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Cirralto Ltd (ASX: CRO) shares are slowly coming down after a morning of flying high on news the company has upgraded its payment services. At its intraday high, the Cirralto share price reached 9.1 cents – a gain of 7.6%. ­– but, it has since fallen.  

At the time of writing, the Cirralto share price is back where it started this morning, trading at 8.4 cents.

Let’s take a closer look at today’s news from the technology-focused investment company.

Spenda’s latest upgrade

Cirralto has upgraded SpendaCollect, SpendaPay, and the Spenda app, with more planned for the remainder of this quarter.

Spenda is designed to facilitate business-to-business (B2B) transactions but is beginning to branch out into business-to-customer transactions.

The Spenda suite now offers what is essentially a buy now, pay later (BNPL) service. It’s also newly equipped with Visa Business Payment Solutions Provider (BPSP) and Mastercard Payment Aggregator (BPA), as part of Cirralto’s agreements with Fiserv, Inc.

Cirralto says this will speed up its onboarding of customers and allow it to create a merchant rate to increase its profits.

Other new services include electric funds transfers, BPAY, credit card services, and finance or pay by the month (essentially a BNPL service).

The company says it provides payment services at a lower cost than traditional merchants. It says this is likely to be attractive to businesses. Spenda is also said to help bypass the disruption businesses often face when changing software as it works with other systems rather than replacing them.

It also allows for the automation of business ledgers in B2B transactions and increases security by identifying both parties of a transaction.

Cirralto will focus on customers in a few key markets, to begin with.

These include connecting fashion, homewares and specialist retailers to manufacturers; connecting parents to schools and schools to suppliers; connecting food producers to suppliers and food retailers to producers, and connecting vehicle owners to service providers.

Spenda’s existing customers will be migrated to the new services over the course of May.

Commentary from management

Cirralto managing director Adrian Floate commented on the upgrades, saying:

The last 12 months has been a transformational period for the company, moving from pure development to launching and commercialising new products…

We have focused our development teams on crafting software that drives improvements for our customers and our customers’ customer’s. We have entered into new strategic relationships that expand our service capability and, in the past few months, we have developed a payment solution that bundles the most common ways businesses pay each other into a single solution.

Cirralto share price snapshot

The Cirralto share price has had a fantastic 2021 on the ASX so far, despite the fact that today’s early gains have failed to stick.

Currently, the Cirralto share price is up 110% year to date. It’s also up a humongous 2,733% over the last 12 months.

The company has a market capitalisation of around $171 million, with approximately 2 billion shares outstanding.  

More reading

• Could this quarterly sink or swim the Cirralto (ASX: CRO) share price?

Motley Fool contributor Brooke Cooper 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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Macquarie Group Ltd (ASX: MQG) seems to have won the battle with private equity firm Roc for control of Vitalharvest Freehold Trust (ASX: VTH) shares.

In a statement to the ASX this morning, the real estate investment trust (REIT) said it has accepted an offer from Macquarie Group subsidiary Macquarie Agricultural Funds Management (MAFM) to buy the trust at $1.26 per share. The price will not be discounted by the already paid dividend of 2.5 cents per share.

At the time of writing, Vitalharvest shares are down 0.39% to trade for $1.285 each – still 2.5 cents above the MAFM offer. The Macquarie Group share price is 0.25% lower to $160.09 each.

Let’s take a closer look at today’s developments.

Vitalharvest agrees to Macquarie offer

While the Vitalharvest board is unanimously recommending shareholders accept the scheme of arrangement with MAFM, and it has ceased contact with Roc, the takeover tumult may not actually be over.

On 26 April, Vitalharvest previously advised investors it was recommending shareholders accept an offer from Macquarie for $1.24 a share. It also said at the time it was ceasing contact with Roc. However, only 4 days later, Roc bettered the MAFM offer for Vitalharvest shares by 1 cent. Macquarie then upped its offer, which the REIT accepted today. Roc may still submit another offer.

Macquarie and Roc have been bidding with each other for Vitalharvest shares since November last year. The war has seen the share price of the trust increase from 78.5 cents to its record high of $1.30. This was achieved during intraday trading today.

If Roc does not submit an improved offer, Vitalharvest shareholders will vote to approve or reject the offer from MAFM by sometime in May, according to the statement.

What’s been happening to Macquarie and Vitalharvest shares recently?

