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ASX tech share COSOL Ltd (ASX: COS) is dropping lower in early trade as the company begins to trade ex-dividend.

This ASX tech share is going ex-dividend today

The ex-dividend date is the last day that investors can purchase a company’s shares and still receive the next dividend payment. Normally, the ex-dividend date is one or two days before the record date, which is when shareholders must be on the register to receive the payment.

COSOL is an ASX tech share that specialises in enterprise asset management software. The company is an Aussie small cap with a market capitalisation of just under $100 million.

The COSOL share price has dropped 1.5% at the time of writing to $0.65 per share. That represents a drop of 1 cent per share since yesterday’s close.

COSOL announced a 1 cent per share fully franked dividend in its full-year results release in August. That came on the back of a strong earnings year highlighted by a 51% revenue growth and net profit up 39% year on year to $3.99 million.

The ASX tech share has struggled throughout 2021 even as company performance has strengthened. Shares in the Aussie tech group are down 16.7% year to date at the time of writing and trading at a 3.08% dividend yield.

It’s no coincidence, however, that the company’s shares have dropped by the same amount as its soon-to-be paid dividend. That’s how things tend to happen on the ex-dividend date to remove any arbitrage opportunities.

Foolish takeaway

The COSOL share price is falling lower this morning as the ASX tech share trades ex-dividend ahead of its 1 cent per share distribution.

The post This ASX tech share is going ex-dividend today appeared first on The Motley Fool Australia.

More reading

• Here’s why the Gascoyne (ASX:GCY) share price is rocketing 23% today
• Why is the Lynas (ASX:LYC) share price so volatile?
• ASX 200 (ASX:XJO) midday update: Zip shares rise on Microsoft deal, big four banks rebound
• 3 ASX 200 shares down more than 50% in 2021
• Why the Metalstech (ASX:MTC) share price hit a record high today

Motley Fool contributor Ken Hall 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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The Gascoyne Resources Ltd (ASX: GCY) share price is surging today, up 22.6% at time of writing, to 38 cents per share.

The All Ordinaries Index (ASX: XAO), for context, is up a more modest 0.9% at this same time.

Below we look at the takeover offer that appears to be driving investor interest in the ASX gold explorer.

What takeover offer is in the making?

The Gascoyne share price is rocketing after the company reported that Westgold Resources Ltd (ASX: WGX) has announced its intentions for an unsolicited and conditional off-market takeover offer for all of Gascoyne’s shares.

Westgold has proposed to offer 1 of its shares for every 4 Gascoyne shares.

At time of writing the Westgold share price is down 0.9% to $1.64 per share. At that level, the offer values the Gascoyne share price at 41 cents per share, some 8% below where it’s trading today.

According to the ASX release by Westgold, its offer will allow Gascoyne shareholders to keep their exposure to the gold explorer’s assets, while becoming part of a bigger and better funded group “which is already the dominant gold producer in the region”.

Aside from shareholder approval and the other standard conditions, Westgold’s takeover offer is contingent on the merger between Gascoyne and junior explorer Firefly Resources Ltd (ASX: FFR) not going forward. The Firefly share price is down 18%.

Commenting on the takeover offer, Westgold’s executive director, Wayne Bramwell said:

The Independent Technical Assessment and Valuation Report in the proposed Firefly Scheme sees Gascoyne merge with a junior explorer offering all the risks associated with early-stage exploration assets…

The Westgold announced intention to bid provides a clear and logical alternative that reduces uncertainty and risk around the longevity of the Dalgaranga mine, the future of Mt Egerton and Glenburgh and the ongoing funding risks to Gascoyne shareholders.

The combination of Westgold and Gascoyne is strategic and value accretive for both groups as we believe the regional integration of mining, processing infrastructure, exploration assets and people can rapidly expand production capacity…

Gascoyne’s Board recommended that shareholders take no action at this time. The Board said it will inform shareholders of further developments as they occur.

Gascoyne share price snapshot

Despite today’s big lift, the Gascoyne share price remains down 21% year-to-date. The All Ords, by comparison, is up 9% so far in 2021.

