Tag: Motley Fool

Participants of the Airtasker Limited (ASX: ART) initial public offering (IPO) would have been rubbing their hands together on today’s successful listing. By the end of its debut trading session, the online marketplace for local services finished at $1.05. That puts the ASX-listed Airtasker share price 61.5% higher than the IPO price of 65 cents.

There’s no doubt plenty of excitement surrounding the company. The five times oversubscribed IPO is clear evidence of that. Even Airtasker’s own select group of ‘taskers’ and staff subscribed for more than 10 times more shares than originally anticipated.

With all the excitement it’s easy to forget that Airtasker still has competitors. So, how do they stack up against each other?

ASX-listed Airtasker competitors

Unsurprisingly, in the world of digital innovation, the old employment model is giving way to something more flexible and nimble. There is a proliferation of people working for themselves, using online platforms to offer their services anytime, anywhere, for anything.

Airtasker is now publicly listed among other such ASX shares as Hipages Group Holdings Ltd (ASX: HPG) and Freelancer Ltd (ASX: FLN). At face value, these companies are very similar. All three provide a website and/or mobile app to find people in your area capable of completing tasks you may require.

Both Airtasker and Freelancer offer an extensive range of services. This includes everything from computer programming to mowing your lawn. However, Hipages differs by being focused on trade-based services – think home renos and air conditioning installation.

Another point of difference between these companies is their service base. For instance, Hipages relies on mostly physical labour, so its operations are predominantly carried out within Australia. The same is somewhat true for Airtasker, while Freelancer operates extensively outside of Australia, due to its services being highly focused on remote digital work.

Money matters, and so do visits

When looking at online businesses, it can sometimes be handy to compare website traffic between peers. Referring to SimilarWeb, it can be seen that in the last month Freelancer has commanded 8.1 million visits, while Airtasker and Hipages were both around 1.3 million. However, this doesn’t quite paint the entire picture considering the ASX’s fresh face, Airtasker, is commonly used through an app.

A more useful comparison is the businesses’ finances. However, Freelancer reports on a different timeline to Hipages and Airtasker, so some calculations were needed to get it on comparative terms. With that being said, for the half-year ended December, revenue and earnings for each company are as follows:

• Airtasker: $12.61 million revenue; $2.06 million loss
• Hipages: $26.9 million revenue; $1.5 million profit
• Freelancer: $29.3 million revenue; $493,000 loss

In revenue terms, Airtasker is certainly the smallest by a substantial margin.

Lastly, knowing the company’s revenue and earnings, it’s worthwhile comparing market capitalisation between these three ASX shares. These are as follows:

• Airtasker: $441.6 million
• Hipages: $266.5 million
• Freelancer: $253.03 million

Foolish takeaway

Based on a simple price to sales (PS) ratio Airtasker looks expensive, trading on a PS multiple of 35. Whereas Hipages and Freelancer are trading at 10 times and 9 times respectively. Potentially investors are pricing in higher growth for the newly listed company.

Whether the listed competitors will surge to meet Airtasker’s rich valuation or Airtasker’s ASX parade will be rained on, remains to be seen.

More reading

• ASX 200 dips, travel shares drop, Pushpay soars
• Airtasker (ASX:ART) share price cools after explosive IPO
• Airtasker (ASX:ART) share price rockets 78% after IPO
• Airtasker’s ASX debut happens tomorrow, after 24-hour delay
• Airtasker IPO: staff demand 10 times the shares offered

Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Hipages Group Holdings Ltd. The Motley Fool Australia has recommended Freelancer 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 ReadyTech Holdings Ltd (ASX: RDY) share price will be one to watch on Wednesday.

This follows the release of an announcement after the market close on Tuesday.

What did ReadyTech announce?

This afternoon the education and workforce solutions software as a service (SaaS) company announced the successful completion of its $80 million acquisition of Open Office.

Open Office is a leading government and justice case management SaaS provider with strong customer bases in Australia, the United Kingdom, and Canada.

According to the release, the acquisition of Open Office involves an upfront consideration of $54 million and an earn out consideration of up to an additional $26 million. This will be funded from the proceeds of a capital raising in November and scrip.

The completion comes after shareholders voted overwhelmingly in favour of the acquisition at an extraordinary general meeting on Friday of last week.

The acquisition is anticipated to be low double-digit EPS accretive in FY 2021 on a pro-forma basis before synergies and excluding integration costs.

What now?