Over the past 12 months, Vitalharvest shares have increased in value by around 92%. As mentioned, this has mostly been driven by the bidding war between MAFM and Roc. If Roc decides to submit a higher offer, the Vitalharvest share price could increase, if its behaviour over the last 6 months is anything to go by.

The Macquarie share price, on the other hand, has increased by around 65% over the past year. It is unlikely today’s news will have too much of an impact on its share price. Macquarie’s primary operations centre around its banking division.

Vitalharvest has a market capitalisation of $238.1 million and Macquarie Group’s is $57.8 billion.

More reading

• ASX 200 Weekly Wrap: Shares have average week but a great month
• Not too late to buy these small ASX mining shares for the commodities boom
• Top brokers name 3 ASX shares to sell today
• What is Macquarie’s (ASX:MQG) dividend outlook for 2021?
• 2 compelling ASX shares rated as buys by brokers

Motley Fool contributor Marc Sidarous 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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We got some big news from one of the ASX’s biggest banking shares this morning. Westpac Banking Corp (ASX: WBC) today reported its half-year results for the 6 months ending 31 March.

We already covered the meat and potatoes of this announcement this morning, but the one figure that sums it all up is the $3.44 billion cash profit that the bank posted. That was up 189% on last year’s corresponding figure, and up 213% over the 6 months ending 30 September 2020.

It’s safe to say that investors have given these results a tick of approval, seeing as the Westpac share price is up 4.52% to $26.11 at the time of writing, and hit a new 52-week high of $26.14 earlier today, blitzing past the old 52-week high of $25.52.

Westpac announces new dividend

One of the more significant announcements that Westpac made today was its revelation of an interim dividend. Westpac will pay a fully franked 58 cents per share dividend on 25 June, with an ex-dividend date of 13 May.

This dividend is a significant increase over Westpac’s final dividend of 2020, which was paid out on 18 December last year, and came to 31 cents a share. However, it’s also still a ways away from the 80 cents per share that the company shelled out in December 2019, and even further from the 94 cent dividend that was common before that.

Westpac was notable for being the only ASX bank not to pay an interim dividend last year at all. That broke a decades-long streak of biannual dividends from Westpac. That has resulted in Westpac shares having a trailing dividend yield of just 1.2% today – not at all what ASX bank investors are used to from the big four.

So how much is this Westpac’s dividend worth now from a yield perspective?

Well, taking Westpac’s newly announced dividend together with its last payment, we get a figure of 89 cents a share. That equates to a trailing yield of 3.41%, or 4.87% grossed-up with full franking on the current share price. If we just take the new 58 cents per share dividend and annualise it, we get a potential forward yield of 4.44%, or 6.34% grossed-up. That’s starting to look like your typical ASX bank now.

Will the dividends keep growing?

As we noted earlier, there’s still a lot of distance between the dividends on offer from Westpac today, and the dividends it used to pay. However, the bank’s report today tells us that the new dividend only represents a payout ratio of 60% of earnings. In the ‘old days’, it was not uncommon to see Westpac pay out 80–90% of its earnings as dividends. That means that there could still be plenty of dividend growth to come for this ASX bank.

More reading

• Why Dubber, PointsBet, Starpharma, & Westpac shares are storming higher
• ASX 200 up 0.25%: Westpac result impresses, PointsBet jumps
• Westpac (ASX:WBC) share price up 4%: Here’s an expert’s opinion
• This is the best of the big ASX banks: fundie
• ASX 200 Weekly Wrap: Shares have average week but a great month

Motley Fool contributor Sebastian Bowen 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 ARB Corporation Limited (ASX: ARB) share price is trading lower on Monday despite the release of a positive announcement.

In afternoon trade, the 4×4 accessories company’s shares are down 2% to $38.33.

What did ARB announce?

This afternoon ARB announced that it has signed an agreement with car giant Ford.

According to the release, the agreement will see ARB branded off-road accessories for Ranger and Everest vehicles sold as Ford licensed accessories through participating Ford dealers in Australia from the second half of 2021. After which, other selected Ford markets are expected to follow.

The release also explains that Ford Ranger and Everest customers who want the ultimate adventure gear will be able to fitout their vehicles with a range of ARB accessories that will be fully backed by Ford Australia’s New Vehicle Warranty of up to five years / unlimited kilometres.

Furthermore, the company notes that the ARB accessories for Ranger and Everest that will be made available through Ford dealerships have been validated by Ford Australia engineers. Testing has been conducted at a number of locations, including the Ford Australia Proving Ground near Lara, Victoria.

