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AMP Ltd (ASX: AMP) shares were struggling on Wednesday. The AMP share price did manage to spend some time in the green but finished the day flat at $1.12. By comparison, the S&P/ASX 200 Index (ASX: XJO) managed to eke out a small gain, closing the day 0.31% higher.

This came following reports AMP Capital will trim its management fees in its Community Infrastructure Fund (CommIF).

Let’s take a closer look at what’s been happening for the embattled financial services company lately.

What went down today?

AMP is currently unwinding AMP Capital’s assets and spinning off its infrastructure and property divisions.

Recently, it confirmed the sale of AMP Capital Global Equities and Fixed Income (GEFI) to Macquarie Group Ltd (ASX: MQG) on 8 July.

Today, AMP Capital stated to investors that its management fees will receive a haircut of up to 32%, according to reports from the Australian Financial Review.

Under the new schedule, from 1 August, management fees will drop to 80 basis points.

This number further reduces to 70 basis points if the fund surpasses $2 billion in assets.

AMP Capital also highlighted two new additions to its investment committee to beef up governance.

It seems investors weren’t quite sure how to take the news, judging by the performance of the AMP share price today.

The battle for AMP Capital continues

The moves come as the company is seeking to hold onto its CommIF fund, which currently has three separate takeover offers. Dexus Property Group (ASX: DXS), Morrison & Co and Palisade Investment Partners have all made separate bids.

These proposals effectively match the fee schedule set in an already proposed takeover that went south back in April.

In a letter to shareholders on Tuesday, AMP co-head of infrastructure Michael Bessel said:

We have reviewed the existing management and service arrangements for CommIF and determined to offer a compelling proposal which includes reduced fees and enhanced governance of the fund.

The saga for AMP Capital continues and there will likely be further events unfolding in the days and weeks to come.

AMP share price snapshot

The AMP share price has had a choppy year to date, having slipped 28% into the red. This extends the previous 12 months’ loss of more than 36%.

These returns have significantly lagged the ASX 200’s returns of around 10% this year to date.

At the time of writing, AMP has a market capitalisation of around $3.7 billion.

The post AMP (ASX:AMP) share price struggles amid management fee cuts appeared first on The Motley Fool Australia.

More reading

• It hasn’t been a great 2021 so far for the AMP (ASX:AMP) share price
• ASX 200 rises, Macquarie up, Rural Funds launches capital raising
• ASX 200 midday update: Zip rockets, AMP asset sale
• Is the Macquarie (ASX:MQG) share price a buy for dividends?
• AMP (ASX:AMP) share price in focus after Macquarie (ASX:MQG) asset sale agreement

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 owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The ARB Corporation Limited (ASX: ARB) share price will be one to watch on Thursday.

This follows the release of a market update by the 4×4 parts manufacturer after the market close.

How is ARB performing?

The good news for shareholders and the ARB share price, is that ARB has been performing very positively in FY 2021.

According to the release, the company achieved unaudited sales revenue of $623 million for the 12 months ended 30 June 2021. This represents an impressive increase of 33.9% over the prior corresponding period.

Pleasingly, things have been even better on the bottom line thanks to margin expansion. The release reveals that ARB is expecting its profit before tax for FY 2021 to be within the range of $145 million to $150 million.

This will be an increase of 85.5% to 92% on FY 2020’s profit before tax of $78.1 million. Though, it is worth noting that its growth has slowed a touch since the end of the first half. At that point, its profit before tax was up 109.6% on the prior corresponding period.

Outlook

While the company is positive on its short term outlook, once again it believes COVID-19 uncertainty makes it impossible to provide any guidance beyond this.

It advised: “The Company maintains a positive short-term outlook based on its consistently strong customer order book. ARB is focused on managing input costs and global supply chain pressures whilst pursuing various market opportunities. The current pandemic and economic conditions remain very uncertain and it is not possible to provide financial or operational guidance beyond the short term.”

Is the ARB share price in the buy zone?

One leading broker that sees value in the ARB share price is Citi.

According to a recent note, the broker has a buy rating and $45.95 price target on its shares. This compares to the latest ARB share price of $41.39.

Though, its analysts are likely to revise its forecasts in the coming days to reflect this update. So, stay tuned for that.

