To The Moon

As of the close on Friday, $S&P/ASX 200(XJO.AU)$ closed at 8,285.20 on Friday, down 0.12% in the past 5 days.

1. $JAMES HARDIE INDUSTRIES-CDI(JHX.AU)$ +16.59%

• The James Hardie share price was up over 15% this week. This follows the release of the building materials company's second quarter update. James Hardie revealed a 4% decline in net sales to US$961 million and an 8% decline in adjusted EBITDA to US$263 million.

• James Hardie CFO, Rachel Wilson, was cautiously optimistic. She said: "Despite greater market headwinds than we anticipated in our original outlook, we remain well-positioned to deliver volumes within our original guidance range. Our Hardie Operating System initiatives, together with efforts to rationalize and prioritize expenses enable us to achieve even better profitability than we initially anticipated. We are therefore reaffirming the low end of our volume guidance range and raising the low end of both our North America EBIT Margin and Adjusted Net Income ranges."

• Looking forward, James Hardie Industries plans for recovery and growth in the North American market, with expectations of volume and EBITDA margin expansion. The company remains focused on capitalizing on market opportunities and sustaining long-term shareholder returns through strategic investments and operational efficiencies.

2. $Block Inc(SQ2.AU)$ +15.01%

• Post Donald Trump’s victory in the US presidential elections, the price of bitcoin rose above $80,000 for the first time ever. Other cryptocurrencies such as dogecoin which is the favorite coin of Elon Musk, a strong Trump supporter, are also posting gains, as reported by BBC.

• Block Inc. is a technology company that focuses on financial services and helps expand access to the economy. Block comprises Square, Cash App, Spiral, TIDAL, and TBD. Block Inc.’s growth remains at scale with rising profitability.  The core businesses are robust with adjusted operating income margins growing significantly for both Square and Cash App.

• In the third quarter, the firm’s gross profit rose 19% year-over-year to $2.25 billion. Square generated a gross profit of $932 million, up 16% year-over-year, due to strength in its software and integrated payments and banking products. Cash App generated a gross profit of $1.31 billion, up 21% year-over-year, driven by strong performance across Cash App Card, Cash App Borrow, and BNPL platform. Overall, the firm delivered year-over-year improvement across all profitability measures including adjusted EBITDA.

3. $MEGAPORT LTD(MP1.AU)$ +12.43%

• It's nice to see the Megaport Limited share price up 16% in a week. But that is small recompense for the exasperating returns over three years. Indeed, the share price is down a tragic 61% in the last three years. Some might say the recent bounce is to be expected after such a bad drop. The rise has some hopeful, but turnarounds are often precarious.

• Investors in Megaport had a tough year, with a total loss of 20%, against a market gain of about 19%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 1.7% per year over five years.

4. $HMC Capital Ltd(HMC.AU)$ +10.50%

• HMC Capital Limited has announced the quotation of 10,000 new ordinary fully paid securities on the Australian Securities Exchange, with an issue date of November 13, 2024. This marks a significant step for the company as it continues to expand its presence in the financial markets, potentially enticing investors looking for growth opportunities.

• HMC already owns US-based digital infrastructure platform StratCap. The proposed public vehicle will own 13 data centres, said HMC Capital. HMC managing director and CEO, David Di Pilla, said the acquisition of iseek is complementary to the firm’s recent acquisition of Global Switch Australia with a number of benefits including enhanced geographic and customer diversification.

5. $XERO LTD(XRO.AU)$ +9.94%

• Xero share price jumps on strong half year results. For the six months ended 30 September, Xero reported a 25% increase in operating revenue to NZ$995.9 million. This was driven by a 6% increase in subscribers and 15% lift in average revenue per user. Xero reported net subscriber additions of 186,000 (excluding the removal of long idle subs).

• Things were even better for its earnings with its adjusted EBITDA up 52% to NZ$311.7 million and its net profit after tax up 76% to NZ$95.1 million. This reflects its strong top line growth combined with an operating expense to revenue ratio of 71.2%. This also resulted in free cash flow increasing to NZ$208.7 million and a free cash flow margin of 21.0%, improving from 13.3% in the prior period. Management notes that this led to Xero continuing to deliver a greater than Rule of 40 outcome of 43.9%.