In a year headlined by corporate failures due the coronavirus pandemic, there have been some notable winners on the ASX bourse. Here we recap the top 5 best share price performers for large cap companies in 2020.
Afterpay Ltd (ASX: APT)
The clear winner this year has been the financial sector darling Afterpay, with its share price rising by an incredible 230% in 2020. The company has shown consistent growth every quarter. Its FY20 result shows some impressive numbers including 112% growth in sales to $11.1 billion, 116% growth in active customers, and 72% growth in active merchants. Similar metrics were also reported for 1Q 2021.
Other notable achievements this year have been: adding a savings account to its services in partnership with Westpac Banking Corp (ASX: WBC), and acquiring a European competitor, Pagantis.
Despite those impressive metrics, Afterpay has not generated a net profit. Talks of impending regulation is also hanging over the the buy-now-pay-later segment.
Nextdc Ltd (ASX:NXT)
In second place this year is the information services provider NextDC, with its share price rising by 93% and reaching an all-time high. The company is involved in the operation of data centres in Australia and providing on-demand cloud services.
The pandemic and resulting rise in remote work arrangements has created increased demand for NextDC’s services, which explains the stock’s meteoric rise.
Notable achievements in 2020 have been: acquiring 180 more customers taking its total number to 1,364, and securing a $1.5 billion borrowing arrangement that will reduce its debt servicing costs significantly.
Despite the meteoric rise, the company has not turned over a profit, with its net loss expanding from $9.8 million in 2019 to $45.2 million in 2020. The capital intensive nature of its business in building new data centres will also weigh on its growth.
Saracen Mineral Holdings Limited (ASX: SAR)
Gold miner Saracen has had an astounding year with its share price rising by 70% YTD, as the company continues to capitalise on high gold prices.
After an impressive FY20, Saracen is also on track to achieve its key FY21 guidance targets for production and financials after a solid September quarter. The company has added $98 million to the balance sheet in free cash, adding liquidity to its business.
Earlier this year, Saracen and Northern Star Resources Ltd (ASX: NST) announced that they were set to combine forces under a $16 billion merger of equals. The mega merger would form a top 10 global gold company with target production of 2 million ounces of gold per year.
Fortescue Metals Group Limited (ASX: FMG)
Another mining company that has had a stellar year is Fortescue Metals. The iron ore miner has seen its share price rising by 62% in 2020.
The outstanding share price performance is on the back of its record full year profit in FY20, helped by a surge in iron ore prices as a result of strong demand from China. In FY20, the world’s fourth-biggest iron ore miner reported net profit of $$6.6 billion, a 49% increase from the previous year.
It continued its performance into FY21 as the company recently announced another 5% increase in iron ore shipment to China for the first quarter. The current geopolitical issues could, however, be a major factor in its future growth.
Fortescue’s biggest shareholder Andrew Forrest is Australia’s second richest person.
Domino’s Pizza Enterprises Ltd (ASX: DMP)
Rounding up the top five is Domino’s Pizza. The retail food giant has seen a remarkable 61% rise in its share price in 2020.
Domino’s Pizza has exclusive master franchise rights for the Domino’s brand in Australia, New Zealand, Belgium, France, The Netherlands, Japan, Germany, Denmark and Luxembourg.
The Domino’s share price reached a new record high of $92.15 earlier this month. The pizza chain operator’s shares have been in demand with investors this year thanks to its strong performance during the pandemic. This led to Domino’s delivering a 12.8% increase in its network sales to $3.27 billion in FY 2020.
The most remarkable metric is that its online sales were $2.4 billion, representing 72% of all sales.
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Returns as of 6th October 2020
More reading
- 3 reasons the Afterpay (ASX:APT) share price smashed the market in October
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- Top brokers name 3 ASX shares to buy next week
- How La Nina will create unexpected ASX stock winners and losers
- How the Saracen (ASX:SAR) share price stoked Kerry Stokes’ multi-billion dollar wealth
Motley Fool contributor Eddy Sunarto has no positions in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Domino’s Pizza Enterprises Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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