Nuix (ASX:NXL) share price up 5% following update on ASIC investigation

Nuix has released news on ASIC's investigation into alleged breaches of the Corporations Act.

| More on:
share price up

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Nuix Ltd (ASX: NXL) share price is gaining this morning after the company released an update on the Australian Securities and Investment Commission's (ASIC) investigation into its listing.

Nuis has updated the market on ASIC's investigation into alleged breaches of the Corporations Act. The company first announced it was aware of the investigation on 30 June.

Right now, the Nuix share price is $2.74 apiece, 4.58% more than its closing price yesterday.

Let's take a closer look at today's news from the tech company.

The latest on ASIC's investigation into Nuix

The Nuix share price is up following the company announcing that it now has a better idea of the exact issues ASIC is most interested in, in its investigation into Nuix.

As The Motley Fool Australia has previously reported, ASIC is investigating the company due to concerns Nuix's prospectus contained false information. Namely, whether its financial forecasts were inflated.

Nuix stated its aware that ASIC is mostly interested in 3 periods of reporting. Those are:

  • Financial statements from Nuix issued between 30 June 2018 and 30 June 2019
  • Nuix's prospectus
  • Nuix's market disclosures for the period between 4 December 2020 and 31 May 2021

Between 4 December – the date of Nuix's Initial Public Offering (IPO) – and 31 May 2021, Nuix released 2 revenue downgrades to the market. In that same time frame, the Nuix share price fell 65%.

Today's release from Nuix stated:

Nuix has not received any formal notification of an investigation from ASIC and remains confident that it has complied with its accounting and disclosure obligations.

Macquarie Group, Nuix's largest shareholder and backer of its IPO, recently said its own review into Nuix's listing found nothing sinister.

ASIC is also investigating the company's former CFO and their family on allegations of insider trading.

Nuix share price snapshot

It likely comes as no surprise the Nuix share price hasn't been doing well lately.

It has fallen 65% since it first listed on the ASX late last year.

The company has a market capitalisation of around $831 million, with approximately 317 million shares outstanding.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended Nuix Pty Ltd. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Technology Shares

A man sits thoughtfully on the couch with a laptop on his lap.
Technology Shares

This ASX tech stock rocketed 60% in March! Can it keep on delivering?

After soaring in March, the ASX tech stock is now up 169% since this time last year.

Read more »

Five happy friends on their phones.
Share Market News

Goldman Sachs says these ASX tech stocks can rise 18% to 30%

The broker sees big returns on offer from these shares.

Read more »

A guy helps a girl lift a couch, both are laughing.
Technology Shares

3 of the best ASX tech shares to buy and hold until 2030

I think these stocks have exciting futures.

Read more »

A young woman uses a laptop and calculator while working from home.
Technology Shares

If I'd put $5,000 in Block shares 5 months ago, here's what I'd have now

Was it a good idea to invest in this payments stock five months ago?

Read more »

Close up of a sad young woman reading about declining share price on her phone.
Technology Shares

Why is the Brainchip share price sinking over 7% today?

What's going on with this tech stock on Wednesday?

Read more »

woman working on tablet
Technology Shares

Missed out on Nvidia? My best ASX tech stock to buy and hold

Do you have FOMO after the US chip maker's share price rocketed? Here's an Aussie company worth backing instead.

Read more »

Three businesspeople leap high with the CBD in the background.
Technology Shares

Guess which ASX small-cap stock is rocketing 45% on 'pivotal moment'

Investors have responded very positively to an announcement.

Read more »

A man looking at his laptop and thinking.
Technology Shares

Why are these ASX tech shares getting smashed today?

Owners of these two stocks are missing out today.

Read more »