Tag: Motley Fool

Global hospital group Ramsay Health Care Limited (ASX: RHC) gave investors something to cheer about last week when it released its first-half results for the 2021 financial year. The Ramsay Health Care share price rose 8% as the company announced net profit after tax (NPAT) was up almost 1%, despite the challenges presented by COVID-19. 

Importantly for income investors, the company also announced it would resume paying dividends after not paying a final dividend in 2020. Here’s what you need to know.

What is the Ramsay Health Care dividend yield?

Ramsay Health Care declared an interim dividend of 48.5 cents per share for the six months to 31 December 2020. This was down -22.4% on the same period in 2019 and because there was no final dividend paid in 2020 at the current share price of $68.49, Ramsay has a trailing dividend yield of just 0.71%, though it does come fully franked.

OK, so it’s not hugely exciting. But, as we can see from the company’s dividend history below, there are good reasons to think this may just be a short-term, COVID-19 induced blip.

When does Ramsay Health Care pay its dividend?

The Ramsay Health Care share price will go ex-dividend on Monday, 8 March 2021.  The ‘ex-date’ is when the shares start selling without the value of their next dividend payment so an investor needs to own the shares before the ex-date to receive the dividend. The dividend will then be paid on Wednesday, 31 March 2021.

What does Ramsay Health Care’s dividend history look like?

Ramsay’s dividend history over the last decade makes for quite a sight. If there are two things dividend investors love to see it’s consistency and growth, both of which Ramsay was delivering hand over fist until COVID-19 hit in 2020.

The chart below shows how the company’s dividend had been rising strongly right up until 2020:

Source: Chart compiled by author using data from Ramsay Health Care

When COVID-19 struck, elective surgery dropped in most of Ramsay’s key markets and the company pivoted to providing more capacity to the public sector through special government arrangements.

Earnings fell as a result and in the ongoing uncertainty, Ramsay decided not to pay a final dividend in 2020. The company also raised $1.5 billion in equity to strengthen its balance sheet and repay debt. 

How much of its earnings does Ramsay Health Care pay out?

Over the last five years, Ramsay Health Care has typically paid out around 50% of diluted earnings per share in dividends. This was slightly lower (40%) in 2020 as the company held back its final dividend.

By retaining some of its earnings, Ramsay is able to reinvest back into the business, developing new hospitals or paying back debt, which helps to grow earnings and dividends over time. Investors will no doubt hope that continues to be the case so they have something else to cheer about when the company releases its full-year results for 2021.

More reading

• Is it time to buy these 2 hot ASX healthcare shares?
• Top ASX shares to buy in March 2021
• Why the Ramsay Health (ASX:RHC) share price is up 8% today
• 2 excellent blue chip ASX 200 shares to buy

Motley Fool contributor Regan Pearson has no position in any of the stocks mentioned. You can follow him on Twitter @Regan_Invests The Motley Fool Australia has recommended 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.

The post Why investors are cheering for the Ramsay Health Care (ASX:RHC) dividend appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3sGwy3K

Shares in ResApp Health Ltd (ASX: RAP) surged higher on open today after the company announced its wearable device has achieved CE mark certification. In early trade, the ResApp share price leapt 10.53% to 6.3 cents. However, at the time of writing, ResApp shares have retreated back to 5.8 cents, up 1.75% for the day so far. 

Let’s take a look at what the digital health company announced.

What caused the ResApp share price to jump?

The ResApp share price was on the rise this morning after the company declared its wearable, cough monitoring device has achieved CE mark certification as a “Class I medical device accessory”. A CE mark indicates that a product has conformed with the necessary health, safety and environmental standards to be sold in the European Union market.

According to ResApp:

The device has very high accuracy and precision. It can identify over 93% of coughs events, with less than 1% of identified events being false positives. Unlike existing solutions, it does not require manual review of cough sounds by an analyst, ensuring a less labour-intensive and more rapid approach to monitoring.