It will be business as usual for Open Office following the acquisition. ReadyTech advised that its experienced management are aligned with its vision, strategy and culture, and will be retained to further strengthen the expanded team.

Open Office’s Managing Director, Phillip Simone, will become ReadyTech’s Chief Executive of Government and Justice.

ReadyTech’s Co‐Founder and CEO, Marc Washbourne, commented: “We’re delighted to welcome the Open Office team to ReadyTech, and are excited by the growth potential we see for our expanded SaaS businesses. With growing revenues, strong margins, profitable operations and positive cashflows, ReadyTech is in a unique position to support our customers, build exciting careers for our people, and deliver sustainable growth in shareholder value.”

Mr Simone added: “Open Office has a strong foothold into all levels of government in Australia. This is an exciting new chapter for us, as ReadyTech’s proven capability will assist in driving deeper connections with an industry that has strong barriers to entry, leveraging the robust, long‐term relationships we already have with our customers.”

More reading

• 2 of the best ASX shares to buy this month
• 8 ASX 200 shares rated as ‘outperform’ by brokers
• Compared! How are ASX gaming share prices performing?
• Why the K-Tig (ASX:KTG) share price opened 10% higher today
• 2 quality ASX dividend shares to buy this month

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 Readytech Holdings Ltd. The Motley Fool Australia has recommended Readytech Holdings 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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If you’re looking to a make a new addition or two to your portfolio, then you might want to take a look at the ASX shares listed below.

Here’s what you need to know about them:

Appen Ltd (ASX: APX)

The first ASX share to look at is Appen. It is a developer of high-quality, human annotated datasets for machine learning and artificial intelligence (AI). Through its team of over 1 million crowd-sourced contractors, Appen develops the data required to create the AI models of some of the biggest tech companies in the world. An example of this, is its work helping Apple develop its Siri virtual assistant.

While the last 12 months have been difficult due to many tech giants pushing back some of their investments in AI because of the pandemic, demand is expected to rebound strongly once the crisis passes. After which, due to the growing importance of AI for businesses and governments, demand for its AI data services is predicted to grow rapidly over the next decade.

One broker that believes the recent weakness in the Appen share price is a buying opportunity is Ord Minnett. It recently upgraded its shares to a buy rating with a $24.75 price target.

NEXTDC Ltd (ASX: NXT)

Another ASX share to consider is NEXTDC. It is one of the region’s leading data centre-as-a-service provider with 11 world class centres in key locations across Australia.

From these Tier III and Tier IV facilities, NEXTDC provides colocation services to local and international organisations. 

Unlike Appen, NEXTDC has experienced a huge increase in demand for its services during the pandemic. This has been driven by the structural shift to the cloud, which has accelerated over the last 12 months. In fact, demand has been so strong, that the company brought forward capacity additions to meet it.

In addition to this, the company has opened up offices in Singapore and Tokyo with a view of expanding into these markets in the near future. If this expansion is a success, it could provide NEXTDC with a significant runway for growth.

Goldman Sachs is positive on the company. Last month it retained its buy rating and lifted its price target to $13.50. The broker believes NEXTDC is well-positioned for growth over the medium term.

More reading

• Why the Xero (ASX:XRO) share price is outperforming today
• How this exponential growth could send ASX 200 data centre shares soaring
• 5 of the best ASX shares to buy next week
• How to turn $20,000 into $650,000 in 5 years with ASX shares
• 5 things to watch on the ASX 200 on Friday

James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Appen 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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The anticipated higher interest rate environment and a recovery in the real economy has seen a number of cyclical ASX 200 heavyweights upgraded to an ‘outperform’ rating on Tuesday. Here are the ASX 200 shares that brokers think could beat the market in the near-term. 

Crown Resorts Ltd (ASX: CWN)

The Crown share price jumped 20% yesterday after Blackstone sent the company an unsolicited $11.85 per share takeover offer. Credit Suisse views this as an opportunistic offer to snap up depressed Crown shares amid weak earnings and regulatory risks. The broker believes the proposal suggests that Crown is unlikely to lose any of its casino licenses. 

Credit Suisse raised its target for the ASX 200 share from $12.00 to $13.50 with an outperform rating. The Crown share price closed Tuesday’s session at $11.85.

Suncorp Group Ltd (ASX: SUN) 

The insurance market is cyclical, moving through hard and soft cycles. Credit Suisse has described current conditions as a continued hard cycle whereby premiums increase and the capacity for most types of insurance decreases. This can be a result of factors such as falling investment returns for insurers or increased severity of losses. 

