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The past few months have proved challenging for the Dicker Data Ltd (ASX: DDR) share price.

Its shares were up some 15% year-to-date after hitting a record high of $12.60 on 9 February. Rising bond yields in mid-February saw a broad selloff in tech shares and, with it, sent the Dicker Data share price some 20% lower in the coming weeks. 

The Dicker Data share price is attempting to return to positive territory, up almost 7% this week. 

Why the Dicker Data share price could be on watch in 2021 

Dicker Data represents a classic example of a falling or flattening share price while business fundamentals continue to improve. 

Dicker Data is an Australian hardware, software and cloud distributor with a valued partner base of over 6,000 resellers. The company distributes a wide portfolio of products from some of the world’s leading technology vendors including Cisco, Citrix, Dell Technologies, Hewlett Packard Enterprise, HP, Lenovo and Microsoft. 

In FY20, the company’s revenues increased 13.6% to $2 billion, while net profit after tax increased 5.3% to $57.2 million. Dicker Data has a strong history of steady or growing earnings, with a respective five year compound annual growth rate of 14.0% and 19.2% for revenue and earnings before interest, taxes, depreciation, and amortization (EBITDA).

What’s in store for the Dicker Data share price in 2021? 

Dicker Data has highlighted the working from home movement as a key focus in 2021. It observes that the shift to working from home has seen the digital transformation of businesses rapidly accelerate. It believes there is now a large opportunity as IT departments no longer have to secure just office environments but home user environments as well. 

The rollout of 5G networking and technologies is what Dicker has called ‘the next wave of data creation’ and presents an opportunity to capitalise on new devices and infrastructure. The company believes 5G will usher the next era of cloud solutions that will enable real-time decision making, further driving the cloud’s consumption and the company’s recurring revenues. 

To address increasing demand, Dicker Data has invested in a new warehouse facility in Kurnell, NSW. This will increase its existing warehouse space by over 80% to 22,965 sqm, providing space for increased inventory holding and further technology portfolio diversification. 

The Dicker data share price is trading marginally higher today at $10.77.

More reading

• Airtasker (ASX:ART) share price continues rollercoaster
• Why the Tilt Renewables (ASX:TLT) share price is in focus
• Brokers name 3 ASX shares to buy now
• Better buy: Microsoft vs. Alphabet
• Why Newcrest (ASX:NCM) and Northern Star (NST) shares are flying high today

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Dicker Data 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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Airtasker Ltd (ASX: ART) shares are continuing on a wild ride today, after rocketing 10% yesterday to rebound from two consecutive days of falls. The Airtasker share price opened slightly lower this morning before rallying 4.6% to $1.47. However, at the time of writing, Airtasker shares have retreated back to $1.40, down 1.06% for the day so far. 

Airtasker is a digital disruptor in the job-sharing space, providing an app-based community platform that connects people who need to outsource tasks and find local services, with people who are looking to earn money and ready to work.

It helps facilitate work such as home cleaning, repair jobs, admin, photography, graphic design or even website building. The platform is popular among young people and those working in the so-called ‘gig economy’. The company generates revenue from service fees and stored value brokerage.

Airtasker executed its initial public offering (IPO) one month ago and, since then, has become one of the most talked-about companies on the ASX. It’s been a favourite of the much-discussed ‘Reddit Army’ of retail day traders, which has led to huge fluctuations in the Airtasker share price.

Airtasker constantly in the news

In addition to the Reddit coverage, and the mainstream interest this can garner for new shares, Airtasker has also found regular coverage across news outlets.

From reports of one Airtasker user paying $600 to transport a puppy, to a DIYer making an income assembling IKEA furniture, the variety of interesting news bites the company’s users can produce could become an infinite stream of free publicity. This is in addition to the paid publicity it’s sourcing from a range of social media influencers.

Airtasker share price snapshot

Arguably, Airtasker has become the ASX’s GameStop, rising by as much as 200% in a single day. The ASX has exercised mild controls over rapid price surges, placing temporary trading halts and constantly monitoring Reddit threads for pump-and-dump encouragement. 

However, it’s also made it clear that “hysterical enthusiasm” isn’t against the rules. Despite declining three out of five days this week, at the time of writing, the Airtasker share price is still up 8.5% for the week so far. To date, it has also rallied by around 117% from its IPO list price. 

