Sebastian Siemiatkowski, CEO of Swedish-based Klarna, was last week scathing of Afterpay Ltd's (ASX: APT) merchant fees, referring to them as an extortion scheme. Mr. Siemiatkowski's attack, as reported in the Australian Financial Review (AFR), also included calls for regulators to provide a "cap" on merchant fees. The sentiment was echoed by Matt Comyn, CEO of Commonwealth Bank of Australia (ASX: CBA). This attack follows on from confirmation that United States payments giant, Affirm, intends to enter the Australian buy now, pay later (BNPL) market, while other payments giants like Paypal Holdings Inc (NASDAQ: PYPL) have been entering the US market. The Afterpay share price fell by 3% last week.

CommBank has a 5.5% stake in Klarna and the companies jointly fund and own (with 50:50 ownership rights) Klarna's Australian and New Zealand business.

The battle at the margins

Afterpay averages a 4% merchant fee per transaction. However, the average merchant cost for credit or debit cards is 1%. Klarna claims its average merchant fees are around 2.1%. 

Afterpay co-chief executive, Anthony Eisen, has disputed the claims, stating that Klarna charges similar merchant fees to Afterpay, as well as 20% interest on a range of bank-like credit products. "We know exactly where they are and they are not out of kilter with us, and even if they were – why are more merchants choosing us then in the US and Australia?" he said. Klarna is an unlisted bank based in Sweden. It was the first BNPL operator there, but the platform only represents one of its service offerings. 

Klarna has 500 Australian merchants, while Afterpay has 48,000. Moreover, Klarna has 400,000 downloads while Afterpay has 3.5 million active Australian users. As also reported by the AFR, Ord Minnett analyst, Phillip Chippindale, told clients on Wednesday that the Klarna average merchant fee was likely to also be around 4%. Meanwhile, Hayden Capital stated that, in the US, Klarna's merchant fees can be as high as 5.99%.

Mr Eisen concluded:

We have never styled Afterpay as a banking product and as a result we have a more frequent and loyal customer base, and that is what merchants care about because that is what drives their business – it's those customers we can drive into the right channel that is the value we add and that makes the difference.

Defending the Afterpay share price

Afterpay has a history of hitting back against its critics. A recent report from the Australian Securities and Investments Commission (ASIC) criticised the BNPL sector on a number of fronts. Within a day, Afterpay responded, pointing out that consumers benefitted from more choice as competition expands, as opposed to a previously narrow, bank-dominated payments industry.

The Australian market leader went on to laud its built-in consumer protections, juxtaposing them with those of other BNPL providers. These include never selling or enforcing debt. Moreover, Afterpay sees itself as a platform rather than a payments company or credit provider. In the view of the company, it is second only to Alphabet Inc's (NASDAQ: GOOGL) (NASDAQ: GOOG) Google as a referral service for retailers.

Despite a rash of competitors, Afterpay remains the leading BNPL company in Australia, and is growing rapidly in the US and the United Kingdom. At the close of trade on Friday, the Afterpay Share price was at $94.70.

The post Afterpay (ASX:APT) share price under heavy fire from industry giants appeared first on The Motley Fool Australia.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Daryl Mather 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 Alphabet (A shares), Alphabet (C shares), and PayPal Holdings and recommends the following options: long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), and PayPal Holdings. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

IOOF Holdings Limited (ASX: IFL) has faced a furious annual general meeting (AGM) today. Shareholders have accused the company of overpaying for its $1.44 billion MLC acquisition from National Australia Bank Ltd (ASX: NAB). The IOOF share price has fallen by 11.7% since the announcement of this deal on 31 August. Criticism to date has focused on the headline price paid for MLC. In particular, activist shareholder, Stephen Mayne, relentlessly accused the company of overpaying, highlighting the wealth destroying impact this can have. 

Mr. Mayne asked repeatedly who registered the 17% proxy vote against the acquisition. Nonetheless, IOOF chair, Allan Griffiths, would not be drawn on the issue. Instead deferring it until analysis could be undertaken. Surprisingly, the IOOF share price is up by nearly 3% today, at the time of writing. 

Another shareholder expressed his outrage, telling Mr. Griffiths "I vote against all resolutions, and will continue to do that as I think the handling of the MLC purchase was a disgrace." He went on to state "You have butchered the share price."

The growing rebellion in the ranks

A group was reported to be planning to vote against IOOF's provision of operating funds for MLC subsidiaries. As a result, the company saw protest votes on all resolutions including, in particular, the reappointment of two directors. Elizabeth Flynn, recorded a 24.8% vote against her. Meanwhile, John Selak saw a 17% vote opposing his re-appointment. 

Shareholders have expressed frustration over the price of and approach to the MLC deal. In particular, they believe the company used a COVID-19 waiver to issue 300 million additional shares on the basis of a non-COVID-related issue. However, an ASX spokesman responded that the rules were not limited to raisings under the health crisis. In addition, many critics are skeptical about claims by IOOF CEO, Renato Mota, that the MLC acquisition would add 20% to the company's earnings per share (EPS). 

Stephen Mayne pointedly questioned the chair's competence to be running IOOF. Particularly as he has spent his career in unlisted financial services companies and has no additional directorships. He referred several times to the fall in the IOOF share price.

Mr. Griffiths pointed out he has only been chair for 18 months, during which time he had reset relationships with regulators, is implementing recommendations from the Hayne Royal Commission, and enjoys the full support of the board.

The falling IOOF share price

Since October 2017, the IOOF share price has fallen by over 60% during the heat of the Hayne Royal Commission. In the wake of the commission's findings Mr. Mota confirmed to a questioner that conflicts of interest were always front of mind. As the four large banks have divested themselves of wealth management assets in response to the royal commission, IOOF has capitalised on this opportunity to propel itself past its longtime rival AMP Ltd (ASX: AMP) with regard to its funds under management.

In year-to-date trading, the IOOF share price remains down by more than 47%.

The post IOOF (ASX:IFL) accused of butchering its share price appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Objective Corporation Limited (ASX: OCL) has released its FY21 outlook prior to its AGM today. In it, the company committed to a growth strategy based on digital engagement, research and development, and building recurring revenue streams. In year to date trading, the Objective share price has more than doubled, growing by 109% at the time of writing.  

FY20 was a benchmark year for the IT services and products company. It achieved a 22% increase in annual recurring revenue, cresting at $56.6 million. Simultaneously, it has grown net profit after tax (NPAT) by 22%. let's take a closer look.

What's driving the Objective share price?

