Tag: Motley Fool

The Chalice Mining Ltd (ASX: CHN) share price has hit a new record high this morning. Shares in the Aussie gold miner jumped more than 10 per cent at the open after a pre-market announcement.

Why is the Chalice Mining share price rocketing higher?

Chalice Mining has started a program of ground electromagnetic (EM) surveying on the South West Nickel-Copper-Platinum Group Element (Ni-Cu-PGE) Project. Venture Minerals Limited (ASX: VMS) owns the site with Chalice working as a joint venture partner.

Chalice has commenced the surveying over selected areas of the “Julimar lookalike” magnetic anomaly (Thor Target) and other interpreted mafic-ultramafic intrusions.

The Chalice Mining share price shot higher in August after announcing the Julimar Ni-Cu-PGE Project discovery. Chalice announced that it had struck a significant sulphide zone, the first in the region.

Chalice is planning a total of ~42 line kilometres of moving loop EM in the initial stage. Any anomalies will be infilled to define targets for follow-up surface geochemical sampling or drilling.

The Chalice Mining share price is soaring on the back of this morning’s news. Similarly, the Venture Minerals share price is up more than 13% in early trade.

The program is expected to be completed within 4 to 6 weeks, subject to weather constraints. It represents the first stage of the joint venture earn-in with Chalice earnings up to 70% by spending $3.7 million on exploration over 4 years.

The two main prospects within Venture Minerals’ project are Thor and Odin with both containing areas of potential Ni-Cu-PGE prospectivity. 

Today’s announcement has investors hoping for more strong discoveries in the region. It comes after the success of the Julimar discovery which has propelled Chalice shares 153.7% higher in the last 6 months.

Foolish takeaway

The Chalice Mining share price is surging this morning after the Venture Minerals update. It comes as the Aussie miner begins ground EM surveying over a “Julimar lookalike” area in the South West Ni-Cu-PGE Project.

More reading

• Why the Chalice (ASX:CHN) share price hit an all-time high
• Why has the Lithium Australia (ASX:LIT) share price plunged 7% today?
• Chalice (ASX:CHN) share price rises after latest update
• Why the Chalice Mining (ASX:CHN) share price has grown 51% in a month

Motley Fool contributor Ken Hall 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.

The post Chalice Mining (ASX:CHM) share price surges to new record high appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/2QXOM3e

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.

Netflix (NASDAQ: NFLX) reported first-quarter 2021 results last week and disappointed many analysts and investors with its subscriber numbers. After adding an incredible 37 million members last year, the streaming giant only managed to sign up 4 million in the first three months of this year. 

This missed estimates by management (6 million) and Wall Street (6.2 million), causing the stock price to fall about 8% since Tuesday’s market close. To make matters worse, the company is forecasting just 1 million subscriber additions in the current quarter. 

The coronavirus pandemic led to a surge in Netflix’s business in 2020, but now investors are concerned that growth going forward will slow as people spend more time away from home and competition in the space heats up. 

If we take a step back for a second, though, we’ll see that Netflix is doing just fine. Here’s a tip for investors regarding this latest news: don’t worry. 

Still the leader in streaming entertainment 

Revenue in the quarter still increased 24% year over year as a result of pricing increases in the U.S. late last year. And average revenue per user (ARPU), a key metric for any subscription-based business, rose 6%. Netflix claimed higher engagement as well as lower member churn in the quarter compared to last year, further calming investor fears. These are still very healthy numbers. 

Operating income nearly doubled from Q1 2020 due to lower content spend. But normal production schedules are now up and running in all regions except Brazil and India. And the company expects to spend $17 billion on content this year, more than the $12.5 billion it spent in 2020. 

This will pressure profits and cash flow, but it will help drive subscriber growth in the second half of the year as a heavier slate of new releases comes out. Furthermore, none of the other competing services spends anywhere close to what Netflix does, cementing its first-mover advantage in the industry as it spreads those costs out over a massive subscriber base. 

