In morning trade, the ASX All Ords stock is up a sizeable 34% to 99 cents.

This compares to a 0.95% gain by the ASX 200 index at the time of writing.

Investors have been fighting to get hold of the gaming technology company's shares after it received and accepted a takeover offer.

ASX All Ords stock jumps on takeover deal

This morning, Ainsworth Game Technology revealed that it has entered into a scheme implementation deed (SID) with Novomatic AG. This will see the latter acquire all the outstanding shares in the ASX All Ords stock that it does not currently have an interest in.

Novomatic currently has a relevant interest in 52.9% of the Ainsworth Game Technology shares on issue.

According to the release, if the scheme is implemented, shareholders will receive $1.00 cash per share, less any permitted dividends declared and paid before closing.

This implies an equity value of $336.8 million and enterprise value of $336.5 million for the ASX All Ords stock, representing a multiple of ~7x enterprise value/FY 2024 EBITDA.

It also represents a 35% premium to the where the company's shares ended last week.

Commenting on the deal, the company's chair, Daniel Gladstone, said:

The proposal put forward by Novomatic. who is already the majority shareholder of AGI, represents a significant premium to long term trading value and is compelling for AGI minority shareholders. The IBC [Independent Board Committee] have carefully evaluated the proposed Scheme Consideration against the company's medium-and long-term growth prospects and alternative opportunities, and has unanimously formed the view that the proposal represents attractive and certain value for AGI minority shareholders.

What's next?

The deal is not done yet. It remains subject to a number of conditions. This includes relevant approvals from ASIC and ASX, approval by the requisite majorities of AGI shareholders, approval by the Federal Court of Australia, and an independent expert concluding that the scheme is in the best interests of shareholders.

The ASX All Ords stock advised that Novomatic has already received approval from the Australian Foreign Investment Review Board in respect of the scheme. Novomatic has also advised that it expects to fund the scheme consideration through a combination of existing cash reserves and third-party debt financing and requires no due diligence to complete the acquisition.

The post Guess which ASX All Ords stock is rocketing 34% on takeover deal appeared first on The Motley Fool Australia.

Share markets have been buoyed by signs that inflation may have peaked and the pace of interest rate hikes could slow.

So, as optimism abounded, the ASX All Ords index continued its recovery, gaining 6.0% across the month to close out spring at 7,480 points.

As always, some ASX All Ords shares were soaring to loftier heights than the rest.

Without further ado, here are the three best-performing ASX All Ords shares in November in terms of share price gains.

Aeris Resources Ltd (ASX: AIS)

Topping the ASX All Ords tables in November was mid-tier base and precious metals producer Aeris Resources.

The Aeris Resources share price shot up 64% across the month to finish at 53 cents as its market capitalisation ballooned to $366 million.

On the last day of October, Aeris released its first-quarter results, which were met with an 18% share price slide.

But it appears this was a knee-jerk overreaction. As the market digested the results, the Aeris share price stormed higher, which set the tone for the rest of the month.

The biggest announcement from Aeris in November came in the form of a mineral resource update.

The ASX miner revealed an updated mineral resource estimate (MRE) for the Turbo lens at the Bentley deposit, located at Aeris' 100%-owned Jaguar Operations in Western Australia. 

The updated mineral resource materially increased the ore tonnes and metal content at the Turbo lens. The MRE now stands at 1.26 million tonnes at 1.82% copper, 8.5% zinc, 0.72 grams per tonne (g/t) gold, and 47g/t silver.

What's more, the drilling campaign resulted in the majority of the resource classification being upgraded to indicated status.

Renascor Resources Ltd (ASX: RNU)

The next cab off the rank is another ASX miner, with Renascor Resources taking out the title of the second best-performing ASX All Ords share in November.

The Renascor share price had a spring in its step, flying 59% across the month to finish at 35 cents. The company's market cap currently stands at around $750 million. 

Renascor is an exploration and development company with a portfolio of projects in South Australia. Its flagship project is the Siviour battery anode material project, the world's second-largest proven graphite reserve.

The Renascor share price steadily climbed throughout the month. Similarly to Aeris, Renascor released its quarterly results on the last day of October.

Following this, the company kicked off November by presenting at the International Mining and Resources Conference in Sydney. 

It was then radio silence for the rest of the month until Rensacor revealed it had received a key approval for its Saviour Project.

Specifically, the South Australian Department of Energy and Mining has granted Renascor approval for the Program for Environment Protection and Rehabilitation (PEPR) for its proposed Siviour mine and concentrator.

The PEPR approval permits Renascor to process up to 1.65 million tonnes per annum. This would allow the ASX All Ords share to produce up to 150,000 tonnes of graphite concentrates per year.

With this approval under its belt, Renascor can now develop the upstream graphite mine and concentrator portion of the Siviour project.

Ainsworth Game Technology Limited (ASX: AGI)

Last but not least, Ainsworth Game Technology rounds out the podium finishes with a whopping share price gain of 58% in November.

Ainsworth designs and manufactures a range of slot machines and a catalogue of standalone and linked games. The ASX gaming share currently boasts a market cap of $420 million.

It was a rather quiet affair at Ainsworth for most of the month, with its share price marching upward despite no news coming from the company.

But the Ainsworth share price received an added boost when the ASX All Ords share held its 2022 annual general meeting (AGM) at the end of November.

Notably, the company instated guidance at its AGM. Based on its current forecasts, Ainsworth expects to achieve around $18 million in normalised profit before tax in the first half of FY23.

The company is building on strong momentum, which saw it deliver normalised profit before tax of $17.3 million in 2H22, up considerably from $10.0 million in 1H22.

Looking ahead, Ainsworth expects to have continued growth in North America, further improvements in Latin America, and steady performance in Australia.

The post These were the 3 best-performing ASX All Ords shares in November appeared first on The Motley Fool Australia.

Four ASX shares that are climbing more than most today are listed below. Here's why they are charging higher:

Ainsworth Game Technology Limited (ASX: AGI)

The Ainsworth Game Technology share price is up 6.5% to $1.28. This morning, analysts at Macquarie responded to the gaming technology company's recent trading update by putting an outperform rating and $1.40 price target on its shares. Macquarie was pleased with its forecast of $18 million in profit before tax pre-currency and one-offs for the six months ending 31 December 2022.

