One cannot really be sure about the actual reason behind the fluctuations in the share prices. However, there is one thing which directly relates to the variations in the share prices - the demand and supply of the shares in the market. If the buyers are more than the sellers, it means that a stock is in demand. On the other hand, if there are more sellers in the market, it means the supply of that specific stock is more than the demand.
Some of the factors which influences share price movement could be related to the company itself while there are external factors as well, which have an impact on the share prices. Some of these includes:
- Demand and Supply: As highlighted above, if the number of buyers is more than the number of sellers in the market, we say that the demand for the stock is higher than its supply and vice versa.
- Interest Rate: The interest rate is inversely proportional to the demand for the share. More the interest rate, less is the demand and vice versa.
- Dividends: Dividend announcements made by the company has a direct impact on its share price. The positive statement increases the share price.
- Company’s Management: The profile of the management plays a vital role in influencing the share price along with the performance of the company. A management team with reliable and experienced professionals with an established background aids in moving the share price in the upward direction.
- Economy: Fluctuation in the economy also impacts the price of the share. When the scenario is favourable, the share price can reach at its peak, while in case of depression in the economy, the share price also falls.
- Political factors: Political factors such as policies within the country, the international relations with other nations also have a direct impact on the share price of any specific stock.
In this article, we would consider two internal factors within a company, that significantly influenced the share price of the companies covered below – OML and DTC. Let’s know about the release and see the impact on the respective share price of the two companies.
oOh!media Limited (ASX:OML)
oOh!media Limited released an update on 29 January 2020 stating that Brendon Cook has provided an indication of stepping down as Managing Director & CEO, and from the Board in 2020.
oOh!media is a leading operator in Australia and is a fast-growing Out Of Home advertising industry in New Zealand. OML is engaged in creating deep engagement between people & brands via unmissable location-based media solutions.
Mr Cook is the founder of the company and has significant expertise and a formidable profile within the industry. With his skills, Mr Cook would continue to support the company as he takes up a non-executive consulting role. In this role, he will be providing ongoing strategic advice post the successful transition to a new CEO.
In his role as Managing Director & CEO, Mr Cook contributed in the establishment, growth and success of the Company over the past 30 years. He has been a true pioneer of the Out of Home industry in Australia.
Other than this, Mr Cook also had the prudence to recognise the growth capacity of digital and was a strong supporter of the growth of new outdoor environments to take advantage of the quick growth in media consumption patterns away from home. He also led the development of new methods to determine the actual value of the out of home segment.
Other contributions of Mr Cook include the diversification strategy to build a data-centric, scalable multiformat business across billboards, rail, office buildings, retail, street furniture, cafes, universities & airports which leads the Australian & New Zealand markets.
OML’s board has started the process of appointing a new Managing Director and CEO with a leading global search firm.
Apart from this news, the company also clarified in the announcement on the earnings guidance issued on 03 December 2019 that its EBITDA would be towards the lower end of the range $138 million to $143 million, apart from integration costs and the impact from the change in accounting standards to AASB16.
The announcement was released at AEDT 8:55 AM, and post the release, with the market open, OML’s shares dropped by $0.09 from its last close and were trading at $3.510. The highest price attained for the day was $3.530. By the end of the trading session, the shares close at $3.360, down 6.667% from its previous close. Market cap on 29 January 2020 was $872.59 million and outstanding shares were ~242.39 million.
Damstra Holdings Limited (ASX:DTC)
Damstra Holdings Limited, an Australian-based provider of integrated workplace management solutions, provided an update on 29 January 2020 regarding the financial and operational performance for Q2 FY2020 ended 31 December 2019.
The total revenue during 1H FY2020 increased by 44% to $10.2 million as compared to the previous corresponding period. The revenue growth rate reported was in excess of Prospectus forecast revenue growth of 39.4% for FY2020.
At present, the company expects its 1H FY2020 pro forma EBITDA to be ~$2.6 million and Prospectus forecast for the FY2020 to be ~$4.3 million.
The international market revenue represented 23% of the total revenue during 1H FY2020. The performance of international market revenue was the outcome of ongoing implementation of the international strategic plan of the company.
On 20 December 2019, Damstra completed the acquisition of Projection Group’s Scenario Advantage Workforce business, a provider of safety, training and worker management.
Second quarter of FY2020 was a key investment period for the company. The number of people engaged in research and development team reached 40, representing a growth of 60% from the previous corresponding period.
During the quarter, the company made an excellent progress in the Newmont rollout with new sites continuing to be brought online. In locations such as Australia, North America, Suriname, Ghana and Peru, Newmont sites are operational and has more than 14,000 users on the Damstra platform and more than 200 hardware devices in the field.
The company continues to secure new clients and rolls out its products regularly. Continued growth in the mining sector was reported during the period with the signing of Metro Mining, a Brisbane, Australia-based exploration and mining company. There was growth in the new clients deploying the eLearning solution of DTC which includes Newcastle Permanent Building Society who have secured 900 licenses for their company.
During Q2 FY2020, DTC used $0.583 million in its operating activities and $8.703 million in investing activities. The net cash generated from financing activities was $20.671 million. The cash receipt during Q2 FY2020 was $4.6 million while the closing balance was $12 million.
The announcement had a positive impact on its share price with the market open. The opening price of the shares was $1.020, a gap of $0.06. The highest price for the day was $1.120 and by the closure of the market, the price of the share was $1.075, 11.979% above its previous close. Around 720,942 shares traded on ASX. The market cap as on 29 January 2020 was $131.93 million and the company had ~137.43 million outstanding shares.
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