ARB’s Managing Director of 4×4 Accessories, Andrew Brown, commented: “ARB is truly honoured to be working with Ford at a global level. This collaboration is a great testament to the progressive vision of Ford and ARB to deliver to customers highly capable off-road vehicles with a broad range of best-in-class accessories.”

This sentiment was echoed by the President and CEO of Ford Australia and New Zealand, Andrew Birkic.

He said: “We are very proud to welcome ARB on-board as they are known globally and respected in the off-road community for their state-of-the-art manufacturing processes and stringent quality controls.”

“A lot of our customers have told us they’d love to be able to access a wider range of quality off-road accessories through our Ford dealership network, and this collaboration will mean they can head off-road safely with access to a range of ARB accessories,” he added.

More reading

• Why brokers think these 3 top performing ASX 200 shares can beat the market

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ARB 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 ResMed Inc (ASX: RMD) share price continues to take a beating on Monday after releasing its third-quarter results last week. Its shares have lost almost 9% in the last two trading sessions. 

At the time of writing, the ResMed share price is down 5.24%, trading at $24.80.

Why is the ResMed share price under pressure?

The narrative for the ResMed share price is similar to that of Kogan.com Ltd (ASX: KGN), Redbubble Ltd (ASX: RBL) and Temple & Webster Group Ltd (ASX: TPW).

COVID-19 supercharged the demand for ResMed products such as ventilators, masks and circuits. As the global pandemic unwinds, companies are finding it challenging to surpass elevated earnings experienced in FY20. 

Brokers weigh in on the dip 

Citi: Undervalued but cautious 

ResMed continues to perform well operationally under a difficult environment, according to Citi. The broker believes that are many upsides for the business in a post-COVID world, including higher market growth with the return of its previous sleep apnea patients, market share gains with its new Airsense 11 device and increased penetration in the chronic obstructive pulmonary disease (COPD) market. 

Citi believes the RedMed share price is about 10% undervalued but cautiously downgraded its rating from buy to neutral. Its target priced also retreated from $29.00 to $28.50. 

Credit Suisse: Tough comparables but industry upside in FY22 

Credit Suisse describes the March quarter result as a disappointment at the revenue level, although the company is cycling a period of tough comparables. 

Looking ahead, the broker eyes ResMed’s new CPAP device, AirSense 11, which is expected to be widely launched in the US by the end of 2021. The broker believes the industry will enter a resupply cycle in FY22 for devices, forecasting approximately 11% device growth in the US. 

Credit Suisse retained an outperform rating and slightly lowered its share price target from $29.50 to $29.00. 

Macquarie: Medium-term forecasts are unchanged 

The March quarter results were below Macquarie’s expectations, but gradual recovery in new patient growth is anticipated across 2021-22. 

The broker remains positive in the medium-term, leaving forecasts unchanged. A neutral rating was retained, and the target price reduced from $28.00 to $27.50. 

Morgans: Current headwinds are more cyclical than structural 

Morgans described the current headwinds for the business as cyclical rather than structural. It believes an upgrade cycle is imminent, with its next-generation sleep apnea platform due for commercialisation by the end of the year. 

Looking at the third-quarter result, the broker felt the performance was mixed as underlying revenue growth was flat, gross margins were contracting on higher costs and an unfavourable product mix. However, profit was slightly ahead of expectations on lower opex,  improving patient flows and ongoing mask resupply. 

Morgans rated the ResMed share price as an add but lowered its target price from $30.09 to $29.14.

More reading

• Why Bubs, IDP Education, ResMed, & Tyro shares are dropping today
• ASX 200 up 0.25%: Westpac result impresses, PointsBet jumps
• Leading brokers name 3 ASX shares to buy today
• Is the ResMed (ASX:RMD) share price good value after its Q3 update?
• ASX 200 drops 0.8%, Pointsbet jumps, Beach sinks

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 Kogan.com ltd and Temple & Webster Group Ltd. The Motley Fool Australia has recommended Kogan.com ltd, ResMed Inc., and Temple & Webster Group 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 IDP Education Ltd (ASX: IEL) share price has started the week deep in the red.

In afternoon trade, the student placement and language testing company’s shares are down 5% to $21.58.

Why is the IDP Education share price sinking today?

Investors appear to have been selling IDP Education’s shares due to concerns over the impact the COVID-19 crisis in India could have on its performance.

