Which Shares Excelled?

The recent trading sessions saw significant winners. Elders (ASX: ELD) began the week on a high note, reporting an impressive underlying return on capital of 16%, and a cash conversion of 163%, surpassing forecasts for FY23. This achievement came despite various industry challenges that otherwise dampened revenue and earnings.

Another notable performer was ALS (ASX: ALQ), a testing and inspection services entity. They revealed an underlying net profit after tax of $158 million, surpassing market expectations. With the evidence of strong wages growth, luxury retailer Cettire (ASX: CTT) saw its stock rally by 12.7% in just two trading sessions earlier in the week.

Audinate Group (ASX: AD8) also ranked among the winners, nearing an all-time high as a renewed interest in tech stocks boosted investor sentiment. Other strong performances came from Clinuvel Pharmaceuticals (ASX: CUV), Centuria Capital (ASX: CNI), Corporate Travel Management (ASX: CTD), and WiseTech Global (ASX: WTC) which is up 9% this week so far.

What’s the word with WiseTech? The company has demonstrated impressive financial performance, characterised by a consistent Return on Capital Employed (ROCE) of 16% over the past five years, outperforming the software industry average of 11%. This steady reinvestment at favourable rates of return, alongside a substantial 354% increase in capital employed, signifies the company’s proficiency in generating profitable returns from its investments. This robust financial strategy has been rewarding for long-term investors, as evidenced by the remarkable 337% stock return over the last five years. Despite this success, WiseTech Global remains a candidate for further exploration to assess its current valuation and future potential.

Which Shares Dragged on the Market?

On the flip side, some stocks weighed heavily on the local market. AMP (ASX: AMP) experienced a significant 16% drop on Thursday, setting a record low. The financial services firm issued warnings about margins and a weak profit outlook, causing investors to shy away from its plans to launch a digital bank for small businesses.

APM Human Services (ASX: APM) continued to struggle, with its shares still falling after last week’s announcement of no major contracts up for renewal in FY24 or FY25 in a low-unemployment market. TPG Telecom (ASX: TPG) shareholders faced disappointment following the company’s failure to reach an agreement with Vocus regarding the non-binding offer to acquire some of TPG’s Enterprise, Government, and Wholesale assets.

Karoon Energy (ASX: KAR) shares also plummeted ahead of a capital raise targeting US$300 million to acquire oil and gas assets in the Gulf of Mexico. Other stocks that saw declines included Imugene (ASX: IMU), Ramsay Health Care (ASX: RHC), Ramelius Resources (ASX: RMS), and ANZ (ASX: ANZ), with the latter trading ex-dividend after reporting its results at the start of the week.

We’ll be back next week with another Weekly ASX Trading Wrap-Up. Until then, have a great week!