The company said in a statement to the ASX that revenue for the year had come in at $948.2 million, 7.2% lower than the previous corresponding period.

The company's net loss came in at $303 million, which was impacted by a $349.1 million write down of goodwill.

On an underlying basis, EBIT was $93.3 million, down 18.9%.

Economic headwinds

The ASX 300 childcare company said occupancy was lower than the previous year, "with affordability and the macro environment, including sector challenges, continuing to impact families and enquiries''.

G8 Education Managing Director Pejman Okhovat said it had been a challenging period.

Occupancy continued to be affected by tough market conditions with falling birth rates, increased supply, trust and confidence in the sector impacted by media coverage and families experiencing sustained affordability pressures, resulting in lower occupancy than the previous corresponding period. Despite the fall in occupancy levels, our cost base remained well controlled. Our statutory Earnings Before Interest and Tax (EBIT) resulted in a loss of $234.7 million, with a Net Loss After Tax of $303.3 million, primarily reflecting a non-trading goodwill impairment expense recognised during CY25. We remain committed to balancing our operational needs with shareholder returns and delivered a fully franked total dividend of 2 cents per share paid in October 2025 with no final dividend being paid.

In terms of the outlook, the company said that as at February 15, group occupancy was 54.4%, 7.5% lower than the previous corresponding period and 57.2% year to date, 7.8% lower.

The company said the challenging trading environment was further exacerbated by significant changes to national laws and the regulatory environment, "requiring additional focus and resources''.

The company added regarding the outlook:

Near term operating conditions remain challenging, with ongoing cost of living pressures and no material relief from inflation or interest rates.

The company said other factors affecting demand included the female work participation rate starting to flatten, more supply coming into the sector, cost-of-living issues, and the costs associated with attracting talent.

G8 said over the medium to long term, the market dynamics were encouraging, with state and federal governments looking to create more equitable and affordable early childhood education, and supply starting to decline, with some operators likely to exit the sector.

G8 shares were 2.7% lower in early trade at 35.5 cents.

The ASX 300 childcare company was valued at $282 million at the close of trade on Tuesday.

The post Why are shares in this ASX 300 childcare company on the slide?       appeared first on The Motley Fool Australia.

Four ASX shares that are falling more than most today are listed below. Here's why they are dropping:

Coronado Global Resources Inc (ASX: CRN)

The Coronado Global share price is down 6% to 28.7 cents. Investors have been selling this coal miner's shares following the surprise exit of its CEO. According to the release, Douglas Thompson intends to resign from his role to pursue new opportunities. Subject to board approval, the company's executive chair and former CEO, Gerry Spindler, will assume the role of interim CEO, and Greg Pritchard will transition to interim chair. In addition, it was revealed that Jeff Bitzer, Coronado's chief development officer and formerly chief operating officer, has decided to step back from full-time responsibilities, effective as of 28 February.

G8 Education Ltd (ASX: GEM)

The G8 Education share price is down 15% to 39.2 cents. This follows the release of the childcare centre operator's full-year results. G8 Education reported a 7% decline in revenue to $946.9 million and an 18.4% decline in underlying net profit after tax to $59 million. On a reported basis, G8 Education recorded a net loss of $303.3 million. This was driven by a $349.1 million goodwill impairment expense. The company also provided a trading update which revealed that its spot occupancy rate was 54.4% on 15 February. This is down 7.5 percentage points from the prior corresponding period.

Megaport Ltd (ASX: MP1)

The Megaport share price is down a further 15% to $8.17. This network-as-a-service provider's shares have crashed since the release of its half-year results last week. This is despite them revealing record revenue and earnings. Megaport reported a 26% increase in revenue to $134.9 million and EBITDA growth of 28% to $35.3 million. Its CEO, Michael Reid, said: "Our global business continues to scale, with the United States delivering exceptional momentum, pushing the Americas to 24% YoY ARR growth. This performance was driven by rising NRR and consistent new logo acquisition."

Perenti Ltd (ASX: PRN)

The Perenti share price is down 14% to $2.43. This morning, the diversified mining services company released its half-year results and revealed flat revenue and a 2% decline in EBITDA for the period. Looking ahead, management is forecasting revenue of $3.45 billion to $3.55 billion for FY 2026. This is broadly in line with the $3.49 billion it achieved in FY 2025. It seems that the market was expecting a stronger performance.

The post Why Coronado, G8 Education, Megaport, and Perenti shares are dropping today appeared first on The Motley Fool Australia.

Janison Education Group Ltd (ASX: JAN)

Janison is a provider of online assessment platforms and digital exams, including the national standardised NAPLAN and competitive ICAS tests. It also delivers the NSW Selective High School and Opportunity Class placement tests on a 5-year state government contract, secured in 2024.

It's a small-cap stock trading around $0.21. In December, it attracted some investor interest, hitting a 12-month high, on the back of announcing a significant contract with the NZ Ministry of Education. The 5-year deal will see Janison deliver New Zealand's new SMART online assessment tool to schools, at a value of $21 million.

In FY25, it did not reach profitability. However, it reported some positive indicators, including:

• 9% revenue growth over the prior corresponding period to $46.8 million
• Solid balance sheet with $11 million cash on hand and a 44% increase in operational cash flow
• EBIT improvement from $10.6 million loss to $7 million loss

The assessment market remains ripe for digitisation, and Janison has a track record of securing major contracts in the space. Based on its 2025 results, it's a bit of a speculative play right now. That said, I think it has real potential for growth in 2026, so it's going on my watchlist.  

G8 Education Ltd (ASX: GEM)

G8 is Australia's largest provider of childcare, running over 400 centres nationwide. Amidst challenging conditions for the sector, the company has been rolling out its 'network optimisation' strategy, which includes divesting underperforming centres, to improve operational efficiency and financial performance.

While its centres have seen an uptick in quality, with 96% of assessed centres meeting or exceeding the National Quality Standard as at HY25, occupancy rates have continued a downward trend.

In HY25, centre occupancy rates declined 3.7 percentage points on the prior corresponding period, most likely driven by cost-of-living pressures. In addition, expectations of a seasonal occupancy uplift in October 2025 were not realised.