More reading

• Wilson Asset Management (WAM) thinks these 2 ASX shares are a buy
• 88 Energy and Airtasker were among the most traded ASX shares last week
• Is Canva coming to the ASX?
• The Airtasker (ASX:ART) share price finished 77% higher in March
• Why it’s turning into a bad week for Airtasker (ASX:ART) shares

Motley Fool contributor Lucas Radbourne-Pugh 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 Tilt Renewables Ltd (ASX: TLT) share price is back in the news. Shares in the trans-Tasman renewables group surged higher in March after agreeing a $2.7 billion takeover offer led by AGL Energy Limited (ASX: AGL) and Mercury NZ Ltd (ASX: MCY).

That could be about to change, however, with a rival bidder lobbing an offer worth 20 NZ cents per share more.

Why is the Tilt Renewables share price on watch?

According to an article in the Australian Financial Review (AFR), Canadian pension fund CDPQ has re-entered the bidding war.

CDPQ has reportedly offered NZ$8.00 per share for Tilt. That is higher than the NZ$7.80 per share agreed with a vehicle established by QIC Ltd, AGL and Mercury.

According to the article, CDPQ’s offer is understood to be binding and fully funded. PowAR, the shared investment vehicle of QIC and AGL, and Mercury do hold a matching right in the deal.

The Tilt Renewables share price will be one to watch as the takeover saga drags on. However, shares in the Aussie renewables group remain in a trading halt since Thursday.

CDPQ has over C$360 billion in assets under management and is a major Canadian pension fund. That puts the ball back in PowAR and Mercury’s court on whether they want to match the NZ$8.00 per share bid.

The Tilt Renewables share price last traded at $7.00 per share on the ASX. On New Zealand’s Stock Exchange (NZX), Tilt’s shares last traded at NZ$7.60 per share.

Goldman Sachs is advising Tilt’s largest shareholder, Infratil Ltd (ASX: IFT), which currently owns a 65.5% stake in the trans-Tasman group.

According to today’s article in the AFR, both the PowAR/Mercury bid and CDPQ see strategic value in the significant portfolio of Australian and New Zealand renewables assets.

Foolish takeaway

The Tilt Renewables share price will be worth watching when it returns to trade as takeover bids heat back up. CDPQ has re-entered the bidding war 

More reading

• Top brokers name 3 ASX shares to sell today
• Origin (ASX:ORG) share price edges higher after hydrogen update
• The ClearVue (ASX:CPV) share price is up 65% in a month. Here’s why
• Top brokers name 3 ASX shares to sell next week
• These 3 ASX companies are leading the way to net zero emissions

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.

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Australia’s top brokers have been busy adjusting their estimates and recommendations once again. This has led to the release of a number of broker notes.

Three broker buy ratings that have caught my eye are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

Appen Ltd (ASX: APX)

According to a note out of Citi, its analysts have retained their buy rating and $30.90 price target on this artificial intelligence (AI) services company’s shares. The broker notes that one of its rivals, Scale AI, has recently raised US$325 million in fresh funding. This doubles its valuation to US$7 billion in a matter of months. Citi believes this is a positive read through for Appen in relation to the outlook for the AI training data market. Though, it acknowledges that the company may have to increase its investment to stay ahead of the competition. The Appen share price is currently fetching $17.17.

Qantas Airways Limited (ASX: QAN)

A note out of Macquarie reveals that its analysts have retained their outperform rating and lifted their price target on this airline operator’s shares to $6.45. This follows an update out of Qantas this week revealing that it is expecting its domestic capacity to increase beyond pre-COVID levels in FY 2022. Overall, Macquarie believes that structural business improvements made during the pandemic will eventually lead to higher profitability. The Qantas share price is trading at $5.15 on Friday morning.

Zip Co Ltd (ASX: Z1P)

Analysts at Morgans have retained their add rating but trimmed their price target on this buy now pay later (BNPL) provider’s shares to $10.39. This follows the completion of its $400 million convertible notes offering. According to the note, the broker believes this leaves Zip with $500 million of cash to support its growth plans. It feels this is enough to fund the company’s operations for some time to come, ruling out any further capital raisings in the near term. The Zip share price is currently fetching $9.19.