Objective builds products largely for government and regulated industries. During FY20, the company saw fast growth for the Objective GOV365 product. This is a governance product for Microsoft teams. During FY20, Microsoft teams went from 20 million to 75 million daily users. Thus helping to protect commercially sensitive data.

The Objective share price benefited from positive trading updates during the COVID-19 pandemic. In fact, it reached new highs after the release of the FY20 annual report showing record growth. During FY21, the company has already acquired regulation technology specialist Itree. This is a cloud-based product company active in Australia and New Zealand. It was profitable on acquisition.

FY21 outlook

Objective continues to spend 20% of revenues on research and development, and is accelerating its integration of the Itree product.

It has also accelerated its growth through acquisitions. The company has honed its skillset in re-branding, integrating and delivery of products to market as a result, and gained praise for its customer service. 

In the Gartner Magic Quadrant for content services platforms, analyst company Gartner Group recently stated:

Objective had the highest Gartner Peer Insights scores for product capabilities and the ability to meet organisational needs.

It was also in the top five for ease of experience and overall experience, indicating that users of the solution are generally happy with both the service and product.

Objective plans to fully integrate two additional products, RegWorks and Reach into its platform, as well as leveraging artificial intelligence and machine learning. Its digital engagement strategy aims to leverage its Objective Redact product, currently 50% of US revenues.

On the financial front, Objective follows conservative accounting practices, and has reiterated its intention to be disciplined with all acquisition opportunities. It also underlined its expectation for material growth in revenue and profitability through the year, focussing on conversion to subscription based contracts.

The Objective share price opened at $13.11 today, and is currently trading up 0.61% at $3.18.

The post The Objective Corp (ASX:OCL) share price is up ahead of AGM appeared first on The Motley Fool Australia.

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Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Objective Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Let's take a closer look at the company and its share price trajectory.

What's moving the Money3 share price?

Money3 a non-bank lender operating in secured subprime automotive loans. The company yesterday announced positive first quarter results and a new low cost warehouse securitisation facility expected to save it more than $10 million per year.

New funding facility

The lower cost warehouse facility will start with $250 million from international bank Credit Suisse Group AG (NYSE: CS). Money3 intends to use the facility to help achieve its goal of a $1 billion loan book. The company will also use it to increase market share in both automotive sectors.  In addition, Money3 will be able to offer loans in car repair finance.

Money3 CEO Scott Baldwin, said:

The new funding facility positions Money3 in the strongest position in our history to continue the growth of the Australian loan book. We are delighted with the flexibility and incremental funding this provides for our growing Australian operations.

This facility reflects the quality of our existing loan book and operations, providing significant validation from what is a globally recognised A+ rated bank.

First quarter highlights

In first quarter results, Money3 saw its revenues increase by 12.3% against the previous corresponding period (pcp). Consequently, statutory net profits after tax (NPAT) also increased by 33.3% pcp. This is a continuation of the solid results delivered in the company's FY20 annual report, despite the pandemic. 

In presenting the results yesterday, Mr Baldwin highlighted the cash collections and improving credit quality. This rose by 31.1% pcp and is attributable largely to government stimulus, and the superannuation capital release in Australia.

Following the easing of Victorian COVID-19 lockdown restrictions, new loan originations continue to improve. In fact, October 2020 produced more loan book growth than the first three months of FY21. Moreover, November 2020 has started with good results and the company loan book now exceeds $456m.

Mr Baldwin referenced the demand for second-hand cars, and the rise in second-hand car prices. He acknowledged that car loans in the subprime sector may increase by an average of $1000 per loan in the short term.

The post Why the Money3 (ASX:MNY) share price is up 87% in 6 months appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Last week, Commonwealth Bank of Australia (ASX: CBA) saw its share price rise 8.11%, more than any other of the big four banks. Furthermore, the Australian Prudential Regulation Authority (APRA) announced it was reducing the bank's capital charge by 50%. This means that Commbank has to hold $500 million less capital as risk mitigation. This helped the CBA share price to rise by 1.43% on Friday alone. 

In other positive news, APRA has indicated it may also remove the cap on bank dividend payments. Additionally, Commbank CEO, Matt Comyn, noted last week that the housing slump risk to the economy had passed. A combination of factors fuelled the CEO's optimism. These included strong surplus savings of $100 billion, very strong housing application figures, and robust consumer confidence.

Adding to this is the motivation for house buyers, with the Reserve Bank of Australia (RBA) recently reducing interest rates to historically low levels. Lastly, the government proposes to relax responsible lending laws. With all of these factors at play, could the CBA share price be headed into calmer waters? There are, however, challengers in the mortgage space.  

Challenges facing the CBA share price

Into the mix of factors that could possibly impact the CBA share price, is the planned IPO of one of Australia's leading non-bank lenders, Liberty Financial Group. Started in 1997, Liberty boasted an $11.7 billion loan book at 30 June. In addition, Liberty delivers a stronger return on assets than any of its bank or non-bank lending counterparts.

Credit Suisse Group (NYSE: CS) is expected to manage the institutional book build, floating 20% of Liberty's value on the ASX at a price of $363 million. This values Liberty at approximately $1.815 billion with a price-to-earnings (P/E) ratio of 11 times the lender's forecast net profit after tax and amortisation (NPATA). This P/E is lower than any other ASX listed non-bank lender.

For instance, non-bank lender Resimac Group Ltd (ASX: RMC) has seen its share price rise by nearly 45% in the past month. It is currently trading at a P/E of 14.47. Stablemate MyState Limited (ASX: MYS) has seen an almost 22% rise in its share price over the past month and has a current P/E of 15.13. Meanwhile, sector minnow, Auswide Bank Ltd (ASX: ABA), has seen a 19.6% rise in its share price over the same period, and trades at a P/E of 13.65.

Does the CBA share price have a moat?

A moat is Warren Buffet's term for an unassailable competitive advantage, invoking an image of a medieval fortress. And in the case of the CBA share price, one could argue it does have a moat against its non-bank lending counterparts.

First is the manner in which all companies obtain capital to lend. Non banks rely on a range of mechanisms. In the case of Resimac, for instance, it uses low interest warehouse funding for short-term capital and a global securitisation program for long-term funding.

Securitisation is where the company will add together dozens, if not hundreds, of mortgages and float them on the debt markets. Resimac has been a regular issuer of Residential Mortgage-Backed Securities (RMBS) since 1987. Currently, it pay 130 basis points, or 1.3% for capital it secures in this manner.