ResApp developed the device in conjunction with Avanti Capital Group subsidiary, Avanti Med. The group is a United Kingdom-based venture capital company. ResApp will now issue Avanti with 6.25 million shares with an approximate value of $500,000 under its 15% placement capacity.

Words from the CEO

ResApp managing director and CEO Dr Tony Keating said

Achieving CE Mark is a major achievement, and we are confident that our wearable device will provide a number of commercial opportunities.

Discussions with potential partners, including global pharmaceutical companies, to introduce the wearable device into clinical trial settings have already commenced. The availability of the device provides a strong value proposition to potential partners and allows ResApp another opportunity to commercialise new products aimed at assessing and predicting respiratory disease progression.

ResApp share price snapshot

Despite today’s positive news, the ResApp share price has been on the slide of late. Over the past twelve months, ResApp shares have fallen by more than 68% from 18 cents to their current level. 

This is in stark contrast to many other ASX healthcare shares than benefitted during the COVID-19 pandemic.

At its current valuation, ResApp has a market capitalisation of around $43.1 million.

More reading

• Here’s why the Resapp (ASX:RAP) share price closed 5% lower
• Why the ResApp (ASX:RAP) share price is climbing higher

Motley Fool contributor Marc Sidarous 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 Why the ResApp (ASX:RAP) share price opened 10% higher today appeared first on The Motley Fool Australia.

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

The Centuria Capital Group (ASX: CNI) share price is edging lower today, down 1% in afternoon trading. At the time of writing, the Centuria share price was trading at $2.32.

Shares have been lagging the returns from the S&P/ASX 200 Index (ASX: XJO) despite the specialist investment manager recently upgrading its earnings guidance to 10.0 cents per share (cps).

According to Centuria, the earnings guidance upgrade was supported by the company’s $162 million in equity raising since 3 January. This was for 3 unlisted real estate funds. The 2021 equity raises to date support a total of more than $286 million of industrial and healthcare property.

These funds are not listed on the ASX, with the investment funds managed directly by Centuria.

What did Centuria report on its real estate fund equity raisings?

Centuria reported that Augusta Capital, its New Zealand platform, raised NZ$109 million (AU$102.5 million). This is for its Augusta Penrose Limited fund. The capital raising was used to settle Centuria’s acquisition of the Visy Glass manufacturing facility. Centuria forecasts an initial pre-tax annual cash distribution of 5% from the fund.

So far in 2021 Centuria also raised $40 million for its newly launched Centuria Industrial Income Fund No.1 (CIIF1). That fund encompasses 3 industrial assets in Adelaide and Brisbane.

The third fund to see a major equity inflow since 2 January was the Centuria Healthcare Property Fund (CHPF). The company reported CHPF has raised $20 million in the advance bookbuild. This is prior to the fund opening for applications later this month for the third time.

Jason Huljich, Centuria’s Joint CEO commented:

It’s exciting to confirm the significant funds we have raised in the eight short weeks of the 2021 calendar year across Australia and New Zealand. These unlisted single asset and multi-asset funds comprise hotly contested assets across the industrial and healthcare sectors.

So what about the office markets?

According to Huljich, there is light at the end of the tunnel for the embattled office sector. He says, “[W]e are still confident and optimistic about the decentralised office markets. With the rollout of the COVID-19 vaccine now underway, we anticipate white-collar workers across Australia will continue to return to the office.”

Centuria share price snapshot

Having yet to fully recover from the pandemic driven market selloff last February and March, Centuria’s share remains down 9% over the past year. By comparison, the ASX 200 is up 6% in that same time.

So far in 2021, the Centuria share price is down 10%.

More reading

• Here’s what’s likely to supercharge ASX logistics demand in 2021: fundie
• Centuria Capital (ASX:CNI) share price falls despite record acquisitions

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.

The post Centuria (ASX:CNI) share price down after $162 million in equity raising in 8 weeks appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3e13eRE

February just didn’t seem fair for ASX 200 tech share investors. The S&P/ASX 200 Info Tech (ASX: XIJ) index slumped by more than 10% despite the ASX 200 closing 1% higher in February. 