Life360 Inc (ASX: 360)

The Life360 share price is up 5.5% to $6.38. This appears to have been driven by a broker note out of Bell Potter this morning. According to the note, the broker has retained its buy rating and $9.00 price target on this location technology company's shares. Bell Potter continues to believe that Life360 will deliver on its guidance in FY 2022.

Temple & Webster Group Ltd (ASX: TPW)

The Temple & Webster share price is up 12% to $5.19. This follows the release of the online furniture and homewares retailer's trading update at its annual general meeting. While Temple & Webster's revenue is down 14% for the four months to 27 November, it revealed that month to date revenue is flat. Management believes that this positions the company for a return to double digit growth during FY 2023.

Whitehaven Coal Ltd (ASX: WHC)

The Whitehaven Coal share price is up 9% to $10.11. Investors have been buying this coal miner's shares following a rise in the coal price and the release of a couple of bullish broker notes. One of those notes came from Bell Potter, which has upgraded Whitehaven Coal's shares to a buy rating with an improved price target of $11.00.

The post Why Ainsworth, Life360, Temple & Webster, and Whitehaven Coal are charging higher appeared first on The Motley Fool Australia.

Four ASX shares that are climbing more than most are listed below. Here's why they are charging higher:

Ainsworth Game Technology Limited (ASX: AGI)

The Ainsworth Game Technology share price is up over 9% to $1.21. Investors have been buying this gaming technology company's shares following the release of an update at its annual general meeting. Management advised that it expects to achieve approximately $18 million in profit before tax pre-currency and one-offs for the six months ending 31 December 2022.

BHP Group Ltd (ASX: BHP)

The BHP share price is up 2.5% to $45.00. The catalyst for this gain appears to have been a rebound in iron ore prices during Asian trade. According to the Singapore Exchange, iron ore futures are up 3% to US$100.40 per tonne. Rio Tinto Ltd (ASX: RIO) shares are rising by a similar margin for the same reason. The potential easing of restrictions in China has boosted prices.

Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)

The Fisher & Paykel Healthcare share price is up 10% to $21.18. This follows the release of the medical device company's half year results this morning. Although Fisher & Paykel Healthcare reported a 57% decline in net profit after tax to NZ$88.85 million, this was in line with expectations. The prior corresponding period benefited greatly from COVID demand for respiratory care devices.

Leo Lithium Ltd (ASX: LLL)

The Leo Lithium share price is up 6% to 51 cents. Leo Lithium and a number of other lithium shares are rebounding strongly today after recent declines. This may have been driven by speculation that China may ease COVID restrictions despite soaring cases. China is holding a COVID briefing later today.

The post Ainsworth Game Tech, BHP, Fisher & Paykel, and Leo Lithium shares are charging higher appeared first on The Motley Fool Australia.

Companies involved in the video game industry and listed on the Australian Securities Exchange (ASX) are known as ASX gaming shares or stocks. This includes companies that produce and distribute electronic games and the software and hardware required to play them. 

Video games have progressed significantly since they first appeared in the 1970s. They can now be played on various devices, from laptops and game consoles to mobile phones. This means people can now essentially play them anywhere, anytime. 

Video game stocks benefit from advancements in technology and the advent of entirely new technologies. Augmented and virtual reality, for example, allows players to immerse themselves more completely in the games. 

The gaming industry remains one of the fastest-growing segments of global entertainment. According to Newzoo, global games revenue is expected to exceed US$205 billion in 2026, with steady growth driven largely by mobile gaming and live-service titles¹. While forecasts have moderated from earlier projections, the sector's scale and recurring revenue models continue to underpin its long-term growth outlook.

Why invest in gaming stocks? 

Worldwide, billions of people have access to smartphones, meaning every one of them is a potential gamer. It's no longer a niche interest. Gaming has become a genuine source of entertainment for people of all ages across different consumer segments. 

Mobile games help people while away their morning commute. And the advent of eSports means that some people are even pursuing online gaming as a full-time profession.

And it's not just playing electronic games that people are interested in. The rise of gameplay live streaming shows that people are interested in watching others play, too. 

Companies involved in the gaming industry include games developers, hardware manufacturers, and those involved in publishing and distribution. Each plays an essential role in the video game ecosystem and can have multiple sources of revenue. 

When a gaming product develops a loyal fan base, additional revenue can be sourced from promotional material, downloadable content, sequels, and expansion packs. The gaming sector is growing, with global player numbers estimated to already be over 3.3 billion in 2026.² 

An investment in a gaming stock can provide exposure to a fast-growing and innovative industry, which is set to benefit from ongoing technological advancement. 

Top ASX gaming shares

(ranked by market capitalisation from high to low)

Aristocrat Leisure 

Aristocrat is a gaming content and technology company and mobile games publisher, offering products such as electronic gaming machines, casino management systems, and free-to-play mobile games.

It operates across two main segments: land-based casino gaming and a growing digital business spanning web and mobile platforms. This diversification has become increasingly important as player behaviour shifts toward online and mobile gaming.

While the company has faced recent share price weakness following softer-than-expected results, its core business remains resilient. Aristocrat continues to benefit from strong recurring revenues, a leading position in key markets like North America, and a large portfolio of gaming content distributed globally.

The company's scale and long-standing relationships with casino operators give it a competitive edge, while ongoing investment in design, development, and emerging technologies such as artificial intelligence is helping to improve product quality and speed to market.

Aristocrat has also maintained a disciplined approach to capital management, including returning capital to shareholders and managing its balance sheet.

Looking into 2026, the company is focused on expanding its digital footprint, pursuing growth opportunities, and strengthening its position across both physical and online gaming. However, investors should be aware that earnings can be influenced by economic cycles, regulatory changes, and shifts in consumer spending, which may contribute to periods of volatility.

Jumbo Interactive

Jumbo Interactive is a lottery technology company that helps governments, not-for-profits, and charities design, manage, and grow digital lottery programs. It takes a player-centric approach, using data and technology to create more engaging online lottery experiences across multiple platforms.

The company operates across lottery retailing, managed services, and charity fundraising, with a growing international presence. While it has long held the rights to sell major Australian lottery products online, its strategy is increasingly focused on expanding offshore, particularly in markets like the United Kingdom and Canada.