Commbank, however, is able to secure capital at far lower rates. For example, CBA is an authorised deposit-taking institution. It takes in deposits and loans them out at higher interest rates. This is the core of the bank's business model.

Second, banks have access to the Reserve Bank of Australia's (RBA) $200 billion term funding facility (TFF). This is a facility that provides banks access to funds at the very low current cash rate of 0.1%. This is 1.2% lower than a lender like Resimac can access. 

Outside of consumer lending, Commbank has a range of other products and service lines that provide it with additional revenue streams and help to set it apart from some of its competitors. For example, Commbank is the largest digital payments provider in the country. Secondly, it owns 50% of the Klarna buy now, pay later platform in Australia and new Zealand. 

Foolish takeaway

Despite looming competition in the mortgage sector, the CBA share price appears to have some notable tailwinds. The APRA changes on capital holdings and potential dividend caps are a positive development, as is the uptick in the housing market CEO, Matt Comyn, has observed. But ultimately, could it be the bank's access to low priced capital that helps set it apart from the rising tide of non-bank lenders? Only time will tell. 

The post Will the Liberty IPO damage the Commonwealth Bank (ASX:CBA) share price? appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Fortescue Metals Group Limited (ASX: FMG) has seen a lot of positive news recently. Chief among these has been a multi-billion dollar export deal with China. In addition, it declared the  intention to become a world leader in renewable technologies, and there is evidence of more progress at its Iron Bridge project. At the time of writing, the Fortescue share price is trading up 5.78% at $17.93. 

Fortescue CEO Andrew Forrest has a long track record of delivering on what he sets out to achieve. Not only that, but he has also shown a talent for picking up on Future trends. His nickel mine, Murrin-Murrin, remains profitable as the world turns more to battery metals like nickel. Moreover, iron ore has proven resilient in the face of a global pandemic, and is one of the few areas where China/Australia trade tensions have not surfaced.

The green tailwinds for the Fortescue share price

At the company's AGM, Mr Forrest announced a new vision for the company in renewable energy. If he achieves his vision, Andrew Forrest would see Fortescue grow into an energy giant comparable with Chevron Corporation (NYSE: CVX) and Total SE (EPA: FP). 

"Consider perhaps that this first target of 235 gigawatts of energy already would make Fortescue one of the largest energy companies in the world but will be financed conservatively and away from our balance sheet," he said.

Delivering on its promises rapidly, the company announced the start of drilling in a Tasmanian green ammonia project, fully energised by renewable energy. The company believes Fortescue will lead a stampede of resource companies into renewables.

A mountain of cash

Fortescue's revenue per tonne increased by 31% compared with the June quarter. Meanwhile, the average benchmark price increased 27% over the same period. Moreover, the company secured 12 new agreements with Chinese steel mill. The 12 memoranda of understanding (MoU) are valued at around $US3-4 billion ($4.1-$5.5 billion). This had little impact on the Fortescue share price when it occurred.

Lastly, ABB Ltd. (SWX: ABBN) has won a contract for $35 million to provide variable speed drives and motors at its Iron Bridge project in Western Australia. In addition, both Iron Bridge and Eliwana remain on time and on budget.

Foolish takeaway

Fortescue Metals Group has proven itself to be a capable operator by delivering quarter after quarter of strong results. This, coupled with its aggressive push into green renewables energy sources, and the progress of major projects; show that the company has the wind at its back. The Fortescue share price has risen by more than 7% in the past 5 days trading. 

The post Why the Fortescue (ASX:FMG) share price is shooting up more than 5% today appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather owns shares of Fortescue Metals Group Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

AGM season this year has seen its fair share of contentious and interesting meetings for S&P/ASX 200 Index (ASX: XJO) companies. This has included first strike votes against Kogan.com Ltd (ASX: KGN) and Lendlease Group (ASX: LLC), and the loss of two directors at Crown Resorts Ltd (ASX: CWN).

Outside of the ASX 200, but still dramatic, was the resignation of the chairman at Myer Holdings Ltd (ASX: MYR).

From an investors point of view, AGM season has allowed us to gauge how companies are recovering from the COVID-19 lockdowns, and get updates on recent news.

Here are a range of AGMs, as well as general investor days, that may make the news this week.

ASX 200 AGMs

Monday

Ampol Ltd (ASX: ALD) is using its investor day to discuss issues around its poor performing Lytton refinery. Market interest was piqued after BP plc (LON: BP) announced it would be closing its West Australian refinery, further underlining difficulties in the sector. 

Tuesday

Ramsay Health Care Limited (ASX: RHC), Brickworks Limited (ASX: BKW), and TechnologyOne Ltd (ASX: TNE) are ASX 200 companies with an AGM on Tuesday. Of these, TechnologyOne has been in the news recently for its engagements with the Tasmanian Government, the Murray River Council, and Victoria University.

Wednesday

IOOF Holdings Limited (ASX: IFL) has seen its share price drop in the wake of an announcement to purchase MLC Limited from National Australia Bank Ltd. (ASX: NAB). In fact, investors have watched the share price for this ASX 200 company fall by 65% from a recent peak in October of 2017.

Medical imaging company Pro Medicus Limited (ASX: PME) will also be holding its AGM on Wednesday, on the back of a 5-year contract renewal for $8.5 million.

Thursday

ASX 200 resource companies will be in the spotlight on Thursday. In particular, gold mining giant Evolution Mining Ltd (ASX: EVN), and rare earths miner Lynas Corporation Ltd (ASX: LYC).  Also, Origin Energy Ltd (ASX: ORG) will be holding an investor day. 

Origin Energy has been in the news a lot in recent time. In particular, it has curtailed drilling at its Queensland natural gas operations as a flow-on from COVID-19. The company is also investigating an export level hydrogen project in Tasmania. 

Friday

Friday is of course 'Black Friday', a retail sales spectacular. Originating from the US, Black Friday is often such a high volume of sales that it puts retailers 'in the black'. As part of a newer tradition, it is grouped together with 'Cyber Monday'.  This is going to prove to be an interesting period in 2020 given the impacts that COVID-19 have had on the discretionary retail sectors of the ASX 200. 

The post ASX 200 events this week that could move the market appeared first on The Motley Fool Australia.

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Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Brickworks and Pro Medicus Ltd. The Motley Fool Australia has recommended Crown Resorts Limited, Kogan.com ltd, and Ramsay Health Care Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Among many announcements during its annual general meeting (AGM) last week, CML Group Ltd (ASX: CGR) voted to change its name. The debtor finance company is rebranding all of its disparate businesses to Earlypay. Although not yet changed on the ASX, the company has already launched a rebranded software-as-a-service (SaaS) platform and website. By the end of the week, the Earlypay share price had risen by 7.46%.