Suncorp shares have been under pressure following the significant flooding in New South Wales and South East Queensland. Credit Suisse has taken the view that Suncorp’s current -27% price-to-earnings discount to the market is significantly higher than its five-year average discount of -19%. 

It also forecasts earnings growth of approximately 11% in FY23 with the continued hard cycle to drive insurance revenue growth and improved margins. Suncorp shares are rated as outperform with an $11.40 target price representing a 15% premium to today’s closing price.

Insurance Australia Group Ltd (ASX: IAG)

Credit Suisse sees an uplift in premium growth in the coming years which will translate to improved margins. The broker views IAG’s current strong capital position as supportive of higher dividend payments in the near-term as profits recover.

Credit Suisse resumed coverage on Insurance Australia shares with an outperform rating and $5.35 target price – a 12% premium to today’s closing price. 

Medibank Private Ltd (ASX: MPL) 

Similarly, Credit Suisse analysts expect strong premium growth to underpin Medibank’s recent turnaround in penetration rates. The broker believes the company could see earnings upgrades in the near-term.

Medibank shares are rated as outperform with a $3.25 target price, which is around 12% higher than Tuesday’s closing share price.  

QBE Insurance Group Ltd (ASX: QBE)

Credit Suisse believes QBE is most leveraged to a hard cycle. The company is also the only general insurer with exposure to overseas markets, which are experiencing even stronger rate increases.

The broker has an outperform rating with an $11.80 target price, representing a 23% premium to today’s QBE share price. 

Ramsay Healthcare Limited (ASX: RHC) 

Macquarie Group Ltd (ASX: MQG) highlights the upside to the value of Ramsay’s Australian operating business that is not reflected in the current share price. The broker sees positive recent activity trends for its healthcare services and believes this ASX 200 share is well-positioned for positive growth in the medium to long term.

Its shares are rated as outperform with a $75.00 target price. This is almost 12% higher than the current Ramsay share price at the time of writing.

Telstra Corporation Ltd (ASX: TLS)

Telstra provided more details regarding its proposed legal restructure on Monday. Credit Suisse commentary focuses on the establishment of Telstra International, which will hold the telco’s subsea cable assets. The broker believes this decision reflects the limited overlap with domestic parts of the infrastructure company as well as potential sensitivity around selling subsea cables.

Overall, the broker takes a positive view on Telstra’s move, with an outperform rating and a $3.85 target price. On Tuesday, the Telstra share price closed the day at $3.33.

Xero Limited (ASX: XRO) 

Credit Suisse views Xero’s recent acquisition of Planday as one with attractive metrics that complement its existing business. Despite the Xero share price hitting 5-month lows in March, the broker believes positive data points and the attractive acquisition will drive short to medium-term value.

Positive industry data suggests Xero will experience another four months of more than 20% revenue growth, says Credit Suisse. The broker upgraded its rating from neutral to outperform with a target price of $136. This represents around 12% upside when compared to the current Xero share price.

More reading

• Compared! How are ASX gaming share prices performing?
• What experts are saying about Telstra’s (ASX:TLS) big restructuring plans
• How are ASX insurance share prices performing during NSW’s floods?
• Why the Xero (ASX:XRO) share price is outperforming today
• Why is the Telstra (ASX:TLS) share price having such a good week?

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited and Telstra Limited. The Motley Fool Australia owns shares of Xero. The Motley Fool Australia has recommended Crown Resorts Limited and Ramsay Health Care 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’re now 12 months on from the beginning of the COVID pandemic in Australia and it’s prime-time to see just how much ASX gaming share prices have been booming over the past year.

News that US investment giant Blackstone has offered to take over Crown Resorts Ltd (ASX: CWN) has sent the resort operator’s share price surging this week. 

It’s been another strong month for Australian gaming and lottery companies, which have been leading the consumer cyclical sector. Almost all companies and resort operators have experienced strong results since the COVID-19 pandemic outbreak, which has led to a boom in gambling revenues across Australia.

We break down all the performers below.

Crown, Star Entertainment and SkyCity share prices on watch

Crown 

Crown’s share price has fallen 1.63% today after rocketing more than $2 in three days due to the Blackstone offer. Crown’s price-earnings ratio (P/E) of 82 and market capitalisation of $8 billion have attracted the interest of the US equity investors.