On 10 February 2026, the company released an announcement regarding a goodwill non-cash impairment of $350 million to be recognised in its full-year results, as well as the suspension of its final dividend for the year. In the same announcement, G8 reported that EBIT guidance for CY25 has not changed, suggesting management believes fundamental operations remain steady.  

Its share price tumbled in the ensuing week, falling from $0.63 on 9 February to $0.48 on 16 February. It will be interesting to see what it reports in its full-year results, to be announced next Monday.

As it stands, this one is a little too risky for me. But if you're comfortable with a turnaround play and believe it can withstand significant headwinds, it may be cheap right now.   

IDP Education Ltd (ASX: IEL)

IDP Education is a leader in the international student market and co-owner and official provider of the IELTS English proficiency test.

IDP also delivers a range of international student services, from course advice to visa and accommodation support, to help students secure educational opportunities in Australia, Canada, Ireland, New Zealand, the UK, and the USA.

In FY25, IDP reported revenue of $888.2 million, a 14% year-on-year decline and a 29% decrease in student placements, likely driven by the tightening of policy in key markets, Australia and Canada.

The Australian Government initially proposed a hard international student cap of 270,000 for 2025, seeking to cut numbers by some 16% on 2023 figures. This was later replaced with a soft cap system, whereby educational institutions face penalties if they exceed allocations.

In Canada, the government plans to issue 408,000 study permits in 2026, with only 155,000 for newly arriving international students and the remainder for current and returning students. This represents a 7% drop from 2025 and a 16% drop from 2024.

Investors have naturally been cautious in this landscape, and IDP's share price has fallen some 60% in the past year. But IDP has shown operational resilience and disciplined cost management in challenging conditions.

It has a solid multi-year strategic transformation plan in progress, and I think this is a business that can bounce back. If you're comfortable with the prospect of continuing short-term volatility, I believe current prices present an attractive opportunity to invest in a quality business.

The post School's in: Are these ASX education shares making the grade? appeared first on The Motley Fool Australia.

Four ASX shares that have failed to follow the market higher today are listed below. Here's why they are falling:

Amplitude Energy Ltd (ASX: AEL)

The Amplitude Energy share price is down 20% to $2.56. Investors have been selling this energy company's shares following the release of disappointing drilling results for the Elanora-1 exploration well. It advised that preliminary drilling and logging data recorded no elevated gas readings in the primary target Waarre A reservoir. As a result, management believes the reservoir is water-bearing. Elanora-1 will now be plugged and a sidetrack into the Isabella prospect will be drilled as planned.

G8 Education Ltd (ASX: GEM)

The G8 Education share price is down 18% to 51.75 cents. This follows the release of a market update from the childcare operator. G8 Education revealed that it plans to make a goodwill impairment of approximately $350 million in its full year financial results. This reflects projected future occupancy based on current occupancy levels, current and expected supply and demand levels, and future fee increases and the impact of cost of living pressures. Making things even worse, the company has decided to pause its on-market share buyback and suspend its dividend.

Pmet Resources (ASX: PMT)

The Pmet Resources share price is down 10% to 58.25 cents. This has been driven by news that the lithium developer is pursuing a C$130 million funding boost. This is expected to be achieved through a flow-through private placement and a public offering. It said: "With this funding, we are well positioned to deliver an updated Feasibility Study optimised for CV5, unlock the value of the world-class caesium discovery we made last year, integrate valuable critical minerals coproducts like caesium and tantalum into our development plan, and continue to unlock value across the broader Property through ongoing exploration."

Steadfast Group Ltd (ASX: SDF)

The Steadfast share price is down 10% to $4.47. Investors have been selling the insurance broker network company's shares amid fears that it could be disrupted by artificial intelligence. This follows news that ChatGPT's owner, OpenAI, has made available an insurance industry app that allows users to browse, research, and compare insurance directly through the platform's new app library. Investors may be concerned that insurance brokers could become redundant in the near future.

The post Why Amplitude Energy, G8 Education, Pmet Resources, and Steadfast shares are sinking today appeared first on The Motley Fool Australia.

Four ASX shares that are falling more than most today are listed below. Here's why they are dropping:

Boss Energy Ltd (ASX: BOE)

The Boss Energy share price is down 6% to $1.91. This appears to have been driven by broad weakness in the uranium industry today. In addition, short sellers have been loading up on Boss Energy and other uranium shares. So much so, a total of 21.6% of its shares are in the hands of short sellers at present. And with its shares down 47% over the past six months, they have done well from this one.

G8 Education Ltd (ASX: GEM)

The G8 Education share price is down 13% to 70 cents. This morning, this childcare operator revealed that its occupancy levels remain subdued. This is due to "the macroeconomic environment remaining challenging and affordability and cost of living pressures continuing to impact families." According to the release, as at 2 November 2025, the company's spot occupancy was 68.3%, which is 6.6% points lower than the prior corresponding period. In light of this, it has downgraded its full year earnings guidance to be in the range of $91 million to $98 million.

Novonix Ltd (ASX: NVX)

The Novonix share price is down 11% to 50.25 cents. This has been driven by news that auto giant Stellantis has cancelled its offtake agreement with the battery materials company. In response, the company said: "While NOVONIX is disappointed with this decision, it remains focused on its deliveries for Panasonic and PowerCo and continuing to provide samples to 15 current and potential customers for battery and industrial applications." Management advised that the deal fell through after the two parties failed to agree upon the unique battery cell product specifications and milestones for mass production qualification.

Weebit Nano Ltd (ASX: WBT)

The Weebit Nano share price is down 11% to $4.58. This is despite there being no news out of the semiconductor company. However, with its shares still up 155% since this time six months ago, it is possible that some investors have been taking profit off the table on Tuesday. In addition, with a market capitalisation of almost $1.1 billion, and quarterly cash receipts of $7.3 million, investors may think this speculative stock is severely overvalued.

The post Why Boss Energy, G8 Education, Novonix, and Weebit Nano shares are sinking today appeared first on The Motley Fool Australia.

A combination of subdued levels of occupancy at its more than 400 early learning centres and the need for the company to invest in those centres as a response to regulatory changes has led the company to downgrade its full-year earnings forecast to a range of $91 million to $98 million.

RBC Capital Markets said this compared with previous consensus estimates of earnings of about $110.9 million.