It wasn’t just ASX 200 tech shares struggling in February 

It wasn’t just ASX 200 tech shares that found February to be a challenging month. A similar narrative played out in the US, where the tech-heavy Nasdaq Composite (INDEXNASDAQ: .IXIC) found itself up more than 8% by mid-February before giving up all its gains to finish the month just 1% higher.  

What’s driving the weakness in tech? 

Long-term US interest rates, otherwise known as bond yields, have surged in recent months to briefly touch 1.60%.  

When COVID-19 rattled the markets back in March 2020, bond yields took a plunge to as low as 0.50%. Low yields typically spell good news for equity markets as investors have to consider buying higher-risk investments such as shares to get a better return. 

Yields have since pushed steadily higher since October, to close at 1.46% last Friday.

Higher yields signal higher borrowing costs and inflation, which negatively impact businesses and drag on equity market performance. 

What about other sectors?

Value sectors that typically generate high cash flow with moderate valuations typically do well in higher interest rate environments. This was evidenced by the strong performance from sectors such as the S&P/ASX Energy (ASX: XEJ), S&P/ASX Materials (ASX: XMJ) and S&P/ASX Financials (ASX: XFJ) that finished the month a respective 2%, 7% and 4.5% higher. 

ASX 200 tech shares giving up gains 

The weakness in the tech sector towards the second half of February saw many ASX 200 tech shares giving up gains.

Tech heavyweights such as Afterpay Ltd (ASX: APT) hit a record all-time high of $160.05 mid-February before diving 25% lower to close at $119.50. Xero Ltd (ASX: XRO), on the other hand, spent most of February in the red and down 8% for the month. Its shares are now almost 30% below their record highs set in December. 

March has so far seen ASX 200 tech shares sliding sideways, with the Info Tech index down 0.48% at the time of writing. 

More reading

• Leading brokers name 3 ASX shares to sell today
• Is Deferit listed on the ASX?
• Why Afterpay, IOUpay, Liontown Resources, & Redbubble are racing higher
• Here’s why the Afterpay (ASX:APT) share price fell 11% in February
• 2 of the best ASX tech shares to buy and hold

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO and Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why February was a shocker for ASX 200 tech shares appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3r9lwUv

We’re already into the third month of 2021 and there are still plenty of potential ASX share opportunities.

Share prices of businesses are always changing and sometimes this can present value for investors to grab.

Not every business is experiencing growth right now, but some companies have been seeing growing customer activity in recent months:

Pushpay Holdings Ltd (ASX: PPH)

Pushpay is an ASX share that offers a variety of tools for US churches to manage their operations. One of the key components of the company is a donation payment service where Pushpay processes money on behalf on the churches and takes a small cut.

In the report for the six months to 30 September 2020, it processed US$3.2 billion. This was an increase of 48%, or $1 billion, from the prior corresponding period.

Pushpay says that it expects continued growth in its total processing volume by a larger proportion of new medium and large customers, further development of its products to result in higher adoption and usage, and increased adoption of digital giving.

The ASX share grew its net profit after tax (NPAT) by triple digits in the most recently reported result, with NPAT rising 107% to US$27 million.

Pushpay has increased its earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) guidance a few times over the last 12 months. The company views this as a useful metric to judge its operating performance.

Before the company’s annual general meeting (AGM), the EBITDAF guidance was for a range of between US$48 million to US$52 million. Since then, the company has raised its guidance to US$56 million to US$60 million. This came after donation volumes were better than expected in December 2020.

Pushpay said that it expects operating leverage to continue to accrue to the company over the second half of the financial year.

Using Commsec estimates, the Pushpay share price is valued at 22x FY23’s estimated earnings.

Bubs Australia Ltd (ASX: BUB)

The Bubs share price has been a casualty from COVID-19 impacts as the number of daigou purchases of its products slowed right down during the middle of the 2020 calendar year.

The ASX share revealed that things are turning round. Bubs founder and CEO Kristy Carr said:

The external forces brought on by the COVID-19 pandemic led to extensive channel disruption and supply and demand volatility across our sector in 2020.

