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Summary
- The market seems to have bounced back after a gloomy week where a massive drop was seen across various sectors, majorly driven by the tech-led plunge on Wall Street.
- Afterpay experienced a drop of 14.48% during the week despite strong FY2020 results announced a week prior with underlying sales growing by 112%.
- NXT shares slipped by 8.69% from 31 August 2020 till 04 August 2020. The shares have bounced back today, gaining 1.26%.
- Medibank shares dropped nearly 7% last week. The share price dipped a further 0.394% closing at A$2.530.
After a gloomy week, the market has bounced back where most indices at AEST 12:18 PM are seen trading in the green zone. Benchmark index S&P/ASX 200 at AEST 12:33 PM is up marginally by 0.18% and is trading at 5,936.3. During the period from 31 August 2020 till 04 August 2020, S&P/ASX 200 was highly volatile. The index, by the end of the week, had fallen by 2.23%, with a drop of 3.06% on 04 September 2020 and settled at 5,925.5. Most of the sectors ended the session in the red zone after the tech-led plunge on Wall Street. Majority of the indices dropped below 2%. Amongst them, the technology sector was the worst performer with the S&P/ASX 200 Information Technology and S&P/ASX All Technology Index down by over 5%.
Apart from the technology sector, other sectors which experienced a fall of more than 3% in the index value were resources, metals and mining, materials, healthcare, and consumer staples.
As a result of the significant fall in the indices values, most stocks also closed in the red zone. In this article, we would be looking at those stocks which dropped over 6% during this week.
Afterpay Limited (ASX:APT)
Leading BNPL player Afterpay Limited noted a drop in the share price by 14.48% in the last five days (from 31 August 2020 till 04 August 2020). On Friday, 4 September 2020, APT shares slipped 6.671% from its previous close and settled at A$78.200. APT share price fell a further 2.366% today to close at A$76.350. The Company has a market cap of A$22.22 billion and 284.16 million outstanding shares.
Recent Developments: FY2020 Results
On 27 August 2020, Afterpay Limited released its FY2020 results for the period ended 30 June 2020. Let us take a quick look at the results:
- Afterpay Underlying Sales improved by 112% to A$11.1 billion.
- Afterpay Active Customer grew 116% to 9.9 million and Active Merchants by 72% to 55.4k.
- A 24% improvement was seen in the gross loss as a percentage of underlying sales.
- Group total income increased by 97% to A$519.2 million.
- Afterpay total income soared by 103% to A$502.7 million.
- Afterpay net transaction loss grew 93% to A$42.8 million.
- EBITDA improved by 73% to A$44.4 million.
NEXTDC Limited (ASX:NXT)
ASX 100 listed technology company NEXTDC Limited is the most innovative Data Centre-as-a-Service provider in Asia. In the last five days, from 31 August 2020 till 04 August 2020, NXT share price fell 8.69%. By the end of the trading session on Friday 04 September 2020, NXT shares slipped by 6.778% and settled at A$11.14. The share price moved north today and ended 1.257% higher at A$11.280. NXT has a market cap of A$5.08 billion and around 455.91 million outstanding shares.
Recent Development: FY2020 Results:
- Total revenue grew A$26 million during FY2020 to A$205.2 million. The revenue was towards the upper end of the guidance range A$200 million - A$206 million.
- Underlying EBITDA increased by 23% to A$104.6 million.
- Operating cash flow went up by 37% to A$53.9 million.
- Capital expenditure increased by 11% to A$418 million.
- Cash and undrawn debt facilities on 30 June 2020 were A$1,193 million.
Business Performance:
- Contracted utilisation improved 33% to 70 MW with new sales of 17.8MW before adjusting for a one-off clawback of the wholesale capacity of 0.4MW.
- The number of customers grew 15% to 1,364.
- Interconnections increased 2,079 (19%) to 13,051. It represents 8.1% of the recurring revenue.
FY2021 Guidance:
- Data centre services revenue in FY2021 expected between A$242 million and A$250 million.
- Underlying EBITDA would range from A$125 million to A$130 million.
- Capex predicted in the range A$380 million - A$400 million.
Medibank Private Limited (ASX:MPL)
Private health insurance company, Medibank Private Limited reported a drop of nearly 7% in its share price in the last five days (31 August 2020 to 04 August 2020). By the closure of the market on 4 September 2020, MPL share price dropped by 3.788% and settled at A$2.540. The shares fell a further 0.394% today to end at A$2.530. MPL has a market cap of A$7 billion and 2.75 billion outstanding shares.
Recent Development: FY2020 Result
Despite the challenges imposed by COVID-19, MPL business is well-positioned. The Company continues to work hard to help its customers, people, and the community.
- Revenue from continuing operations increased 1.7% to A$6,769.6 million as compared to the previous corresponding period.
- Total income from operations slipped 6% to 6,785.4 on pcp.
- Net profit from ordinary activities, dropping 31.3% to A$315 million.
- Health Insurance premium revenue rose A$84.0 million to A$6,554.7 million.
- Medibank Health revenue grew A$29.8 million (16.1%) to A$214.9 million.
- Net investment and other income reduced 91% to A$9.8 million.
- Profit from continuing operations slipped 27.9% to A$315.6 million.
- The Company declared a fully franked final ordinary dividend of 6.3 cents per ordinary share.