Star Entertainment Group Ltd (ASX: SGR) 

Crown rivals Star Entertainment has also fallen 2.76% today against gains of 5.43% this month, with a P/E ratio of -29 showing the difference in market sentiment between the two resort providers.

Star’s share price has been a very strong performer recently, up 140% over the past 12 months. Its performance is 45% greater than the consumer cyclical sector and 91% stronger than the S&P/ASX 200 Index (ASX: XJO). 

Skycity Entertainment Group Ltd (ASX: SKC) 

SkyCity has also dropped 1.4% today against very strong all-round performances over the past 12 months. The SkyCity share price has gained 0.95% this week, 19% this month, 7% in 2021 year-to-date (YTD) and 158% over the past 12 months.

That’s a return 63% greater than its sector and 110% better than the ASX 200.

A look at ASX gaming share prices

PointsBet Holdings Ltd (ASX: PBH) 

The PointsBet share price dropped 3% today but has a whopping 1,146% one-year return, from $1.19 in April 2020 to $13.80 per share today. The wagering services operator has dropped a further 16% this month, compared to 2021 gains of 16%. 

It goes without saying that the $2 billion market cap company has been a very strong performer recently, however PointsBet does appear to be undergoing a general share price correction, with steady declines since a high of more than $17 in February.

Jumbo Interactive Ltd (ASX: JIN) 

One of the few gambling shares up today, Jumbo has risen 1.2% against overall 3% falls this week. The online and mobile lottery retailer has increased its share price by 39% over the past 12 months, with its market cap reaching $800 million.

However, its overall market performance of late has been one of the weaker in the category. Jumbo has dropped 9% this month and 7% in 2021. Unsurprisingly, that leaves it down 55% against the high-performing sector and 8% down against the ASX 200.

Tabcorp Holdings Ltd (ASX: TAH)

The Tabcorp share price rose by another 1.8% today, increasing its figures to 5% this week, 7% this month, and 24% in 2021 YTD. Tabcorp’s strong share price gains (up more than 120% over the past 12 months) have beaten the sector by 30% and the ASX 200 by 77%.

As one of Australia’s major players in this space, Tabcorp’s high-profile portfolio of brands including TAB, Keno, The Lott, George, Max, TGS, eBET, and Sky Racing make it a key indicator of the overall strength of the Australian gaming industry in general.

Aristocrat Leisure Ltd (ASX: ALL)

Finally, gambling technology designer and distributor Aristocrat is down 1% today and 1% this week. The Aristocrat share price has also led the gaming charge over the past 12 months, rising from a price of $17 in April 2020 to more than $30 today. 

Aristocrat shares are up 5% this month since announcing on 3 March that it had settled a US lawsuit over some of its digital social games, which has added to its 10% increases in 2021 YTD. 

More reading

• Why BrainChip, Crown, Qantas, & Quickstep shares are tumbling lower
• Motley Fool CIO Scott Phillips talks to SBS News: A takeover in the offing for Crown Resorts (ASX:CWN)
• Is the Crown (ASX:CWN) takeover offer good value for shareholders?
• ASX 200 crash anniversary: 5 of the best performing shares of the last 12 months
• ASX 200 climbs, Crown soars, Mineral Resources drops

Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Pointsbet Holdings Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Jumbo Interactive Limited. The Motley Fool Australia owns shares of and has recommended Jumbo Interactive Limited. The Motley Fool Australia has recommended Crown Resorts Limited, Pointsbet Holdings Ltd, and Sky City Entertainment 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 K-Tig Ltd (ASX: KTG) share price was climbing today following the company’s announcement regarding a signed Memorandum of Understanding (MoU) with a South Korean military manufacturer.

At the market’s open, the welding technology company’s shares jumped 10% to trade at 55 cents. However, by the end of the day, the K-Tig share price had retreated back to 51 cents, up 2% for the day. 

What did K-Tig announce?

The K-Tig share price was running higher after the company provided investors with an update that could propel its future prospects.

According to its release, K-Tig has entered into an MoU with Hanwha Defence Australia Pty Ltd and Hanwha Defence Corporation (Hanwha).

One of South Korea’s largest military manufacturers, Hanwha represents an attractive opportunity for K-Tig to align with.

Based in South Korea, Hanwha has been selected as the preferred supplier of the Australian Army’s multi-billion-dollar Land 8116 self-propelled artillery (Huntsman) project. In addition, it has also been shortlisted for the Land 400 Phase 3 Infantry Fighting Vehicle project.