The Indian market is the biggest contributor to the company’s earnings. So with COVID-19 numbers sadly rising rapidly in the country, there is significant downside risk to earnings estimates.

Is this a buying opportunity?

One leading broker that believes the weakness in the IDP Education share price is a buying opportunity is Goldman Sachs.

This morning the broker reaffirmed its buy rating and $29.90 price target on the company’s shares.

Based on the current IDP Education share price, this implies potential upside of almost 39% over the next 12 months.

What did Goldman say?

Goldman Sachs believes IDP Education is well-placed for growth over the long term.

And while it acknowledges that the COVID-19 outbreak in India will disrupt its recovery, it feels investors should look beyond this.

It said: “We believe there is an attractive long-term opportunity for IEL and the business is well positioned for the re-opening of international students markets. IELTS volumes have rebounded to pre-COVID levels, and the key to the recovery is a bounce-back in student placement volumes.”

“Although this remains disrupted in the near term, particularly with the current COVID outbreak in India, the fundamentals of the business look very strong. We think the key growth driver from here will be increasing student placement volumes into multi-destination, where we see a long runway for growth as IEL gains share in the highly fragmented market for student placement. On our estimates, IEL currently has <5% market share in its two key multi-destination markets, the UK and Canada. We see long term share being materially higher than current levels,” it added.

Goldman concluded: “COVID is disrupting the recovery in Student Placement Volumes, particularly the ongoing outbreak in India; for context, Indian students represent 43% of IEL’s volumes (as of FY20). IEL’s key markets (Australia, UK, Canada) have all closed borders to non-citizens traveling from India, which presents a risk in the near term to Indian student placement volumes. We cut our FY21 student placement volumes to reflect the near term disruption. Our 12m TP is unchanged at A$29.90 and we remain Buy rated.”

More reading

• Brokers think these 2 top ASX shares are buys in May 2021
• Why Bubs, IDP Education, ResMed, & Tyro shares are dropping today
• Brokers name 3 ASX shares to buy now
• 2 excellent ASX growth shares tipped as buys
• 2 highly rated mid cap ASX shares for the long term

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 Idp Education Pty Ltd. 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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A2 Milk Company Ltd (ASX: A2M) shares are not having a fantastic day today. At the time of writing, the A2 Milk share price is down 0.55% to $7.18. That contrasts with the broader S&P/ASX 200 Index (ASX: XJO) which, presently, is essentially flat with a decline of 0.02%.

But zooming out, and the picture looks a little better for A2 Milk. One could arguably even say it looks as though the embattled dairy company may have found a share price bottom after a disastrous few months.

A2 shares bottomed out last week when they hit a new multi-year low of $6.83 a share last Tuesday. That’s the lowest share price that A2 has experienced since October 2017. It also represents a fall of more than 64% from the company’s 52-week (and all-time) high of $20.05 that we saw back in July last year.

That bottom was the culmination (at least until today) of a series of bad news items for the A2 Milk share price. These mostly revolve around the collapse of the Chinese sales channels known as daigou.

Daigou sales are where customers buy products in bulk in order to ship them to China for resale. They were a very popular and lucrative channel for A2 – at least until the coronavirus pandemic came along. Together with the effects of the deterioration of Sino-Australian relations over the past year or so, demand from this side of the Chinese market has all but dried up.

This is a big deal for A2, which reported a 16% slump in revenues in its last earnings report, largely as a result of the daigou issue.

But since last Tuesday when the A2 share price hit this low, the company has rebounded rather enthusiastically. On the current share price, the gains since Tuesday are clocking at 5.1% which is a pretty sturdy recovery. So have we indeed found the bottom for A2?

Are A2 shares a buy today?

Despite the low share prices we are still seeing for A2 Milk, it still doesn’t have too many fans. As my Fool colleague James reported last month, broker Morgans has a ‘hold’ rating on A2, with a price target of $8.24. Citi is less optimistic, with a ‘sell’ rating and a price target of $7.15. So clearly, some brokers don’t have rose-tinted glasses on this one.

More reading

• Why is the Telstra (ASX:TLS) share price rising today?
• Morgans just added these ASX shares to its “best ideas” buy list
• ASX 200 up 0.25%: Westpac result impresses, PointsBet jumps
• Deterra (ASX:DRR) share price outperforms on royalty update
• A2 Milk (ASX:A2M) share price continues to stink in April

Motley Fool contributor Sebastian Bowen owns shares of A2 Milk. The Motley Fool Australia owns shares of and has recommended A2 Milk. 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.