Over the past month Gascoyne shares have gained 16%.

The post Here’s why the Gascoyne (ASX:GCY) share price is rocketing 23% today appeared first on The Motley Fool Australia.

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• ASX quarterly rebalance: A2 Milk dumped from ASX 50, Nuix kicked out of ASX 200

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 Lynas Rare Earths Ltd (ASX: LYC) share price has been on a rollercoaster ride recently.

Shares in the rare earths miner are trading within an extremely wide range of late.

Let’s take a closer look at why the Lynas share price is so volatile.  

What’s been happening with the Lynas share price?

Shares in Lynas have been all over the place in September. Since the start of the month, the company’s share price has soared by as much as 17% to hit a high of $8.05 on 16 September.

Today, shares in Lynas are trading at $6.65, which is 3.4% lower for the month. Given the company did not release any price-sensitive news during September, this price action reflects just how volatile the Lynas share price is.

Why is the price so volatile?

Lynas is a producer of rare earths metals, which are an essential component of the functioning of our modern-day lives.

As a result, Lynas is essentially a resources company that relies on the production and sale of commodities.

Since commodities are dictated by their own spot prices, Lynas is therefore considered a ‘price taker’. That means its share price is at the mercy of the ebb and flow of the individual spot prices of rare earths metals.

Recently, weakness in the Lynas share price has been driven by weakness in commodity prices.

Commodites have felt the pain following concerns over the Chinese economy. The neodymium price, in particular, has been a poor performer putting pressure on the Lynas share price.

More on the Lynas share price

Although shares in Lynas have suffered this month, they are 59% higher year to date.

Bullish sentiment towards the rare earths miner was reflected in the company’s full-year results in late August. Lynas revealed a record result, highlighted by a 60% increase in revenue to $489 million.

Other highlights of the company’s full-year report include:

• Net profit after tax (NPAT) of $157.1 million compared to a loss of $19.4 million the previous year
• Earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $235.3 million, up from $59.7 million in FY20
• Cash and cash equivalents as at 30 June of $680.8 million compared to $101.7 million in the prior year

Over the past five years, Lynas shares have risen by 1,130%.

The post Why is the Lynas (ASX:LYC) share price so volatile? appeared first on The Motley Fool Australia.

More reading

• These were the worst performers on the ASX 200 last week
• It’s been a terrible week for the Lynas (ASX:LYC) share price. Here’s why
• Why the Lynas (ASX:LYC)share price is sliding 12% on Monday
• Why the Lynas (ASX:LYC) share price is up 86% in 2021
• Here are the top 10 ASX shares today

Motley Fool contributor Nikhil Gangaram 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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At lunch on Thursday the S&P/ASX 200 Index (ASX: XJO) is back on form and charging higher. The benchmark index is currently up 1.4% to 7,298.9 points.

Here’s what is happening on the ASX 200 today:

Zip shares rise on Microsoft deal

The Zip Co Ltd (ASX: Z1P) share price is pushing higher today after it announced a deal with tech giant Microsoft. This agreement will see the integration of Zip’s technology into the shopping experiences within the Microsoft Edge web browser. This will allow shoppers using the web browser to use a digital payment option provided by Zip.

South32 acquisition

Also rising today is the South32 Ltd (ASX: S32) share price. This follows news that it has acquired an additional 25% shareholding in Mozal Aluminium in Mozambique from MCA Metals. South32 has exercised its pre-emptive rights to acquire the additional stake for US$250 million. This brings its ownership of the smelter up to 72.1%.

Big four banks rise

Investors have been flooding back into the banking sector on Thursday. This has helped drive the big four banks notably higher. The best performer in the group has been the Westpac Banking Corp (ASX: WBC) share price with a 3% gain. The laggard in the group is the Commonwealth Bank of Australia (ASX: CBA) share price with a 1.2% gain.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Thursday by some distance is the Orica Ltd (ASX: ORI) share price with a gain of 15%. This morning Morgans upgraded its shares to an add rating with a $13.70 price target. The worst performer has been the Pinnacle Investment Management Group Ltd (ASX: PNI) share price with a 2.5% decline on no news.