Under the MoU, K-Tig will use its technologies to develop advanced keyhole welding procedures for Hanwha. This will see advanced steel composites welded together for the proposed military vehicles contracts.

Should K-Tig be successful in its welding demonstration, Hanwha will work with the company to develop automatic welding procedures. This is expected to take place in the regional city of Geelong, where the Huntsman will be manufactured. In total, 60 self-propelled artillery systems are planned to be produced along with 15 ammunition supply vehicles, support systems, and maintenance works.

K-Tig managing director Adrian Smith commented:

Partnering with Hanwha to create crucial equipment for Australia’s defence is a significant opportunity for K-Tig to deploy the speed, efficiency and effectiveness of our advanced keyhole welding technology, all while helping to create local jobs, develop strategically vital manufacturing skills for the nation, and provide the Australian Army with the self-propelled artillery capability it’s desired for many years.

About the K-Tig share price

The K-Tig share price has gained 750% over the past 12 months, reflecting strong investor sentiment. Year to date, the company’s shares are up 50% and are within striking distance of their all-time high of 58 cents.

On current valuation grounds, K-Tig commands a market capitalisation of around $63 million, with more than 125.8 million shares outstanding.

More reading

• 2 quality ASX dividend shares to buy this month
• What experts are saying about Telstra’s (ASX:TLS) big restructuring plans
• ASX 200 dips, travel shares drop, Pushpay soars
• Airtasker (ASX:ART) share price cools after explosive IPO
• How are ASX insurance share prices performing during NSW’s floods?

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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With savings accounts and term deposits still offering ultra low interest rates, the share market continues to be the best place to earn a passive income.

However, with so many dividend shares to choose from, it can be hard to decide which ones to buy. To narrow things down, I’ve picked out two that come highly rated:

Super Retail Group Ltd (ASX: SUL)

Super Retail is the name behind retail store brands BCF, Macpac, Rebel, and Super Cheap Auto.

Collectively, its businesses have been in fine form during the pandemic. This culminated in Super Retail recently releasing its half year results and revealing a 23% increase in sales to $1.78 billion and a 139% increase in underlying net profit after tax to $177.1 million.

Management advised that this was underpinned by strong like for like sales growth across its store network and its an 87% jump in online sales.

Positively, the second half has started just as strongly. The company reported like for like sales growth of 30.5% during the first seven weeks of the half. This puts Super Retail in a position to deliver a bumper profit result in August.

Goldman Sachs is a fan of Super Retail. It currently has a buy rating and $15.00 price target on the company’s shares.

The broker also suspects that a special dividend could be coming with its full year results. In light of this, it is forecasting a a fully franked 81 cents per share dividend for FY 2021. Based on the current Super Retail share price, this represents a 6.9% yield.

Transurban Group (ASX: TCL)

Another ASX dividend share to look at is Transurban. It is one of the world’s leading toll road operators with a collection of key roads in Australia and North America.

Unlike Super Retail, Transurban has not been a positive performer during the pandemic. With traffic on its roads falling significantly during lockdowns, the company’s financial results were hit hard.

However, traffic levels are now improving and are expected to continue doing so as vaccines are rolled out across the world.

In light of this, it could be worth considering a long term and patient investment in the company’s shares. Especially given the quality of its roads, the time savings they offer, and their strong pricing power.

Macquarie is positive on the company. Earlier this month it put an outperform rating and $14.76 price target on its shares. The broker is also forecasting dividends of 40.5 cents per share and 60.4 cents per share in FY 2021 and FY 2022, respectively.

Based on the latest Transurban share price of $12.74, this will mean forward yields of 3.2% and 4.75% over the next two years.

More reading

• ASX 200 Weekly Wrap: Inflation fears hold ASX down
• We’ll get 7.8% yield from ASX this year, says investment pro
• ASX 200 Weekly Wrap: Calm restored to the ASX 200
• ASX 200 Weekly Wrap: ASX finishes higher, despite tech selloff
• 2 high yield and buy-rated ASX dividend shares to snap up

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Super Retail Group Limited. The Motley Fool Australia owns shares of Transurban Group. 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 Telstra Corporation Ltd (ASX: TLS) share price chalked up its third day of gains as brokers pass judgement on its headline grabbing restructuring plans.

