential increased market reach appears to be aiding the Envirosuite share price today.

Currently, the consulting firm uses EVS Water for water treatment and desalination plants across the Asia-Pacific region. Following the agreements, GHD will provide technical support for EVS Water products and offer product improvements. Additionally, the consultant will assist in configuring digital twins for EVS Water projects.

What does it means for revenue?

Envirosuite expects that the revenue from these two agreements will not be material to the group FY22 revenue. However, it is anticipated to be material to the revenue of the EVS Water segment. This is possibly due to the relatively small base from which the water product is starting.

In Q1, the company recorded $0.1 million in annual recurring revenue (ARR) from the water product. For context, this made up only 7% of ARR for the group.

Finally, the Envirosuite share price is up 24% since the beginning of the year.

The post Envirosuite (ASX:EVS) share price jumps 5% on strategic splash with GHD appeared first on The Motley Fool Australia.

More reading

• This deal just caused the Envirosuite (ASX:EVS) share price to pop

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 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.

The auto industry is clearly shifting toward electricity, with every major automaker pushing hard in the electric vehicle (EV) space. However, it was Tesla (NASDAQ: TSLA) that really got the ball rolling on this front, and investors have clearly noticed.

Here’s a trio of reasons why investors might want to put some money to work in Tesla’s shares, and one important reason why you might not want to. In fact, if you have profits in the stock, it might even be a good reason to consider locking in at least some of your gains.

1. Tesla is hyper-focused on the clean energy transition

Tesla is, basically, the leading pure-play electric vehicle maker. There are others in the niche, but Tesla has long been the name to beat. And at this point, it is actually turning a profit, with positive earnings in each of the last five quarters. For many years the company basically just bled red ink. However, it has turned an important corner even though it only sold 240,000 or so cars in the third quarter. For reference, Ford (NYSE: F) sold more than four times as many cars in the quarter. So Tesla remains a small fry, but that’s just fine if it’s making money.

The key difference is that Ford and its peers are largely trying to balance the shift from gasoline to electricity. Tesla doesn’t need to do that. In addition to cars, meanwhile, Tesla also has its hand in solar power and battery technology. So there are more avenues for growth as renewable power technology comes to the masses, and it has a very loyal customer base it can sell other products to. So it looks like Tesla could eventually be a much broader play on the clean energy space for those with an ESG bent.

2. Tesla has visionary leadership

Tesla is the brainchild of CEO Elon Musk. He’s sometimes compared to Tony Stark from the Iron Man comic series, which is a way to suggest that he’s a wealthy genius do-gooder. That characterization is debatable, since he has a team of experts that help him actually make electric cars and the technology behind them — but what is very clear is that he knows how to promote the company he runs. And what he has created is quite impressive. While he has a habit of pushing the promotional envelope at times, that’s been a net positive so far, and there’s no reason to expect this to change. In fact, many investors own the stock partly because of Elon Musk. 

3. Tesla has plenty of growth opportunity

A hyper-focus on a growing industry niche with a visionary leader at the helm. There’s a lot to like in that description. However, what’s really interesting here is that, assuming Tesla can maintain its industry cachet, there’s a lot of room for it to gain ground on older competitors that simply don’t have the same image. Go back to the sales numbers in point No. 1 that noted Tesla’s sales are at less than a quarter of what Ford sold. And Ford is just one of many large global auto companies from which Tesla can steal market share by being cooler and hipper. For example, General Motors (NYSE: GM) sold 1.3 million or so cars in the third quarter. Yes, both are looking to grow their EV businesses, but their dominance of the gasoline-powered vehicle market doesn’t necessarily give them an advantage in the EV space, where Tesla’s brand is often top of mind. Indeed, the EV playing field is much more level, and Tesla has already proven it can compete effectively with the industry’s biggest automakers. 

TSLA Market Cap data by YCharts

Time to lock in some gains?

The big problem with Tesla, and one that investors should really think about closely, is valuation. There is a number of ways to look at this, but the one that is probably the most shocking is market cap. Tesla’s market cap is roughly $1.1 trillion, compared to Ford’s $77 billion and General Motors’ $89 billion. That’s shocking because, going back to the sales numbers above, Tesla sold less than a quarter of the cars that Ford or GM sold in the third quarter. How could it possibly be worth more than 10 times as much as each of those two companies? Even with all the opportunities it has for growth in the years ahead, a lot of good news is clearly being priced into Tesla’s stock today. 

Investors who have ridden the stock up should probably think about taking some money off the table. In fact, in the past year alone the stock price has doubled. And that includes the recent volatility surrounding Elon Musk’s stock sales. This isn’t to suggest that you have to sell every share you own, but prudence hints that locking in some gains makes sense. Perhaps you can use the cash to add some diversification to your portfolio, which may be a little extra heavy on Tesla given its huge 1,200% gain since January of 2020.

Act before the situation changes

Nothing lasts forever, and Tesla’s massive market cap relative to its peers is likely to reverse at some point. The company may make great EVs, but it hardly owns the EV market. And that will likely lead to an eventual revaluation of the stock. Since it’s impossible to predict when that will happen, long-term investors should act now while they still have big stock gains. Locking in some of that profit may sting if the stock keeps going up, but it is the logical move for most investors given the very real risk that Wall Street is pricing in way too much good news. And that remains true even with all of the positive attributes Tesla has.

And if you haven’t bought Tesla yet, well, it might be best to leave it on your wish list for now if you have even the slightest value bias. 

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

The post 3 reasons to buy Tesla stock, and 1 reason to sell appeared first on The Motley Fool Australia.

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Reuben Gregg Brewer 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 Bruce Jackson.

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/3CMi8nv