While not immune to these factors, Bubs’ strong foundations, organisational agility and resilient business model delivered solid turnaround momentum with quarter on quarter sales growth following the major COVID-19 driven disruption to the daigou channel.

There were two particular areas of growth in the result that Bubs wanted to bring to the attention of investors.

It said that Bubs was the fastest growing infant formula manufacturer across Woolworths Group Ltd (ASX: WOW), Coles Group Ltd (ASX: COL) and Chemist Warehouse. It tripled its market share with combined retail scan sales at the checkout up 55% in the first half of FY21 compared to the prior corresponding period.

Another thing that the ASX share pointed investors to was that its goat infant formula gross revenue to China increased by 36% during the period, which offset unforeseen disruption to the daigou channel.  

What does Mrs Carr think about the outlook? She said:

Although the first half was challenging and resulted in group gross margin pressure as we rebalanced our inventory position, we have a robust plan in place to focus on core goat dairy profit drivers working alongside our strategic partners, including supporting our daigou channel partners to maximise the opportunity for Bubs as a lead challenger brand in the infant formula category from the recovery.

More reading

• Coles’ (ASX:COL) dividend is hitting Woolworths (ASX:WOW) out of the park
• ASX 200 Weekly Wrap: Friday carnage ruins last week of ASX earnings
• How Aldi plans to disrupt many ASX retail shares
• 2 reliable ASX dividend shares to buy in March
• 2 outstanding ASX growth shares to buy in March

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 BUBS AUST FPO and PUSHPAY FPO NZX. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Woolworths Limited. The Motley Fool Australia has recommended BUBS AUST FPO 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.

The post 2 ASX shares to buy in March 2021 appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3bN5hG6

The Nanosonics Ltd (ASX: NAN) share price has been a disappointing performer in 2021.

Since the start of the year, the infection control specialist’s shares have fallen a sizeable 25%.

Is the Nanosonics share price in the zone now?

According to a note out of Goldman Sachs, its analysts aren’t recommending investors jump in just yet.

A note out of the investment bank from last week reveals that its analysts currently have a neutral rating and $5.50 price target on Nanosonics’ shares.

So with the Nanosonics share price currently fetching $6.18 on Tuesday afternoon, this implies potential downside of approximately 11%.

What did Goldman Sachs say?

Goldman Sachs was disappointed with Nanosonics’ recent half year results. It notes that the company fell short of its expectations on both sales and earnings. The broker commented:

“H21 sales/earnings miss by -16%/-68%. Revenue declined 11% vs. Visible Alpha consensus’ +5%, driven by a shortfall in both capital (-35% vs. consensus -5%) and consumables (-1% vs. consensus +4%). Although 2Q consumables growth improved +29% from 1Q, the growth rate slowed sharply in the last two months of the period, since growth had been tracking +4% YoY at the November trading update. Capital sales were impacted by a sharp reduction in purchases by key distributor GE Healthcare due to their own inventory management triggered by Covid-19 (previously flagged).”

Rising costs

Another concern the broker has is the company’s decision to allow its costs to increase even when revenues are falling. It explained:

“Expenses continued to grow despite top-line pressure, driving EBIT/PBT to zero. Despite the 11% decline in revenue, the company continues to invest in its growth strategy, with 1H21 opex +8% YoY.”

One positive, though, is that the company is well-placed to ride out the storm thanks to its strong cash balance. It notes:

“FCF was negative in the period at -$2.4m vs. +10m in the pcp, but the company is debt-free and cash still remains robust at $88m (vs. $92m in FY20).”

Furthermore, Goldman points out that management expects growth in revenue and profitability in the second half.

Positive broker

One broker that is a bit more positive on the company is UBS. In response to its half year results, the broker put a buy rating and $7.00 price target on its shares.

This price target implies potential upside of 13% for the Nanosonics share price over the next 12 months.

Time will tell which broker has made the correct call.