The post ARB (ASX:ARB) share price on watch after reporting stellar FY2021 growth appeared first on The Motley Fool Australia.

More reading

• 2 booming ASX shares show exactly what Aussies are up to during COVID
• Here are the best performing ASX 200 shares so far in 2021

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

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If you’re fed up with low interest rates, you’re not alone. But don’t worry, because the Australian share market is here to save the day with its plenty of dividend options.

Two ASX dividend shares that are growing at a decent clip are listed below. Here’s why they are tipped to grow their dividends over the coming years:

Charter Hall Social Infrastructure REIT (ASX: CQE)

The first ASX dividend share to consider is the Charter Hall Social Infrastructure REIT. It is a high quality real estate investment trust with a focus on properties with specialist use, limited competition, low substitution risk, and very long leases.

These are properties such as bus depots, childcare centres, police stations, and justice services facilities. In respect to childcare centres, Charter Hall Social Infrastructure REIT is the largest owner of early learning centres in Australia. At the last count, it was actively partnered with 35 high quality childcare operators.

According to a note out of Goldman Sachs, it believes the Charter Hall Social Infrastructure REIT is well-placed for growth in the coming years.

As a result, it is forecasting dividends per share of 15.7 cents, 17.6 cents, and 18.8 cents over the next three financial years. This represents yields of 4.3%, 4.8%, and 5.2%, respectively.

Sonic Healthcare Limited (ASX: SHL)

Another ASX share that has been tipped to grow its dividend in the coming years is Sonic Healthcare.

It is one of the world’s leading healthcare providers, with operations in Australasia, Europe and North America. Sonic currently employs more than 1,500 pathologists and radiologists, and more than 10,000 medical scientists, radiographers, sonographers, technicians, and nurses.

Like Integrated Diagnostics, it has been a very strong performer in FY 2021. This has been driven by growth across the business, but particularly from its COVID-19 testing business.

Analysts at Credit Suisse expect its growth to continue. The broker is forecasting partially franked dividends per share of 97 cents in FY 2021 and then 98 cents in FY 2022. Based on the latest Sonic share price, this implies potential yields of 2.4% and 2.5%, respectively, over the next couple of years.

The post 2 ASX shares growing their dividends appeared first on The Motley Fool Australia.

More reading

• The 5 best ASX 200 healthcare shares of financial year 2021
• 2 top ASX 200 shares that might be buys today
• 2 quality ASX dividend shares with very attractive yields
• 3 blue chip shares that smashed the ASX 200 index in FY21
• 2 ASX 200 shares growing their dividends

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

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There are a lot of shares to choose from on the All Ordinaries index. To help narrow things down, I have picked out two that come highly recommended.

Here’s why these could be All Ords shares to buy:

Integral Diagnostics Ltd (ASX: IDX)

The first All Ords share to look at is Integral Diagnostics. Integral Diagnostics is one of the largest diagnostic imaging providers in Australia. It provides imaging services through its six brands. These are Lake Imaging, South Coast Radiology, Global Diagnostics, Imaging Queensland, SRG Radiology, and Trinity MRI.

It has been a strong performer in FY 2021. For example, during the first half it reported a 29.5% increase in revenue to $170.7 million and a 61.1% jump in net profit after tax to $23.2 million.

The good news is that analysts at Goldman Sachs are confident there will be further solid growth in the years to come.

It said: “We believe this medical imaging service provider is a well-run business in an attractive industry, with a relatively secure volume profile of mid/high single digit growth, and a clear path for further growth through brownfield and M&A activities. In our view, IDX is well-positioned to benefit from these key drivers:”

Goldman has a buy rating and $5.50 price target on the company’s shares.

Lifestyle Communities Limited (ASX: LIC)

Another All Ords share to look at is Lifestyle Communities. It builds, owns, and operates land lease communities which provide affordable housing options to Australians over 50. Its land lease model allows working, semi-retired, and retired people to downsize their family home to free up equity in retirement whilst enjoying resort style living.

Goldman Sachs is also confident in Lifestyle Communities’ growth prospects. This is thanks to strengthening demand for land lease options from Australia’s ageing population.

