These two companies should see their shares hotly traded this week, with G8 Education Ltd (ASX: GEM) acquiring another 91 childcare centres and Macquarie Group Ltd (ASX: MQG) predicting a 45% profit rise for FY14.
Both have been favourites of various contributors here at fool.com.au for some time as a result of the strength of their core businesses; strength that looks set to continue after the positive announcements seen this morning.
G8 Education
G8 announced this morning that it has entered into contracts to acquire Sterling Early Education Limited and its 91 premium childcare and education centres; boosting G8's licensed places by 6,203 to 27,995 (an increase of 28%). The acquisition will cost $228 million, occur progressively from 31 March-30 September 2014, and contribute $39.4 million in earnings before interest and tax to G8's earnings for 2015.
The acquisition will be funded through $215 million in cash and the issue of approximately three-million G8 shares on 31 March 2014. I assume that 'approximately' refers to the fact that the number of shares issued will depend on an x-day volume weighted average share price to make up the remaining $13 million.
G8's shares are at an all-time high, having surged nearly 50% since October, but I think it's fair to say they will go higher after this announcement which adds a lot of revenue to the company's profile. As at the time of writing, G8 is still in a trading halt, however investors should expect it to be hotly traded when trade resumes (no later than Wednesday).
Macquarie Bank
Macquarie will knock the socks off investors when they read the investment bank's announcement this morning, forecasting a 40-45% increase in net profit for FY2014.
Macquarie also included a sizeable investors' presentation attached to the update; I recommend interested investors at least take a glimpse at page eight (forty years of unbroken profitability) to understand why Macquarie Banking Group may just be my favourite blue-chip stock.
A regular feature in Foolish articles on blue-chip stocks, it's no coincidence that infrastructure stocks Macquarie Atlas Roads Limited (ASX: MQA) and Sydney Airport Holdings Ltd (ASX: SYD) share the Macquarie traits of long-running profitability with very little risk.
Macquarie Bank is always a stock to watch and deserves a spot right at the heart of your portfolio.
Foolish takeaway
So there you have it, two of the hottest shares on the ASX this week. I doubt if Macquarie's share price will spike a huge amount, but this makes the opportunity all the more valuable for the savvy investor. G8 I fully expect to leap skywards when its shares resume trade because of investors' high expectations around that stock. It makes it difficult to find the 'right' time or price to buy into such a share; but potential G8 investors would do well to meditate over this quote (which I borrowed from someone wiser): 'The best time to plant a tree was ten years ago. The second best time is right now."