To add to the discussion on competition, in the most recent earnings call, co-founder and co-CEO Reed Hastings highlighted that other, newer services entering the market were not to blame for the subpar quarter. “Our largest competitor for TV viewing time is linear TV, our second largest is [Alphabet‘s] YouTube, which is considerably larger than Netflix in viewing time and [Walt] Disney is considerably smaller,” he said. 

I tend to agree with him. And if newcomers streaming services like Disney+ and AT&T‘s HBO Max give you pause, then consider this: About 90% of customers to these two services also subscribe to Netflix, while only 20% and 50% of Netflix subscribers are also customers of HBO Max and Disney+, respectively. This demonstrates the value proposition Netflix offers. 

The final word 

Netflix is still the leader in streaming. As it continues to spend billions on award-winning content, membership will keep rising over time, particularly overseas. Even if the company only adds 9 million total customers during the rest of the year, that would still equate to 50 million over the last two years. Investors should take this pessimism surrounding the stock (and the short-term price drop) as an opportunity to buy shares. 

Additionally, the company is on the verge of being sustainably cash-flow-positive, with planned share repurchases supporting shareholder returns. Although the pandemic boost has faded, investors don’t need to worry. 

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Neil Patel has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Netflix, and Walt Disney. The Motley Fool has a disclosure policy.

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

More reading

• Netflix wins big at the Oscars
• Netflix doubled profits, but it can’t keep paying this price
• Broker weighs in on the Redbubble (ASX:RBL) share price after its 20% dive
• Are Netflix’s woes a warning for ASX tech shares?
• Analyst sees Netflix falling 38% after earnings

Neil Patel has no position in any of the stocks mentioned. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Netflix, and Walt Disney. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Netflix, and Walt Disney. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Netflix’s pandemic boost is over — but here’s why I’m not worried appeared first on The Motley Fool Australia.

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

from The Motley Fool Australia https://ift.tt/2R3AaiF

South32 Ltd (ASX: S32) shares are edging higher this morning after the company released its results for the quarter ended 31 March.

At the time of writing, the South32 share price is swapping hands for $2.89, up 0.7% from yesterday’s close of $2.87. 

Let’s take a close look at what the company has been up to over the last quarter.

The quarter that’s been for South32

The South32 share price is in the green today after the mining company reported a good quarter for its cash position.

This was bolstered by increased commodity prices, strong operating performance and a reduction in working capital. South32’s cash balance increased by US$242 million over the quarter, leaving it with US$517 million in its coffers. 

South32 received US$46 million of net distributions from its manganese equity-accounted investments. As well, US$40 million in cash and US$15 million in shares flowed in from selling assets to Elemental Royalties Corp.

The company executed an on-market buy-back of 42 million of its own shares for an average of $2.78 apiece during the quarter. It also paid US$66 million worth of fully franked dividends.

In further news impacting the South32 share price, the company advised its operating costs are continuing according to plan and capital expenditure guidance of US$515 million is unchanged.

South32 paid US$28 million towards exploration programs and development options in the nine months ended March 2021.

The company further advised US$23 million of expenditure is to be incurred by the company’s Dendrobium Next Domain (DND) life extension project over the coming quarter. Expenditure guidance for the project was previously withdrawn after South32’s DND plan was rejected by the Independent Planning Commission.

This quarter, South32 has continued its pre-feasibility study for the Taylor Deposit with work expected to be finished next quarter. It’s also conducting a scoping study at the Clark Deposit which is expected to be finished in the first half of the 2022 financial year.

The company is also continuing its divestment of South Africa Energy Coal. It will no longer be providing capital expenditure guidance for the project. The miner has continued to pay for the project this quarter to underpin its sustainability.

While the risk of COVID-19 is ongoing across most of South32’s explorations, drilling and fieldwork continued this quarter.