Tough times for sector

G8 had already noted, when releasing its first-half results in August, that occupancy for the first half of its financial year ending in August was lower than for the same period the previous year, "with the macroeconomic environment remaining challenging and affordability and cost of living pressures continuing to impact families''.

At the time, occupancy was 67%, 5.9% lower than for the previous corresponding period.

But at that time, the company expected that the usual seasonal growth in the second half would help it reach similar levels of earnings to the previous year.

That second-half occupancy increase has not occurred, however, as the company explained.

Since the first half 2025 results announcement, the operating environment has remained challenging, with families continuing to face cost of living pressures, lower enquiry levels compared to last year and ongoing sector-wide challenges. As a result, the expected seasonal increase in occupancy in October did not occur.

Indeed, when tested on November 2, the company's "spot occupancy" level was 68.3%, 6.6% lower than for the same period in 2024.

G8 said it had also committed to the rollout of CCTV across its network starting in 2026.

Given the subdued levels of occupancy, the ongoing need for the group to invest in response to changes in the regulatory environment and operational settings, as well as participation of the group in the government inquiries, currently either in progress or scheduled to commence, the group is revising its forecasted full year earnings to be in the range of $91m to $98m.

Shares looking cheap

But while the update was negative, the RBC Capital Markets team believe G8 is good buying at current levels.

They said in a note to clients following the downgrade that "the stock has been a significant laggard'', and they have a 12-month price target of $1.70 on the shares.

G8 shares were trading 14.6% lower on Tuesday morning at 68.7 cents, levels not seen in more than a decade.

Should the company's shares recover to the RBC price target, that would constitute a return of 147.5%. G8 was valued at $621.1 million at the close of trade on Monday.

The post Despite a brutal sell off, one broker tips this childcare centre operator's shares to more than double appeared first on The Motley Fool Australia.

With the August reporting season done and dusted, scores of companies have ex-dividend dates next week.

If you're keen to buy any of these ASX shares while they are still trading cum dividend, time is running out!

To receive a stock's next dividend, you must buy or already own it before the ex-dividend day.

We provide a sample of the ASX shares going ex-dividend next week below.

35 ASX shares about to go ex-dividend

The post 35 ASX shares with ex-dividend dates next week appeared first on The Motley Fool Australia.

The following list of ASX shares revealed share buyback programs alongside their latest financial results during earnings season.

Companies may decide to run a share buyback if their profits have been especially strong or they have excess cash on their books.

Sometimes, a company may want to take advantage of a weaker share price, too.

A share buyback is a form of capital management whereby an ASX company repurchases some of its shares from shareholders.

Once the buyback program is complete, the company cancels the repurchased shares.

This reduces the overall pool of issued stock, which means future profits are spread across fewer shares.

As a result, earnings per share (EPS), long-term return on equity (ROE), and future dividends are enhanced on a per-share basis.

This benefits investors, and it's why a company's share price will usually rise when it announces a buyback.

9 ASX shares commencing share buybacks

Let's look at some of the ASX shares that announced new share buyback programs alongside their latest financial results.

CSL Ltd (ASX: CSL)

The CSL share price is $207.98 on Thursday, up 0.7%.

CSL announced a multi-year buyback program that will target US$500 million in the 2026 financial year.

The company will get better value for money after a 23% decline in its share price following its FY25 report.

According to Macquarie's data, CSL shares are now trading on a forward price-to-earnings (P/E) ratio of 19.1x.

This is not only below the current market average P/E but also 2.3 standard deviations lower than the historical norm for CSL shares.

Telstra Group Ltd (ASX: TLS)

The Telstra share price is $4.83, down 0.3% at the time of writing.

Telstra announced an on-market share buyback of up to $1 billion last month.

The company said:

This has been enabled by growth in earnings, and the strength of our balance sheet.

The new buyback follows the completion of a $750 million on-market buyback completed in June.

G8 Education Ltd (ASX: GEM)

The G8 Education share price is 82 cents, up 0.25%.

The child care centre operator announced a further on-market share buyback of up to 5% of issued capital starting from mid-September.

This follows an earlier buyback program between September 2024 and June 2025, during which time G8 Education reacquired 37.9 million shares for about $50 million.

G8 Education CEO and Managing Director Pejman Okhovat said the share buybacks reflect "our ongoing dedication to returning value to investors and prudent capital management".

Treasury Wine Estates Ltd (ASX: TWE)

The Treasury Wine Estates share price is $7.82 on Thursday, down 0.4%.

Treasury Wine Estates announced an on-market buyback of up to $200 million for FY26. 

The ASX wine share has lost 30% of its value in the year to date. This contributed to the board's decision to run a share buyback.

Treasury Wine said the buyback:

Reflects the Board's confidence in TWE's Luxury-led strategy, financial strength and long-term outlook, in addition to the Board's belief that the Company's shares are materially undervalued.

Suncorp Group Ltd (ASX: SUN)

The Suncorp share price is $21.01, up 0.65%.

The insurance giant announced an on-market share buyback of up to $400 million to begin this month.

Suncorp CFO Jeremy Robson said:

Going forwards, capital excess to our needs is expected to be returned to shareholders in the form of ongoing buybacks.

Aurizon Holdings Ltd (ASX: AZJ)

The Aurizon share price is $3.19 on Thursday, up 0.2%.

Aurizon announced another buyback of up to $150 million for FY26 following completion of a $300 million program in FY25.

Ventia Services Group Ltd (ASX: VNT)

The Ventia Services share price is $5.21 on Thursday, up 0.5%.

The company said it would increase its current share buyback program by $50 million to $150 million due to its strong balance sheet.

Ventia Services CFO Mark Fleming said:

Our strong balance sheet and reliable cash flow have enabled us to return capital to shareholders, while maintaining financial flexibility.

With our buyback program progressing well and leverage at the low end of our range, we are pleased to announce an increase in our buyback program by $50 million to $150 million in 2025. We will continue to evaluate capital management options based on performance and market conditions.

Brambles Ltd (ASX: BXB)

The Brambles share price is $26.09 on Thursday, up 0.6%.

Brambles announced a new share buyback of up to US$400 million in FY26 after completing a US$403 million buyback in FY25.