Although the share price has weakened in recent months amid softer jackpot activity and broader market pressures, the underlying business continues to perform well. Recent results showed strong growth across key segments, with total transaction value rising to over $500 million for the half year and underlying EBITDA increasing to around $37.5 million.

Jumbo's diversification beyond traditional lottery retailing is becoming more important. Growth in its managed services and SaaS-style offerings is helping drive more stable, recurring earnings, even as jackpot cycles create some variability in its core business.

From a valuation perspective in eaerly 2026, the company is trading on a price-to-earnings (P/E) ratio of roughly 14–15 times, which is below levels seen during its earlier growth phase. It also maintains a solid dividend profile and a disciplined approach to capital management, appealing to income-focused investors.

Moving forward, Jumbo is focused on scaling its international operations and leveraging its technology platform to drive further growth. However, performance can still be influenced by jackpot cycles, consumer spending trends, and broader market sentiment, which may lead to periods of share price volatility.

Ainsworth Game Technology 

Ainsworth Game Technology is a fully integrated gaming machine company that designs, develops, and manufactures its own range of gaming products. It operates across the entire product lifecycle, generating revenue through the sale, leasing, and servicing of gaming machines.

Although headquartered in Sydney, Ainsworth has a global footprint, with a strong presence across North America, Latin America, Europe, and Australasia. A significant portion of its revenue is generated offshore, reflecting its focus on international growth markets.

The company has faced a mix of operational challenges and uneven earnings in recent years, including regional headwinds and regulatory pressures. However, its scale and exposure to key gaming markets have helped support revenue growth, with annual revenues previously exceeding $140 million despite volatility in profitability.

More recently, Ainsworth has come into focus following a takeover offer from its majority shareholder, which values the company at approximately $330 million and implies a valuation of around 7 times EBITDA. The proposal represents a notable premium to its recent trading levels and has driven a sharp re-rating in the share price.

The potential acquisition highlights both the strategic value of Ainsworth's global operations and the challenges it has faced as a standalone listed company. If completed, it would provide shareholders with certainty of value, while underscoring ongoing consolidation trends in the gaming technology sector.

Ainsworth's outlook remains tied to global gaming demand, regulatory developments, and execution across its key markets. While the takeover may cap near-term upside, it also reflects underlying value in the business despite recent volatility.

What to look for when buying ASX gaming stocks 

As competitive gaming cements itself in popular culture, investors, consumers, media outlets, and brands are all paying attention. 

The United States has more gaming stocks listed than Australia, including some of the sector's most valuable companies. These include Electronic Arts Inc (NASDAQ: EA) and Activision Blizzard  — which tech giant Microsoft Corp (NASDAQ: MSFT) recently acquired for an eye-watering US $69 billion.

Goes to show how lucrative the gaming industry has become! 

Investors looking to spot the next Activision Blizzard will want to hone in on financial data like how fast a company grows revenues, its total returns, and its product pipeline. Have a look at the strength of the company's fanbase, particularly if it spans multiple demographics. Remember, it's not just teenage boys playing video games anymore — it's men, women, and children, both old and young. 

Like investing in any stock market sector, an investment in the gaming sector involves risk, and requires research. Learning, tracking, and staying engaged is crucial. The growing prominence of the industry makes it an attractive prospect for investors seeking growth. Based on facts and thorough research, deciding which industry players to back should be an informed decision. 

Pros of investing in ASX gaming shares

High growth prospects: The gaming industry is developing rapidly and received tailwinds from the COVID-19 pandemic. Some data indicates that the pandemic accelerated the gaming industry's adoption and subsequent growth. Maintaining player engagement will now be a key challenge for gaming companies.

High margins: Gaming companies often have higher average margins than companies in other industries. Profit margins can be around 90% for hit games with significant opportunities for ongoing revenue from selling virtual goods within digital gaming environments. This compares to margins of about 40% for the average successful console game.

And the cons

Rapid change: The gaming industry can experience sudden shifts with the introduction of new and improved products and the disappearance of legacy gaming systems. Remember Atari? Probably not.

Operational profitability: Trends in gaming are hard to predict, making gaming companies particularly unreliable. Sudden project failures, fan backlashes, and quality issues are not uncommon in the industry. Video games can be costly and time-consuming to produce. And marketing costs have increased in recent years as companies fight for top-ranking visibility in a competitive market. 

Volatility: Gaming shares are a subset of technology shares, which can have high valuations and volatility compared to the stock market as a whole. This means they are often higher-risk investments, with share prices fluctuating considerably over time. This means you should do your research and not invest more than you can afford to lose. 

Are ASX gaming shares a good investment? 

The video game sector has significant long-term expansion potential. The industry benefited from a surge in interest during the COVID-19 pandemic. It is now seeking to retain new gamers acquired during lockdowns. Companies adapting to players' demands and shaping tastes for interactive electronic entertainment should be well-positioned to deliver positive returns. 

Whether Australian shares in the gaming sector are a good choice for your portfolio will depend on your investment goals, risk tolerance, and financial situation. Gaming shares can be volatile and trade at high price-to-earnings (P/E) ratios. Nonetheless, if you are interested in technology and electronic entertainment, gaming stocks may be rewarding.

For investors seeking exposure to the industry as a whole rather than individual companies within it, an exchange-traded fund (ETF) such as Betashares Video Games and eSports ETF (ASX: GAME) may be a good option. Remember that any investment in equities involves risk. You should seek financial advice if required prior to making your investment decision. 

• Additional reporting: Rhys Brock

The post Investing in ASX gaming shares appeared first on The Motley Fool Australia.

At the closing bell, Ainsworth shares were trading at $1.02, down 1.45%.

Let's take a closer look to see how the gaming technology company performed during the period.

Ainsworth share price slides despite solid revenue growth

Here are some of the company's key highlights for the 12 months ending 30 June 2021:

• Revenue of $159.5 million, up 6.8% year on year;
• Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of $15.5 million, up 167.2%;
• Net loss after tax of $53.4 million, down 23%.
• No final dividend declared for FY21 (continues to be suspended)

What happened in FY21 for Ainsworth?