The post ASX 200 (ASX:XJO) midday update: Zip shares rise on Microsoft deal, big four banks rebound appeared first on The Motley Fool Australia.

More reading

• Zip (ASX:Z1P) share price jumps on Microsoft integration agreement
• Why the South32 (ASX: S32) share price is on watch today
• The ASX 200 banks may be in danger as half of mortgage-stressed households have “borrowed to the hilt”
• Top broker sees 19% upside for the Westpac (ASX:WBC) share price
• These 2 ASX shares have been rated as buys by leading brokers

Motley Fool contributor James Mickleboro owns shares of Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended PINNACLE FPO and ZIPCOLTD 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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It’s been a pretty good year for ASX 200 shares. The S&P/ASX 200 Index (ASX: XJO) has gained 7.7% to close at 7,196.70 points on Wednesday afternoon.

However, it hasn’t been all good news across the index. In fact, here are 3 companies that have shed more than 50% of their value so far in 2021.

3 ASX 200 shares down more than 50% in 2021

1. Appen Ltd (ASX: APX)

One of the most surprising companies to make this coveted ASX 200 shares loser list. Appen shareholders have watched as more than 65% of the company’s value has dropped away this year.

Shares in the data annotation company are now sitting at a 3-year low, having hit as low as $8.87 per share on Wednesday. One factor that has hurt Appen is the significant price run-up seen throughout 2020.

A pullback in growth shares amid rising bond yields has hurt the Appen share price. A disappointing FY21 earnings result, highlighted by a 55.1% drop in net profit after tax, hasn’t helped the ASX 200 share in 2021.

2. Polynovo Ltd (ASX: PNV)

Another former ASX growth darling has made the list. The Polynovo share price has been smashed in 2021, falling 51.8% as at Wednesday’s close. That’s despite limited price-sensitive news from the Aussie company.

However, it appears that Polynovo may be falling for similar reasons to Appen – its recent share price growth has been significant. In fact, from 30 September 2020 to the end of last year, the ASX 200 rocketed 80% higher.

This year’s pullback saw the Polynovo share price shed 30% in January alone after a sharp decline in first half sales from the Aussie biotech company. That downward trajectory has continued with the ASX 200 share’s value continuing to decline.

3. AGL Energy Limited (ASX: AGL)

AGL may be a surprising addition to the list of share price decliners amongst two ASX growth shares. However, shares in the Aussie energy generator and retailer have slumped 51.6% lower since the start of the year.

2021 has been a tough year for AGL investors. A weak FY2021 result, highlighted by a statutory loss north of $2 billion, certainly hasn’t helped boost sentiment.

Management has pointed the finger at the COVID-19 pandemic with increased supply coupled with weaker energy demand hurting the company’s earnings.

The post 3 ASX 200 shares down more than 50% in 2021 appeared first on The Motley Fool Australia.

More reading

• How have the WAAAX shares performed so far this year?
• Why these 3 ASX shares all hit 52-week lows today
• The Appen (ASX:APX) share price just hit a 3-year low. Here’s why
• Why has the Polynovo (ASX:PNV) share price tanked 15% in 3 weeks?
• Why is the AGL (ASX:AGL) share price down almost 4% on Tuesday?

Motley Fool contributor Ken Hall 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 Appen Ltd and POLYNOVO FPO. The Motley Fool Australia owns shares of and has recommended Appen 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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Gold hasn’t totally lost its lustre as the surging Metalstech Ltd (ASX: MTC) share price demonstrated this morning.

Shares in the gold explorer rallied 15% to an all time high of $0.65 at the time of writing. Its outperformance stands in contrast to other ASX gold shares too.

The Newcrest Mining Ltd (ASX: NCM) share price sunk 0.5% to $22.52, St Barbara Ltd (ASX: SBM) share price slipped 0.6% to $1.35 and Northern Star Resources Ltd (ASX: NST) share price gave up 1.1% to $8.41.

Metalstech share price defies falling gold price

The weakening gold price is weighing, but that’s not enough to keep the Metalstech share price down.

Management excited the market after it reported “excellent” results from its first drill hole of its phase 2 program.