Downer EDI Ltd (ASX: DOW)

The Downer EDI Ltd share price is $6.86, down 0.5%.

Downer EDI announced an on-market share buyback of up to $230 million, or about 5% of the current stock on issue.

The company's Managing Director and CEO, Peter Tompkins, said:

The on-market share buy-back announced today of up to $230 million, alongside delivery of dividend growth
and an increased payout ratio target range, are signals of our improving operational performance.

Other types of capital return

Other ASX companies also revealed extra capital returns to shareholders last month, but in a different way than share buybacks.

Check out which ASX shares announced special dividends this earnings season.

The post Which ASX companies announced share buybacks during earnings season? appeared first on The Motley Fool Australia.

The company operates more than 430 childcare centres in Australia, with a portfolio of 21 brands. It is among the larger for-profit operators in the early education and childcare sector.

G8 Education shares have endured a tough last 12 months, falling more than 37% in that span. This includes a daily drop of 6.5% following its CY25 Half Year results last week. 

What did G8 Education report?

The company reported on August 26th for CY25 Half Year: 

• Statutory NPAT of $22.5 million up 12.4% on the prior corresponding period (pcp)
• Operating EBIT up 2.8% on pcp to $40.5 million
• Occupancy for the half was lower than pcp. 
• 3.5% decline in revenue to $464.7 million after its occupancy levels fell from 68.2% to 64.5%

Commenting on the results, the company said it has been a challenging operating environment and recent regulatory uncertainty, with softer occupancy levels compared to the prior corresponding period.

What does Macquarie expect 

Despite falling 37% in the last year, Macquarie remains neutral on G8 Education shares. 

Macquarie has cut its earnings forecasts, lowering CY25, CY26, and CY27 EPS estimates by 2.7%, 3.3%, and 5.2%, respectively. These changes mainly reflect lower projected occupancy (down 3% across all years) and minor adjustments to depreciation, amortisation, and EBIT margins.

1H25 average occupancy of 64.5% was down -3.7% YoY and has further deteriorated into 2H25, with YTD occupancy of 65% down -4.1%. The monthly occupancy curve shape should track seasonal trends in CY25; however, we don't expect the current gap to CY24 will close.

Updated price target for G8 Education shares

According to the recent report from Macquarie, the broker has lowered its price target for G8 Education shares by 22% to $0.90 (from $1.15). 

It has also reduced its valuation multiple range to 10–14x (previously 12–15x). 

Given current challenges, G8 Education is now being valued at the bottom of that range with an additional 20% discount, effectively valuing the company at 8x forward earnings.

Based on the G8 Education share closing price of $0.84 on Monday, the updated price target from Macquarie indicates an upside of 7.1%. 

The post Down 37% this year, does Macquarie rate G8 Education shares a buying opportunity? appeared first on The Motley Fool Australia.

Four ASX shares that are falling more than most today are listed below. Here's why they are dropping:

Fortescue Ltd (ASX: FMG)

The Fortescue share price is down over 3% to $19.35. This morning, Fortescue released its full year results and reported a 15% decline in revenue to US$15,541 million and a 26% decline in underlying EBITDA to US$7,941 million. Things were even worse on the bottom line, with attributable net profit after tax sinking 41% to US$3,373 million. This led to the Fortescue board declaring a fully franked final dividend of A$0.60 per share, which brought its full year dividend to A$1.10 per share. This is down 44% on last year's payout.

G8 Education Ltd (ASX: GEM)

The G8 Education share price is down 6.5% to 85.5 cents. This has been driven by the release of the childcare operator's half year results. G8 Education posted a 3.5% decline in revenue to $464.7 million after its occupancy levels fell from 68.2% to 64.5%. However, thanks to cost reductions, its net profit increased 6.6% to $25.5 million. A trading update then revealed that its spot occupancy rate was 5.9 percentage points lower than the prior corresponding period at 67%.

Reece Ltd (ASX: REH)

The Reece share price is down a further 6% to $11.02. Investors have been selling this plumbing parts company's shares since the release of its FY 2025 results. Reece posted a 1% decline in sales revenue to $8,978 million and a 20% decline in EBIT to $548 million. In response to its results, this morning the team at Morgans downgraded its shares to a trim rating (from hold) and cut its price target on them to $11.10 (from $14.80). It said: "While we continue to view REH as a fundamentally good business with a strong culture and long track record of growth, the operating environment remains tough (particularly in the US) with further downside risk to earnings forecasts if housing conditions remain weak and competitive pressures intensify."

Web Travel Group Ltd (ASX: WEB)

The Web Travel share price is down 5.5% to $4.34. This follows the release of the travel technology company's annual general meeting update. Web Travel revealed that it is on track to achieve total transaction value (TTV) of at least $3.1 billion in the first half of FY 2026. This is up from $2.6 billion a year ago. However, this is expected to be achieved with a TTV margin of 6.2% to 6.4%. This is below the 6.7% recorded in FY 2025.

The post Why Fortescue, G8 Education, Reece, and Web Travel shares are sinking today appeared first on The Motley Fool Australia.

Four ASX shares that have failed to follow the market higher today are listed below. Here's why they are falling:

Evolution Mining Ltd (ASX: EVN)

The Evolution Mining share price is down 1.5% to $7.76. Investors have been selling ASX gold shares today after the price of the precious metal fell overnight. The catalyst for this was strong US economic data, which has led to the market reducing its expectations for interest rate cuts. This has seen the S&P/ASX All Ordinaries Gold index fall 0.8% today.

G8 Education Ltd (ASX: GEM)

The G8 Education share price is down a further 5% to 94.5 cents. Investors have been selling this childcare operator's shares this week due to a widely reported criminal incident at one of its centres. The team at Macquarie responded to the news by downgrading G8 Education's shares to a neutral rating with a heavily reduced price target of $1.15. Macquarie made the move after lowering its occupancy estimates for G8 Education due to a potential backlash from the incident.

Lottery Corporation Ltd (ASX: TLC)

The Lottery Corporation share price is down 2.5% to $5.24. This appears to have been driven by the release of a broker note out of Citi this morning. According to the note, the broker has downgraded the lottery company's shares to a sell rating (from buy) and cut the price target on them to $5.00. Citi isn't feeling overly positive about the company's results next month. In fact, it thinks that it could report a double-digit decline in earnings for FY 2025. And with recent trends pointing to lower lottery ticket sales, the broker has trimmed its earnings estimates for next year.