Commentary from management

South32 CEO Graham Kerr commented on the quarter that’s been for the company, saying:

We continue to reshape our portfolio, moving closer to the divestment of South Africa Energy Coal while progressing studies for our base metals development options.

Looking ahead, we expect the global economic recovery combined with fiscal stimulus to continue, driving a rebound in metal demand and sustaining higher prices for many of our key commodities.

South32 share price snapshot

South32 shares have been performing well on the ASX so far this year.

Currently, the South32 share price is up 15.4% year to date. It’s also up almost 52% over the last 12 months.

The company has a market capitalisation of $13.6 billion, with approximately 4.7 billion shares outstanding.

More reading

• History is on the side of the battered AMP (ASX:AMP) share price as it plans its demerger
• Top broker picks ASX shares next in line for a profit upgrade
• South32 (ASX:S32) share price on watch after being added to conviction buy list
• 5 things to watch on the ASX 200 on Thursday
• Acquisitions and spin-offs put these 3 ASX shares on brokers’ “buy” list

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.

The post The South32 (ASX:S32) share price is up this morning. Here’s why appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3esPs8U

On Monday I looked at three ASX shares that brokers have given buy ratings to this week.

Unfortunately, not all shares are in favour with them right now. Three that have just been given sell ratings are listed below. Here’s why these brokers are bearish on these ASX shares:

Commonwealth Bank of Australia (ASX: CBA)

According to a note out of Morgan Stanley, its analysts have retained their underweight rating but lifted their price target on this banking giant’s shares to $83.00. The broker is very positive on the banking sector and suspects that the earnings upgrade cycle will continue. This is expected to support a dividend recovery, much to the delight of income investors. Nevertheless, it believes the Commonwealth Bank share price is overvalued at the current level and sees more value in some of its peers. The Commonwealth Bank share price is trading $88.55 today.

Iluka Resources Limited (ASX: ILU)

A note out of Credit Suisse reveals that its analysts have retained their underperform rating and $5.70 price target on this mineral sands producer’s shares. This follows the recent release of Iluka’s quarterly update. While Credit Suisse notes that zircon and rutile sales were strong, it was disappointed by the performance of the Sierra Rutile operation. Unfortunately, it is expecting the operation to continue to struggle and weigh on its performance. The Iluka share price is fetching $7.49 on Tuesday.

OZ Minerals Limited (ASX: OZL)

Another note out of Credit Suisse reveals that its analysts have retained their underperform rating and $16.15 price target on this copper producer’s shares. This follows the release of its quarterly update last week. It notes that OZ Minerals’ production during the quarter was softer than expected due to issues at the Carrapateena mine. And while it is expecting a stronger performance in the current quarter, it isn’t enough for a change in rating. Credit Suisse continues to believe its shares are expensive at the current level. The OZ Minerals share price is trading notably higher than this price target at $24.62 today.

More reading

• What’s behind the rising BHP (ASX:BHP) share price today?
• What could APRA’s climate guidance mean for ASX bank shares?
• Is the Commonwealth Bank (ASX:CBA) share price a buy at $90?
• CommBank (ASX:CBA) share price hits new 52-week high
• Is the CBA (ASX:CBA) share price a buy for a recovery of dividends?

Motley Fool contributor James Mickleboro 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.

The post Leading brokers name 3 ASX shares to sell today appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3gG66Vf

Starpharma Holdings Limited (ASX: SPL) shares are having a mixed morning after the Aussie healthcare group’s latest quarterly update. The Starpharma share price opened today’s session 5.88% higher at $1.80.

However, since then, the company’s shares have been swinging between red and green. Currently, Starpharma shares are trading at $1.715, up 0.88% for the day so far.

Let’s take a look at how the company has been performing.

What’s impacting the Starpharma share price?

Starpharma today reported its quarterly cash flow and activities report for the period ended 31 March 2021.

The company reported net operating cash outflows of $5.8 million which included significant investment in DEP/VIRALEZE clinical trials. VIRALEZE product manufacturing and launch costs also contributed to the result.