More reading

• Why Flight Centre, Life360, Nanosonics, & Universal Store are racing higher
• ASX 200 up 0.85%: A2 Milk & Zip shares hammered, Afterpay to raise $1.25bn
• ASX 200 drops, Appen sinks, Nine jumps
• Why Appen, Bigtincan, Humm, & Nanosonics are tumbling lower
• ASX 200 down 0.45%: Woolworths rises, Blackmores jumps, Appen sinks

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

The post The Nanosonics (ASX:NAN) share price is down 25% in 2021: Time to buy? appeared first on The Motley Fool Australia.

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

One of the undercurrents in the world of investing over the past year or so has been the rise (or perhaps re-rise) of cryptocurrencies like Bitcoin (CRYPTO: BTC). Yes, markets have spent 11 of the past 12 months rising, usually enthusiastically. The S&P/ASX 200 Index (ASX: XJO) is up roughly 50% since 23 March last year. The US tech-heavy Nasdaq Composite (INDEXNASDAQ: .IXIC) Index is up almost 100% over the same period.

But all of these moves, which are independently very strong by historical standards, pale against what has happened with Bitcoin. Since 23 March last year, the price of Bitcoin has rocketed more than 600% (in US dollar terms). Just last month, the cryptocurrency set a series of new all-time highs, first rising over US$50,000, then US$55,000. It peaked at more than US$57,400 on 12 February. Today, Bitcoin has given up some of those gains, but is still trading for US$49,719 at the time of writing. That’s a level that would have been a new all-time high just a fortnight ago.

Moves like these have naturally elicited new rounds of FOMO, of investors who have thus far stayed off of the Bitcoin train, but can’t bear to keep watching it go up and up. Those investors might find some interest in a report from the Australian Financial Review (AFR) this week.

Fundie: Bitcoin is here to stay

The report is authored by Mark Carnegie, a founding partner of American alternative asset manager M.H. Carnegie & Co. His first line is, “it took too long, but I now believe that crypto is here to stay”.

Mr. Carnegie has enthusiastically come around to Bitcoin and other cryptocurrencies like Ethereum (CRYPTO: ETH) as a “new asset class”. He says his portfolios “have a giant hole in them because they don’t include Bitcoin and Ethereum”.

So what’s changed? Well, it’s the expansion of the global money supply (i.e. money printing) that’s got Cargenie keen on cryptocurrencies:

Hard currency has been around a very long time but there has never been as much of it borrowed or spent as in the past 18 months. Don’t waste your time looking for financial prudence. There isn’t any. Not in any corner of the globe. Nor is there any convincing theory about how we are going to unwind the knot.

Carnegie calls Bitcoin and Ethereum “insurance” against this “abandoning of sound money”. Since Bitcoin and, to a lesser extent, Ethereum, have a finite supply mechanism built in, and cannot be ‘printed’ at will, they are intrinsically resistant to inflation and currency debasement. Carnegie compares them with precious metals like gold and platinum in this regard.

He finishes by stating that:

If you are wondering what all the fuss is about, then ask yourself this: What insurance have I bought against the world’s financial system creating a monetary policy-resistant financial crisis? It might just be that crypto is the vaccine you need.

An interesting perspective on Bitcoin and cryptocurrencies indeed!

More reading

• Goldman Sachs to relaunch trading in Bitcoin futures
• The latest ASX shares that brokers have upgraded to “buy”
• ASX 200 up 0.3%: Mesoblast raises US$110 million, tech shares rebound
• ASM (ASX:ASM) share price jumps as scoping study supports $45m plant build
• 5 things to watch on the ASX 200 on Tuesday

Sebastian Bowen owns Bitcoin and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Bitcoin. 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 Why this fund manager changed his mind on Bitcoin appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3sCOa0w

Australian Potash Ltd (ASX: APC) shares were on the rise this morning after the company announced its government loan has been approved. At one point during intraday trade, the Australian Potash share price jumped by more than 9% to 18 cents.

However, at the time of writing, the mineral explorer’s shares have retreated back to 16.5 cents, flat for the day so far. 

