NZ shares fall even as Pushpay climbs

New Zealand's main share index fell on Tuesday as declines among large companies more than offset a $200 million increase in Pushpay’s market value following takeover bid updates.

Tuesday, May 24th 2022, 7:09PM

by BusinessDesk

The S&P/NZX 50 Index fell 70 points, or 0.6%, to 11,247.03. Turnover was $115 million.

Pushpay Holdings jumped 12.9% to $1.40, despite the falling market, after existing shareholders BGH Capital and Sixth Street revealed they were working together on a takeover bid. T

his prompted Pushpay to make a statement talking down the agreement and emphasising it was in early-stage discussions with multiple interested buyers.

Greg Smith, head of retail at Devon Funds, said having would-be buyers out in the public suggested a successful bid was becoming more likely but either party could still walk away.

“It’s not concrete but it is firmer than it was; of course, the big missing piece is the price,” he said.

Analyst estimates have suggested a possible takeover price could be roughly $1.73 or $1.80 per share, although Sixth Street paid $1.85 for its 17% stake only last year.

Pushpay shares traded as high as $1.50 today but are still down more than 18% in the past 12-months.

Elsewhere on the market, some large companies had declining share prices.

Meridian Energy dropped 3.5% to $4.44, and Contact Energy slipped 1.5% to $7.67.

Logistics stocks were weaker with global heavyweight Mainfreight set to report later this week. Freightways fell 3.3% to $10.50, Mainfreight declined 1.5% to $75.81, and Move Logistics was down 1.7% at $1.14.

Fisher & Paykel Healthcare declined half a percent to $20.71.

It is another big stock with earnings to report this week. Investors will be looking for clues about the company’s earnings profile in 2023 which will likely be seen as a post-covid base for F&P to grow from.

Some tech stocks continued to decline, including Vista Group which fell 3.2% to $1.50 and Pacific Edge which dropped 2.5% to 79 cents.

Turners Automotive Group was up 2.7% at $3.86 after reporting yet another record profit of $31.3 million in the 12 months ended March 31.

“Whilst the near-term economic outlook is looking much more uncertain, our business has never been in better shape and we are ready for whatever comes next,” said chief executive Todd Hunter.

The firm is contending with an accelerating pace of inflation – the retail price for private vehicles was up 5.6% in the March quarter – and rising interest rates are increasing the burden for potential borrowers.

The NZ dollar was trading at 64.33 US cents at 3pm in Wellington, down slightly from 64.50 cents yesterday.

Tomorrow, the Reserve Bank of NZ is expected to hike the official cash rate another 50 basis points and will provide an economic update that could shift the dollar. However, movements in the US dollar have been the main driver behind fluctuations in the exchange rate.

Tags: Market Close