In February, Starpharma reported a new research agreement with Merck & Co. Inc using its proprietary DEP technology for dendrimer-based antibody drug conjugates (ADCs). The Starpharma share price shot 15.7% higher on 12 February following the announcement.

The company also signed an exclusive arrangement for its VIRALEZE product on 25 March with LloydsPharmacy/McKesson UK. VIRALEZE was the fastest-selling product on record on LloydsPharmacy.com in its first week following the 29 March launch. 

The Starpharma share price is gradually edging higher today following the company’s update on its DEP trials. Phase 2 DEP irinotecan trials “continue to progress well” with 40 patients now recruited. Starpharma also reported “encouraging efficacy signals observed” in its DEP docetaxel clinical trials.

Starpharma CEO Dr Jackie Fairley said, “It has been an important quarter for Starpharma with multiple value-adding milestones achieved in the DEP portfolio, in addition to the commercialisation and launch of VIRALEZE”.

AstraZeneca significantly expanded its clinical program for DEP AZD0466 during the quarter. That will now include a “multi-centre global phase 1 study with a focus on haematological tumours” aimed at rapid development and approval of the anti-cancer drug.

Foolish takeaway

The Starpharma share price is edging higher on the back of this morning’s quarterly update. Shares in the Aussie pharma group jumped almost 6% at the open before retreating to their current levels.

More reading

• Why the Starpharma (ASX:SPL) share price is up 27% in 2021
• Why the Starpharma (ASX:SPL) share price is tumbling lower today

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

The post Starpharma (ASX:SPL) share price edges higher on update appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/32QbT2p

The A2 Milk Company Limited (ASX: A2M) share price continued its demise yesterday, hitting a fresh, 3-year low. Shares in the infant formula producer are down 37% year-to-date as the company battles multiple headwinds.

So, what is fuelling the fall of the A2 Milk share price and when will it recover?

At the time of writing, the A2 Milk share price is down 2.45%, trading at $6.98. 

China souring A2 Milk share price

Despite being a perennial market darling, a2 Milk has struggled to absorb the full impact of the COVID-19 pandemic. With a large portion of the company’s sales relying on Chinese consumers, border closures and trade regulations have hampered the company.

Multiple earnings downgrades served as a catalyst for the A2 Milk share price to tank. The company attributed the poor performance to weakness in the daigou and cross-border e-commerce (CBEC) channels. With no tourism and international students coming into Australia, both the retail and corporate daigou markets have struggled.

This was reflected in the company’s half-year results which were released earlier this year. For the six months ended 31 December, the company reported a 16% decline in revenue to NZ$677.4 million. In addition, A2 Milk posted a 32.2% decline in earnings before interest, tax, depreciation and amortisation (EBITDA) to NZ$178.5 million.

Recently, analysts at broker Morgan’s painted a dour outlook for a2 Milk. Despite being supporters of the company, analysts downgraded a2 Milk’s shares to a hold rating and issued a  revised price target of $8.34.

Outlook for the share price

Although Morgans have a negative outlook for A2 Milk, analysts at broker UBS expect the contrary. Recently, analysts from the broker issued a buy rating on A2 Milk citing a meaningful recovery in indirect infant formula sales over the next 2 years. Analysts also noted that the company could make substantial gains in market share in China through offline roll-outs and expansion of a free trade zone.

Currently, A2 Milk is one of the most shorted companies on the ASX, with a 5.9% short holding. As long as international borders remain closed, A2 Milk will be dealt with a difficult trading environment. Therefore, the obvious catalyst for the company’s share price would be a re-opening of international borders. However, there is also the notion of demand as Chinese consumers could have shifted to domestic products during the pandemic. Another hurdle for A2 Milk is whether the Chinese government will impose tariffs or other restraints on its products.