During the year, Ainsworth progressed its game development, software and hardware activities.

International revenue brought in $120.5 million due to the progression of vaccination programs which saw most customer venues gradually reopen. In domestic markets, Australia recorded revenues of $39 million with increase sales due to improved product performance on A-STAR hardware.

Online revenue came in at $5.9 million, up 28% following the launch of Real Money Gaming in New Jersey in April 2020. The company progressively went live with its innovative content amongst seven major operators during the period.

The company's bottom line suffered a loss, which related to currency impacts and other one-off non-recurring items. This included a non-cash impairment charge of $41.7 million.

Ainsworth ended the 2021 financial year with a cash balance of $42.7 million.

What's the outlook for Ainsworth in FY22?

Looking ahead, Ainsworth advised that it has laid the foundations for a solid FY22 year. The company has strengthened its balance sheet to develop superior games and hardware and maintain its distribution network.

Furthermore, online revenue is forecasted to surge following the execution of the United States exclusivity agreement deal with GAN Ltd.

While positive, no revenue or profit guidance was given by the company.

Ainsworth share price snapshot

The Ainsworth share price has accelerated more than 150% over the past 12 months, with year-to-date gains above 110%.

Based on today's prices, Ainsworth has a market capitalisation of around $343.5 million, with 336 million shares on issue.

The post Ainsworth (ASX:AGI) share price slips on FY21 results appeared first on The Motley Fool Australia.

Spheria's investment philosophy is to buy companies with cash generative business models, with a demonstrated track record of solid returns at a sensible valuation given their industry dynamics and positioning.

Whilst Spheria believes that the world can overcome COVID-19, the threat of inflation and emerging signs of reluctance by central banks to "pump prime" to the same extent as they have since the emergence of COVID-19 means the fund manager is focusing its efforts on finding business models with pricing power and trying to avoid those that are likely to see unexpected compression in profit margins, such as mining contractors.

In this era of high levels of corporate activity with lots of liquidity, "procyclical" boards and record levels of private equity funding, Spheria thinks it's well placed to benefit. That's because of its focus on undervalued, cash-generating businesses with decent balance sheets.

Spheria is avoiding ASX shares that are overvalued and it's trying to maximise the risk-reward equation for investors with a disciplined investment approach that is predominately guided by valuation fundamentals.

Ainsworth Game Technology Limited (ASX: AGI)

Ainsworth is a gaming machine manufacturer and supplier. It offers the types of machines that you may find in casinos.

Spheria noted that whilst the company has been heavily impacted by COVID-19, it has never been in danger of insolvency because of property holdings in the US that at one point exceeded its market capitalisation.

The fund manager pointed out that in the US (and Australia), the end market of casinos, pubs and clubs have/had recovered strongly and in many case are now/were in a position to recommence expenditure on new machines. The company returned to profitability in the second half of FY21.

Spheria believes that the ASX share has the potential to leverage its portfolio and intellectual property and regulatory approval to improve earnings and surpass what it was making before COVID-19 came along.

City Chic Collective Ltd (ASX: CCX)

This ASX share is a retailer of plus-size clothes, footwear and accessories. It has a number of different brands including City Chic, CCX, Avenue and Evans. City Chic is now making a majority of its sales online.

Spheria said this business appears to be well positioned to benefit from the re-opening across the countries that it has major operations in (mainly the UK, the US and Australia). It can also benefit from the significant bounce back in apparel expenditure, which has been hurt by lockdowns in the UK and US in-particular, that is accompanying this trend.

According to Commsec, the City Chic share price is valued at 31x FY23's estimated earnings.

The post Leading fund manager likes these 2 ASX shares appeared first on The Motley Fool Australia.

At market close, the gaming technology company's shares finished the day at 88 cents, down 2.78%.

What was announced?

Investors sold off their positions in Ainsworth today despite the company's strong forecasted preliminary results and new partnership agreement.

According to its release, Ainsworth advised it expects to report a profit before tax of $1 million for H2 FY21. Continued improvements in market conditions following the impact of COVID-19 led the group to achieve better revenue and profitability.

Group underlying earnings before interest, tax, depreciation and amortisation (EBITDA) for FY21 is projected to come in at $19 million. Most of the earnings were attributed to the robust second-half performance which recorded $13.2 million. This represents an increase of 128% on the $5.8 million achieved in the first-half.

Ainsworth noted, however, that both forecasted metrics excludes any currency movements and one-off items such as the $3.3 million sale of land at its Nevada facility.

In addition to the update, the company announced an exclusive agreement with internet-based interactive gaming services, GAN Limited (NASDAQ: GAN).

The 5-year partnership will see Ainsworth provide GAN with exclusive use of online real money games within the United States. Rights of up to 79 unique slot titles including QuickSpin brand of wheel games are included in the deal.

Furthermore, Ainsworth will supply a variety of new game content on a regular basis to keep customers enthused.

Online operations will run in New Jersey and are being planned for Michigan and Pennsylvania.

The contract will generate a minimum guaranteed amount of US$30 million and will come into effect 1 July 2021. The funds will be received with US$10 million in cash in H1 FY22, and the remaining US$20 million paid over the life of the contract.

About the Ainsworth share price

Year-to-date, Ainsworth shares have gained traction to almost double in value, up over 80%, reflecting positive investor sentiment. The company's share price reached a 52-week high of $1.175 before profit taking swooped in.

On valuation grounds, Ainsworth commands a market capitalisation of around $294 million, with approximately 336 million shares outstanding.

The post Ainsworth Game Tech (ASX:AGI) share price slips on business update appeared first on The Motley Fool Australia.

Three sell ratings that caught my eye are summarised below. Here's why top brokers think investors ought to sell these shares next week:

Ainsworth Game Technology Limited (ASX: AGI)

According to a note out of UBS, its analysts have retained their sell rating but lifted their price target on this gaming technology company's shares slightly to 35 cents. While UBS notes that its performance is improving, it suspects that its recovery could be prolonged. Particularly in the Latin American market, which has been hit hard by casino closures and operating restrictions. The Ainsworth Game Technology share price ended the week at 74 cents.