More reading

• ASX 200 rises, Zip sinks, BOQ reports
• Zip (ASX:Z1P) eyes potential stock and crypto trading services
• Top broker tips Zip (ASX:Z1P) share price to rocket higher
• Why BrainChip, Regis Resources, Whitehaven, & Zip shares are tumbling lower
• ASX 200 flat: Zip raises $400m, Bank of Queensland results, Regis crashes

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 Appen Ltd and ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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

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

Microsoft (NASDAQ: MSFT) and Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) are two of the mega-cap technology companies that currently dominate the stock market. Both stocks are up over 700% in the past decade (compared to the S&P 500 at 200%) and now have market caps of $1.9 trillion (for Microsoft) and $1.5 trillion (for Alphabet).

Microsoft has continued its dominance of the workplace software market and also ventured into other profitable businesses like Azure (its cloud computing division) and business-focused social network LinkedIn, while Alphabet continues to lead the search and online advertising markets. But which stock is the better buy going forward? Let’s take a look.

Alphabet is a juggernaut

Alphabet’s search and advertising business is a juggernaut, growing substantially over the past few years even though it is now larger than a small nation’s GDP. The search and ad segment is the majority of Alphabet’s current business and houses search, YouTube, and other Google media properties. Last year, Google services operating income hit $54.6 billion, up from $49 billion in 2019 and $43.1 billion in 2018.

However, Alphabet’s overall operating income in 2020 was only $41.2 billion, which was significantly less than its search and advertising division. How did this happen? Because the company’s two other subsidiaries (Google cloud and “other bets”) are currently generating heavy operating losses. This shouldn’t scare investors, though. Google cloud lost $5.6 billion in 2020 on $13 billion in revenue, but this is to be expected with all the upfront spending that is required to run a cloud computing service, especially when the company is trying to compete with the market leaders in Amazon‘s Amazon Web Services and Microsoft’s Azure.

“Other bets” is a bit different, as it is a collection of moonshot start-ups that Alphabet is trying to build and potentially spin off as separate companies. One example is Waymo, the leader in self-driving technology, which was spun off from Alphabet in 2016, but there are many start-ups within this segment.

Right now, Alphabet stock currently trades at a price-to-earnings ratio (P/E) of 35.8. This looks high, but if you just look at Google services operating income of $54.6 billion (ignoring other bets and Google cloud), that P/E comes down to a more reasonable 27, which is well below the average market multiple at the moment.

Microsoft is growing at double-digit rates

Microsoft has seen many of its business lines grow at double-digit rates over the past few years since it transitioned to cloud-based services at the end of Steve Ballmer’s tenure and expanded them under current CEO Satya Nadella. Microsoft 365 Business, which puts more emphasis on secured cloud services, grew revenue by 21% last quarter, while the personal computing division grew by 12% to $15.1 billion. That is some impressive growth at the scale Microsoft is already operating in.

Microsoft’s fastest-growing division is its cloud computing unit Azure. Last quarter, Azure’s revenue grew 50% year over year. Azure falls under Microsoft’s intelligent cloud division, so investors don’t know its nominal revenue numbers. However, intelligent cloud as a whole grew revenue 23% last quarter to $14.6 billion, and you can assume Azure made up the majority of that growth.

Microsoft is also seeing solid growth from its Xbox and LinkedIn subsidiaries, plus it has acquired software collaboration hub Github and is rumored to be looking to acquire the social network Discord. This week it announced that it bought voice-to-text specialist Nuance Communications for $16 billion in the hopes of expanding its healthcare vertical. Finally, Microsoft just signed a multi-billion dollar contract with the U.S. Army to provide it 182,000 HoloLens augmented reality goggles.

Clearly, Microsoft is busy, with many different business lines humming along. Its valuation reflects that although its trailing P/E of 38 is still just below an inflated S&P 500 average hovering around 42.

Verdict

There’s a reason Microsoft and Alphabet both have market caps over $1 trillion. As you can see from the examples above, the businesses are phenomenal and are currently firing on all cylinders. But if I had to choose one company to own over the next decade, it would have to be Alphabet, mainly due to its cheaper valuation. I don’t think investors can go wrong owning either one of these stocks, but the odds currently tilt in Alphabet’s favor.

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

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Brett Schafer has no position in any of the stocks mentioned. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, 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), Amazon, and Microsoft and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), and Amazon. 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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The Newcrest Mining Ltd (ASX: NCM) share price and the Northern Star Resources Ltd (ASX: NST) share price have been strong performers on Friday.

At the time of writing, the shares of these gold miners are both up 4%.

Why are Newcrest and Northern Star shares charging higher?

There have been a couple of catalysts for the rise in the Newcrest and Northern Star share prices today.

