Day: January 11, 2021

3 highly rated ASX growth shares to buy now

tech growth shares

I’m a big fan of growth shares and feel very fortunate to have such a large number to choose from on the Australian share market.

But having so much choice can make it hard to decide which ones to buy. To help you decide which ones to add to your portfolio, I have picked out three top growth shares that are highly rated. They are as follows:

Appen Ltd (ASX: APX)

The first highly rated growth share to look at is Appen. It is a leading developer of high-quality, human annotated datasets for machine learning and artificial intelligence (AI). Its team prepare or create the data for the machine learning models of large tech companies and government organisations.

Analysts at Citi have a buy rating and $32.60 price target on its shares. The broker believes the company is well-positioned to benefit from the increasing spending on artificial intelligence and sees opportunities for it to expand its addressable market.

Kogan.com Ltd (ASX: KGN)

This ecommerce company could be a good option for investors due to continued rise in online shopping. In addition to this, its expansion into potentially lucrative verticals, the growing popularity of Kogan Marketplace, and recent acquisitions should support its growth in the coming years.

And while its shares have surged higher over the last 12 months, analysts at Canaccord Genuity still see a lot of value in them. The broker has a buy rating and $25.00 price target on Kogan’s shares.

Pushpay Holdings Group Ltd (ASX: PPH)

Another highly rated growth share is Pushpay. It is leading donor management and community engagement platform provider with a focus on the faith sector. It has been a very strong performer in FY 2021 and has just upgraded its full year EBITDAF guidance to between US$56 million and US$60 million. This will be up 123% to 139% year on year.

This is still scratching at the surface of its addressable market in the United States, which gives it a long runway for growth over the 2020s.

Analysts at Goldman Sachs are bullish on its prospects. They have a conviction buy rating and $2.59 price target on its shares.

Where to 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 are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Appen Ltd, Kogan.com ltd, and PUSHPAY FPO NZX. The Motley Fool Australia has recommended Kogan.com ltd and PUSHPAY FPO NZX. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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2 quality ETFs to buy for the long term

ASX ETFs

There are some exchange-traded funds (ETFs) that may be quality ideas for some investors to look into.

ETFs are often investments that give exposure to a diversified group of businesses, in a single trade. Many ETFs also have lower fees than a typical active fund manager.

With that in mind, here are two of the most popular ETFs on the ASX:

Vanguard Msci Index International Shares ETF (ASX: VGS)

This is investment is provided by Vanguard, one of the world’s leading ETF providers. It doesn’t try to make a profit – the owners of Vanguard are the investors themselves, so Vanguard shares the profit by lowering the management fees for investors when it can.

Vanguard Msci Index International Shares ETF has an annual management fee of just 0.18% per annum, which is among the lowest on the ASX. The ETF is more than $2.5 billion in size.

The purpose of the ETF is to provide exposure to many of the world’s largest companies listed in major developed countries. Vanguard says that it offers low-cost access to a broadly diversified portfolio of shares and allows investors to participate in the long-term growth potential of international economies outside of Australia.

It has over 1,500 businesses in its portfolio. Just over two thirds of the portfolio is invested in US shares, though plenty of other countries have a material weighting including Japan, the UK, France, Canada, Switzerland, Germany and so on.

In terms of the actual largest holdings of Vanguard Msci Index International Shares ETF, at the end of November 2020 they were: Apple, Microsoft, Amazon, Facebook, Alphabet, Tesla, Johnson & Johnson, JPMorgan Chase, Visa, Proctor & Gamble, NVIDIA, Nestle and Berkshire Hathaway.

Over the past five years this ETF has generated net returns of 10.6% per annum. Vanguard showed that its price/earnings ratio was 25.5x at the end of November 2020.

Betashares Nasdaq 100 ETF (ASX: NDQ)

This ETF is focused on the largest 100 businesses that are listed on the NASDAQ, which is an American stock exchange.

Many of the largest American tech companies are listed on the NASDAQ. Indeed, its largest holdings include: Apple, Microsoft, Amazon, Tesla, Facebook, Alphabet and Nvidia. These are similar holding names like the Vanguard ETF, however Betashares Nasdaq 100 ETF gives much larger exposure to them in terms of the portfolio weighting. Those seven businesses are not far off making up half of the overall ETF.

However, there are plenty of other businesses that are recognisable in the ETF’s portfolio such as PayPal, Adobe, Netflix, Intel, Broadcom, Qualcomm and Texas Instruments.

The annual management fee of Betashares Nasdaq 100 ETF is higher than the Vanguard one, at 0.48% per annum.

However, the net returns have been much higher in recent years. Over the past year to 31 December 2020 Betashares Nasdaq 100 ETF made a net return of 34.8%. Over the past five years it generated a net return of 22% per annum.