Air New Zealand Limited (ASX: AIZ)

A note out of Macquarie reveals that its analysts have retained their underperform rating and NZ$1.20 (A$1.11) price target on this airline operator's shares. This follows news of a travel bubble between Australia and New Zealand opening up this month. While the broker expects there to be pent-up demand for people wanting to visit friends and family, it isn't sure that business and leisure travellers will be as interested. This is due to the potential of being stranded should borders suddenly snap shut because of an outbreak. The Air New Zealand share price ended the week at A$1.70.

ASX Ltd (ASX: ASX)

Analysts at Goldman Sachs have retained their sell rating and $67.46 price target on this stock exchange operator's shares. This follows the release of its activity data for the month of March. Goldman notes that futures trading continues to slide while cash market trading normalises. Overall, the broker continues to see earnings risks skewed slightly to the downside. As a result, it believes its shares are overvalued at the current level. The ASX share price was trading at $72.78 on Friday.

The post Top brokers name 3 ASX shares to sell next week appeared first on The Motley Fool Australia.

At the time of writing, Ainsworth shares are trading hands for 82 cents apiece.

What did Ainsworth report today?

Earlier today, Ainsworth released its half year report and investor presentation for the period ended 31 December 2020. The company advised it earned $72.1 million in FY21 compared to $42 million over the corresponding period in FY20. Ainsworth designs and manufactures pokies and lottery machines, and gaming shut downs across the world due to COVID-19 continue to hurt the business.

The company registered a statutory loss after tax of $50.1 million and currency translation loss of $13.4 million in the first half of FY21. Its earnings per share fell to -14.9 cents and its earnings before interest, tax, depreciation and amortisation (EBITDA) was -$36.8 million.

Its biggest losses took place in Latin America, where it lost 85% of its revenue from July to December 2020. The company predicts this will continue to worsen as the region struggles to deal with COVID-19, but is beginning to shed its leased assets in the area.

In positive news for investors, its other international sales remain strong and contribute 73% of its revenue. 

Ainsworth also refinanced its $50 million loan facility with a US-based bank, Western Alliance Bancorporation on 18 February 2021 with a loan period of five years. Ainsworth reduced its total assets base by nearly $70 million from June 2020 to December 2020, primarily due to recognition of impairment losses related to property, plant equipment and leased assets. 

The company advised it will continue to suspend its dividend to increase its own cash reserves.

Ainsworth share price in a nutshell

The Ainsworth share price has a bullish price-to-earnings (P/E) ratio of 20.92.

Over the past 12 months, we've seen the Ainsworth share price rise from around 40 cents to over 70 cents per share, but that's still a long way off its decade highs.

It was priced at $4.50 in 2013 and has steadily declined from that point until November 2020, when it began its current recovery.

Earnings gains backed by MTD Gaming acquisition

The company's half year report says its acquisition of MTD Gaming has had an "immediate and positive impact on EBITDA".

MTD is a developer and supplier of poker, keno and video-reel content. It provides Ainsworth access to multi-game and video lottery terminal markets and expands its existing hardware offering with the Apollo cabinet it manufactures.

Its Australian performance has improved on a small existing base, increasing revenue 118% compared to second-half FY20 of $8.8 million.

Ainsworth's own outlook

The company believes its North American operations will gradually return to pre-COVID levels by the end of 2022, with Australia recovering quicker and Latin America more slowly.

Ainsworth is insistent that it will continue to cut its operational costs without affecting its deliverables market. It also aims to introduce six new brands and lottery games worldwide, while simultaneously re-entering the West Australian market.

The post Ainsworth Game Tech (ASX:AGI) share price rises after 71% revenue increase appeared first on The Motley Fool Australia.

Despite this healthy move today though, this is a company that has been on struggle street in recent months. ResApp is still down around 71% from its 52-week high of 23 cents, and down nearly 80% from where it was in mid-October last year. Saying that, the company is also up 58% from the 52-week low of 5.2 cents a share that we saw just a fortnight ago on 5 March (timing can be everything).

So who is this company? And why are ResApp shares soaring today?

Res-who?

ResApp was founded in 2014 and listed on ASX in 2015. As its name implies, ResApp is a digital healthcare company. It aims to develop digital healthcare solutions for both doctors and patients, specifically in the area of respiratory disease. The company develops software exclusively for smartphones, which are designed to be integrated into existing telehealth services. ResApp's products can assist with diagnosing some of the most common repository illnesses. These include everything from common colds and the flu to sleep apnoea, asthma, and chronic obstructive pulmonary disease.

The company has developed algorithms that assess 'lung sounds' from breathing and coughing to accurately diagnose diseases. Using this machine learning, ResApp can provide a far more accurate diagnosis than a traditional stethoscope.

Why is the ResApp share price shooting higher today?

A number of events have transpired in quick succession for ResApp over the past week or so that might be influencing the company today.

Firstly, last week the company announced it was commencing a clinical study in the United States to assess the links between COVID-19 and coughing for its app. It's aiming to develop an algorithm to identify COVID-19 through cough sounds recorded on a smartphone. The ResApp share price responded well to this announcement at the time.

Additionally, in a separate release last week, ResApp announced that it had inked a deal with pharmaceutical giant AstraZeneca (whom you might know as the maker of a COVID-19 vaccine). This deal is unrelated to COVID though. It instead involves AstraZeneca's Japanese subsidiary using ResApp's technology to support asthma patients. As we reported, the ResApp share price responded very positively at the time.

Further, ResApp was, as of last Friday (and effective yesterday) kicked out of the All Ordinaries Index (ASX: XAO) by its administrator S&P Global. Normally, exclusion from an index does not bode well for an ASX company. But somewhat perversely, this logic doesn't seem to apply for this particular All Ords rebalance. Yesterday, we covered how a similar phenomenon was occurring with Ainsworth Game Technology Limited (ASX: AGI). The same thing seems to be happening to ResApp today.

Finally, before market open this morning, we were treated to an interesting insight into the company's directors. According to ASX notices, three company directors have loaded up on ResApp shares over the past few days. That's an obvious vote of confidence in the company from management which investors typically love to see.

It's likely that one or a combination of these factors are pushing up the ResApp share price today.

The post ASX stock of the day: Why ResApp Heath (ASX:RAP) shares are soaring appeared first on The Motley Fool Australia.