Lynas Rare Earths Ltd (ASX: LYC)

The Lynas Rare Earths share price is down over 2% to $8.16. This morning, the team at Bell Potter reaffirmed its sell rating on the rare earths producer's shares with a trimmed price target of $6.05. The broker made the move on valuation grounds. It said: "Whilst we like the business, asset, and team, we believe there is significant optimism priced into the stock, with investors using it as a hedge on USChina relations. LYC is well poised, if or when, the tides shift for NdPr, with sufficient installed capacity and leverage."

The post Why Evolution Mining, G8 Education, Lottery Corp, and Lynas shares are tumbling today appeared first on The Motley Fool Australia.

G8 Education is Australia's largest childcare centre operator, with over 400 early learning, kindergarten, and preschool centres across Australia under various brands.

Recently, retail investors have embraced a 'buy in the dip' mentality. In other words, they have taken advantage of share market volatility to buy shares at lower prices. 

This was most evident back in April, when a record number of retail investors bought ASX stocks during the 'Liberation Day' dip. So far, this strategy appears to have paid off with the S&P/ASX 200 Index (ASX: XJO) rebounding more than 15% since then. 

Does broker Macquarie Group Ltd (ASX: MQG) think this is a good strategy in the case of G8 Education shares? 

Let's see.

Macquarie downgrades G8 Education

In a 2 July research note, Macquarie downgraded G8 Education shares from outperform to neutral. 

The broker also cut its 12-month price target by 25% from $1.53 to $1.15. Given that shares are currently changing hands for $1.02, this suggests 13% capital appreciation over the next 12 months. 

G8 Education also offers a dividend yield of 5.38%, boosting investors' total return. 

When issuing this downgrade, the broker said:

We are positive on GEM's CY26 outlook, but cautious on CY25 given 1) sluggish occupancy trends, and 2) the Creative Garden Point Cook incident. The incident will likely be an overhang on GEM until visibility improves concerning investigation outcomes and potential impacts.

Macquarie reduced its CY25E occupancy forecast to 65.0% (from 65.7%), citing reduced growth expectations. Looking further out, the broker cut its forecast for CY26/27E occupancy to 70.5%/71.0% (down from 71.4%/71.9%). The broker said it still expects the abolishment of the activity test on 1 January 2026 to be a material tailwind for CY26 occupancy. 

Macquarie also referenced the Creative Garden Point Cook incident when issuing its ratings change. 

This week, it was reported that a man had been arrested and charged with offences relating to children placed at the Creative Garden Point Cook childcare centre. The man in question had been employed by G8 Education between October 2021 and February 2024. 

According to Macquarie, "There is high uncertainty concerning the quantum of potential reputational or financial impacts the incident could create."

Other risks cited by the broker included softer macro driving weaker occupancy trends, mandated wage increases with little to no government subsidisation, cost inflation exceeding above their forecasts, and inability to exit underperforming centres.

What could investors buy instead?

Those interested in the childcare sector and concerned about G8 Education may wish to consider Embark Early Education Ltd (ASX: EVO). 

Its current CEO is Chris Scott, who founded G8 Education. 

The company initially listed in New Zealand, where it operated the majority of its centres. After failing to bounce back from the pandemic in 2022, it sold its NZ centres (around 100), re-domiciled to Australia, and listed on the ASX. This was done via a "scheme of arrangement", meaning no initial public offering (IPO) road show. 

For this reason, as well as its market capitalisation of $128 million, it has largely flown under investors' radar. 

Over the past couple of years, it has been ramping up acquisitions throughout Australia. In May, the company announced it had acquired 2 new centres, bringing its total number of childcare centres to 40. 

It also offers a dividend yield of 8.57%, which is likely to be very attractive to passive income-oriented investors. 

Embark Early Education could be an attractive alternative to G8 Education shares.

The post Why did Macquarie just re-rate G8 Education shares? appeared first on The Motley Fool Australia.

Four ASX shares that are falling more than most today are listed below. Here's why they are dropping:

Commonwealth Bank of Australia (ASX: CBA)

The Commonwealth Bank share price is down 1.5% to $180.82. This banking giant's shares have been under pressure this week. This could be due to speculation that a great rotation could happen in FY 2026 with large investors taking profits on bank stocks and moving to underperforming mining giants like BHP Group Ltd (ASX: BHP). Interestingly, BHP's shares are up strongly today.

G8 Education Ltd (ASX: GEM)

The G8 Education share price is down 4% to $1.03. This may have been driven by a broker note out of Macquarie this morning. According to the note, the broker has downgraded this childcare centre operator's shares to a neutral rating (from outperform) with a reduced price target of $1.15 (from $1.53). Macquarie made the move after lowering its occupancy estimates for G8 Education due to a widely reported criminal incident at one of its centres.

JB Hi-Fi Ltd (ASX: JBH)

The JB Hi-Fi share price is down 5.5% to $106.29. This is despite there being no news out of the retail giant today. However, with its shares up very strongly over the past 12 months, it is possible that some investors are taking a bit of profit off the table today. For example, despite today's sizeable pullback, the JB Hi-Fi share price is still up approximately 75% since this time last year.

Vault Minerals Ltd (ASX: VAU)

The Vault Minerals share price is down almost 5% to 40 cents. The catalyst for this decline has been the release of the gold miner's preliminary fourth quarter and full year sales results. According to the release, Vault Minerals' preliminary four quarter gold sales were 95,974 ounces and its FY 2025 sales were 385,230 ounces. The latter is 1.2% below the lower end of its FY 2025 sales guidance. This comprises Leonora gold sales of 193,817 ounces, Deflector sales of 108,526 ounces gold and 492 tonnes copper, and Mount Monger gold sales of 82,887 ounces. In respect to its costs, management advised that its group all in sustaining costs (AISC) are yet to be finalised. However, they will be released with its quarterly report later this month.

The post Why CBA, G8 Education, JB Hi-Fi, and Vault Minerals shares are falling today appeared first on The Motley Fool Australia.

