DGL (ASX:DGL) share price soars 16% in last 2 days

The company is eyeing strong growth in the near-term.
The post DGL (ASX:DGL) share price soars 16% in last 2 days appeared first on The Motley Fool Australia. –

The DGL Group Ltd (ASX: DGL) share price is again flying higher today. This comes after the chemical company announced the acquisition of Opal Australasia late yesterday afternoon.

At the time of writing, DGL shares are up 10.03% to $1.81. Over the previous 2 days, the company’s share price is hovering above 16%, reflecting an upbeat sentiment from investors.

DGL expands market access

According to its release, DGL advised it has strategically acquired contract formulator and packaging business, Opal Australasia for $8.6 million.

Based in the Kwinana Industrial Area, Opal is one of two independent agricultural chemical toll manufacturing companies in Western Australia. The group provides specialised product and formulation development services to a majority of chemical suppliers within the industry.

The agreed purchase price represents a valuation of 5.1 times the last twelve months of Opal’s earnings. The deal is expected to be funded by both cash and shares, with the latter valued at $1.9 million.

DGL stated that the takeover will provide it access to a number of agricultural customers on Australia’s west coast. In addition, the company’s manufacturing capacity is also expected to increase in excess of 150,000 tonnes per annum.

DGL founder and CEO, Simon Henry commented:

Opal brings to our business a substantial foothold in the Western Australian market. It means we can now adequately service Western Australia’s grain industry, the largest agricultural sector in the state, which also represents around 40 percent of Australia’s grain exports.

Through this acquisition, we will have Australia’s agriculture market covered, and with a presence on both the east and west coast of Australia, it will provide a natural hedge on varying drought cycles.

About the DGL share price

It’s been an impressive start since DGL entered the ASX in late May with a share price of $1. The company has made quick progress which has been reflected in its share price.

Based on valuation metrics, DGL presides a market capitalisation of roughly $429.1 million, with 257 million shares outstanding.

The post DGL (ASX:DGL) share price soars 16% in last 2 days appeared first on The Motley Fool Australia.

Should you invest $1,000 in DGL right now?

Before you consider DGL, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and DGL wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

5 small-cap ASX shares on their way up

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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!