The first is a rise in the gold price overnight. According to CNBC, the spot gold price rose 1.6% to US$1,764.70 an ounce after bond yields retreated.

This has given the overall sector a lift, leading to the S&P/ASX All Ords Gold index rising 3% this morning.

What else is driving their shares higher?

In addition to the rising gold price, a broker note out of Goldman Sachs this morning has given their shares a boost.

According to the note, the broker has upgraded both Newcrest and Northern Star to buy ratings from neutral.

Newcrest share price is cheap

In respect to Newcrest, Goldman has upgraded its shares to a buy rating with an improved price target of $33.50.

The broker made the move for three key reasons. One is its valuation. Goldman notes that its shares were trading at 0.76x net asset value (NAV) prior to today’s gain. This is the largest discount among ASX 100 gold peers and North American gold majors.

In addition to this, the broker points out that Newcrest’s value-accretive growth pipeline continues to develop, with project catalysts to come.

And thirdly, it believes its earnings will hold up at current levels despite production declines in the coming years.

Northern Star share price trading at a big discount

As for Northern Star, the broker believes the Northern Star share price is trading at an attractive level after recent weakness.

It notes that its shares trade at 0.83x NAV compared to 1.2x by its North American peers.

Outside this, Goldman likes Northern Star due to its organic growth opportunities across all production hubs and potential synergies from its merger with Saracen Mineral.

This could make both gold miners worth considering if you’re looking for exposure to the precious metal.

More reading

• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday
• Is it time for ASX gold shares to make a comeback?
• 5 things to watch on the ASX 200 on Tuesday

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.

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Mineral Resources Ltd (ASX: MIN) shares are sliding lower today after the company released its quarterly exploration and mining activities report. At the time of writing, the Mineral Resources share price is trading 4.32% lower at $43.23. The iron and lithium miner included both positive and negative news in its update.

Let’s take a closer look at the company’s quarterly report.

What went well for Mineral Resources this quarter?

The third quarter of the 2020 financial year saw Mineral Resources accomplish a number of achievements.

The miner saw the first iron ore shipments from its Womunna Iron Ore Mine commence during the quarter. 

Mineral Resources also commissioned 3 crushing plants – a NextGen 2 plant at Mount Whaleback, the Womunna plant and another at a third-party site. According to the release, the combined capacity of these plants is 31 million tonnes per annum.

The company was awarded 2 gas exploration titles in March, continuing its strategy to power its mining operations with its own natural gas supply. Thus, replacing diesel fuel with a lower cost and lower emissions alternative.

Mineral Resources will be hoping this places it in good stead to meet its goal of zero emissions by 2050. It’s also continuing plans to install a solar and battery array that could provide 30% of the Womunna mine’s power needs.

The company’s total iron ore production and shipping hasn’t changed since the previous quarter but were 44% and 51% higher respectively than the previous corresponding period.

The quarter saw iron ore prices reach a near-record high of US$144.80 per tonne.

Finally, Mineral Resources’ employee safety continued to be strong. No employees took time off work due to a workplace injury over the last 12 months and the company’s reportable injuries were down 13% compared to last quarter.  

Not all news within the company’s quarterly report was positive

There were 2 notable pieces of not-so-positive news in Mineral Resources’ quarterly exploration and mining activities report.

The first being shipping delays due to a shortage of truck drivers caused by coronavirus-induced border closures.

The company managed to ship just 4.1 million wet metric tonnes (wmt) of iron ore throughout the quarter, around the same amount as the previous quarter.

This is significantly below the guidance set before the pandemic hit Australia. Back then, Mineral Resources expected to ship between 19.5 million and 20.5 million wmt throughout the 2020 financial year (averaging approximately 4.8 million to 5.1 million wmt per quarter).

Mineral Resources states, on an average day, it produces around 10,000 wmt of iron ore that is unable to be shipped.

As no one can predict when sporadic border closures could end, the company’s iron ore shipment guidance for the 2021 financial year has been lowered. It now expects to ship between 17.4 million and 18 million wmt of iron ore throughout the 2021 financial year. This represents a goal of approximately 4.3 million to 4.5 million wmt per quarter.

Finally, Mineral Resources reported that its Mt Marion Lithium Project’s production was 16% lower than the previous quarter. It stated the lower production rate was due to lower-yielding ore being used in production, which is part of the company’s optimised long-term mine plan. Production at the mine is still 22% higher than the previous corresponding quarter.