There were also many other structural changes announced during the AGM. For instance, a restructure of the company's debt financing portfolio, a distribution agreement with a large scale brokerage network, and the formal launch of its SaaS platform.

What's driving the Earlypay share price?

Earlypay is a non-bank lender in the commercial sector. Nonetheless, unlike non-bank lenders in the mortgage sector, its loans are not secured by real estate. Moreover, it specialises in debtor finance in the areas of invoice finance, asset finance and trade finance.

The company recently purchased a SaaS platform, moving its invoice financing operations onto a digital platform. The company believes this will increase its addressable market by 140%. 

Debt management

Like other non-bank lenders, Earlypay does not have deposits. Nor does it have access to the Reserve Bank of Australia's (RBA) $200 billion term funding facility (TFF). This is a facility that provides banks access to funds at the very low current cash rate of 0.1%. As a result, the company must rely on other mechanisms to secure the capital it needs to provide its loans. 

The Earlypay share price is benefitting, in part, by the restructure of its debt portfolio, shaving $1.5 million from its annual costs. This will include retirement of corporate bonds in December. In addition, it will move to warehouse funding, and tap the Australian Office of Financial Management (AOFM) for $36 million of capital via COVID-19 initiatives. 

Distribution agreements

Earlypay also announced a formal distribution agreement with COG Financial Services Ltd (ASX: COG), Australia's largest asset finance broker and aggregator. This will provide Earlypay with a much enlarged broker network through which the company can market to and educate potential customers. COG Financial Services currently holds a 16.3% stake in Earlypay as a result of a FY20 aborted takeover attempt.

In addition, Earlypay has appointed Mr. Stephen White to the board. Mr. White is also a current director of COG Financial Services. He has been appointed, in part, to facilitate the relationship between the two companies. 

Commenting on the opportunity with COG, Daniel Riley, CEO of CML said;

The agreement with COG facilitates access for CML to Australia's largest distribution network for commercial finance. The CML team looks forward to working with COG brokers to offer its finance solutions to SME's and anticipates an opportunity to expand business volumes across all products.

Foolish takeaway

Earlypay believes it has significantly increased its addressable market by moving to a SaaS platform, and a distribution agreement. It has also dramatically reduced costs in its debt portfolio, along with cost reductions achieved during the COVID-19 lockdowns.

The Earlypay share price is now enjoying a level of upward momentum. This was after falling substantially in May when the aforementioned takeover deal fell through.

The post Why the Earlypay (ASX:EPY) share price rocketed up 7% last week appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Magellan Financial Group Ltd (ASX: MFG) share price has been flat after announcing a 40% stake in new investment bank, Barrenjoey. Regardless, the company has managed to secure some top flight talent to run the fledgling investment bank.

This includes outgoing chairman of Australia and New Zealand Banking GrpLtd (ASX: ANZ), David Gonski. He has been appointed as the independent chairman of the new investment bank.

Magellan has also secured many top investment bank deal makers of UBS Group AG (SWX: UBSG) in Australia, and can boast ex-CEO of BHP Group Ltd (ASX: BHP) Ken McKenzie as a strategic advisor.

But despite Magellan's moving and shaking, the financial news has been filled with the investment banking activity of Macquarie Group Ltd (ASX: MQG). Furthermore, the Macquarie share price has risen steadily by 5% over the past month.

Investment banks act as intermediaries between companies and capital markets. For example, companies could engage an investment banker for assistance with an initial public offering (IPO), a capital raising, or a refinancing strategy. 

What's fueling the Macquarie share price?

In recent weeks, Macquarie Capital has been named a key player in many major ASX events. For instance, just last week the Australian Financial Review disclosed that Macquarie had secured an IPO funding pipeline for local services marketplace, Air Tasker. Moreover, the investment bank is running the Nuix IPO, likely to be either the largest or second largest IPO this year.

Nuix has developed technology that extracts meaningful information from unstructured data. It finalised IPO details last week, settling on a listing worth $975.3 million. When combined with the shares the company owns, it values the company at $1.8117 billion.

Other companies seeking to float in the near future include legal company HWL Ebsworth, with an estimated value of $917 million; Fantastic Furniture, planning to raise up to $669 million; and Sapura Energy, which is potentially a US$2 billion float.  

The Magellan-backed challenger

Magellan holds a 40% stake, and a 4.99% voting interest, in new investment bank and full-service brokerage, Barrenjoey. The bank plans to provide corporate and strategic advisory services, equity and debt capital market underwritings, cash equites, research, prime brokerage and fixed income trading. However, Magellan's investment in Barrenjoey has received mixed reviews. In fact, the Magellan share price fell 5% on the day of the announcement.

As a rule of thumb metric, investment banks are often valued at 1 to 1.5 times revenue . Given that Magellan has paid $155 million for 40% of Barrenjoey, the full valuation would be just under $400 million. Meaning, the start-up bank has to be earning $400 to $600 million to justify this price.

Foolish takeaway

Macquarie Capital is regularly among the top three investment banks nationally every year. Something that is reflected in its ASX share price.

With the current pipeline of IPOs under way, it may repeat that again this year. However, despite being a start-up in a competitive sector, Barrenjoey has plenty of talent at the helm.

The post Can Magellan (ASX:MFG) prosper in a market dominated by Macquarie (ASX:MQG)? appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

US buy now, pay later (BNPL) giant Affirm plans to enter the Australian market, according to rumours reported by the Australian Financial Review. This comes as market leader Afterpay Ltd (ASX: APT) reveals strategies to return more value to merchants.  The Afterpay share price is already down by 6.68% since Monday after a report from the Australian Securities and Investments Commission (ASIC).

Affirm is a privately owned US BNPL company. Its CEO and co-founder is Max Levchin, who also co-founded Paypal Holdings Inc (NASDAQ: PYPL). At present, Affirm is the largest BNPL company in the United States by monthly active users. Where Afterpay leads in total US users, and Sezzle Inc (ASX: SZL) leads in total US merchants, the US giant operates a different business model with payments scheduled over longer terms. 

What's weighing on the Afterpay share price?

The ASIC report highlighted a range of issues in the BNPL sector, focusing on consumer impacts. In particular, it pointed to the number of people missing payments. As well as those who are forced to cut back on essentials like meals to pay for BNPL purchases. 