Metalstech reported that it struck a thick, continuous, mineralised zone of 45m @ 2.65 grams per tonne (g/t) of gold. It also hit 10.4 g/t of silver from 52m.

Additionally, it struck 35m @ 3.31 g/t of gold from 60m. This included 19m @ 5.08 g/t of gold and 12.9 g/t of silver from 67m.

Caveat to the good results

These results from UGA-17 offers “strong confidence” to the mineralised zone interpretation at the southern margin of the Sturec Mineral Resource, according to Metalstech.

The results from UGA-18 are pending but management has high hopes. It reported visible gold at 81.35m downhole and the lab results are expected within days.

However, the bullish announcement comes with a disclaimer. The intersections are not the true thickness as the drill hole was drilled at an acute angle to the mineralised zone.

This is due to location of the underground drill site relative to the target zone. More drilling is necessary to get an accurate picture.

Hopes building for more good news

But this isn’t dampening the excitement of the Metalstech share price or management.

“Its [sic] great to we have hit nice thick mineralisation with excellent gold grade right out of the gate on this program,” said Metalstech chairman Russell Moran.

“The next hole looks fantastic based on the visible gold seen in cut core and we look forward to reporting on that in a couple of days when assays come in.”

The Sturec Gold Mine is 100% owned by Metalstech and is located in Slovakia. The explorer has competed two diamond drilling programs to date.

How the Metalstech share price compares to other ASX gold shares

The Metalstech share price has surged by over 270% over the past year. That stands in contrast with the bigger ASX gold shares, which have slumped into bear territory over the period.

This is because the gold price has retreated since hitting a record high over US$2,000 an ounce. The outlook for gold isn’t bright either as with withdrawal of QE and rising global interest rates have dampened the outlook for the commodity.

The post Why the Metalstech (ASX:MTC) share price hit a record high today appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Why Sigma, Smartgroup, St Barbara, & Touch Ventures are pushing higher
• Which ASX 300 shares are leading the way mid-week?
• ASX 200 (ASX:XJO) midday update: Big four banks fall, Afterpay tumbles
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor Brendon Lau owns shares of Newcrest Mining 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 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 Afterpay Ltd (ASX: APT) share price is lagging behind its peers on Thursday, up just 0.25% to $122.24.

Zip Co Ltd (ASX: Z1P) shares are currently topping the BNPL leaderboard, up 3.01% to $7.18 following its new agreement with US-tech behemoth Microsoft Corporation (NASDAQ: MSFT).

Players on the small end of town are also eking out gains ahead of the Afterpay share price.

Splitit Ltd (ASX: SPT), Openpay Group Ltd (ASX: OPY) and Laybuy Holdings Ltd (ASX: LBY) are bouncing slightly higher after yesterday’s tech-heavy selloff, up 1.16%, 0.75% and 0.97% respectively.

Why the Afterpay share price is flat today

The US market is likely to blame for the underperformance of Afterpay shares.

Tech shares on Wall Street struggled to bounce back on Wednesday night with the Nasdaq Composite down 0.24% compared to the S&P 500 and Dow Jones Industrial Average which finished the session up 0.16% and 0.26% respectively.

US-listed BNPL rival Affirm Holdings Inc (NASDAQ: AFRM) opened 4.75% higher but faded towards market close, down 1.53% by the closing bell.

More importantly, the Square Inc (NYSE: SQ) share price tumbled 2.74% to a 2-month low of US$236.04.

The Afterpay share price has closely tracked the performance of Square Inc ever since the US payments company came forth with a $39 billion all-scrip takeover offer.

On the record date of Square’s takeover offer, Afterpay shareholders can expect to receive a fixed exchange ratio of 0.375 Square shares for each Afterpay share they own.

After last night’s performance and converting the figures back into Australian dollars, this would theoretically value the Afterpay share price at $123.09.

By comparison, the Square share price closed at $242.70 on Tuesday night which implies a theoretical value of $125.99.

With the transaction expected to close in the first quarter of calendar year 2022, the Square share price will likely continue to play a major role in how Afterpay shares perform.