What caused the Australian Potash share price to jump?

The Australian Potash share price surged ahead in morning trade after the company announced that the Northern Australia Infrastructure Facility (NAIF) had approved its $140 million loan.

The company will use the funds to develop its Lake Wells Sulphate of Potash (SOP) project near Laverton in Western Australia.

The company advised the 17-year loan will be interest-only “until such time as other tranches are repaid”. The loan will then convert to principal and interest. The security for the loan is the Lake Wells Project itself. Australian Potash did not disclose the interest rate.

The loan facility is still subject to commercial and project conditions, as well as state and federal ministerial approval.

The company also declared that it expects to receive a tranche of the senior debt facility from Export Finance Australia.

Australian Potash claims the Lake Wells Project will be the lowest CO² emitting SOP project in Australia.

Words from the CEO

Australian Potash managing director and CEO Matt Shackleton said the following regarding the financing:

We are very pleased to advise the first major step in financing the development of Lake Wells, with the board of NAIF resolving to support this regionally important project that returns strong social and economic benefits…

We continue to enjoy strong relationships with stakeholders in the local community of Laverton, most importantly with senior traditional owners.

He added:

We now turn our attention to closing out the balance of the development financing pathway, and to moving into the pre-mobilisation phase of the development of the Lake Wells Sulphate of Potash Project.

Lake Wells is a substantially de-risked, technically sound, low cost and socially responsible project that will deliver a premium product for at least 30 years.

What does Australian Potash do?

Australian Potash is a mineral exploration company primarily focused on, you guessed it, potash. Beyond the Lake Wells Potash Project, its other endeavours include the Lake Wells Gold Project, and Laverton Downs Project.

According to the company’s website, potash is described as “potassium-bearing minerals or compounds.” Potassium is mainly used to aid plant growth. Some of the element’s benefits include thickening plant cell walls and protecting plants from drought and diseases.

What is NAIF?

According to the agency’s website, “NAIF is a Commonwealth Government agency established to facilitate economic growth by lending to infrastructure projects and businesses in northern Australia and helping to catalyse private sector investment.”

NAIF is focused on the mining and energy sectors, tourism, agriculture, and education. Its purpose is to drive economic growth in Northern Australia. The Commonwealth defines the region as areas in Queensland and Western Australia north of the Tropic of Capricorn, as well as the entire Northern Territory.

Australian Potash share price snapshot

In March last year, the company’s shares were selling at 7 cents each. With today’s Australian Potash share price currently sitting at 16.5 cents, this puts its gains at more than 135% over the past twelve months. Year to date, the company’s shares have also jumped by 25%.

Based on the current share price, the company has a market capitalisation of around $91 million.

More reading

• ECS Botanics (ASX:ECS) share price edges lower despite positive update
• Here’s why the Pacific Smiles (ASX:PSQ) share price is frozen
• Leading brokers name 3 ASX shares to sell today
• Is Reddit’s GameStop (NYSE:GME) crowd targeting Asian shares?
• The Dicker Data (ASX:DDR) share price has pumped 47% in 6 months

Motley Fool contributor Marc Sidarous 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 Why the Australian Potash (ASX:APC) share price leapt 9% this morning appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3b4abzs

ECS Botanics Holdings Ltd (ASX: ECS) share price is trading lower in mid-afternoon trade. This comes despite the company announcing that Murray Meds has signed a Memorandum of Understanding (MoU) with an Australian-based cannabis group.

When news broke out this morning, the ECS share price rose to an intraday high of 7.5 cents. However, some profit-taking has contributed to its shares falling to 6.9 cents, down 2.8% at the time of writing.

What did ECS announce?

The ECS share price is softening regardless of the positive announcement made earlier today.

According to its release, ECS advised that Murray Meds entered a MoU with an undisclosed subsidiary of a large medical cannabis company.

In January this year, ECS signed a binding term sheet to acquire 100% of Victoria-based medical cannabis cultivator, Murray Meds.