More reading

• Why these ASX shares just hit 52-week lows or worse
• Bubs (ASX:BUB) share price hits multi-year low but could keep sinking
• This broker thinks you should buy the Kogan (ASX:KGN) share price dip
• Top brokers name 3 ASX shares to sell next week
• Why a2 Milk, Centaurus Metals, Kogan, & Youfoodz are sinking today

Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. 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.

The post The A2 Milk (ASX: A2M) share price is at a 3-year low appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3xs3JeD

The Life360 Inc (ASX: 360) share price has been a strong performer on Tuesday morning.

At the time of writing, family safety app company’s shares are up over 9% to a record high of $5.72.

Why is the Life360 share price on fire today?

Investors have been scrambling to buy the company’s shares this morning after it announced a potential acquisition.

According to the release, the company has entered into a non-binding term sheet for the acquisition of Jiobit for US$37 million. This could increase to US$54.5 million if certain performance targets are achieved in the two full calendar years following completion.

What is Jiobit?

Jiobit is a provider of wearable location devices for young children, pets, and seniors. It provides families a comprehensive location-aware safety solution that is accurate, secure, reliable and real-time.

This solution combines a discreet wearable called the Jiobit Location Monitor, with mobile-based software services, combined with patented location technology.

The release notes that Life360 has been monitoring this segment of the location awareness market for several years, knowing it would potentially accelerate its strategy to broaden market reach.

Management believes Jiobit’s combination of quality hardware, patented Progressive Beaconing proprietary connection technology and subscription-based real-time location awareness intersects with Life360’s high standards of performance and technology capability.

Furthermore, it is complementary to the company’s core mission of family operations, safety, and security. It also feels Jiobit will allow Life360 to tap into two fast growing markets: the multi-billion pet supplies and services and elder care markets.

Jiobit expects its total annualised revenue run rate for the month of December 2021 will be US$11.7 million. This comprises US$5.7 million of subscriptions and US$6 million from other sources, which primarily consists of hardware device sales.

Strategic review

Management notes that this proposed acquisition represents the first stage of the strategic review previously announced in February.

That review has seen the company execute a strategy to enlarge and enhance its core user base of families with teenagers by moving into both younger and older demographics.

With the launch of Membership in July 2020, Life360 made the initial step in this direction, offering a significantly enhanced suite of bundled products focused on the safety and security of the family.

Expanding into the complementary business of hardware-based location awareness is part of this broader strategy, extending Life360’s audience reach and opening up a new segment of younger, tech savvy parents with pre-teen kids, independent home living seniors, and pets.

Positively, by bundling Jiobit’s high value, low-cost physical device into Life360’s top membership tiers, it is expected to significantly boost both conversion and retention.

The Life360 share price is now up 47% since the start of 2021.

More reading

• 2 buy-rated mid cap ASX shares
• 2 of the best mid cap ASX shares to buy
• EML Payments (ASX:EML) and these ASX shares just hit new highs
• 2 very exciting ASX tech shares to buy in April
• 2 stellar ASX tech shares to buy in April

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Life360, Inc. 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.

The post Life360 (ASX:360) share price jumps 9% to record high on acquisition news appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/32REvZe

The small end of the Australian share market is home to a number of companies with the potential to grow materially in the future.

Three that investors might want to get better acquainted with are listed below. Here’s why they should be on your watchlist:

Audinate Group Limited (ASX: AD8)

Audinate is a leading digital audio-visual networking technologies provider. The key product in its arsenal is its popular Dante audio over IP networking solution. This solution is used across a number of industries and is the clear industry leader. For example, the number of Dante enabled products manufactured by its customers is eight times greater than its nearest rival. This puts the company in a great position to benefit from increasing demand once the pandemic passes. In fact, this demand is already showing, with Audinate reporting its highest ever quarterly revenue last week.