This latest move in the Ainsworth share price caps off what has been an especially pleasing few months for shareholders. Back in early November 2020, Ainsworth shares were trading for 28 cents each. That means at today's prices, the shares are up 189% since then. However, they are also still down 25% from the peak of $1.08 per share we saw at the end of last month.

So what is Ainsworth Game Technology? And why were Ainsworth shares shooting higher today?

What does the company do?

Ainsworth Game Technology is a gaming company established in 1995. It was founded by Len Ainsworth. Mr Ainsworth was also the founder of the ASX's most prominent gaming manufacturer, Aristocrat Leisure Ltd (ASX: ALL).

Like Aristocrat, Ainsworth also manufactures poker machines. It has facilities that enable the design, development and testing of these machines. The company also offers services such as installation, maintenance/servicing and support.

Ainsworth supplies markets as diverse as Europe, North America and Latin America, as well as Australia and Australasia.

Ainsworth has had a rough year due to the coronavirus pandemic effectively shuttering gambling institutions around the world. Last month, the company announced it was expecting to report a net loss before tax of $14 million for the six months ending 31 December 2020.

However, on the same day, the company also announced it had established a new, secured credit facility with the US-based Western Alliance Bancorporation. Investors were evidently pleased with that announcement, given Ainsworth shares rose 15% that day.

What fuelled the Ainsworth Game Technology share price today?

Something very interesting was certainly happening with this company today. On Friday last week, after market close, we had an announcement from S&P Global. S&P Global is the company that administers the S&P/ASX 200 Index (ASX: XJO) and the other major indexes on the ASX. In this announcement, S&P reported that Ainsworth would be removed from the All Ordinaries Index (ASX: XAO).

Normally when a company is removed from an index, it causes a selloff from investors. We covered some of the winners and losers from the ASX 200's rebalancing this morning in fact. But the opposite has happened today, so this is strange indeed.

Unlike the ASX 200, the All Ordinaries is not an index that is widely covered and tracked by exchange-traded funds (ETFs). So that could be behind this situation.

But we could also just be seeing some price discovery here. Last week, Ainsworth fell by around 10% between Wednesday and Friday to an intra-week low of 74 cents per share. That was before the rebalancing became public knowledge. Perhaps investors have simply decided that price was too low, and have been bidding up the company accordingly.

ASX data does show that trading volumes today were significantly above the company's 5-day average.

Whatever the reason for today's Ainsworth share price moves, investors will no doubt be pleased. At the current share price, Ainsworth has a market capitalisation of around $245 million.

The post ASX stock of the day: Ainsworth Game Technology (ASX:AGI) shares rise 11% appeared first on The Motley Fool Australia.

Let's take a look at what drove the gaming machine developer's shares higher.

Why the Ainsworth share price was winning today

Ainsworth shares had a stellar end to the week after the company advised it has entered into a new, secured credit facility with United States-based Western Alliance Bancorporation. 

Proceeds from this new, five-year US$35 million facility are being used to pay out the company's obligations under its prior credit facility with Australia and New Zealand Banking Group Limited (ASX: ANZ).

How has Ainsworth been performing?

On 10 February 2021, Ainsworth announced it expects to report a loss before tax of approximately $14 million for the six months ended 31 December 2020. 

In its preliminary results, however, the company also reported that it expects improved revenue when compared to the prior period. 

Ainsworth reported preliminary revenue of $72 million for the first half.

The company's North American business continued to show positive signs with revenue in the period of $41 million compared to the $21 million in the previous half and $51 million in the prior corresponding period.

At 31 December 2020, Ainsworth had a cash balance of $24 million resulting in net debt of $15 million. 

The company expects to release its unaudited FY21 first-half results on 25 February 2021 and audited results in March 2021.

Company snapshot

Ainsworth is engaged in the design, production, sale, lease, and servicing of gaming machines, also known as poker machines or 'pokies'.

Over the past year, the Ainsworth share price has rallied by more than 34%.

Based on the current share price, Ainsworth has a market capitalisation of around $262 million. The company presently has approximately 336.6 million shares outstanding.

The post Why the Ainsworth (ASX:AGI) share price surged 15% today appeared first on The Motley Fool Australia.

Still, Ainsworth's share price gains today while the All Ordinaries Index (ASX: XAO) lost 1.7% demonstrates the old investor axiom that it's not so much a share market but a market of shares.

Despite today's gains, the Ainsworth share price remains down 62% year to date.

What does Ainsworth Game Technology do?

Ainsworth Game Technology develops, manufactures, sells and maintains gaming machines, or 'pokies' to you and me. Headquartered in Sydney, Ainsworth has operations across New Zealand, the United States, Europe and Asia.

The company manages all facets of its product's life cycle, from conceptualisation and design through to production, distribution, installation, service and support.

Ainsworth shares first began trading on the ASX in 2001.

What's moving the Ainsworth share price?

Ainsworth Games' 2020 annual report confirmed some of the negative impacts the company has been suffering due to the fallout from COVID-19. These included a 37% decline in revenues and a 46% fall in profit in North America as well as a 26% decline in revenue in Australia. Also reported was a 39% drop in revenue and 59% fall in profits across the rest of the world, excluding Latin America.

On the positive front, the company reported it has made additional progress in accelerating the monetisation of its online, real money and social gaming. Ainsworth also reported it has gone live with several leading operators in the US state of New Jersey.

Addressing the results, chair Danny Gladstone said:

Our opportunities to operate and sell new machines were inhibited [by the pandemic] as customers temporarily closed venues and cut capital expenditure programs. The Loss after Tax for the year was $43 million. On a pre currency basis and excluding one-off items, the Loss before Tax was $35 million.

We closed the year with cash on hand of $26.5 million and a net debt position of $17.5 million. This followed the payment for the acquisition of MTD assets announced in early March 2020. MTD has performed resiliently and we remain confident that this acquisition will provide good returns over coming periods.

Our balance sheet and liquidity are also in a strong position. The current financing facilities have been re-negotiated with the previous financial covenants being replaced for the remaining term to de-risk the potential for breach.

With the Ainsworth share price enjoying a 10% intraday surge and closing 1.8% higher, investors look to have mostly priced in the bad news and focused instead on the good.

The post Here's why the Ainsworth Game (ASX:AGI) share price gained today appeared first on The Motley Fool Australia.