Located on the Murray River in North Western Victoria, Murray Meds operates a licenced medical cannabis cultivation and manufacturing facility. The company produces around 3,500kg of medicinal cannabis per year consisting of dried flower, oils, and tinctures.

Terms of the MoU

Under the conditions of MoU, Murray Meds and the contracting party will meet throughout the 12-month term to discuss the potential cultivation and supply of cannabis. This will include a review of Murray Meds production capacity in servicing the contracting party’s needs.

It is believed that the MoU will eventually be replaced with a production plan and quality contract in the long-term.

ECS stated that it’s too early to grasp quantities, specifications, and pricing of the cannabis products from the MoU. In light of this, no financial figures could be provided in the release.

About the ECS share price

The ECS share price has accelerated over the last year, jumping to more than 90%. The company’s shares hit a low of 1.5 cents in March 2020, before strongly rebounding from December onwards.

Based on the current share price, ECS has a market capitalisation of around $30 million.

More reading

• Here’s why the Pacific Smiles (ASX:PSQ) share price is frozen
• Leading brokers name 3 ASX shares to sell today
• Is Reddit’s GameStop (NYSE:GME) crowd targeting Asian shares?
• The Dicker Data (ASX:DDR) share price has pumped 47% in 6 months
• No ASX dividend share is perfect, but Soul Patts (ASX:SOL) is more perfect than most

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.

The post ECS Botanics (ASX:ECS) share price edges lower despite positive update appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3805l4g

Pacific Smiles Group Ltd (ASX: PSQ) shares are frozen today after the dental centre operator requested a trading halt as it announced details of a capital raising. The Pacific Smiles share price closed yesterday’s session at $2.70.

What was announced?

The Pacific Smiles share price is not going anywhere today. This comes after the company advised it will seek to raise $15 million through a placement of new shares. Further to this, another $5 million will be raised through a share purchase plan (SPP).

The reasoning provided for the injection of funds is to accelerate growth opportunities and increase liquidity. This comes after the company recorded a solid result for 1H FY21. Earnings before interest, tax, depreciation, and amortisation (EBITDA) increased by 64.7% year-on-year to $21.2 million.

The company intends to open 15 new dental centres during FY21. From here, the rollout is expected to increase to over 20 per year. Furthermore, Pacific Smiles sees a long runway for growth ahead in Australia. In addition, it has a desire to capture more than 5% of the addressable market.

The placement will be at an offer price of $2.60, representing a 3.7% discount to its last close price. Meanwhile, the SPP will be offered to shareholders in Australia and New Zealand up to a maximum amount of $30,000.

Following the capital raising, Pacific Smiles will hold approximately $18 million of net cash and $37 million of debt facilities to orchestrate its expansion goals.

When will Pacific Smiles trade again?

As detailed in the announcement, the company’s timeline indicates shares will commence trading on Wednesday 3 March. This is following the completion of the placement.

Eligible shareholders can expect to receive their application documents after 8 March. The SPP will then close on 18 March.

Notably, all new shares purchased through the cap raise will be eligible for Pacific Smiles 2.4 cents per share fully franked dividend.

Smiling about the Pacific Smiles share price?

In the last 12 months, the Pacific Smiles share price has grown by 54%. For comparison, the S&P/ASX 200 Index  (ASX: XJO) has appreciated by 6.4% during the same time period. The last 6 months alone has returned 46% for shareholders of Pacific Smiles. I bet they can’t wipe the smile off their faces about that!

More reading

• Leading brokers name 3 ASX shares to sell today
• Is Reddit’s GameStop (NYSE:GME) crowd targeting Asian shares?
• The Dicker Data (ASX:DDR) share price has pumped 47% in 6 months
• No ASX dividend share is perfect, but Soul Patts (ASX:SOL) is more perfect than most
• The Argosy (ASX:AGY) share price is racing 9% higher. Here’s why.

Motley Fool contributor Mitchell Lawler 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 Here’s why the Pacific Smiles (ASX:PSQ) share price is frozen appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/381uwTV