Wesfarmers (ASX:WES) share price rose 8.7% in a month. Here’s why

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Highlights

  • ASX:WES is on an uptrend since last month.
  • Wesfarmers recently acquired a stake in ASX:API.
  • The Company also held its 2021 AGM.

The share price of ASX listed retailer, Wesfarmers Limited (ASX:WES) is witnessing a subtle upsurge since last month. Shares have gained 8.7% in the last 30 days, i.e., over AU$5 per share. Even today, the stock is trading strong.

What is hyping investor interest in Wesfarmers?

  • In 2021, Wesfarmers net profit from continuing operations grew 16.2 per cent to AU$2.4 billion.
  • WES even increased its dividend to AU$1.78 per share.
  • It reported improved sales growth in Bunnings, Officeworks, and Catch, although store closures affected other businesses.
  • Wesfarmers also spent almost AU$900 million of capital expenditure in data and digital activities to ensure online presence in the year 2021.
  • In addition, Wesfarmers also entered a deed to acquire all shares in Australian Pharmaceutical Industries (ASX:API), for cash consideration of AU$1.55 per share. Wesfarmers currently owns a 19.3 per cent shareholding in API as of now.
  • API’s board has unanimously recommended the acquisition by WES. However, the deal still needs shareholder approval and ACCC approval.
  • Wesfarmers supports the community pharmacy model of business and thus see opportunities with API acquisition in the pharmacy business.

Bottom line-

A company’s share price is affected by various reasons, financial results and mergers and acquisitions being a few amongst those. However, WES share price seems to have witnessed a positive investor interest due to a potentially visible growth opportunity in business.

Meanwhile, On ASX today, WES shares are 0.084% up at AU$59.160 per share as of noon AEDT.

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