Mineral Resources said its shipments of spodumene concentrate from the mine are back in line with expectations. The mine remains on track to meet or exceed its shipment guidance for the financial year.

Mineral Resources share price snapshot

The Mineral Resources share price has been performing well on the ASX as of late.

The miner’s share price is up 15.4% year to date. It’s also up by around 155% over the last 12 months.

Mineral Resources has a market capitalisation of around $8.5 billion, with approximately 188 million shares outstanding.

More reading

• Big brokers think these 5 ASX shares can outperform the market
• ASX 200 climbs, Crown soars, Mineral Resources drops
• Mineral Resources (ASX:MIN) share price falling despite good news

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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The Origin Energy Ltd (ASX: ORG) share price has come under pressure on Friday morning.

At the time of writing, the energy company’s shares are down 5.5% to $4.44.

Why is the Origin share price sinking?

Investors have been selling Origin’s shares today following the release of an update on its guidance for FY 2021.

As you might have guessed from the Origin share price reaction, the company isn’t performing as well as it expected.

According to the release, the company has downgraded its earnings guidance due to an adverse and unexpected outcome on a domestic gas contract price review and continued headwinds in energy markets’ operating conditions.

In respect to the price review, Origin has been engaged in a price review for gas purchased from the Otway Basin fields owned by Beach Energy Ltd (ASX: BPT).

This dispute was referred to arbitration, but Origin didn’t receive a favourable decision as it expected. As a result, the new gas price is likely to be materially above Origin’s expectations and recent comparable wholesale contracts.

The release explains that the outcome is expected to result in an increase in Origin’s cost of supply of $30 million to $40 million for FY 2021, before increasing to $60 million to $80 million in FY 2022.

Origin will now assess the timing and extent to which this increased cost of supply can be mitigated.

Origin CEO, Frank Calabria said, “We are disappointed in this decision which we believe is wrong, and entirely inconsistent with our prior experience in the gas market. This will result in a gas price that does not reflect market prices, and it is therefore a very poor outcome.”

What will the earnings impact be?

Combined with tough operating conditions, energy markets operating earnings is now expected to be in the range of $940 million to $1,020 million.

This is down from its previous guidance of $1,000 million to $1,140 million. It will also be a 30% to 35.5% decline year on year from $1,459 million in FY 2020.

One positive, though, is that some of the weakness in the energy markets division will be offset by the continued strong performance and upgraded guidance for Australia Pacific LNG.

Origin expects the cash distribution from Australia Pacific LNG to be greater than $650 million, driven by continued strong production and capital and operating cost discipline. This has resulted in a lower distribution breakeven of US$22-25/boe.

FY 2022 outlook

Management has warned that FY 2022 will be a tough year as well.

It explained: “As previously foreshadowed, challenging operating conditions in Energy Markets are expected to persist in FY2022. Electricity gross profit is expected to be lower, primarily due to a ~$20/MWh reduction in forward electricity prices compared to a relatively fixed cost supply on ~16 TWh.”

“Natural Gas gross profit is expected to decline, due to higher procurement costs as a result of price reviews and increases in the JKM index, as well as lower volumes and prices on commercial and industrial sales reflecting current subdued domestic market conditions.”

In light of this, Origin is continuing to target significant capital and operating cost savings and mitigating actions. This includes the roll out of the new retail operating model and Kraken platform over FY2022-2024.

Following today’s decline, the Origin share price is now down 11% over the last 12 months. This compares to a 30% gain by the ASX 200 index.

More reading

• Origin (ASX:ORG) share price edges higher after hydrogen update
• Buru Energy (ASX:BRU) share price jumps 6% on Canning Basin project
• How are ASX 200 shares faring in the carbon revolution?
• Genex (ASX:GNX) share price frozen on hydro project fund raising
• Top broker issues buy alert on Santos (ASX:STO) and these ASX energy shares

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.

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Coca-Cola Amatil Ltd (ASX: CCL) shares are slumping lower on Friday. At the time of writing, the Coca-Cola Amatil share price is sliding 1.26% to $13.29.

This comes as shareholders of the S&P/ASX 200 Index (ASX: XJO) listed beverage giant are voting on the long-proposed acquisition by Coca-Cola European Partners (CCEP).

Shareholders are meeting virtually this morning in Amatil’s Independent Shareholder Scheme Meeting, being held by management in Sydney.