The Telstra share price jumped 2.5% to a seven-month high of $3.33 on Tuesday. In contrast, the S&P/ASX 200 Index (Index:^AXJO) dipped 0.1%.

Australia’s largest telco excited the market when it announced it was splitting itself four ways.

Unlocking value in Telstra’s share price

The radical restructure is meant to position Telstra to buy the NBN down the track and to unlock value for shareholders.

While acquiring the NBN is politically sensitive and far from certain, most brokers seem to be optimistic about the restructure.

Goldman Sachs is one that is taking a positive view on the Telstra share price following the restructuring announcement.

Asset split highlights attractive valuations

“This update outlines the next steps of the corporate restructure and potential asset monetization, and gives us confidence that its infrastructure value will ultimately be realized by shareholders,” said Goldman.

“TLS shares currently trade on just 4.1-4.7x ServeCo FY23E EBITDA or 5.7-6.3X at our unchanged A$4.00 12m TP, vs. SPK.NZ at 8.3x.

“We reiterate our ‘Buy’ on TLS, our preferred ANZ Telco, ahead of its FY21 results and Nov-21 ID, both of which we view as positive catalysts.”

Telstra share price looks like an attractive buy

Meanwhile, Credit Suisse also repeated its “outperform” recommendation on the Telstra share price.

The separation of Telstra’s businesses has highlighted how attractively priced some of its key assets are.

“Our analysis of the valuation for InfraCo implies the remainder of Telstra (including ServeCo and Telstra International) is currently valued by the market at 5.8x FY21 EBITDA,” said the broker.

“Given this multiple is applied to cyclically-depressed earnings (given the COVID-19 impact on roaming revenues) and with the Australian mobile market at an inflection point (with TLS guidance for postpaid ARPU to see growth from 2H21 onwards), we are of the view a higher value for ServeCo can be justified.”

Credit Suisse’s 12-month price target on the Telstra share price is $3.85 a share.

Telstra’s shareholders will need to approve the restructure. The company’s plan is to split its assets into InfraCo Fixed, InfraCo Towers, ServeCo and Telstra International.

More reading

• ASX 200 dips, travel shares drop, Pushpay soars
• Why the Xero (ASX:XRO) share price is outperforming today
• Why is the Telstra (ASX:TLS) share price having such a good week?
• How to counter the ASX 200’s Achilles heel
• ASX 200 up 0.4%: Bank shares lower, Xero shares upgraded

Motley Fool contributor Brendon Lau owns shares of Telstra Limited. The Motley Fool Australia owns shares of and has recommended Telstra 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 S&P/ASX 200 Index (ASX: XJO) fell by 0.1% today to 6,745 points.

Here are some of the highlights from the ASX, with an IPO stealing some of the headlines:

Pushpay Holdings Ltd (ASX: PPH)

The Pushpay share price jumped more than 10% today after it was announced that the investor Sixth Street is going to become the largest shareholder of the company with a 17.8% holding.

This increased holding by Sixth Street is due to the investment vehicle related to Peter Huljich and Christopher Huljich selling of its shares of Pushpay to Sixth Street.

Sixth Street is a global investment business with over US$50 billion of assets under management (AUM) and committed capital. It has previously invested in other growth companies like Airbnb, AirTrunk, Paycor and Spotify.

The Chair of Pushpay, Graham Shaw, said:

We are delighted to welcome Sixth Street as a cornerstone investor in Pushpay. As a highly experienced technology and growth investor with a core thematic focus on the convergence of software and payments, Sixth Street’s global scale and partnership-orientated investing approach brings considerable strength to Pushpay’s shareholder register.

Kathmandu Holdings Ltd (ASX: KMD)

The Kathmandu share price went up over 9% in reaction to the company’s half-year result today.

The company reported a 12.9% increase in sales to $410.7 million, underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose 19% to $48.2 million and underlying net profit grew 32.8% to $23.1 million. Statutory net profit after tax came in at $22.3 million.

The Kathmandu division suffered a significant fall of sales and profit due to COVID-19 related travel restrictions and store closures.

However, the acquired Rip Curl business achieved strong sales and profit growth – sales went up 86.1% to $251.1 million and EBITDA grew 164.3% to $48.7 million.

The board resolved to continue dividend payments again, with an interim dividend of NZ 2 cents per share.

The company said Kathmandu is entering the strong winter season, whilst Rip Curl continues to trade in line with the strong first half results.