It said: “We see strengthening demand for Land Lease as the aging population looks to enhance retirement by releasing equity from the family home. Our penetration analysis suggests the current 2-3% of people over 65 living in a land lease community could rise to 5% over the medium term; coupled with the absolute increase in over 65s population, LIC is well-placed to grow its occupied lots at a rate of c.15% p.a.”

Goldman has a conviction buy rating and $16.50 price target on the company’s shares.

The post 2 All Ords shares this broker rates as buys appeared first on The Motley Fool Australia.

More reading

• The 5 best ASX real estate shares of the 2021 financial year unmasked
• 2 excellent ASX shares that could be buys for a retirement portfolio
• Why we avoid mining and biotech ASX shares: fund manager
• These ASX shares are growing their dividends at a solid rate
• Why AVITA, Cettire, Lifestyle Communities, & SEEK are storming higher

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 recommended Integral Diagnostics 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 Cirralto Ltd (ASX: CRO) share price was frozen today while the company prepared to release news regarding its agreements with Mastercard (NYSE: MA) and Fresh Supply Co.

The Cirralto share price sat at 61 cents, the same level as at last Friday’s close and where it has been all week.

The company released an announcement to the ASX saying it would voluntarily suspend the trading of shares while it plans the announcement of its first trade customers under the agreements.

Cirralto is a transaction services business that supplies business-to-business payment solutions and digital trading software.

Let’s take a closer look at what has halted the Cirralto share price.

Cirralto’s trading halt

Cirralto has initiated a trading halt to ready itself for the release of what might be an exciting announcement.

However, Cirralto stated, with or without an announcement, its shares will resume trading on Friday.

The announcement is expected to relate to Cirralto’s first trade customers under its two new partnerships.

Last Thursday, Cirralto announced two separate partnerships. One with Mastercard Asia Pacific and the other with Fresh Supply Co.

The news saw the Cirralto share price gain 14% through the day.

Under their partnership, Mastercard may introduce new sales leads to Cirralto in exchange for a fee and a cut of the profits Cirralto receives from their business.

Cirralto will keep at least 70% of the profits from customers provided by Mastercard.

The agreement will continue for five years. Cirralto’s agreement with Fresh Supply Co is also for five years.

Fresh Supply Co works as a data layer that specialises in taking operational farming data and allowing it to be used by the financial sector.

Cirralto will provide Fresh Supply Co with the ability to process payments to agriculture businesses.

The partnership will also allow the companies to use the data captured by Fresh Supply Co to pay farmers at operational milestones.

Cirralto share price snapshot

This year has been a good one for the Cirralto share price.

It is currently 52.5% higher than it was at the start of 2021. It has also gained 510% since this time last year.

The company has a market capitalisation of around $167 million, with approximately 2.95 billion shares outstanding.

The post Here’s why the Cirralto (ASX:CRO) share price was frozen today appeared first on The Motley Fool Australia.

More reading

• Why the Cirralto (ASX:CRO) share price is zooming 25% higher 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 Mastercard. The Motley Fool Australia has recommended Mastercard. 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 S&P/ASX 200 Index (ASX: XJO) has managed to have a pretty successful day so far this Wednesday, despite a few ups and downs. At the time of writing, the ASX looks set to end the day in the green, up 0.38% to 7,360 points. But let’s take a closer look at the ASX 200 shares that are seeing the heaviest trading volume today.

3 ASX 200 shares with the heaviest trading volume today

Sydney Airport Holdings Pty Ltd (ASX: SYD)

Sydney Airport is our first ASX 200 share to look at today. This airport operator has been at the forefront of man investors’ minds ever since the dramatic takeover offer earlier this month which saw the Sydney Airport share price rise by roughly 35% in one day. Today has seen an impressive 10.73 million SYD shares swap hands so far. That’s despite not too much happening with the company’s share price.

Sydney Airport shares are currently down 0.26% to $7.82 this afternoon. As my Fool colleague Tristan covered earlier today, this might be the result of rumours that the offer of $8.25 a share is “highly likely to be rejected” by the Sydney Airport board. This might be the reason why so many shares are bouncing around today.

Incitec Pivot Ltd (ASX: IPL)

Fertiliser, chemical and explosives manufacturer Incitec Pivot is another ASX 200 share to examine today. So far today, a very hefty 12.28 million Incitec shares have traded. Incitec shares have had a very dramatic week so far, rising almost 10% yesterday at one point on an announcement of a business restructure.

