Money is gushing back into the Australian sharemarket today in a rally fuelled by takeover reports from the energy sector, as well as strong gains from the major banks and miners. The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) is up just over 1%, with these six companies posting even stronger gains:
Oil Search Limited (ASX: OSH) is by and far the biggest winner for the day after the energy producer received a takeover bid from Woodside Petroleum Limited (ASX: WPL). Woodside's offer of one of its shares for every four Oil Search shares represents an approximate 13.6% takeover premium. Oil Search's shares have actually risen 16.8% to $7.86, implying that investors believe Woodside will need to sweeten its offer to get the deal over the line.
The deal has also sparked confidence in the market that now could be a reasonable time to buy down-and-out energy companies. Santos Ltd (ASX: STO), for instance, has surged 8.8% to $4.56 while AWE Limited (ASX: AWE) is up 7.5% at 71.5 cents.
Elsewhere, Virtus Health Ltd (ASX: VRT) has risen 3.8% despite the absence of any company-specific news which would explain the sudden jump. The company's shares have come under heavy selling pressure over the last three months on reports that it had lost some of its market share in Australia's IVF market, but investors may be taking advantage of the lower share price to buy an otherwise high-quality company.
G8 Education Ltd (ASX: GEM) is up 3.6% at $3.13. Again, it's possible that investors are taking advantage of a very low price for a high-quality company that has generated enormous returns for investors in years gone by. At its current price of $3.13 per share, the stock also offers a forecast 7.7% fully franked dividend yield (paid quarterly), which is compelling in this low interest rate environment.
Senetas Corporation Limited (ASX: SEN) has been one of the best-performing companies on the ASX since the beginning of the year, hitting a high of 22 cents from just 5.1 cents in January. However, the stock has retreated considerably over the last month and investors appear to be taking full advantage. The shares are up 12% today at 14 cents, and could be a good buying opportunity.