Nonetheless, Afterpay was quick to respond, pointing out that consumers benefitted from more choice as competition expands. As opposed to a previously narrow, bank-dominated payments industry. The Australian market leader went on to laud its built-in consumer protections, juxtaposing it to other BNPL providers. This includes never selling or enforcing debt.

Afterpay also revealed some of its own research that reached different conclusions. For example, that there was no causal link between spending on Afterpay and changes in spending on essentials. Also, that there was no statistical relationship between merchant growth in Afterpay and how much their prices changed.

Swimming with sharks

Affirm is only the latest giant to enter the BNPL sector, and it comes at an interesting time given the sabre-rattling by ASIC. On 1 September, payments giant Paypal announced it would be entering the market. It boasts an 82% better conversion rate than other forms of payment and it already has 237 million shoppers globally. After zooming up the charts in previous months, the Afterpay share price has slowed since close of trading on 31 August, rising by just 3.5%.

Furthermore, Commonwealth Bank of Australia (ASX: CBA) has already entered the BNPL market locally via its partnership with Swedish private bank, Klarna. In addition, there have been a raft of recent IPOs, into an already crowded marketplace, by companies with new twists on the business model. For example, an interesting twist is the approach by unlisted BNPL challenger, Limepay. 

The Limepay technology allows companies to build their own BNPL capability. Thus preserving the relationship with customers, rather than having a third party sell them competitor products. 

Moves to defend the Afterpay share price

The threat to BNPL companies is to merchant margins. Particularly as new market entrants try to gain rapid merchant coverage. In order to counter this, Afterpay has announced several initiatives in its AGM designed to add value to merchant partners. For example, its Cross Border Trade also builds on our global expansion by enabling all merchants to open their e-commerce sites to Australian, British, Canadian and New Zealand shoppers.

Moreover, the company has also premiered the Next Gen index. An economic series focussing on consumer spending and the role of BNPL. This has highlighted that Gen Z and the millennials have been the first to increase spending during COVID-19. 

The post Afterpay (ASX:APT) share price under pressure by US BNPL giant appeared first on The Motley Fool Australia.

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Daryl Mather 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 PayPal Holdings. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Sezzle Inc and recommends the following options: long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended PayPal Holdings and Sezzle Inc. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

These ASX 200 shares are from a range of sectors and have managed to not only survive but to thrive in a year that began with flood, passed through a pandemic, and looks to be ending in political upheaval in the USA.

Here are the top 5 ASX 200 performers so far in 2020, based on share price growth.

5 top-performing ASX 200 shares

As you read these, bear in mind that they are exclusively ASX 200 companies, so companies like Temple & Webster Group Ltd (ASX: TPW) and Redbubble Ltd (ASX: RBL) are not included. 

Afterpay Ltd (ASX: APT)

Unsurprisingly, Afterpay is the leading ASX 200 share so far in 2020. This company has seen its share price grow by 262.7%, year to date. However, if it was purchased it on 23 March, when the ASX bottomed out, the investment would have grown 1074.49%.

Afterpay recently reported that by the end of the first quarter of FY21 it has secured 11.2 million active users. It also recently announced a strategic partnership with Westpac Banking Corp (ASX: WBC). It is available on Apple Pay and Google Pay platforms, and has 68,300 merchants. 

Kogan.com Ltd (ASX: KGN)

Kogan is another unsurprising entrant on this list. This ASX 200 company saw its share price grow by 220.65% from the beginning of the year. Again, had an investor purchased Kogan on 23 March, they would have earned 482.9% by now. As an online retailer Kogan has been a great beneficiary of the pandemic, which sent consumers online in droves. Kogan announced an increase in online sales by 100% in an update midway through the fourth quarter of FY20. The company's profit for the same period also grew by 130%.

Netwealth Group Ltd (ASX: NWL)

This company saw its share price grow by 134% over the year. Netwealth provides a platform for managing superannuation, self managed super funds, and access to advisors. The company also has its own funds. In fact, during August it rolled out two specialist funds on the Netwealth platform managed by Magellan Financial Group Ltd (ASX: MFG).

Listed in November of 2017, Netwealth is now valued at $4.1 billion. In its first quarter FY21 report, the company announced $34 billion in funds under administration (FUA) and $1.9 billion net FUA inflows.

NextDC Ltd (ASX: NXT)

This data centre operator has seen its share price rise by 119.29% this year so far. It has been in the news recently offering to help Tabcorp Holdings Limited (ASX: TAH) recover from its systems failure on Sunday.

The company is fundamentally an ASX 200 infrastructure company, albeit with a mix of physical assets and digital services. In FY20, NextDC's total revenues rose by 14%, customers rose by 15%. Moreover, underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by 23%. In FY21, the company has advised it expects to see EBITDA rise by 20–24%.

Saracen Mineral Holdings Limited (ASX: SAR)

The Saracen share price has risen by 95.75% this year. At present the gold price is sitting at $2,543 per ounce. With all of the crises during the year investors have rushed, several times, to gold. This includes gold mining companies, and Saracen has benefitted greatly.

The company purchased the Barrick Gold Corp (NYSE: GOLD) stake in the Kalgoorlie Consolidated Gold mines, or the super pit, in November 2019. A month later, Northern Star Resources Ltd (ASX: NST) purchased the other 51%. Less than a year later the two giants of the goldfields have announced a $16 billion merger.

The post The 5 best-performing ASX 200 shares so far this year appeared first on The Motley Fool Australia.

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Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd and Temple & Webster Group Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO and Netwealth. The Motley Fool Australia has recommended Kogan.com ltd and Temple & Webster Group Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

RPMGlobal Holdings Ltd (ASX: RUL) has seen gradual increases in its share price this week. Culminating in a 4.19% jump today, taking the 5-day share price rise to more than 9%. 

The company has been steadily consolidating its software and services portfolio, while trying to deal with the impacts of COVID-19.

At present, the mining software company currently has 11 of the 21 global offices either partially closed or fully closed, with previous positive COVID-19 cases in South Africa, Russia, the US, Chile and Indonesia. All of which have since recovered.

Regardless of the COVID-19 restrictions, the company has managed to acquire 3 bolt-on software products, bringing the tally to 9 in 6 years. The company's software solutions range from physical asset management, to mine scheduling, through to sophisticated budgeting and simulation tools. 

The uniqueness of each product within the mining sector, means that there is potentially a longer tail of revenue. A long tail that is still growing for every customer. 

