Austal (ASX:ASB) share price lower despite new contract bid

The shipbuilder’s shares are struggling to float despite news of a new contract opportunity.
The post Austal (ASX:ASB) share price lower despite new contract bid appeared first on The Motley Fool Australia. –

The Austal Limited (ASX: ASB) share price is sinking into negative territory during lunchtime trade. This comes after the shipbuilder announced its new bid to supply upgraded littoral manoeuvre capability for the Australian Army.

At the time of writing, Austal shares are swapping hands for $2.23 apiece, down 1.33%.

Austal enters tender process

Investors are dragging the Austal share price lower despite the company announcing its new contract opportunity.

In a statement to the ASX, Austal advised it will submit a proposal to design, build and service the Australian Army’s next generation of littoral — or shoreline — capability.

The Department of Defence’s LAND 8710 (Phase 1) project is seeking to develop a new amphibious vehicle and independent landing craft. They’re scheduled to replace the Army’s lighter amphibious cargo vehicle and current landing craft mechanised (LCM-8) vessels.

The Australian-built amphibious vehicles and landing craft will aim to provide improved speed and protection in transporting land forces.

In February this year, the federal government announced plans to invest $800 million into the project. The new vehicles and vessels are expected to be integrated into the Army from 2026.

Austal CEO Paddy Gregg reinforced the company’s capability, saying:

Austal is Australia’s proven defence prime contractor that has designed, constructed and sustained multiple naval shipbuilding programs for Australia, and export markets around the world, for more than 20 years.

Drawing upon this local strength in defence capability, including Australia’s largest team of naval architects, Austal is confident of offering an exceptional new littoral manoeuvre capability for the Australian Army that may be relied upon throughout its working life.

The company has vessel manufacturing and service facilities across Western Australia, Queensland, and the Northern Territory. As Australia’s premier shipbuilder, Austal supplies some of the world’s most advanced defence vessels.

Currently, the company is partnering with more than 1,200 businesses across the country to deliver projects such as replacing the guardian-class patrol boats used as part of Australia’s maritime security program in the South Pacific.

About the Austal share price

It’s been a difficult 12 months for the company’s shareholders, watching their holdings fall in value by almost 40%. Although the Austal share price has failed to launch recently, for the company, it’s business as usual.

Austal has been busy completing its guardian-class patrol boats contract, with 12 vessels now delivered. A total of 9 patrol boats remains to be fulfilled, with 6 currently under construction.

Austal has a market capitalisation of roughly $803 million, ranking it 332 out of the 2,255 companies on the ASX.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

Why the Austal (ASX:ASB) share price is edging higher
Austal (ASX:ASB) share price edges higher amid acquisition rumours

The post Austal (ASX:ASB) share price lower despite new contract bid appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!