Although yesterday’s gains ended up being more muted than that at just under 7% at market close, Incitec is adding to that today, with another 1.56% rise to $2.61 a share. It’s likely a combination of both yesterday and today’s gains that is resulting in a high volume of Incitec shares moving around this Wednesday.

Zip Co Ltd (ASX: Z1P)

Buy now, pay later (BNPL) company Zip Co is our most traded ASX 200 share today, with a very substantial 24.4 million shares trading owners so far. That’s probably the result of the very steep share price fall Zip has endured today. At the time of writing, the Zip share price is down a nasty 11.26% to $7.33 a share.

This sharp fall can be attributed to the news that none other than Apple Inc (NASDAQ: AAPL) is reportedly working in a new BNPL service. It’s probably safe to say that Apple is one of the last companies any other company would want on their turf. As such, investors have reacted accordingly.

The post Here are 3 of the most heavily traded ASX 200 shares today appeared first on The Motley Fool Australia.

More reading

• ASX 200 rises, Afterpay sinks, Macquarie Telecom soars
• Broker warns that small lenders are set to beat ASX bank shares
• BNPL ASX share prices tumble as PayPal declares no BNPL late fees
• Sydney Airport (ASX:SYD) share price lower as board expected to reject takeover
• Why ASX BNPL shares like Afterpay, Zip, and Sezzle are sinking

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. owns shares of and has recommended Apple and ZIPCOLTD FPO. 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 Bruce Jackson.

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The Spark Infrastructure Group (ASX: SKI) share price has figuratively hit a wall today. Shares in the energy infrastructure company surged 7.83% to $2.48 before entering a trading halt.

While it hasn’t yet been confirmed by the company, reports in The Australian indicate Spark has been approached by a potential suitor. Just before we thought the day would close without a takeover proposal…

Let’s look at the circulating reports to get an idea of what’s going on.

Potential takeover offer

The market was clearly sniffing out another possible takeover bid today, bidding up the Spark Infrastructure share price. It’s rumoured the company has been approached by an unlisted infrastructure investor.

Additionally, the proposed offer is believed to have been $2.70 a share. This would represent a 17.4% premium on the company’s opening share price this morning. Moreover, it would be an added 8.9% on the currently halted Spark Infrastructure share price.

Based on these details, the potential buyer is valuing the company at a market capitalisation of $4.725 billion.

For those unaware, Spark holds a 49% interest in Victoria Power Networks and SA Power Networks. That’s in addition to 15% ownership of TransGrid (NSW) and 100% ownership of Bomen Solar Farm.

The company’s shares will remain halted until an announcement is made or the commencement of normal trading on Friday.

Spark Infrastructure share price recap

The Spark Infrastructure share price has been gradually climbing since April. Prior to today’s development, the company’s shares were roughly in line with where they were a year ago. However, with today’s jump, Spark’s value is now 10.7% above this time last year.

Interestingly, Spark’s shares trade at a slight discount to the electric utilities industry in the Oceanic region. While Spark trades on a price-to-earnings (P/E) ratio of 37.04, the industry average is 39.1 times.

Currently, the company offers an enticing dividend yield of 5.64%.

The post Spark Infrastructure (ASX:SKI) share price frozen on possible takeover bid appeared first on The Motley Fool Australia.

More reading

• How did ASX renewable energy shares perform in FY21?
• A dividend bonanza could be inbound for ASX shares, here’s why

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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The S&P/ASX 200 Index (ASX: XJO) rose by around 0.3% today to 7,355 points.

Here are some of the highlights from the ASX:

Afterpay Ltd (ASX: APT), Zip Co Ltd (ASX: Z1P) and Sezzle Inc (ASX: SZL)

The buy now, pay later industry was heavily down today.

Afterpay and Zip were the worst two performers in the ASX 200, falling by around 9.6% and 11.4% respectively.

The Sezzle share price also dropped by approximately 10.3% today as well.

There was no official news out of the big buy now, pay later operators. However, there was news reported from overseas.