Inventory optimisation

In late October, RPMGlobal announced that it intends to acquire Canada-headquartered, inventory optimisation management software company, IMAFS. A Software-as-a-Service (SaaS) and cloud-delivered provider of inventory optimisation software, IMAFS has more than 20 years' experience developing and selling its flagship product.

It connects to an organisation's enterprise resource planning (ERP) system and utilises proprietary artificial intelligence (AI) algorithms to improve inventory management. Its sole purpose is for optimising the inventories of large capital intensive companies. 

Other RPMGlobal software growth

However, IMAFS is the company's second SaaS product, with its first being launched as recently as 14 October. RPMGlobal launched its Haulage as a Service product. The product leverages the company's TALPAC calculation engine, providing access online rather than on the desktop.

Commenting on the move, RPMGlobal CEO Richard Mathews said:

RPM's cloud enabled SaaS solutions help to solve several key industry challenges, including the problem of siloed data. With HaaS, data is no longer trapped within individual desktop applications or siloed with individual users.

This cloud enabled approach enables operations to get the best overall haulage performance right across their operations irrespective of where the users or applications calling the cloud service are physically located.

According to IBM, there are many strong benefits of moving to an SaaS style application. Including, quicker implementation, scalability, ease of updates, and lower costs.

In other, organic software developments, RPMGlobal has released a scheduling and design tool for underground potash mines. This system provides sophisticated mine scheduling across all scheduling horizons. Lastly, the company has updated its AMT asset management product.

Specifically designed for asset lifecycle costing and budgeting, the latest updates have dramatically improved the speed and accuracy of maintenance budgeting. RPMGlobal claims the product is one of the only products on the market that is purpose-built for maintenance cost budgeting that works seamlessly with any miner's ERP.

Foolish takeaway

So far in first quarter FY21, RPMGlobal has secured a total contract value of $3.3 million. This has raised the annual recurring revenue stream to $13.5 million, up from $12.7 million. Moreover, the company CEO and CTO have long track records in the enterprise software industry. Once the restrictions from the COVID-19 pandemic have eased, the company will emerge back into the market with more products and increased functionality. 

The post The RPMGlobal (ASX:RUL) share price is up 9% in a week. Here's why. appeared first on The Motley Fool Australia.

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Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of RPMGlobal Holdings. The Motley Fool Australia has recommended RPMGlobal Holdings. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Why the disagreement over Afterpay?

Westpac Banking Corp (ASX: WBC) CEO Peter King has defended the decision to provide Afterpay with access to the Westpac's deposit and transaction accounts. Some analysts had disagreed with the move, believing the bank would lose its relationship with younger customers. But Mr King told shareholders at the Westpac AGM recently:

When we look at banking and how it is provided, we think it is fundamentally changing. Other banks are seeking to provide infrastructure to fintechs and this is a market Westpac wants to be in.

Westpac's banking as a service platform will allow Afterpay to provide branded saving and transaction accounts. It will then be able to link these to customers' existing Afterpay accounts. This provides Afterpay's customers with an alternative to traditional banking, and gives Afterpay a scalable platform to expand globally. When this was announced the Afterpay share price spiked 7%.

Currently, National Australia Bank Ltd (ASX: NAB) is leading the banks in terms of warehouse finance arrangements, or debt funding for fintech companies. 

However, Australia and New Zealand Banking GrpLtd (ASX: ANZ) has a different view. In an interview with Ticky Fullerton of Sky News, outgoing chairman David Gonski declared his skepticism of the BNPL business. ANZ CEO Mr Shayne Elliot went further, saying that Afterpay's 3.5 million customers were generally not high savers motivated to buy their own homes, and therefore were not a good fit with the bank.

Forces driving the Afterpay share price

Despite these differing viewpoints, Afterpay continues to display strong growth metrics in every quarterly update. The recent first quarter FY21 update saw sales grow by 9% than the record underlying sales of Q4FY20. Moreover, the company's active users has increased to 11.2 million, with the US reaching over 6.5 million. 

Furthermore, 45% of like for like sales growth is driven by millennials. Gen X and Gen Z then form 25% and 24% respectively. Lastly, the company's number of active merchants has increased to 63.8 k. An increase of 70% year on year. 

Foolish takeaway

The Afterpay share price has continued to grow despite the entrance of payments giants like Paypal Holdings Inc (NASDAQ: PYPL), or the views of senior financial players. The company continues to sign strategic alliances like the one with Westpac, while continuing to report solid results quarter on quarter.

The post Afterpay (ASX:APT) share price up 4% in today's trading appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

What are the details of the agreement?

The agreement covers a number of high profile events internationally. For example, the premier domestic and trans-Tasman competitions including Super W, Super Rugby Australia and Super Rugby Aotearoa. In addition, it includes international matches featuring New Zealand, South Africa and Argentina, and the New Zealand and South African domestic competitions.

The three-year deal, based around both live free-to-air and subscription coverage, is worth approximately $100 million, and includes a two-year option for Nine to extend. Based on this deal, which only requires the approval of the body which oversees Super Rugby, Nine is launching Stan Sports. This will be a live and on-demand premium sports package to be offered as a bundle to Stan's streaming customers from 2021.

The launch of Stan Sports will enable Nine to provide extensive live and on-demand coverage. Additionally, the company advised it is progressing opportunities to invest in additional exclusive sports rights to drive its long-term subscriber growth and profitability objectives.

Company performance

In its FY20 annual report, Nine stated that digital now comprised almost half of the company's earnings before interest, taxes, depreciation and amortisation (EBITDA). This is a 38% increase on FY19. Its streaming service, Stan, has seen strong growth in active subscribers and profitability. Several financial KPIs saw increases during FY20. For example, revenue was up 17%, and group EBITDA was up 13%. The company attributed this in part to cost savings to tackle low advertising revenues caused by COVID-19.

In FY21, Nine plans to generate about 60% of EBITDA from digital businesses, along with more than 35% of group revenues from subscriptions.

At the time of writing, the Nine share price is $2.32 per share. Nine shares are up by 27% since the start of the year.

The post Nine (ASX:NEC) share price edges up on rugby union deal appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Tabcorp Holdings Limited (ASX: TAH) was up 16% last Friday on rumours of takeover interest by two large US private equity firms. This week, however, the Tabcorp share price has slipped slightly after a failure of wagering systems. 

Why is the Tabcorp share price slipping?

Tabcorp experienced an outage of its wagering operations and systems from around 11.30am AEDT on Saturday. This is one of the largest betting days in the annual racing calendar. It features the Mackinnon Stakes day in Melbourne and Golden Gift day in Sydney. 