Two years ago, NASA put out a call for America’s biggest space companies to build it a “Human Landing System” to return American astronauts to the moon. Last year three teams signed up to do just that, and NASA doled out $967 million in contracts to help Jeff Bezos’ Blue Origin (in cooperation with Lockheed Martin (NYSE: LMT) and Northrop Grumman, Leidos Holdings subsidiary Dynetics, and Elon Musk’s SpaceX design and build prototypes for NASA to choose from.

And this month, NASA finally picked its winner: SpaceX.

The Washington Post reports, NASA decides

In a story that you know must have just burned Jeff Bezos’s biscuits, The Washington Post (which Bezos also owns) reported last week that SpaceX “beat out Jeff Bezos’s Blue Origin and Dynetics” as well. For $2.9 billion, paid in installments so that it “fits within NASA’s current fiscal year budget,” NASA will hire SpaceX to: 

• Build a Starship spacecraft,
• Dock it with an Orion spacecraft (which will be delivered to lunar orbit by a NASA “Space Launch System” rocket),
• Take onboard two astronaut passengers,
• Land them on the moon, and then
• Bring them back up to re-board the Orion for their return to Earth.

As NASA explained, although SpaceX’s Starship is still in development, the rocket’s enormous capacity promises “to greatly improve scientific operations” on the moon. Perhaps even more importantly, though, SpaceX’s bid “was the lowest [bid] by a wide margin.” Both Leidos’s bid and the bid submitted by Blue Origin, Lockheed Martin, and Northrop Grumman were described as “significantly higher” than SpaceX’s price.

The reason: SpaceX was already building Starships on its own dime as part of Elon Musk’s goal of colonizing Mars. Because SpaceX was willing to pay “over half of the development and test activities” costs of building a Starship itself, it was able to charge NASA much less than the other bidders. In fact, SpaceX is probably viewing the moon contract as NASA helping to pay for some of SpaceX’s development costs, rather than vice versa!

What the losers said

Not everyone was thrilled with NASA’s decision. After absorbing the initial shock, on Monday both Dynetics and Blue Origin filed protests with the Government Accountability Office (GAO).

In a statement to SpaceNews.com, Dynetics questioned “several aspects of the acquisition process as well as elements of NASA’s technical evaluation.” NASA had rated Dynetics’ management “very good,” but rated its bid “marginal” for technical quality, citing concerns about the Dynetics lander’s weight. Additionally, it seems that Dynetics’ bid was well in excess of $6 billion — far more than NASA had budgeted for this leg of the Artemis project. 

Blue Origin bid just under $6 billion, still more than twice SpaceX’s bid. Accusing NASA of running “a flawed acquisition” contest, Blue Origin alleged that the space agency “moved the goalposts at the last minute.” Although it did not specify how NASA moved said goalposts, it argued that awarding only one human lander contract “eliminates opportunities for competition, significantly narrows the supply base, and … delays [and] endangers America’s return to the moon.” 

From that language, it appears Blue Origin was hoping NASA would choose two winners, as initially envisioned. And seeing as it submitted a bid higher than SpaceX’s but lower than Dynetics’, Blue Origin would have been the logical winner of any second contract. So that’s what Blue Origin will probably be asking for now — not that GAO take away SpaceX’s win, but that it demand NASA award a second contract to Blue Origin as well.

Alternatively, Blue might try to couch its bid in installment payments, as SpaceX did, so as to similarly fit “within NASA’s current budget,” suggested Blue Origin CEO Bob Smith in a statement to the Post. That wouldn’t change the fact that Blue’s bid comes in at twice SpaceX’s cost, but it might give NASA the financial flexibility to award a second contract.

What comes next

Ordinarily, the twin GAO protests of SpaceX’s NASA contract would draw work on the lander to a screeching halt, and keep it halted until the GAO renders a decision(s) — which it must do within 90 days. In the current case, however, with SpaceX already building Starship prototypes on its own dime, and presumably not needing NASA’s money to continue the spacecraft’s development, it’s likely SpaceX will continue working. 

As for the challengers, however — Dynetics parent Leidos, and Blue Origin partners Lockheed and Northrop — well, investors in those companies will just have to bide their time and hope for the best. GAO will wrap up its consideration of the challenges by the end of July, and once GAO has decided, NASA intends to “begin work immediately on a follow-up competition” to “provide regularly recurring services to the lunar surface that will enable these crewed missions on sustainable basis.” 