The post Why is the Afterpay (ASX:APT) share price trailing Zip on Thursday appeared first on The Motley Fool Australia.

More reading

• How have the WAAAX shares performed so far this year?
• Why Afterpay, Mineral Resources, Pilbara Minerals, & Pro Medicus shares are falling
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• ASX 200 (ASX:XJO) midday update: Big four banks fall, Afterpay tumbles
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Motley Fool contributor Kerry Sun 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 AFTERPAY T FPO, Affirm Holdings, Inc., Square, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Fortescue Metals Group Limited (ASX: FMG) share price has been hammered by investors over the past 2 months. This comes as the mining company is facing a challenging year as the spot price of iron ore drops.

In early trading on Thursday, the Fortescue share price is up 1.69% to $15.05. Shareholders are feeling the pain of a 39.6% drop in just 2 months. The shares closed at $24.91 on 30 July.

Fortescue is now trading at levels not seen since July 2020.

What’s dragging Fortescue shares lower?

It’s no secret that the falling iron ore price has impacted Fortescue and other miners alike. The steel-making ingredient is fetching US$119.89 a tonne, plunging a mammoth 44% in just 2 months.

The Fortescue share price has mimicked the price of iron ore, sinking almost 40% over the same period. The two are strongly aligned as the company is primarily focused on mining and exporting iron ore to overseas markets.

At the same time, Fortescue’s biggest customer, China has chosen to reduce its reliance on Australian resources, affecting demand on iron ore. This has led to a bearish outlook for the commodity to reach about US$91 a tonne in 2022, according to Bank of America.

Nonetheless, Fortescue will still be churning out profits as it boasts one of the lowest iron ore costs in the world. The Pilbara producer is mining, processing and exporting iron ore at roughly AU$40 per tonne (US$29). That still represents a sizeable margin for the company.

In addition, the broader market weakness has also hindered the Fortescue share price. The S&P/ASX 200 Index (ASX: XJO) is down 3.24% in the past month, and 4.46% off its record high of 7,632.8 points.

At the time of writing, the benchmark index is 7,292 points.

Fortescue share price snapshot

Up until the end of July, Fortescue shareholders were enjoying strong gains. The share price hit an all-time high of $26.58.

That all came crashing down in August and September, with its shares touching as low as $14.15 on 20 September.

On valuation grounds, Fortescue commands a market capitalisation of roughly $46.3 billion. It has approximately 3.1 billion shares on issue.

The post Fortescue (ASX:FMG) share price tumbles 40% in 2 months. What happened? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Fortescue (ASX:FMG) share price eyes fresh 14-month lows as iron ore prices tumble
• How China’s energy crisis could be good for BHP (ASX:BHP) and Rio Tinto (ASX:RIO)
• 2 hot ASX growth shares that this income fund manager favours
• Why the Fortescue (ASX:FMG) share price is down 5% today

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 Bruce Jackson.

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Shares in Chalice Mining Ltd (ASX: CHN) are sinking this morning after an initial lift at the open.

At the time of writing, the Chalice share price is down 2.38% trading at $6.15 apiece.

Below we take a look at the ASX resource producer’s demerger and initial public offering (IPO) announcement.

What spin-out did Chalice announce?

Chalice Mining’s share price is sliding after the company confirmed it was going forward with the demerger and IPO of its Australian gold assets. Namely its Pyramid Hill Gold Project in Victoria, along with its Viking Gold Project and Mt Jackson Gold Project, both located in Western Australia.

The proposed spinout, still subject to final board, regulatory and shareholder approvals, would see the rise of a new ASX-listed gold explorer, to be called Falcon Metals Limited with the proposed ticker ASX: FAL.

Chalice intends to launch Falcon Metals complete with an experienced board and management team. According to the release that includes “one of most decorated explorers in Australia”, Mark Bennett, who has been appointed non-executive chair.

Chalice advised it expected eligible shareholders would gain 1 Falcon share for every 3 Chalice shares held (1-for-3) via an in-specie distribution.

Atop the demerger, there will be a concurrent IPO. Falcon will raise between $15–30 million under a pro-rata priority offer to Chalice shareholders.