In an update, Tabcorp advised that its systems were "largely" restored. 

The company blamed a "smoke and likely fire incident" at a third-party managed data centre in Sydney. Consequently, it has suffered extensive damage to its servers and associated infrastructure. The company placed its potential losses at "less than $10 million" of earnings before interest, tax, depreciation and amortisation (EBITDA).

Management response

Tabcorp managing director and CEO, David Attenborough apologised for the outage, saying it was unacceptable:

Tabcorp remains deeply sorry for this and acknowledges the significant disruption caused to our customers, the racing industry and venue partners.

Racing Victoria chief executive Giles Thompson said:

We'll be seeking a clear and frank explanation from Tabcorp on how this has happened and what they will be doing to ensure that it doesn't occur again.

It's incredibly disappointing and frustrating for this TAB outage to occur on a major Group 1 race day, in particular for the punters who were looking forward to a great Stakes Day program at Flemington.

Other pressures

There are other pressures on the company at the moment. The Australian reports that shareholders are pushing for a demerger of the wagering and lotteries businesses. In addition, the company agitation over performance from a group led by Perpetual Limited (ASX: PPT). And finally Mr Attenborough, the CEO, is planning to leave the company in the first half of 2021.  

The Australian has also revealed the Victorian state government has been sounding out rival bookmakers ahead of a formal tender process. Regardless, Tabcorp retains exclusive access to pubs and racetracks until 2024.

The Tabcorp share price dropped sharply in opening trade today but has somewhat recovered and is trading at $4.02, down 1.95%, at the time of writing.

The post Tabcorp (ASX:TAH) share price slips after systems failure appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Crown Resorts Ltd (ASX: CWN) share price rose by 6.7% last week, despite a barrage of bad news. 

On one hand, the company is planning to open its new establishment at Barangaroo on 14 December. On the other hand the gaming commission inquiry has heard that Crown is unsuitable to hold the casino licence.

Counsel assisting the inquiry also stated clearly that the influence of Packer and his private company Consolidated Press Holdings (CPH) had a "deleterious impact on the good governance of Crown".

Even NSW premier Gladys Berejiklian has cast doubt on the opening of Crown's NSW casino, stating that she would seek "urgent and immediate" advice on the matter. 

How has the Crown share price performed recently?

The Crown share price fell dramatically prior to its AGM. This was after the company's largest institutional investor, Perpetual Limited (ASX: PPT), declared it would vote to oppose the re-election of three directors. This follows months of public discussion of money laundering accusations at Crown. Financial crimes regulator AUSTRAC has also declared "serious concerns" over the issue, driving it to launch its own investigation.

On the day before Crown's AGM, the company formally announced the termination of all agreements between Crown and CPH. In addition, the AGM saw a strong protest vote against three directors, as well as the board's remuneration report. The abstention by CPH allowed the directors to retain their seats, but also caused the remuneration report to receive a "first strike".

Additionally, the Australian Financial Review reports that the federal Labor Party has demanded Crown chair Helen Coonan be removed from her role as the head of the federal government's Australian Financial Complaints Authority.

Nevertheless, the Crown share price began to edge upwards after its AGM.

Foolish takeaway

The resignation of two directors, termination of all agreements between CPH and Crown, and the continuing gaming commission inquiry are all an exercise in transparency and accountability.

Amid the recent turbulence, the Crown share price continues to rise, sitting at $9.04 at the time of writing.

The post Crown (ASX:CWN) share price bucked bad news to rise 6% last week appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Crown Resorts Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The story of last week on the S&P/ASX 200 Index (ASX: XJO) can be told largely in the 5 shares that saw the biggest gains. While the US election caused a fair bit of turbulence throughout the week, there were legitimate growth stories. In fact, just like the week before, when the ASX 200 was rocked by 2 separate billion dollar takeover ploys within 4 days of each other, last week also had a few surprises.

Last week on the ASX 200

Takeovers on the ASX 200

The Tabcorp Holdings Limited (ASX: TAH) share price rose 24.62% over last week, with most of it at the tail end of the week. On Friday, Tabcorp shares rose swiftly on rumours that private equity funds in the USA were running a ruler over the company with a view to acquisition.

The Australian believes the figure was likely to be around $9 billion, which is considerably more than Tabcorp was valued at when trading started on Friday.

Travel and tourism

The Flight Centre Travel Group Ltd (ASX: FLT) share price rose by 24.42% across the week, particularly after its AGM on Thursday. This ASX 200 share still faces a lot of uncertainty. Nevertheless, it has approximately $1 billion in liquidity to tide it over for an extended period. Moreover, the company has been very ruthless in cost cutting measures and believes it can be profitable at 40% of pre-COVID-19 revenues. 

Webjet Limited (ASX: WEB) saw its share price jump by 20.34% in the week of its AGM. The company made many difficult decisions through FY20 resulting in a 50% reduction in costs, even to the point of closing once profitable businesses. Moreover, the company strengthened its balance sheet with a share placement and rights entitlement from April 2020. Webjet believes people will resume their travel patterns as soon as conditions permit. However, this recovery will be decidedly non-linear and will initially emerge where either there are vaccines, or in safe corridors. 

Discretionary Retail

Eagers Automotive Ltd (ASX: APE) saw its share price rise by 16.48% upon news of the intention to acquire the Castle Hill site in NSW.  This is on the back of a September announcement to purchase 5 properties currently leased by its dealerships. The latest purchase strengthens the company's tangible assets value and will provide a $15 million benefit over the current lease term. AP Eagers intends to reconfigure the site to house up to 8 auto brands. 

REITs and infrastructure

Vicinity Centres (ASX: VCX) saw its share price jump by 15.7% across the week, after the announcement it intends to pay a dividend for this half. The ASX 200 REIT is heavily exposed to the Melbourne mall market, and is also impacted heavily by CBD workers staying home. Sales for the quarter ended 30 September across the portfolio were 32% below last year, largely due to the impact of Victorian centres being closed. Moreover, foot traffic has hit 80% of last year across the portfolio by early November.

The post 5 ASX 200 shares that rose by more than 15% last week appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Last week the US election caused all sorts of market turbulence for the S&P/ASX 200 Index (ASX: XJO). Friday saw rumours of another takeover, this time of  Tabcorp Holdings Limited (ASX: TAH). Forcing its share price up by 15.8%. The week also saw candle seller, Dusk Group Ltd (ASX: DSK) list on the ASX and finish the week 1.7% higher.