Franking credits are the tax already paid by a company on its profits. When a company distributes dividends to shareholders, it can attach franking credits to show that tax has already been paid at the corporate level (usually 30%).

They're attractive for investors looking to take advantage of Australia's dividend imputation system because they offer the benefit of boosted total return, higher effective yields, and potential for special dividends or buybacks.

Here's a breakdown of the 7 companies that Macquarie believes may act on their large franking credits balance and boost dividend yields, according to the broker's latest research report.

Downer EDI Ltd (ASX: DOW)

Macquarie analysts note there is a potential likelihood of capital return for Downer EDI in the form of Special DPS or Buyback.

The company currently has a 1% franking credit balance as a percentage of market cap and holds 19% excess cash. 

Analysts also believe the company may retire its high-cost Downer EDI ROADS security division.

At time of writing, Downer EDI shares were trading at $6.12.

Flight Centre Travel Group Ltd (ASX: FLT)

Macquarie analysts note there is a potential likelihood of capital return for Flight Centre in the form of Special DPS or Buyback.

The report shows the company currently has a 3% franking credit balance as a percentage of market cap and holds 66% excess cash. 

Analysts also flag the company "just announced a $200m buyback so a special could also be considered".

At time of writing, Flight Centre shares were trading at $13.67.

G8 Education Ltd (ASX: GEM)

Analysts have flagged G8 Education as having potential likelihood of capital return in the form of a Buyback.

The company currently has a 5% franking credit balance and holds 9% in excess cash as a % of market capital.

But Macquarie notes, "[A] potential buyback [is] currently in-progress. If GEM announced growth plans for its centre network a new buyback will be less likely."

At time of writing, G8 Education shares were trading at $1.28.

JB HI-FI Ltd (ASX: JBH)

JB HI-FI has a franking balance of 4% and excess cash of 1% of market capital, according to the report.

This puts the company in a position of potential for capital return in the form of Special DPS or Buyback, according to report data.

At time of writing, JB HI-FI shares were trading at $103.37.

Jumbo Interactive Ltd (ASX: JIN)

The report notes that Jumbo Interactive currently holds a 4% franking balance and 17% in excess cash.

Analysts predict this puts the company in a position of a potential for capital return in the form of a Buyback.

Analysts note that the current buyback program is ongoing, and the share price has fallen substantially in the last couple of months.

On 15 May shares were trading at $9.85, down 31.63% from January this year.

Liberty Financial Group Ltd (ASX: LFG) 

Analysts list Liberty Financial as having potential for Special DPS capital return.

The company currently holds a 6% franking balance and 89% in excess cash.

Company shares, at time of writing, were trading at $3.15.

Monash IVF Group (ASX: MVF)

Monash IVF currently holds a 4% franking balance and 14% in excess cash, according to the report.

This saw analysts list the company as having potential for capital return in the form of Special DPS or Buyback.

The company commenced ordinary dividends at last result, noted scope for further capital return post supply chain investments. 

Analysts see "a level of cash retained on balance sheet as prudent and will spend a portion on supply chain investment short-med term before making capital return decisions."

Monash IVF shares were trading at $0.87 on 15 May.

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Macquarie describes G8 Education as a childcare centre operator that provides developmental and educational childcare services, mainly in Australia. It recently changed from its historical path of growth of brownfield acquisitions, it's now focused on greenfield (new) sites.

The G8 Education share price has seen plenty of volatility over the past 12 months, as the chart below shows.

Let's have a look at how optimistic the broker is about the business.

Outperform rating on G8 Education shares

Macquarie currently has an outperform rating on the business. That's despite a recent softening of occupancy.

As of 20 April 2025, year-to-date occupancy of 64.1% was down 3% year over year, which was a further deterioration from the 1.9% decline at 16 February 2025.

Weaker occupancy has been driven by higher cost of living pressures, the later Easter holiday period and aggressive promotional activity from competitors.

However, G8 Education has pointed out some occupancy 'green shoots' appearing with enquiry levels and family engagement improving from March. Macquarie expects enrolments will start improving in May and is forecasting that the ASX share's 2025 first half occupancy will end down 2.5% year over year.

Despite that, the company is confident of delivering earnings growth in the first half of 2025. The weaker occupancy can be offset by controlling variable costs and further procurement benefits. Macquarie is forecasting operating profit (EBIT) growth of 1.2% for the first half.  

Why the optimism about the childcare stock?

There are a few reasons why Macquarie is optimistic about G8 Education share.

The broker pointed out that G8 Education is "cautiously optimistic" about the 2025 result. Management are expecting favourable economic tailwinds to help ease cost-of-living pressures and that could lead to an increase in childcare participation.

The second half of 2025 is expected to benefit from three things.

First, an easing of inflation.

Second, further interest rate cuts.

Third, the increase in the childcare subsidy.

Macquarie expects the abolishment of the activity test on 1 January 2026 will also be supportive for occupancy in the 2026 calendar year and beyond. The broker suggested this could be better than the market is expecting, with most childcare providers yet to quantify the potential uplift. The government has estimated that 66,700 families will benefit, with more than 100,000 families eligible for additional care.

The broker said:

GEM's cost base and footprint is being optimised with growth potentially back on the agenda beyond CY26. GEM will benefit from recent government legislation, and we expect LT [long-term] the sector will continue to receive bipartisan funding support, albeit via different policies.

G8 Education share price target

The broker has a price target of $1.53 on the childcare business. That implies the broker thinks there's a possible rise of close to 20% in the next year.

Macquarie predicts that G8 Education could generate 9.9 cents of earnings per share (EPS) in FY25. That would mean the business is trading at 13x FY25's estimated earnings. EPS is then predicted to rise by more than 10% in FY26.

The post Childcare in focus this Federal Election: how much upside does Macquarie expect for G8 Education shares? appeared first on The Motley Fool Australia.

But this has opened the funding window to own passive interests in high-quality Australian businesses at a reasonable price.

That's the view of Macquarie analysts' in the investment bank's small-to-mid-cal (SMID) best picks for March 2025.

The report highlights G8 Education Ltd (ASX: GEM), Integral Diagnostics Ltd (ASX: IDX), and IPH Ltd (ASX: IPH) as buys after being heavily sold in recent weeks. Let's dive in.