Company commentary

Chalice described the demerger of its gold assets as “the optimal structure to maximise value for our shareholders”. The company said it could then focus on its Julimar Ni-Cu-PGE Project and the new West Yilgarn Ni-Cu-PGE Project in Western Australia.

Commenting on the demerger, Chalice CEO Alex Dorsch said:

This will result in the establishment of a significant new, well-funded ASX-listed gold explorer with a high-quality portfolio spanning some of Australia’s most highly-endowed gold provinces.

Importantly, Chalice shareholders will retain exposure to these assets via an in-specie distribution of shares in Falcon Metals on a 1-for-3 basis. I think this is a great result for our shareholders…

If approved, the company expects the demerger to be completed in late 2021.

Chalice Mining share price snapshot

The Chalice Mining share price has been a stellar performer over the past 12 months, gaining 137%. By comparison, the S&P/ASX 200 Index (ASX: XJO) is up 25% over that same time.

Chalice Mining’s shares have struggled recently, however, down 12% over the past month.

The post Chalice Mining (ASX:CHN) share price falls on demerger announcement appeared first on The Motley Fool Australia.

More reading

• Why is the Chalice Mining (CHN) share price plunging on Friday?
• Why ASX 200 gold shares are sinking on Friday
• Here are the top 10 ASX shares today
• Which ASX shares are leading the way on the ASX 300?
• Which ASX shares are the top movers in the ASX 300 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 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 MGC Pharmaceuticals Ltd (ASX: MXC) share price is clicking higher on Thursday and is currently trading at 6.1 cents.

MGC shares are lifting after the company announced updates to its new production and supply agreement out of the United States.

For context, the S&P/ASX Health Care Index (ASX: XHJ) is currently only 0.5% higher so far today.

Here’s what we know.

MGC Pharmaceuticals share price jumps after initial order placed

The MGC Pharmaceuticals share price is surging 5.17% after the company advised its distribution partner, AMC Holdings Inc, has placed an initial order of 1,000 units for the company’s CimetrA label.

The order is “on an expedited basis, in order to fast track the approval process for the medication to be distributed and sold” throughout the US.

AMC will ship the units to a pharmacy where they “will then be analysed in order to make comparisons with MGC Pharma’s research lab in Slovenia”.

This process is the first step in materialising the US Supply Agreement signed by MGC and AMC last month. Both parties are working towards starting clinical trials and meeting supply milestones in the US for CimetrA.

CimetrA is MCG’s lead drug candidate, designed to treat viral infections that produce inflammatory complications.

These complications include heart inflammation, breathing difficulties, loss of consciousness and even death.

COVID-19 falls under this umbrella, and the company began enrolments in July for a Phase 3 trial to treat COVID patients admitted to hospital using CimetrA.

Today’s release notes that AMC is now working closely with the University of Florida on the “immediate submission of CimetrA to [the University’s] internal review board” due to surges in US COVID-19 case numbers.

Aside from this, MGC is working closely with its partners to commercialise its adjacent drug labels, CannEpil and CogniCann, as per the announcement.

Investors appear to have bought on the news, and are pushing the MGC Pharmaceuticals share price higher in midday trading.

What did management say?

Speaking on the announcement, MGC Pharma CEO Roby Zomer, said:

AMC are already making significant progress in propelling CimetrA, CannEpil® and CogniCann® to Clinical Trial stage in the US and we are pleased that they have cemented relationships with these prestigious institutions for the continued research into our products.

MGC Pharmaceuticals share price snapshot

The MGC Pharmaceuticals share price has rallied by around 144% this year to date and climbed by almost 9% this past month.

Over the last 12 months, MGC Pharma shareholders have enjoyed a return of 165%, ahead of the S&P/ASX 200 index (ASX: XJO)’s gain of about 25% in this time.

The post Why the MGC Pharmaceuticals (ASX:MXC) share price is leaping 5% appeared first on The Motley Fool Australia.

More reading

• What’s going wrong for ASX cannabis shares lately?
• MGC Pharma (ASX:MXC) share price jumps 11% on UK approval

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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