The week finished on a solid rise for gold stocks. This helped push the Bellevue Gold Ltd (ASX: BGL) share price up by 19.9% over the week. While Ramelius Resources Limited (ASX: RMS) finished the week with its share price 16.75% higher.

Let's look at 5 events coming up for the ASX 200 this week. All times are Australian Eastern Standard Time (AEST)

ASX 200 events this week

Monday

At 11.30am, the Australian Bureau of Statistics (ABS) will release the building approvals for September. This is always a closely read report as it provides an insight into the general direction of traffic in the economy itself. It has shown a good recovery in recent months but is likely to reflect the Victorian lockdown during September. 

Tuesday

At 9am, James Hardie Industries plc (ASX: JHX) will release second quarter results and a shareholder briefing. This ASX 200 share finishes its year in March, 2021. At the company AGM, chairman Michael Hammes said he believed the company entered the COVID-19 pandemic in a strong position and would emerge from the crisis in even better shape, driving profit growth that will outstrip the broader market. 

Wednesday

At 10.30am, ASX 200 gold miner Newcrest Mining Limited (ASX: NCM) will hold its AGM including first quarter results. Newcrest has recently re-listed on the Toronto Stock Exchange and has benefited from the high gold price. The company will also update shareholders on its recent acquisition Red Chris. Furthermore, the Lihir gold mine suffered a 14% production loss in the June quarter due to equipment and maintenance issues. A $61 million CAPEX spending program was signed off in October. 

Thursday

At 10am, Hipages Group Holdings Limited (ASX: HPG) will list on the ASX for the first time. Hipages is an online trade services platform. The Australian reported that it has exceeded its offer size at the top end of its price range of $2.05-$2.45 a share. The company will list with a market capitalisation of between $266.5 million and $318.5 million. 

Also at 10am, Breville Group Ltd (ASX: BRG) will hold its AGM. In October, the ASX 200 company announced its acquisition of a US manufacturer of coffee grinding machines, Baratza. UBS believes this will be approximately 3% earnings accretive from the 2022 financial year. In addition, analysts say the company is likely to benefit from increased consumer spending in the federal budget.  

The post 5 notable events on the ASX 200 this week appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ReadyTech Holdings Ltd (ASX: RDY) provides a software-as-a-service (SaaS) platform for a diverse range of applications. The ReadyTech share price will be on watch on Monday after the company announced a move to grow by acquisition. The company is currently in a trading halt while it makes announcements related to this acquisition.

ReadyTech has executed a heads of agreement and exclusivity agreement to acquire government-based software provider, Open Office. The deal is for an upfront consideration of $54 million and an earn out of up to an additional $18 million. 

Why will the ReadyTech share price be on watch?

Open Office is a leading government and justice case management SaaS provider with a customer base in Australia and the United Kingdom. It provides a platform to local and federal government for various applications including asset management, HR and payroll, community management, finance, and many other applications. 

At present, ReadyTech provides services for student management, HR and payroll, and management of work pathways. Accordingly, the company believes that the acquisition is consistent with its strategy to acquire complementary technologies, thus providing it with the opportunity to focus on new and attractive verticals and target higher value customers. 

The company will pay for this via a fully underwritten institutional placement for up to $25 million. This will be an offer with the ReadyTech share price at $1.88, a 6% discount to Thursday's closing price. 

Management commentary

ReadyTech CEO Marc Washbourne said the acquisition opportunity is strategically compelling for ReadyTech:

Open Office is a high-quality business, providing solutions to 130 government and global justice clients, with a client retention rate of approximately 95%. It is a resilient market, with long-term government funding. Gaining access to government and justice clients allows ReadyTech to unlock the potential of servicing a new market and adding a third pillar to our operations.

The Open Office acquisition provides ReadyTech with an opportunity to secure a strong foothold into all levels of government in Australia, with the benefits of long-term, sustainable client base with strong barriers to entry. Entering a market of this type requires the type of expertise for which ReadyTech is renowned.

Trading guidance

Aside from the acquisition, ReadyTech has reaffirmed FY21 guidance, with Q1 trading in line with guidance assumptions. Revenue retention for the first quarter of FY21 is maintained at 95%. In addition, gross new business remained at $14 million and the company is investing in sales and marketing to drive top line revenue. The ReadyTech share price is currently up by 11.7% year to date. 

The post All eyes on ReadyTech (ASX:RDY) share price Monday after acquisition bid appeared first on The Motley Fool Australia.

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Daryl Mather 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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Although the New Energy Solar (ASX: NEW) share price fell today, it rose around 12% this week. There appear to be a number of reasons for the action in the New Energy share price lately, not the least of which is a potential takeover by a US fund. 

New Energy Solar is an investment fund that buys develops and operates solar-powered generation plants. This includes operating assets in Australia, Nevada, California, North Carolina, and Oregon.

What's moving the New Energy share price

On 26 October New Energy announced it had completed the initial phase of a strategic asset review it launched in September. 

According to a report in Renew Economy, New Energy's head of investor relations Fleur Jouault said the 'strategic review of the company's portfolio would seek to identify how New Energy Solar can maximise the value of the business for its security holders, and to ensure that the company's security price was better aligned with the business' value'.

The strategic review has found the New Energy share price impeded predominantly by two issues. First, the current structure of the company, and second the limited support for the listed renewables sector in Australia. Moreover, the review noted that the Australian assets are in a mature operational state. Meanwhile, the US-based portfolio has yet to reach optimal operational performance. Fortunately, it identified material interest in the underlying solar assets from both domestic and international investors. 

As a result, the board of New Energy Solar has decided to sell the two Australian assets. Accordingly, proceeds from the sale of assets will be available for a range of capital issues. These may include security buybacks, capital returns, and debt reduction.

Asset sales and takeovers

Thus far, there has been a lot of interest in New Energy's Australian assets. The Australian reports that Palisade Investment Partners, Lighthouse Infrastructure, First Sentier, and the Dutch Infrastructure Fund are believed to be among those lining up to buy New Energy Solar's Australian assets.

However, this is at a time when the national energy operator, AEMO, has warned against the rapid growth of solar power. In South Australia, there's even been some discussion about potentially banning any new installations. Australia is a world leader in the adoption of rooftop solar power, and according to the AEMO, this has created an "invisible and uncontrolled" power source that risks destabilising electricity grids. 

The post The New Energy Solar (ASX:NEW) share price jumped 12% higher this week appeared first on The Motley Fool Australia.

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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.