Travel sector suffers

The ASX travel sector had many of the ASX 200’s worst performers today.

One of the worst performers in the ASX 200 was the Flight Centre Travel Group Ltd (ASX: FLT) share price which fell more than 4%. The Webjet Limited (ASX: WEB) share price fell over 3%, the Corporate Travel Management Ltd (ASX: CTD) share price fell around 4%, the Helloworld Travel Ltd (ASX: HLO) share price dropped around 4% and the Qantas Airways Limited (ASX: QAN) share price dropped over 2%.

Airtasker Ltd (ASX: ART)

The Airtasker share price rose around 60% today on a strong first day on the ASX.

Airtasker gave a short update as part of an announcement to say that all metrics across the business continue to perform strongly and management expect to meet or exceed its prospectus forecast.

It also said that, as part of the initial public offering (IPO), it received higher than expected demand from both its staff and taskers, with over $2.5 million subscribed from these stakeholders.

Airtasker CEO Tim Fung said:

We have an incredible foundation to build from and we’re excited to be taking our new shareholders on the exciting journey to fulfill Airtasker’s mission: to empower people to realise the full value of their skills.

More reading

• What experts are saying about Telstra’s (ASX:TLS) big restructuring plans
• Airtasker (ASX:ART) share price cools after explosive IPO
• Why the Xero (ASX:XRO) share price is outperforming today
• Why BrainChip, Crown, Qantas, & Quickstep shares are tumbling lower
• Qantas (ASX:QAN) share price dips after dismissed legal defection case

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Helloworld Limited and PUSHPAY FPO NZX. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited and Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited, Helloworld Limited, and PUSHPAY FPO NZX. 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 Airtasker Ltd (ASX: ART) share price has cooled off significantly during the trading day. However, shares remain well above their initial listing price. Airtasker officially IPOed this morning after a false start this week and months of anticipation. The company had a listing price of just 65 cents, but opened this morning at $1.01 a share, meaning company insiders and investors were treated with a 55% win right off the bat.

At the time of writing, the Airtasker share price is currently sitting at $1.05, up 0.48%. 

Airtasker share price rockets

However, it wasn’t all smooth sailing for investors looking to get into this IPO after trading commences (which is almost all retail ASX investors).  Airtasker’s share price then went as high as $1.16 a share. This was prior to falling as low as 88 cents soon after market open. This company had a more volatile start to life than a giraffe!

At the time of writing, Airtasker shares are back to $1.02 a share, almost where they started the day.

IPOs can be ART-fully dangerous for new investors

Of course, Airtasker’s listing is nothing the ASX hasn’t seen before. Last year saw a smorgasbord of new companies hitting the ASX boards. These included Doctor Care Anywhere Group (ASX: DOC), Booktopia Group Ltd (AS:X BKG), Plenti Group Ltd (ASX: PLT), Nuix Ltd (ASX: NXL), Payright Ltd (ASX: PYR) and Laybuy Holding Ltd (ASX: LBY).

With the exception of Doctor Care, all of these companies are today trading below the price they IPOed at. And even Doctor Care was down 17% at one point from its IPO price before recovering. Laybuy has been a clanger, currently more than 47% below its IPO price.

We have seen a similar trend play out in the United States. Companies like Uber Technologies Inc (NYSE: UBER), Lyft Inc (NASDAQ: LYFT), and Snowflake Inc (NYSE: SNOW) have all IPOed in the last couple of years, and have been highly volatile in the months and/or years since.

IPOs can be dangerous things for retail investors to get involved in at the starting gate, despite all of the hype and buzz they generate. Remember, its often the motivation of those pushing the IPO to offload their shares for the highest price possible. So for any investor thinking about jumping on the Airtasker train, it might be prudent to keep all of this in mind!

More reading

• Airtasker (ASX:ART) share price rockets 78% after IPO
• Here’s why the Payright (ASX:PYR) share price is soaring 9% today
• 3 exciting small cap ASX shares to watch
• 4 reasons ARK recently increased its Tesla share price target to US$3,000
• Airtasker’s ASX debut happens tomorrow, after 24-hour delay

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Snowflake Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Booktopia Group Limited, Doctor Care Anywhere Group PLC, Nuix Pty Ltd, and Uber Technologies. The Motley Fool Australia has recommended Doctor Care Anywhere Group PLC and Nuix Pty Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Airtasker (ASX:ART) share price cools after explosive IPO appeared first on The Motley Fool Australia.

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