Short-term gains are broadly going backwards today, with the S&P/ASX 200 Index (ASX: XJO) down 2.7% in early afternoon trading.

Tech share prices are among the hardest hit. The S&P ASX All Technology Index (ASX: XTX), which tracks 50 of Australia's leading and emerging technology shares, is down 4.4% intraday trading.

ASX shares are broadly following the lead of US share markets, which all lost ground yesterday (overnight Aussie time).

The S&P 500 Index fell 3.5% while the tech-heavy Nasdaq Composite Index lost 5.0%.

All the fabled FAANG shares lost ground, with behemoth Apple Inc. (NASDAQ: AAPL) leading the way down. Apple's share price fell 8.0% by the closing bell. A bit of back of the napkin maths tells me that works out to more than a US$160 billion (A$216 billion) daily loss.

Some of today's share price losers… and winners

Here in Australia, online retailer Kogan.com Ltd's (ASX: KGN) share price is among the biggest fallers today, down 11.2% at time of writing.

Buy now, pay later (BNPL) giant, Afterpay Ltd (ASX: APT)'s share price dropped more than 7% at the open, but has regained some of those losses and is currently down 4.6%.

Of course, as the old saying goes, it's a market of shares, not a share market. And while the overall indexes are falling, there are some big winners on the ASX today too.

Like the Metro Mining Ltd (ASX: MMI) share price, up 5.3%. Or Ainsworth Game Technology Limited (ASX: AGI), which is up 4.0%.

There are always opportunities, if you know where to look for them.

Why you should keep these short-term share price falls in perspective

After detailing some of the daily moves for you, I'll now recommend you largely ignore it.

You see, the rapid share price gains enjoyed by many companies over the past months, particular technology shares, was never going to continue apace. At some point retracements are inevitable. And at some point the rate of growth will slow.

Let's take the ASX All Tech index as an example.

From 23 March through to yesterday's close, the index of 50 leading ASX tech shares had gained 110%. That blistering recent growth doesn't mean these shares don't have further growth ahead of them. I believe many of them do. But they won't keep doubling in price every 5–6 months.

And that's okay. At least, if you have a long-term investment horizon, rather than looking to double your money in short order. That way you can ride out the share price dips and let the power of time and compounding grow your wealth.

Kogan's share price, for example, is still up 157% in 2020. And Afterpay's share price is up 159% this year. As for the Nasdaq, it's still 27% higher than it was on 2 January.

Now there may well be some more short-term falls to come. But long-term, the well managed companies with solid balance sheets and good growth outlooks should continue to deliver patient investors healthy share price gains.

What the experts are saying about the share price retracement

If you're feeling anxious watching the share prices of some of your favourite companies head lower today, don't be. In fact, turn off your finance screens and tune into something else.

The current retracement was broadly expected. And as Alec Young, chief investment officer at Tactical Alpha says, healthy even for the broader market (as quoted by the Australian Financial Review):

Frankly, the deeper the pullback in tech, the healthier it is for the overall market. The market was overbought, there were too many people chasing the tech names. It's all healthy. The valuations have been stretched.

Randy Frederick, the vice-president of trading and derivatives for Charles Schwab in Austin Texas, agrees:

Some of the stocks have gotten a little pricey, and what the actual cause is to spark this selloff is difficult to say. The leading sector for quite a long time has been the Nasdaq, which is very heavily weighted in technology stocks so people just saw this as an opportunity to take the profits off the table.

There's nothing wrong with taking profits off the table if your investment horizon is months and not years. But unless you need the money for other purposes, history shows that staying invested in quality shares is among the best ways to growth your wealth over time.

The post Every bull run has pullbacks. Why today's share price falls are 'healthy' appeared first on The Motley Fool Australia.

What happened in FY 2020?

As with rival Aristocrat Leisure Limited (ASX: ALL), Ainsworth was negatively impacted by the pandemic.

For the 12 months ended 2020, Ainsworth reported a 36% decline in revenue to $149 million. This was mainly due to its performance in the second half. During that half, revenue came in at just $42 million, down 64% from $116 million in the prior corresponding period.

Things were even worse on the bottom line, with the company posting an adjusted net loss after tax of $34 million. This excludes the impacts of foreign exchange movements, one-off costs, JobKeeper, and costs associated with the acquisition of MTD.

At the end of the period the company had net debt of $17.5 million.

In light of its poor performance and debt load, Ainsworths' final dividend has been cancelled. Management wants to ensure the company is well placed should a protracted downturn eventuate.

"Severely impacted".

Management notes that the pandemic had a severe impact on its performance, particularly during a key period of the financial year.

It commented: "These results were severely impacted by Covid-19 primarily in quarter 4, traditionally the strongest period for the Group. Customers across all of our major markets suspended their operations from mid-March."

The company attempted to offset some of this weakness with cost-savings.

"AGT implemented a series of cost saving measures to ensure the Company can endure a protracted downturn. In addition to voluntary salary and other overhead reductions, the Group has reduced employee numbers by eliminating 107 roles at an annual cost saving of approximately A$10 million, which is expected to carry forward into FY21," it advised.

Trading conditions.

The company notes that some customers' facilities have started to reopen. However, the majority of venues have indicated initial reductions in capital expenditure due to travel restrictions and the resultant impact on visitation.

Nevertheless, with a rationalised cost base, together with its new AStar range of cabinets which are incorporating a newly developed suite of game brands, management believes it is well positioned as customers progressively resume more typical business levels.

The company's Chief Executive Officer, Lawrence Levy, commented, "While the Covid-19 pandemic hit our industry hard, we moved quickly to protect Ainsworth. We took proactive measures to streamline our overheads and restructure previous financing arrangements to ensure we can endure the current downturn. AGT is well positioned as customers across our major markets look to recover from the effects of the pandemic."

No guidance has been given for the year ahead.

The post Ainsworth Game Technology share price on watch after $34m loss because of COVID-19 appeared first on The Motley Fool Australia.

At the time of writing the gaming technology company's shares are down 1% to 69.5 cents.

What did Ainsworth announce?

This morning Ainsworth revealed that it has bolstered its portfolio through the acquisition of U.S. based MTD Gaming.