Beaten down ASX shares in favour

Macquarie laid out several beaten down ASX shares in its report, including G8 Education. The early education centre operator has had a tough time this month, with shares down 5% from February highs.

Macquarie expects continued operating margin expansion in 2025 from G8, noting it has already seen a 1.2% margin growth in 2024

We expect further expansion of +70bps in CY25 will be driven by remaining procurement initiatives and divestments (MRE 8/13 flagged). Outer-year margins could see upside if: 1) occupancy increases; 2) pricing growth remains above inflation past CY26; and 3) GEM's footprint expands.

The broker also notes the recent 10% government funded pay increase for centre staff, with another 5% to come later this year.

It rates the beaten down ASX share a buy at $1.60 apiece. G8 closed at $1.29 on Monday.

Integral Diagnostics is another beaten-down ASX stock on Macquarie's list. The healthcare services company is down 21% this year, after its shares sunk in February on the back of its H1 FY25 numbers. It closed at $2.31 on Monday.

But Macquarie sees "several revenue tailwinds" this coming year, "supported by MRI deregulation and CT uplift from (its) lung screening programme."

MBS indicates strong start to 2H25 with benefits growth of +10% and volume +5% vs pcp. We expect revenue growth of ~7.5% in 2H25.

IDX's recent merger with CAJ is also expected to drive cost synergies, supporting operating margins in the future. The investment bank projects $8 million in cost savings this year thanks to lower employee costs.

It rates the beaten down ASX share a buy at $3.20 apiece.

IPH: 'Fundamentally cheap'?

The broker also rates IPH a buy and expects "a number of factors to support 2H25 earnings" which could see the stock trade higher.

IPH is down 11% this year and down nearly 28% in the past twelve months, falling from highs of $6.48 in August last year. It closed on Monday at $4.46.

The beaten down ASX stock is "fundamentally cheap", according to Macquarie, after the business beat its estimates in H1 FY25.

IPH's Canadian operations are expected to generate $4.5 million in annualised savings at the current run rate as well. This is bullish long-term for the company:

Longer term, sustained performance requires positive filing activity/improved market share in Australia, as well as underlying Asian and Canadian segment growth. PCT filing activity in the US turning positive would be well-received by investors.

Foolish takeaway

This broker is bullish on these beaten down ASX shares and sees long-term opportunities after the recent selloffs.

Macquarie also sees each name as high quality, seeing as they passed a number of screens. Time will tell if the broker's convictions are right into the future.

The post Top broker bullish on these beaten down ASX shares appeared first on The Motley Fool Australia.

In this article, we'll examine two stocks that Wilson Asset Management (WAM) fund managers are excited about. WAM usually searches for undervalued ASX growth shares with a catalyst that could raise the market's valuation.

WAM runs a number of listed investment companies (LICs), including one of the ASX's largest – WAM Capital Limited (ASX: WAM). In a recent webinar, WAM lead portfolio manager Oscar Oberg and portfolio manager Tobias Yao revealed some of their highest-conviction picks.

A2 Milk Company Ltd (ASX: A2M)

A2 Milk sells dairy products that only have the A2 type of beta-casein protein that comes from certain cows that don't produce the A1 protein. The company sells products like infant formula, liquid milk and milk powder. It claims to be the brand leader of fresh liquid milk in Australia. It also has a large presence in China for infant formula and a presence in North America for liquid milk.

One of the largest positions in the WAM Capital portfolio is A2 Milk. The WAM team said they had done an "incredible amount of work" on A2 Milk, including visiting China three times in the last 18 months to help with on-the-ground due diligence.

The fund manager said A2 Milk had suffered a "hiccup" during August due to a supply chain issue, but noted that consumers see the brand as a premium product.

However, WAM believes the company's underlying momentum and demand for its products have continued, enabling the business to win market share. The investment team pointed out that the ASX's growth share is entering other regions, including Vietnam and the Middle East, while also growing its presence in the US.

Another positive about the company is its "very very strong balance sheet", which gives it optionality. The investment team concluded their bullish outlook with the following:

So, A2 Milk, we think over the next 12 months looks very exciting.

G8 Education Ltd (ASX: GEM)

G8 was another pick highlighted by the WAM team. The company describes itself as one of Australia's largest providers of early childhood education and care, with over 400 early learning centres and more than 10,000 team members. WAM called the stock a value play.

Oscar Oberg believes the management team has done a very good job over the past two years, trying to turn the business around in a "really hard environment" due to cost-of-living pressures and other factors.

Specifically, the fundie noted G8 Education has worked hard recently to take costs out of the business and improve performance and profit margins.

Oberg noted that WAM's aged care picks had worked well following increased funding for the sector. He believes "the exact same thing has happened here in childcare, there has been a 15% increase in the award wage and the government has effectively funded it."

WAM thinks the sector can now "generate real strong operating leverage" and boost the bottom line.

The fund manager suggested that G8 Education has very low debt, is buying back its shares, and is "getting rid" of loss-making centres.

WAM also believes that the Liberal party will eventually announce a better-than-expected childcare policy. Oberg suggested that "investors effectively get a free option on that".

In terms of valuation, Oberg suggested the price-earnings (P/E) ratio of the ASX growth share is around 12, and earnings are growing at 15%, with cost savings driving "substantial earnings upgrades".

The post 2 ASX growth shares set to skyrocket in the next 12 months appeared first on The Motley Fool Australia.

Four ASX shares that have failed to follow the market higher today are listed below. Here's why they are falling:

Collins Foods Ltd (ASX: CKF)

The Collins Foods share price is down 11% to $7.84. Investors have been hitting the sell button in response to the release of a trading update from the KFC restaurant operator. Management revealed that its sales were up 1.1% during the first 16 weeks of the FY 2025 financial year. However, Collins Foods has been impacted by inflationary pressures. As a result, management warned that the "profit gains on higher sales were more than offset by the impact of persistent inflation on cost of sales, labour and energy."

G8 Education Ltd (ASX: GEM)

The G8 Education share price is down 10% to $1.26. This has been driven by the release of the childcare operator's half year results. G8 Education posted a 5.6% increase in revenue to $481.7 million and a 21.8% lift in net profit after tax to $23.9 million. While this is positive, management warned that second half "sector conditions are anticipated to be more challenging."