Serko Ltd (ASX: SKO)

Serko is an online travel booking and expense management provider. Its two key products are the Zeno Travel and Zeno Expense platforms. Serko’s Zeno Travel provides AI-powered end-to-end travel itineraries, cost control and travel policy compliance to corporate customers. Whereas Zeno Expense allows businesses to automate and streamline their expense administration function, identify out-of-policy expense claims, and prevent fraud. Given its exposure to travel markets, it will come as no surprise to learn that demand has fallen heavily during the pandemic. However, with travel markets beginning to recover, Serko has also reported improvements in its performance. Another positive is that a significant deal with travel giant Booking.com could be a game-changer once trading conditions return to normal.

Universal Store Holdings Limited (ASX: UNI)

Universal Store is a fashion retailer aiming to deliver a frequently changing and carefully curated selection of on-trend products to the fashion focused customer. Unlike the others, it has been a particularly positive performer during the pandemic. For example, during the first half of FY 2021, Universal Store reported a 23.3% increase in sales to $118 million and a 63.6% increase in underlying net profit after tax to $21.1 million. Positively, it is expecting a strong second half and bumper full year profit result. Looking further ahead, the company has opportunities to expand its footprint meaningfully over the next decade to drive further growth. As things stand, management has identified up to 60 new store sites. This compares to the 65 stores it was operating from during the first half.

More reading

• 2 small cap ASX shares that are growing quickly
• The ASX share to go gangbusters as COVID vaccines roll out
• 3 growing small cap ASX shares to watch
• Brokers name 3 ASX shares to buy now
• Audinate (ASX:AD8) share price climbs on Q3 update

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 Serko Ltd. The Motley Fool Australia owns shares of and has recommended AUDINATEGL FPO. The Motley Fool Australia has recommended Serko Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post 3 exciting small cap ASX shares for your watchlist appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3aF573M

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

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

The world’s largest audio streaming platform, Spotify (NYSE: SPOT), saw its stock price decline by more than 10% at one point in the last week amid announcements for new audio features from Apple (NASDAQ: AAPL) and Facebook (NASDAQ: FB). Since some of these new products are targeted at the podcasting space, investors seem to be worried that the potential added competition could hurt Spotify.

But before Spotify shareholders rush to the exits, it’s worth examining whether this is truly important news, or simply investing noise. Let’s take a closer look at what was announced and whether it might actually have an effect.

Impending competition

Before diving into why Spotify might be well-positioned to deal with these competitive threats, it’s important to understand what the threats actually are. Earlier this week, Facebook announced that it will be introducing several new audio features to its platform. Some of these include short sound bites to share with friends, podcasts, and a live audio product for open discussions.

Although most of these are designed to be social features, Facebook’s podcasting product would be a direct competitor to Spotify. With 2.8 billion total monthly active users, it’s understandable that investors would fret at the idea of Facebook joining the audio space. But there was more seemingly bad news that followed. 

A few days after the Facebook news dropped, Apple had its spring event, where it announced an array of new products. Alongside new iterations of the iMac and iPad, the company announced that it’s revamping its podcast app for the first time in several years and even building a podcast subscription. Although Apple didn’t mention any details about possible pricing, the subscription would unlock additional content like ad-free shows and the ability for listeners to support their favorite podcasts financially. 

The updated version would allow podcast creators to set their own pricing and even dictate what additional content their listeners get access to. While this subscription would unlock some new monetization strategies for creators within the Apple Podcasts app, participating podcasts would not have to be exclusive on Apple.  

What does this mean for Spotify?

Though it’s clear that competition in the audio space is heating up, some of the announcements will ultimately benefit Spotify as well. Each of these new announcements has the same end goal: boosting the number of listeners on the respective platforms. Regardless of where the end-user listens, Spotify still owns the majority of podcast distribution thanks to its acquisitions of podcasting specialists Anchor and Megaphone.

According to Spotify, Anchor accounts for more than 70% of new podcasts on its platform. While it’s impossible to tell what that data looks like on other platforms, Anchor distributes podcasts everywhere, so it’s probably fair to assume the data is similar across most apps. So while redirecting the listeners to other apps could potentially hurt Spotify’s subscription revenue, the revenue it generates from Anchor and Megaphone would likely grow as more and more advertisers seek the larger podcasting audience. 

