Fleetwood (ASX:FWD) share price jumps on secured contract success

Shares in the modular building company have lifted on news of a new contract.

| More on:
One female and two males construction crew in hard hats laughing.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

sdf

The Fleetwood Corporation Limited (ASX: FWD) share price has started the day strongly in the green.

Shares in the building solutions company are bidding higher on the back of an announcement earlier today.

Let's take a look at why investors are pushing the Fleetwood share price higher.

Fleetwood share price soars on contract news

Shares in Fleetwood have been boosted following a major announcement earlier today.

The company revealed it has secured a major contract for the new 1000-bed quarantine facility, the Centre for National Resilience, in Melbourne.

According to the release, Fleetwood will utilise its manufacturing facilities to deliver 500 beds by the end of 2021.

The company highlighted that the contract is expected to result in revenue of approximately $32 million for FY22.

The Centre for National Resilience is a purpose-built quarantine facility, built and owned by the federal government.

The facility will be operated by the Victorian government for the duration of the COVID-19 pandemic.

Fleetwood's Chief Executive Officer Bruce Nicholson noted:

This is an outstanding outcome for the company and highlights the strengths of using innovative offsite manufacturing to deliver highly effective and efficient products with strong sustainability credentials.

More on Fleetwood

Fleetwood is a leader in the modular construction industry and is a key supplier to the education, health, custodial, mining and affordable housing sectors.

Shares in the construction company took a blow recently after the company provided an operations update.

Fleetwood noted a slow and cautious recovery in the building industry following COVID-19 lockdowns in New South Wales and Victoria.

As a result of the current uncertainty, the company noted that clients have been very conservative and slow in their decision making.

In addition, Fleetwood noted that ongoing border closures and uncertainty around domestic travel have impacted its recreational vehicles (RV) business.

The company noted that foot traffic has also declined across its retail channels, while online and click and collect channels also showed signs of slowing.

Fleetwood had recently addressed the direct impact that various COVID-19 restrictions were having on its operations in its full-year report.

Snapshot of the ANZ share price

Shares in Fleetwood have soared more than 12% since the start of 2021.

However, the company's share price is still well off its 52-week highs from earlier this year.

At the time of writing, shares in Fleetwood are trading more than 2.64% higher for the day at $2.33.

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 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.

More on Share Market News

A young man wearing a black and white striped t-shirt looks surprised.
Broker Notes

These ASX 200 shares could rise 25% to 80%

Analysts think big returns could be on offer from these shares.

Read more »

The silhouettes of ten people holding hands with their arms raised against the sky, as the sun rises or sets in the background.
Share Gainers

Here are the top 10 ASX 200 shares today

Investors were nervous this Friday, ending the week on a sour note.

Read more »

A businessman looking at his digital tablet or strategy planning in hotel conference lobby. He is happy at achieving financial goals.
Share Market News

Where to invest $5,000 into ASX 200 shares this month

The team at Bell Potter is bullish on these names. But why?

Read more »

Man pointing an upward line on a bar graph symbolising a rising share price.
52-Week Highs

8 ASX 200 shares hitting multi-year highs today

These shares have defied the trend, hitting new price milestones amid a day in the red for the ASX 200.

Read more »

Broker Notes

Brokers name 3 ASX shares to buy today

Here's why brokers are feeling bullish about these three shares this week.

Read more »

A young man punches the air in delight as he reacts to great news on his mobile phone.
Share Gainers

Why EOS, Evolution Mining, Renascor, and Woodside shares are jumping today

These shares are ending the week on a high. But why?

Read more »

Person with thumbs down and a red sad face poster covering the face.
Share Fallers

Why Accent, Cettire, Ioneer, and Pro Medicus shares are dropping today

These shares are ending the week in the red. What's going on?

Read more »

A group of three miners in hard hats and high visibility vests confer at a rocky mining site.
Broker Notes

Up 66% in a year, just how much more upside does Macquarie tip for Perseus Mining shares?

Just how much higher might Perseus Mining shares soar? Here’s what Macquarie had to say about the ASX 200 gold…

Read more »