According to the release, the company has agreed an initial purchase price of US$13 million, with an additional US$13 million of deferred consideration payable on the successful delivery of financial targets and contract renewals.

MTD Group is a developer and supplier of premium performing Poker, Keno, and video reel content for use in Multi-Game and Video Lottery Terminal (VLT) markets. Its products are currently installed within Montana, Louisiana, and more recently South Dakota.

Management notes that these games are highly complementary to Ainsworth's existing game suite and should provide meaningful synergies.

Ainsworth's Chief Executive Officer, Lawrence Levy, advised: "We are delighted to welcome MTD to Ainsworth. The acquisition marks another positive step in transitioning AGT to growth and improved profitability."

"MTD's unique Poker and Keno games are a great fit with our existing Class II and Class III offerings in the US and follows the global launch of our new A-Star cabinet hardware in February 2020. We expect to drive incremental revenues by offering these proven and highly successful games to customers in our established markets where Ainsworth operates, including California and Nevada," he added.

The company advised that the acquisition will be funded by its existing debt facilities and cash reserves. It is expected to be earnings accretive in the first-year post completion.

In addition to this, management revealed that all necessary closing conditions have been completed, which enables the company to push ahead with its plans immediately.

It notes that initial opportunities for these products will be within restrictive gaming and other specific gaming venues in Nevada, California, Arizona and New Mexico. These are markets that currently have a combined market size of approximately 42,000 units.

Rival Aristocrat Leisure Limited (ASX: ALL) hasn't fared as well this morning and is trading over 7% lower in early trade.

The post This ASX tech share is trading lower despite announcing an acquisition appeared first on The Motley Fool Australia.

Unfortunately, not all shares are in favour with brokers right now. The three shares listed below have all just been given sell ratings. Here's why they are bearish on them:

Ainsworth Game Technology Limited (ASX: AGI)

According to a note out of UBS, its analysts have retained their sell rating and 46 cents price target on this gaming technology company's shares. The broker notes that Ainsworth Game Technology delivered a first half result in line with its downgraded guidance this week. And although management is forecasting a return to growth in the second half, UBS doesn't appear convinced by this and continues to forecast another loss. The Ainsworth Game Technology share price is changing hands at 68 cents today.

Domain Holdings Australia Ltd (ASX: DHG)

Analysts at Morgans have retained their reduce rating but lifted the price target on this real estate listings company's shares slightly to $2.54. According to the note, the broker was disappointed with Domain's performance in the first half and notes that its result was well short of expectations. Morgans notes that its average prices were far lower than it forecast and appears concerned that its second half earnings could be under pressure if things don't improve quickly. The Domain share price is down 1.5% to $3.42 this afternoon.

Platinum Asset Management Ltd (ASX: PTM)

A note out of Credit Suisse reveals that its analysts have retained their underperform rating and $4.05 price target on this fund manager's shares. According to the note, Platinum delivered a half year result that was better than it expected. However, it notes that its investment performance remains soft and fears this could lead to further fund outflows in the second half and into FY 2021. The Platinum share price is changing hands at $4.38 this afternoon.

The post Leading brokers name 3 ASX shares to sell today appeared first on The Motley Fool Australia.

This follows the release of the gaming technology company's half year results after the market close on Monday.

How did Ainsworth Game Technology perform in the first half?

During the six months ended December 31, the Aristocrat Leisure Limited (ASX: ALL) rival reported a 9% decline in revenue to $107.3 million.

This was largely the result of declines in the North America and Latin America markets. Revenues fell 6% and 8%, respectively, in these markets. Domestic revenues were flat at $19.5 million.

Intense competition and product mix changes put pressure on its margins during the half. The company's EBITDA margin fell from 25% last year to just 14% during the first half. This led to underlying EBITDA, adjusted for currency and significant items, falling 28% on the prior corresponding period to $17.2 million.

On the bottom line, excluding currency and one-off items, the company reported an underlying loss before tax of $0.2 million. This is significantly better than the half year guidance from its annual general meeting in November for a loss of $4 million.

Cash flow from operations reduced to $17.9 million. As a result, the Ainsworth Game Technology board decided to defer the reinstatement of the dividend policy at the present time.

Outlook.

Chief Executive Officer, Mr Lawrence Levy said: "At the AGM in November we laid out our six key priorities to strengthen AGT to deliver improved results. I am pleased to report we are making progress on each of these measures. The transition is in progress to make AGT more profitable and efficient."

"We are re-evaluating R&D, increasing our game development resources, sharpening our sales and marketing focus and complementing organic growth with selective acquisitions. We are busy building the foundations and expect return to profitability to deliver a positive net profit in the second half of FY20, with better results in FY21," he added.

The post Ainsworth Game Technology share price on watch after half year results release appeared first on The Motley Fool Australia.

Three sell ratings that caught my eye are summarised below. Here's why top brokers think investors ought to sell these shares next week:

Ainsworth Game Technology Limited (ASX: AGI)

According to a note out of UBS, its analysts have retained their sell rating and cut the price target on its shares to 46 cents. The broker was expecting the gaming technology company to record a profit in the first half, so was disappointed that it has guided to a loss of $4 million during the half. And while things look likely to improve in the second half, the broker remains bearish on the investment opportunity here. The Ainsworth Game Technology share price ended the week at 69 cents.

AMP Limited (ASX: AMP)

Another note out of UBS reveals that its analysts have downgraded this financial services company's shares to a sell rating with a $1.80 price target. According to the note, the broker made the move partly on valuation grounds after AMP's shares pushed notably higher than its price target. In addition to this, the broker has concerns over its platform margins and notes that there are execution risks around its strategy. AMP's shares were changing hands at $1.96 at the end of last week.

City Chic Collective Ltd (ASX: CCX)

Analysts at Citi have retained their sell rating and $2.30 price target on this retailer's shares. According to the note, Citi believes City Chic will record strong sales during the all-important period of Black Friday through to Christmas and New Year. It also believes its growth outlook is positive. However, it appears to believe that its shares are overvalued at around 21x estimated full year earnings. In light of this, it retains its sell rating. The City Chic share price last traded at $2.73.

The post Top brokers name 3 ASX shares to sell next week appeared first on The Motley Fool Australia.