Here’s why the Wesfarmers (ASX:WES) share price is up 7% in a month

There are several reasons that have propelled the share price.
The post Here’s why the Wesfarmers (ASX:WES) share price is up 7% in a month appeared first on The Motley Fool Australia. –

The Wesfarmers Ltd (ASX: WES) share price has had a tremendous month thus far.

Since the start of July, shares in Wesfarmers have soared around 7% and are currently trading near record highs.

There have been several catalysts that have made Wesfarmers a top performer on the S&P/ASX 200 Index (ASX: XJO).  

Let’s take a look at what’s propelled the Wesfarmers share price.  

Investors embracing Wesfarmers strategy

With the Wesfarmers share price trading at record highs, it can be assumed that investors are embracing the conglomerate’s ambitious growth strategy.

The company recently reiterated its priorities of investing in new growth platforms and selling unwanted assets.

Wesfarmers, which operates household banners such as Bunnings, K-Mart, Officeworks and Target plans to leverage and scale its unique assets.

In addition, Wesfarmers has also managed to divest its coal business and expand into the burgeoning lithium sector. Recently, the company’s Mt Holland lithium project received ministerial approval.

Earlier this year, Wesfarmers demonstrated the potential of its growth strategy by reporting strong half year results.

The company delivered a 25.5% increase in net profit after tax of $1,414 million. This was fuelled by a 16.6% increase in revenue for the 6 months of $17,774 million.

Wesfarmers plans expansion into pharmaceuticals

The Wesfarmers share price recently received a boost following its proposed expansion into the pharmaceutical sector.

Earlier this month, the company launched a $687 million offer for Australian Pharmaceutical Industries Ltd (ASX: API).

The offer slated by Wesfarmers is to acquire 100% of API’s shares outstanding for $1.38 cash per share by way of a scheme for arrangement.

Wesfarmers management cited that the proposed acquisition of API would provide the company an attractive opportunity to enter the $25 billion pharmaceutical, beauty and wellbeing sector.

Wesfarmers cited the strong competitive position of API and intends to bring its capital and unique capabilities to support further investment.

The deal is subject to due diligence, ACCC clearance and approval from the API board and shareholders

Snapshot of the Wesfarmers share price

As highlighted earlier, the Wesfarmers share price has stormed around 7% higher in July to record highs. Overall, shares in Australia’s second largest retailer have soared around 22% higher since the start of the year.

The post Here’s why the Wesfarmers (ASX:WES) share price is up 7% in a month appeared first on The Motley Fool Australia.

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

Before you consider Wesfarmers, 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 Wesfarmers 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

ASX 200 Weekly Wrap: Just like that… ASX back to record highs

Here’s what the Wesfarmers (ASX:WES) dividend will pay you today
Wesfarmers (ASX:WES) share price up as Catch involved in ACCC inquiry
What a Wednesday! Wesfarmers (ASX:WES) share price hits new all-time high
Lockdowns hurt, ASX falls, Wesfarmers climbs, and the Aussie set to fall? Scott Phillips on Nine’s Late News

Motley Fool contributor Nikhil Gangaram 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 owns shares of and has recommended Wesfarmers Limited. 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!