Whilst a large portion of Betashares Nasdaq 100 ETF is dedicated to tech shares, there are some non-tech holdings such as PepsiCo, Costco, Starbucks, Monster Beverage and Moderna, which gives sector diversification.

Where to 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 are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

*Returns as of June 30th

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Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended BETANASDAQ ETF UNITS and Vanguard MSCI Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Can the Domino’s Pizza (ASX:DMP) share price go even higher?

Domino's Pizza share price

Over the last 12 months, the Domino’s Pizza Enterprises Ltd (ASX: DMP) share price has been among the best performers on the S&P/ASX 200 Index (ASX: XJO).

During this time, the pizza chain operator’s shares have rallied a sizeable 49% higher.

Why has the Domino’s share price smashed the market?

Investors have been buying the company’s shares over the last 12 months due to its strong performance during the pandemic.

For example, during FY 2020, Domino’s delivered a 12.8% increase in network sales and a 21.4% jump in online sales.

This was driven by strong same store sales growth and a 6.5% to increase in its store network to 2,668 stores. This comprised 78 new stores in Europe, 75 new stores in Japan, and 10 new stores across Australia and New Zealand.

This ultimately led to the company reporting a 7.3% increase in earnings before interest, tax, depreciation and amortisation (EBITDA) to $303.0 million. This was despite the company providing $14.1 million to support stores through the height of the pandemic.

Can the Domino’s share price go higher?

The good news is that the Domino’s share price has been tipped to go higher from here by one leading broker.

According to a note out of Bell Potter, its analysts have just reiterated their buy rating and $99.30 price target on its shares.

This price target represents potential upside of 20% over the next 12 months excluding dividends.

With group year-to-date (first 17 weeks) same store sales up 8.4% on the prior corresponding period, the broker feels the company is well-placed to deliver another strong result in FY 2021. It is forecasting a 20% year on year increase in net profit to $174.9 million.

And looking further ahead, Bell Potter notes that management has plans to double its store network organically over the next decade or so to 5,550 stores. It also believes the company could accelerate its growth inorganically through acquisitions.

Where to 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 are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

*Returns as of June 30th

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Domino’s Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Leading broker names the ASX resources shares to buy in 2021

boost in mining asx share price represented by happy miner making fists with hands

Analysts at Bell Potter have been busy finding ASX shares from several industries that they believe are best placed to have a strong 2021.

On this occasion, I’m going to look at the resources sector. Here are a couple of shares they rate highly:

Nickel Mines Ltd (ASX: NIC)

Nickel Mines is one of the broker’s top picks. This is based on its shares being cheap relative to its peers, its aggressive growth profile, and its pure nickel commodity exposure. Nickel is one of Bell Potter’s preferred base metals.

The broker has a buy rating and $1.60 price target on the company’s shares.

It commented: “During 2020 NIC’s NPI production lines operated at steady state production levels and all-in costs that beat our original forecasts and nameplate capacity, resulting in production attributable to NIC of ~34ktpa. The strong operational performance and rising nickel price enabled NIC to repay debt early and declare a maiden A2cps dividend (unfranked).”

The broker has also been pleased with its agreement with its partner, Shanghai Decent Investment, to acquire a 70% equity interest in the Angel Nickel Project in Indonesia.

“We view this as a positive development. The acquisition has been de-risked by the strong performance of NIC’s existing operations and screens as excellent value on a number of metrics. It should lift attributable production by +25ktpa (~74%), commissioning October 2022,” it concluded.

Regis Resources Limited (ASX: RRL)

This gold miner is another resources share that Bell Potter rates highly. It currently has a buy rating and $5.72 price target on the company’s shares.

It views Regis Resources as an attractive, reliable gold producer and notes that it has achieved consistent operating margins and is investing smartly.

Bell Potter commented: “RRL’s FY20 EBITDA margin of 52% is competitive with, or ahead of, key industry peers. RRL’s ongoing CAPEX is, in our view, an investment into attractive, capital efficient growth options that leverage off RRL’s existing infrastructure – an aspect of its operations that set it apart from many peers.”

The broker believes the market is overlooking the potential of its McPhillamys Project in NSW, which has made good progress through the permitting process and is well placed to advance to production.

It feels this should deliver material production growth in the future and could commence construction during 2021.

“In our view, the market attributes little value to this asset. RRL also remains one of the sector leaders for shareholder returns. Its FY20 dividend equates to a payout of $41m and a payout ratio of 43% of NPAT for a 2.9% fully franked yield (at dividend declaration),” it concluded.

Where to 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 are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

*Returns as of June 30th

More reading

Motley Fool contributor James Mickleboro 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.

The post Leading broker names the ASX resources shares to buy in 2021 appeared first on The Motley Fool Australia.

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