Altium Acquisition Sends ASX Higher

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The Aussie market rose today, with a significant lift in the Technology (+6.8%) sector after a takeover offer for electronic circuit board designer Altium, which sent its share price soaring by 28.8% to $66.00. The ASX 200 index finished 0.8% higher to 7,608.70, with the Real Estate (+3.4%) and Discretionary (+2.8%) also seeing big gains. While the Energy (-2.1%) sector was the biggest faller of the companies that closed in the red. Australia’s jobless rate hit a 2-year high of 4.1% during January, up from 3.9% in December and forecasts of 4.0%. The number of unemployed individuals climbed by 22,300 to 600,600.

Altium is set to be acquired by Japanese semiconductor Renesas Electronics in an all-cash deal for $9.1 billion, valuing the company at $68.50 per share. The price represents a 33.6% premium to Altium’s closing price on Wednesday. Altium’s board has endorsed the offer, with the deal expected to close in the second half of 2024.

It was a busy day for company earnings today as we are amid half-year earnings reports; here are some of the highlights:

  • Wesfarmers’ shares rose 5%, with the retail conglomerate posting a 3.0% lift in NPAT, with revenue increasing by 0.5%. The company said that its Lithium business would be unprofitable at the current spodumene prices.

  • Treasury Wines Estate rose 2.9% despite the winemaker reporting a fall in profits from its U.S business, cutting its dividend to $0.17. Total net profit dropped 11.4% to $166.7 million.

  • Goodman Group (+7.0%) shares hit an all-time high of $28.47 today, lifting operating income by 29% during the first half of FY24 to $1.1 billion. The company did report a statutory loss of $220.1 million due to write-downs on its real estate assets.

  • Origin Energy (+2.6%) reported a 17-gold increase in Net Profit during the first half of the financial year due to higher customer prices. Still, it did warn its energy markets business will be lower next financial year.

  • Telstra Group (-2.3%) lowered its full-year earnings guidance as the telco giant looks to overhaul its enterprise business. The company reported an 11.5% increase in Net profit to $1 billion.

  • Pro Medicus (-13.0%) shares released some steam after its recent share price surge, lifting Net Profit by 33.3% to $36.3 million, underpinned by a 30.3% rise in Revenue to $74.1 million. North American revenue rose 36.8%, with four significant implementations completed during the half.

  • Whitehaven Coal (-5.7%) cut its dividend by 7.0 cents per share as Coal Prices fell significantly during the half, resulting in a 58% fall in revenue. Underlying NPAT dropped 79% to $372.3 million.

  • BHP Group (-1.7%) will cop a $US2.5 billion after-tax impairment on the value of its nickel interests based in Western Australia that the company acquired as part of the OZ Minerals takeover.

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Wall Street

The U.S. market ended Wednesday higher, with large rises in ride-sharing companies Uber (+14.8%) and Lyft (+35.1%) the biggest story of the day, while Nvidia’s (+2.5%) stellar run continues, displacing Alphabet as the third most valuable company on the U.S. market.

The S&P 500 (+0.96%) finished higher, while the NASDAQ (+1.30%) rose, with Meta Platforms (+2.9%) and Tesla (+2.6%) both gaining more than 2%.

Uber shares hit a new 52-week high on Wednesday after announcing a $7 billion share repurchase program, with the ride-sharing company expecting gross bookings to be in the mid to high-teens over the next three years. Lyft's stock price surged after beating Q4 adjusted earnings estimates of $0.08 per share, coming in at $0.18.

Economic Data
  • Australia’s Unemployment rate rose to 4.1% during January 2024 - the highest mark since January 2022, lifting from 3.9% in December.

  • Japan's Q4 GDP shrank 0.1% in Q4 of 2023, missing forecasts of a 0.3% growth following a 0.8% fall in Q3.

  • U.K. Business Investment increased by 1.5% during the last quarter of 2023, beating forecasts of a 0.1% rise.

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