Big as “$2.9 billion” sounds, it’s really only the beginning of what these companies hope to earn from NASA’s return to the moon.

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

More reading

• The A2 Milk (ASX:A2M) share price is up 5% in 5 days. Can it go higher?
• Worley (ASX:WOR) share price down on second contract win for the day
• Why the Kogan (ASX:KGN) share price was sold off in April
• Some takeaways from Warren Buffett’s Berkshire Hathaway meeting
• Is it time to sell, hold or buy Webjet (ASX: WEB) shares?

Rich Smith has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Lockheed Martin. 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.

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Worley Ltd (ASX: WOR) shares can’t seem to catch a break today. The global engineering company’s shares are continuing to fall even after the announcement of a second contract win.

During mid-afternoon trade, the Worley share price is treading 1.98% lower to $10.64.

What’s with the Worley share price?

Investors appear unfazed by the company’s market updates today, sending Worley shares in negative territory.

In another statement to the ASX, Worley advised it has been awarded a front-end engineering design (FEED) services and cost estimate contract by Liquid Wind.

Established in 2017, Liquid Wind is a Swedish circular carbon energy company that aims to bring renewable methanol to market. The emerging group is seeking to meet the growing demand for cleaner fuel alternatives and reduce global carbon emissions.

Under the agreement, Worley will provide works on Liquid Wind’s renewable methanol facility in Ornskoldsvik, Northern Sweden.

Once completed, the plant is expected to generate around 50,000 tonnes of renewable methanol each year. The methanol is formed by by reacting carbon dioxide and green hydrogen together.

Worley noted that the cleaner fuel alternative is intended as a potential pathway to cut carbon emissions in marine transportation.

The project will be executed by Worley’s team in Sweden and the United Kingdom. Support will be on offer from its Global Integrated Delivery team in India.

Chris Ashton, CEO of Worley, hailed the contract win, saying:

We are pleased that Liquid Wind has chosen Worley to deliver this important project. We look forward to developing a strong and long-term relationship with Liquid Wind and supporting its renewable fuels goals, while also supporting Worley’s purpose in delivering a more sustainable world.

While Worley shares are down today, they are up 15% when compared against the broader energy sector over the 12 months.

More reading

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• ASX 200 drops, Santos entices CEO, Centuria acquires again
• Worley (ASX:WOR) share price edges lower despite contract award

Motley Fool contributor Aaron Teboneras 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 Kogan.com Ltd (ASX: KGN) share price was a disappointing performer again in April.

Despite a rebound late on in the month, the ecommerce company’s shares sank almost 8% during the 30 days.

This meant the Kogan share price had lost 42% of its value year to date at the end of the period.

Why did the Kogan share price come under pressure?

Investors were selling Kogan’s shares in April following the release of its third quarter update.

For the three months ended 31 March, the company reported a 47% increase in gross sales to $271.5 million.

This was driven by a 77% increase in active customers over the prior corresponding period to 3,215,000 for Kogan.com and 742,000 for Mighty Ape. This compares to active customers of 3,003,000 and 719,000, respectively, at the end of December.

However, despite the strong top line growth, things weren’t anywhere near as positive for its earnings. Which is the key reason for the underperformance of the Kogan share price.

Kogan revealed that its adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) actually declined by 24% over the three months to $7.2 million.

This comprises $5.5 million EBITDA from Kogan.com, which was down 42.7%, and $1.7 million of EBITDA from Mighty Ape. The latter business was not part of Kogan in the prior corresponding period.

Management advised that customer demand fluctuated below the levels seen in the prior nine months. As a result, Kogan was required to store larger than expected levels of inventory, which led to the company incurring high storage expenses and demurrage fees.

Is this a buying opportunity?

One broker that sees the weakness in the Kogan share price as a buying opportunity is Credit Suisse.

Last week the broker retained its outperform rating but trimmed its price target to $17.93.

With the Kogan share price currently fetching $11.31, this price target implies potential upside of 58% over the next 12 months.

Credit Suisse believes the issues it is facing will only be temporary and feels investors should be focusing on its positive long term growth potential.

More reading

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• Is there still upside to the JB Hi-Fi (ASX:JBH) share price?

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd. The Motley Fool Australia has recommended Kogan.com ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why the Kogan (ASX:KGN) share price was sold off in April appeared first on The Motley Fool Australia.

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