Insignia Financial Ltd (ASX: IFL)

The Insignia Financial share price is down almost 14% to $2.53. This morning, this financial services company released its full year results and reported a 0.9% increase in revenue to $1.39 billion and a statutory net loss of $185 million. In light of this poor form, the company suspended its dividend. CEO Scott Hartley said: "We acknowledge the pause in dividend payments will be disappointing for some of our shareholders however, at this time, we must prioritise strengthening our balance sheet."

Megaport Ltd (ASX: MP1)

The Megaport share price is down 21% to $9.29. This has been driven by the release of the network as a service provider's full year results. Megaport revealed a 28% increase in revenue to $195.3 million and a 182% jump in EBITDA to $57.1 million. While this was largely in line with expectations, its guidance for FY 2025 disappointed. Goldman Sachs said: "Megaport provided FY25 guidance for: (1) Revenue growth of +10% to +14% to A$214-222mn (-7% at midpoint vs. GSe A$234mn; -6% vs VAe A$233mn), with MP1 focus on accelerating ARR through the next 3 years; (2) EBITDA growth of +0% to +14% to A$57-65mn (-22% at midpoint vs. GSe A$78mn; -18% vs VAe A$74mn) with Jun-24 EBITDA being $4.5mn, implying $54mn annualised."

The post Why Collins Foods, G8 Education, Insignia, and Megaport shares are sinking appeared first on The Motley Fool Australia.

G8 Education shares are currently swapping hands at $1.24 apiece, more than 10% lower on the day as investors react to the company's numbers and outlook.

Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is up less than 1% today.

Let's see what the company posted.

G8 Education share price plummets after H1 earnings

Here are the key takeaways from the company's annual results:

• Revenue was up 5.5% on the prior year to $480.4 million
• Statutory net profit Increased by 33.6% year over year to $20.0 million
• Operating profit rose 20.5% to $39.4 million
• Group occupancy stood at 68.2%, up 80 basis points from the previous year
• Declared a fully franked interim dividend of 2 cents per share

What else happened in H1 FY 2024?

G8 Education delivered a solid financial performance in the first half of CY24. However, management raised concerns for the remainder of 2024.

During the first half, the company divested 15 centres and surrendered three more as part of its "network optimisation program".

Additionally, two new centres were opened, which G8 is "confident [has] the underlying fundamentals to perform".

Management also highlighted an increase in team retention rates, which rose by 6 percentage points to 76%.

It says this improvement is part of a broader strategy to build team member capability and enhance the overall experience for "families and children" at G8 centres.

The experience for shareholders was enhanced too, with the board increasing the dividend 33% year over year to 2 cents per share.

This is around 81% of the reported net profit, so management decided to share the profit around this half.

However, despite the growth in H1 2024, the company has seen a "softening" in occupancy growth in the second quarter due to lower enquiry levels, a trend that is consistent across the broader sector.

What did management say?

G8 Education's Managing Director and CEO, Pejman Okhovat, acknowledged the challenges ahead.

Our team's strategic cost management and conservative balance sheet approach coupled with
achieving operational efficiencies and positive occupancy results have contributed to the Group's
solid CY24 H1 financial performance.

Against the macroeconomic environment, lower enquiries, consistent with the broader sector, have
resulted in occupancy growth softening in Q2. This demands that we maintain our disciplined focus on our team engagement position, improve our family experience including our enrolments and transition, continue to maintain capital and cost disciplines and implement our 'fit core' strategic plan initiatives leading into 2025.

What's next for G8 Education?

Looking ahead, G8 Education anticipates more challenging conditions in the second half of 2024 and into 2025.

G8 is also set to begin an on-market buyback of up to 5% of issued capital as part of its capital management strategy. Management has set a high bar for the remainder of the year:

While our first half result demonstrates our progress against G8 Education's strategy, the Group's
strategic focus to build a stronger and more sustainable business continues as we recognise there is more to do. However, we are encouraged by the Federal Government's recent announcement to fund wage increases for Early Childhood Educators that will support the Early Childhood Education sector.

G8 Education share price snapshot

Investors are punishing the G8 Education share price on Thursday, despite a decent set of half-year accounts. With a more challenging outlook, investors might be spooked.

The stock is up 10% over the past year.

The post G8 Education share price plummets on weaker 2024 outlook appeared first on The Motley Fool Australia.

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

Cettire Ltd (ASX: CTT)

The Cettire share price is up 11% to $1.35. This is despite there being no news out of the online luxury products retailer. However, it is worth noting that its shares have been on fire this week. Investors appears to have been buying stocks that were sold off in the last financial year. Nevertheless, Cettire's shares remain down by over 55% since this time last year despite this week's heroics. That weakness was driven by concerns over its business model and a sudden deterioration in its performance because of consumer spending headwinds.

Deterra Royalties Ltd (ASX: DRR)

The Deterra Royalties share price is up 1.5% to $4.08. This appears to have been driven by a broker note out of Goldman Sachs this morning. Its analysts have upgraded the mining royalties company to a buy rating with a $4.70 price target. This implies potential upside of 15% from current levels. The broker feels that a recent selloff has created a buying opportunity for investors.

G8 Education Ltd (ASX: GEM)

The G8 Education share price is up 3% to $1.22. This strong gain also appears to have been by a broker note this morning. According to a note out of Macquarie, its analysts have upgraded the childcare centre operator's shares to an outperform rating with an improved price target of $1.35. Macquarie believes the company could be performing better than expected thanks to improving occupancy rates and lower wage increases.

Red Hill Minerals Ltd (ASX: RHI)

The Red Hill Minerals share price is up 11% to $7.34. This morning, this mining company announced a very large special dividend. Red Hill Minerals recently received $200 million from Mineral Resources Ltd (ASX: MIN) following the first shipment of ore from the Onslow Iron Project to China Baowu Steel Group. Its board has decided to return proceeds to shareholders through a special fully franked $1.50 per share dividend. Based on its current share price, this represents a 20% dividend yield. Its shares are scheduled to trade ex-dividend next week on 9 July. After which, the payment will be made to eligible shareholders later this month on 19 July.

The post Why Cettire, Deterra Royalties, G8 Education, and Red Hill shares are pushing higher appeared first on The Motley Fool Australia.