Before Apple’s announcement, eMarketer reported that Spotify was set to surpass Apple podcast listenership for the first time ever in 2021, and it’s likely safe to assume that projection still stands. Spotify has grown its position in the podcasting market not by acquiring existing listeners, but by creating new podcast listeners. A year ago, only 16% of Spotify’s total monthly active users engaged with podcast content, and today that number stands at 25%. While Apple’s and Facebook’s new announcements might garner some attention, it’s hard to see Spotify’s growth within its existing user base stopping anytime soon.

Is this the time to buy? 

Ever since its inception in 2006, Spotify has endured bumps in the road and heavy competition, and all along the way, it continued to grow its user base. Though these recent announcements could mean increased competition, Spotify has proved itself to be the dominant platform in audio with more than 345 million total monthly active users. 

With its stock now off more than 20% from its highs and trading at its lowest revenue multiple in the last nine months, this strikes me as a good opportunity for long-term investors to add shares. 

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

More reading

• Apple takes aim at Spotify’s podcast ambitions
• Apple introduces slate of updated and new products
• Cathie Wood’s ARK Invest only owns 4 Dow stocks, and they aren’t what you think
• How Apple can afford to pay twice as much as Spotify for music streaming
• Apple’s iPhone 12 shows its 5G dominance

Ryan Henderson owns shares of Spotify Technology. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Apple, Facebook, and Spotify Technology and recommends the following options: short March 2023 $130 calls on Apple and long March 2023 $120 calls on Apple. The Motley Fool Australia has recommended Apple and Facebook. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Isn the right time to buy Spotify? appeared first on The Motley Fool Australia.

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

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

The Cirralto Ltd (ASX: CRO) share price is slipping in opening trade after the company released its third-quarter update this morning. In what could be a tug of war between the bulls and bears, the Cirralto share price is down 1.18% at the time of writing, trading at 8.4 cents.

Third-quarter highlights 

In its update for the quarter ending 31 March (3Q21), Cirralto announced a 25% increase to $294,000 in total cash receipts from customers. The company is still in the testing phase of its payments technology, which might explain the relatively lacklustre growth.

It plans to launch the payments platform on 1 May 2021.

Cirralto used this quarter to put together the pieces it needs to drive growth in the near term. This included recruiting and integrating new talent into the team, optimising operational systems and building market momentum for its Spenda software product.

The company said it had translated into a 1,088% increase in total leads from 35 in the second quarter FY21 to 416 in 3Q21. As well, there was a 121% increase in website session views between the second and third quarter. 

Cirralto is focusing on expanding the capabilities of Spenda. The software includes real-time digital business payment services, debt collection software, a dynamic POS and inventory management system. The company is currently releasing additional features to expand its addressable market and competitiveness. 

Why it could go either way for the Cirralto share price 

Cirralto’s quarterly highlights relatively stagnant growth for the richly valued, transaction services business. This quarterly reporting season has been particularly punishing for companies that have not been able to live up to expectations. 

On the flip side, Cirralto has used this quarter to ready its springboard for accelerated growth towards the end of the year.

The launch of its upgraded technology platform, increased brand awareness, previous capital raising, zero debt and increased headcount could all contribute to more growth in the future. 

More reading

• Why the Damstra (ASX:DTC) share price is jumping 9% higher today
• Spark Infrastructure (ASX:SKI) share price on watch on latest update
• Here’s why the BlueScope (ASX:BSL) share price is shooting 8% higher today
• Cleanaway (ASX:CWY) share price falls on acquisition update
• BINGO (ASX:BIN) share price charges 7% higher on takeover agreement

Motley Fool contributor Kerry Sun 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.

The post Could this quarterly sink or swim the Cirralto (ASX: CRO) share price? appeared first on The Motley Fool Australia.

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