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ASX shares daily report: Z1P, HUB, CL1, ALL, TPW and AD8

It’s been a busy day for ASX shares, with takeovers, annual general meetings (AGM) and quarterly updates taking centre stage.

The benchmark S&P/ASX 200 index finished the day in green, up 0.26% to 7381.10 points.

Here’s your two-minute recap of all the corporate news from Monday, 18th October.

1. Aristocrat goes chips in

Casino games business Aristocrat Leisure Limited (ASX: ALL) announced a monster acquisition with its $3.9 billion proposed purchase of gambling software and content supplier Playtech PLC.

The acquisition values the London-based business on an ‘adjusted EBITDA’ (EBITDA explained) multiple of 11.4x for FY21.

Aristocrat’s purchase had been 12 months in the making as the business looks to continue its growth in Europe and America.

2. Zip growth slows quarter-on-quarter

Zip Co Ltd (ASX: Z1P) provided the market with a first-quarter update, recording a doubling of transaction value compared to the prior years period.

While the headline numbers read well, quarterly growth was more subdued. Revenue was up only 8% while transaction value grew just 7%.

The growth story remains on track. But Zip is cycling some very high 2020 comps, which will dwindle its growth comparisons throughout FY22.

3. Class receives an A+

Speaking of takeovers, the Class Ltd (ASX: CL1) share price finished the day up 61% after receiving an approach from Hub24 Ltd (ASX: HUB).

Hub24 will purchase the business for $386 million, a 71.6% premium to Class’ last price.

It’s an A+ deal for Class, whose share price had effectively halved over the past 5 years.

However its yet to be determined if the deal is in the long-term interests of Hub24 shareholders.

4. Market turns down the volume on Audinate

The Audinate Group Ltd (ASX: AD8) share price fell as much as 12% today before recovering some losses to finish down 8.67% to $8.95.

Despite a record quarter for revenue, the business announced the global chip shortage would impact future sales.

“This component shortage constrains our ability to supply products that have historically delivered approximately 43% of Audinate’s revenue”

Management was forced to cut its guidance, however, believes the business will record growth in FY22.

5. Temple & Webster records 56% growth

At its AGM today, Temple & Webster Group Ltd (ASX: TPW) showed its stellar FY21 was no fluke, achieving 56% growth in the first three and a bit months of FY22.

Impressively, this comes on top of the 85% growth the company recorded in FY21.

With Australian borders expected to reopen by year-end, growth will likely subside. However, as CEO Mark Coulter pointed out:

“Temple & Webster is a long-term growth story and periods of above and below average growth are to be expected”.

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At the time of publishing, Lachlan does not have a financial or commercial interest in any of the companies or funds mentioned.

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