What exactly are shareholders voting on?

Yesterday, after market close, Coca-Cola Amatil announced that the New Zealand Overseas Investment Office (OIO) had given the green light for CCEP to acquire up to 100% of the shares in Amatil. That ticked the last box needed to meet all the regulatory approval conditions precedent under the Implementation Deed.

CCEP initially announced its intention to acquire all the independently held shares in Amatil back in 2019. Since then, it has gradually increased its offer price. On 26 October 2020, CCEP offered $12.75 per share. On 15 February this year, the European beverage giant increased its offer to $13.50 per share.

The lengthy acquisition process was spurred along last month when the Supreme Court of New South Wales approved the convening of a scheme meeting.

What happens if Amatil shareholders approve the acquisition scheme?

According to Ilana Atlas, chair of Coca-Cola Amatil, if the scheme is approved and implemented:

CCEP will acquire all of the shares in Coca-Cola Amatil held by independent shareholders, being all shareholders other than The Coca-Cola Company, for $13.50 cash per share less the cash amount of the final second half 2020 dividend of 18 cents per share, which was announced on 18 February 2021. CCEP has declared this to be its best and final offer.

The company said it expects to pay the second half dividend on 30 April. Atop the 18-cent dividend, if the shareholders approve the scheme today, they’ll receive $13.32 cash per share upon implementation of the scheme. That’s expected to occur on 10 May.

Amatil’s Related Party Committee and group managing director Alison Watkins unanimously recommend that independent shareholders vote in favour of the scheme.

Coca-Cola Amatil share price snapshot

Following a big rise on 26 October, after the CCEP takeover offer was lifted to $12.75 per share, the Coca-Cola Amatil share price has gained another 4.2%.

Year to date, Coca-Cola Amatil shares are up 2.7%, compared to a gain of 5.6% on the ASX 200.

More reading

• 5 things to watch on the ASX 200 on Friday

Motley Fool contributor Bernd Struben 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 Mayne Pharma Group Ltd (ASX: MYX) share price is shooting higher on Friday morning.

At the time of writing, the pharmaceutical company’s shares are up a massive 28% to 59 cents.

This latest gain means the Mayne Pharma share price is now up 69% since the start of the year.

Why is the Mayne Pharma share price charging higher?

Investors have been buying the company’s shares this morning following the release of a very positive announcement.

According to the release, the US Food and Drug Administration (FDA) has approved the New Drug Application (NDA) from Mayne Pharma and Mithra Pharmaceuticals for the novel combined oral contraceptive Nextstellis.

Following this approval, Mayne Pharma anticipates the commercial launch of Nextstellis by the end of June 2021.

What is Nextstellis?

Nextstellis was developed by Mithra and is the first and only contraceptive pill containing estetrol. This is a native estrogen which is now produced from a plant source. Estetrol is also the first new estrogen introduced in the US in more than 50 years.

The release explains that almost 10 million American women use short-acting combination (estrogen and progestin) contraceptives. This led to the US market for combined hormonal contraceptives generating US$3.6 billion in sales for the 12-month period ending January 2021 according to IQVIA.

Mayne Pharma has a 20-year exclusive license and supply agreement in the US and Australia for Nextstellis. The product is still under active review at the Australian Therapeutics Goods Administration.

Positively, the University of California’s Professor and Director of Family Planning, Mitchell Creinin, spoke very positively about the product.

He said: “Nextstellis is a new innovative contraceptive that has been shown in clinical trials to be not only safe and effective but also well tolerated with a desirable bleeding profile and minimal impact on triglycerides, cholesterol and glucose, as well as weight and endocrine markers.”

Management commentary

Given that the company considers this an important milestone, it isn’t surprising to see the Mayne Pharma share price shooting higher.

The company’s CEO, Scott Richards, commented “The approval of Nextstellis represents an important milestone, providing women with a new choice for their reproductive health. We are delighted to be introducing a new estrogen and bringing to market this novel, safe and effective option for women to consider with their healthcare providers.”

“As a result of receiving FDA approval for Nextstellis, Mayne Pharma will pay Mithra US$11m in cash and issue 85.8m ordinary Mayne Pharma shares. Mithra is also entitled to a Mayne Pharma Board position. The new appointment will be subject to shareholder approval at the next Annual General Meeting in November 2021.”

Based on the current Mayne Pharma share price, those shares are worth approximately $50.6 million.

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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.

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