Bloomberg is reporting that Apple and Goldman Sachs are planning to launch a buy now, pay later service that may challenge Affirm, Afterpay and others

Bloomberg said that the service is internally known within Apple as Apple Pay Later. Consumers will be able to use Apple Pay for any purchase in instalments over a certain amount of time.

Goldman Sachs will be the lender of the money that funds the instalment plans. The two companies have been partners on the Apple Card credit card for the last couple of years. But, according to Bloomberg, consumers won’t need an Apple Card for the BNPL purchases.

The ASX 200 BNPL operators of Zip and Afterpay both have substantial growth hopes in the US.

Macquarie Telecom Group Ltd. (ASX: MAQ)

The Macquarie Telecom share price went up more than 15% today after announcing an update about a new data centre and a cybersecurity centre.

It announced that Macquarie Data Centres has today lodged a ‘State Significant Development Application’ to build a new data centre at the Macquarie Park Data Centre Campus.

The new data centre will be called “IC3 Super West” and will be the largest data centre on the campus, adding 32MW of IT load to bring the total campus load to 50MW over time.

Macquarie Data Centres is aiming to complete construction of the first phase of the new data centre in the second half of the 2023 calendar year. It is designed to meet the needs of the corporate, government and wholesale markets and will enhance the state’s cybersecurity infrastructure and capabilities.

The Macquarie Telecom CEO David Tudehope said:

This global scale data centre campus will attract new investment into Australia from multinationals looking to expand in the Asia Pacific region. The Macquarie Park Data Centre Campus will also be the home to our new Sovereign Cyber Security Centre of Excellence which is being launched today with the support of Investment NSW.

That new cybersecurity centre is going to be a mix of “leading edge” physical and virtual infrastructure designed to monitor and manage cybersecurity events. The infrastructure and personnel will be housed in IC3 Super West.

Mr Tudehope said:

NSW’s digital economic is rapidly growing, and this project will create world class infrastructure and valuable long-term jobs in the digital and cyber security sector.

It also confirmed that its FY21 earnings before interest, tax, depreciation and amortisation (EBITDA) would be in between $72 million to $75 million.

Humm Group Ltd (ASX: HUM)

Humm announced that it has entered into a joint venture agreement with Red Bird Ventures, a subsidiary of Westpac Banking Corp (ASX: WBC) New Zealand, to bring the buy now, pay later product bundll to the New Zealand consumer finance market.

The arrangement will see Red Bird have the option to take an equity stake in bundll New Zealand.

This is the first partnership that is under Humm’s strategic global agreement with Mastercard and will see bundll available to all New Zealanders and preferential benefits offered to Westpac New Zealand customers.

The Humm share price dropped 4%, though this was less of a decline than other ASX BNPL operators like Afterpay and Zip.

The post ASX 200 rises, Afterpay sinks, Macquarie Telecom soars appeared first on The Motley Fool Australia.

More reading

• Why are ASX 200 bank shares in focus on Wednesday?
• Broker warns that small lenders are set to beat ASX bank shares
• BNPL ASX share prices tumble as PayPal declares no BNPL late fees
• Macquarie Telecom (ASX:MAQ) rockets 12% to new all-time high
• Why ASX BNPL shares like Afterpay, Zip, and Sezzle are sinking

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. owns shares of and has recommended AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. The Motley Fool Australia has recommended Humm Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Nearmap Ltd (ASX: NEA) share price is out of form on Wednesday and edging lower.

At the time of writing, the aerial imagery technology and location data company’s shares are down 2% to $2.23.

Despite this decline, the Nearmap share price is up almost 13% over the last two trading sessions thanks to a very positive trading update on Tuesday.

Can the Nearmap share price climb even higher?

A number of leading brokers have been giving their opinion on the Nearmap share price following yesterday’s update.

One broker that believes Nearmap shares can keep on climbing is Morgan Stanley. This morning its analysts retained their overweight rating and $3.20 price target on the company’s shares. Based on the current Nearmap share price, this implies potential upside of 43% over the next 12 months.

Morgan Stanley was pleased with the update and the fact that the company’s outperformance is coming from the North American business. This side of the business was heavily criticised by a short seller several months ago. In addition to this, there were concerns that a patent dispute in the US could also negatively impact its sales.

In respect to the latter, the broker also highlights that Nearmap is seeking to dismiss the patent claims made by rival Eagleview.

Sitting on the fence

Analysts at Citi are sitting on the fence when it comes to the Nearmap share price. According to a note, the broker has retained its neutral rating and lifted its price target to $2.35. This implies modest upside of 5% over the next 12 months.

The broker was pleased to see that the patent dispute is not impacting its performance. However, it isn’t overly convinced that this risk is behind the company fully just yet and has suggested that new contract signings could be harder in the region in FY 2022.

Citi commented: “A solid trading update from Nearmap which indicates that the legal proceedings from Eagleview is not having an impact on the US business. While Nearmap enters FY22e with solid momentum, we continue to be cautious as we see potential for the legal case to have an impact on growth in the US, especially in signing up new partners.”

Finally, analysts at Macquarie have held firm with their neutral rating and $2.60 price target. Though, the broker is reviewing its forecasts following Nearmap’s update and may make changes to its recommendation in due course.

The post Brokers give their verdict on the Nearmap (ASX:NEA) share price appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy today
• Behind the Nearmap share price surge, upgrades for Rio and BHP. Scott Phillips on Nine’s Late News
• Why the Nearmap (ASX:NEA) share price is up 20% in a month
• ASX 200 flat, Select Harvest jumps, Nearmap soars
• ASX 200 midday update: Nearmap rockets, Incitec Pivot jumps

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. owns shares of and has recommended Nearmap Ltd. The Motley Fool Australia owns shares of and has recommended Nearmap 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 Endeavour Group Ltd (ASX: EDV) share price is doing a whole lot of not much today. At the time of writing, Endeavour shares are up 0.48% to $6.31 a share. But doing a whole lot of not much is what investors in this new ASX 50 share would be used to by now.

Endeavour Group used to be the liquor division of Woolworths Group Ltd (ASX: WOW). It owns the dominant bottle shop chains BWS and Dan Murphy’s, as well as a series of pubs and hotels. Last month, Endeavour flew the Woolworths nest as part of an ASX demerger. The company was spun off in its own right, with existing Woolworths shareholders receiving one Endeavour share for every one Woolworths share owned.

Since its official ASX debut on 24 June, the Endeavour share price hasn’t exactly made waves. In fact, as it currently stands, the Endeavour share price is sitting pretty much at the same level it was at at the start of July. That stands in contrast to the S&P/ASX 200 Index (ASX: XJO), which has managed to add roughly 1.3% since the start of this month.

So why is the Endeavour share price so sluggish?

Endeavour share price fails to excite in July

Perhaps we can point to the recent but dramatic escalation of the New South Wales coronavirus crisis as a possible reason. These lockdowns have the potential to significantly increase running costs for retailers. Responsibilities like QR code check-ins, regular deep cleaning of stores, and store capacity restrictions certainly don’t make life easier (or cheaper) for retail companies like Endeavour.

Another factor that could be at play is the very nature of Endeavour’s business. As we’ve discussed before on the Fool, Endeavour is not exactly the kind of company that jumps to mind when someone mentions ESG (ethical, social and corporate governance) or ‘ethical investing’. That’s what you can expect from a company that trades in one of our most popular vices – alcohol.

This could well lead to permanent exclusion from exchange-traded funds (ETFs) or other investment vehicles like managed funds that follow an ESG mandate. Since Endeavour has yet to release any earnings numbers on its own steam, we can’t yet accurately analyse the kind of price-to-earnings (P/E) ratio its shares are currently trading on.

But it’s very possible that Endeavour will not be able to command the same kinds of P/E multiples that Woolworths or Coles Group Ltd (ASX: COL) can for this reason.

At the current Endeavour share price, the company has a market capitalisation of $11.3 billion.

The post Why has the Endeavour share price gone nowhere this month? appeared first on The Motley Fool Australia.

More reading

• Here’s why the Woolworths (ASX:WOW) share price is up 10% since May
• ASX 200 Weekly Wrap: COVID wobbles ASX as shares retreat
• These 3 ASX 200 shares were the most heavily traded today
• These ASX shares are the latest to be hit by broker downgrades
• Will ESG concerns really affect companies like Endeavour (ASX:EDV) and AGL (ASX:AGL)?

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 owns shares of and has recommended COLESGROUP DEF SET. 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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