Day: October 15, 2021

2 small cap ASX shares with a lot of potential

If you’re wanting to invest in the small side of the Australian share market, then the two small caps listed below could be worth a closer look.

Here’s why these small caps are rated highly by analysts:

Infomedia Limited (ASX: IFM)

The first small cap share to look at is Infomedia. It is a leading global provider of software as a service solutions to the parts and service sector of the automotive industry.

After a solid result in difficult trading conditions in FY 2021, Infomedia’s growth is expected to go up a level this year.

Management has provided revenue guidance of $117 million to $123 million. The mid-point of this guidance range implies revenue growth of 23% year on year.

The team at Bell Potter are very positive on Infomedia. In fact, the company is one of its top picks in the tech sector right now. It has a buy rating and $2.00 price target on its shares.

Volpara Health Technologies Ltd (ASX: VHT)

Another small cap ASX share to look at is Volpara Health Technologies. It is a healthcare technology company with a focus on the early detection of breast cancer.

It achieves this by improving the quality of screening using artificial intelligence. Volpara’s technology, which was developed at Oxford University, has been designed to provide objective data on breast tissue density, which is a key risk marker for breast cancer.

It has been growing at a strong rate in recent years and appears well-placed to continue this trend in the future. This is thanks to the quality of its technology, recent acquisitions, and favourable industry trends.

The team at Morgans are very positive on Volpara. Last week the broker retained its add rating and $1.87 price target on the company’s shares. It believes the company’s revenue guidance of NZ$25 million in FY 2022 is conservative.

The post 2 small cap ASX shares with a lot of potential appeared first on The Motley Fool Australia.

Wondering where you should 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 could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of August 16th 2021

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Motley Fool contributor 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 and has recommended Infomedia and VOLPARA FPO NZ. The Motley Fool Australia owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia has recommended Infomedia. 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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ASX travel shares on watch as US border reopens

a man stands before a chalk board with line drawings of paper planes with various curling flight trajectories and paths.

The US borders are going to open to travel, which could put the share prices of the ASX travel shares in focus.

According to reporting by international media, such as the BBC, the US is planning to reopen its borders for fully vaccinated travellers from 33 countries on 8 November 2021. That means it’s less than a month away.

Vaccinated people who want to travel just need to have a negative test in the 72 hours before travelling.

Which countries will the US open up to?

The list includes the UK, Brazil, China, India, Iran, Ireland, South Africa and Schengen countries. The Schengen countries are 26 European countries that allow unrestricted travel between them, these are: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden and Switzerland.

In other words, the US is going to be opening up to most of the global population and most of the global economy.

These travellers will not need to go into quarantine after entering the country according to the reporting.

The US is also going up open up its land borders with Canada and Mexico for fully vaccinated foreign nationals. However, unvaccinated travellers will continue to be barred from entering through the land borders.

How will this affect ASX travel shares?

There are several businesses which may be affected by this change.

For example, Webjet Limited (ASX: WEB), Flight Centre Travel Group Ltd (ASX: FLT) and Corporate Travel Management Ltd (ASX: CTD) all have exposure as global travel businesses.

With the release of Corporate Travel Management’s FY21 result, it said that it experienced a rapid return to positive underlying earnings before interest, tax, depreciation and amortisation (EBITDA) in the fourth quarter of FY21, led by its increasing exposure to a recovery momentum in North America and Europe.

After its Travel & Transport acquisition, the company is now estimated to be the world’s fourth largest global travel management company.

Corporate Travel Management commented:

The lucrative Transatlantic and intra-European segments are opening or expected to re-open in the first half of FY22 and should materially continue to group revenue and profitability in both regions.

WebBeds also has exposure to the northern hemisphere with its WebBeds business. Management suggested profitability for this business in each of the FY22 months so far. It has seen “strong demand” as travel restrictions ease in North America and Europe, suggesting “significant upside” as more international markets reopen.

The ASX travel share said:

We see a world of opportunity for Webjet. All our businesses have significant potential to grow market share by expanding into new market segments and benefiting from consumers shifting to buy travel online. Transformation initiatives are underway and we are on track to reducing costs by at least 20% once the company gets back to scale. As a result, as conditions normalise, we believe our Webjet businesses will have higher market share, lower costs and greater profitability.

While the exact timing is uncertain as our growth opportunities are driven by the opening of borders, we know demand for travel will return and we are absolutely ready to capture it.

The post ASX travel shares on watch as US border reopens appeared first on The Motley Fool Australia.

Should you invest $1,000 in Corporate Travel right now?

Before you consider Corporate Travel, 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 Corporate Travel 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 August 16th 2021

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Motley Fool contributor Tristan Harrison 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 Corporate Travel Management Limited and Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group 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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Could the Qantas (ASX:QAN) share price soar to $6.50 by the end of 2021?

Plane taking off from Sydney airport with CBD in background

The Qantas Airways Limited (ASX: QAN) share price has been a strong performer in 2021.

Since the start of the year, the airline operator’s shares are up 16%

This compares favourably to the S&P/ASX 200 Index (ASX: XJO), which has gained 10% over the same period.

Could the Qantas share price hit $6.50 by the end of the year?

According to a recent note out of one of Australia’s leading brokers, the Qantas share price could be about to take off.

The note out of Ord Minnett reveals that its analysts have retained their buy rating and lifted their price target on the company’s shares to $6.50.

Based on the current Qantas share price of $5.69, this implies potential upside of 14% for investors.

Unsurprisingly, the broker feels it is a little too soon to start thinking of dividends. Though, it does see potential for one in FY 2023 and has pencilled in a 28 cents per share dividend.

Overall, based on the above, Ord Minnett appears to believe it is possible for Qantas’ shares to be trading around the $6.50 level by the end of the year.

What did the broker say?

Ord Minnett is positive on the Qantas share price due to its belief that there is significant pent-up demand for domestic air travel.

The broker also expects rational pricing from domestic carriers as borders between states reopen following the easing of COVID-related restrictions. And with Virgin Australia downsizing, its analysts expect Qantas to win market share and sees opportunities for it to achieve a 70% share in the future.

Another reason the broker is positive is Qantas’ restructuring plans. It notes that this is tracking ahead of schedule, which helps support a positive earnings and margin outlook in the near term.

All in all, the Qantas share price may be beating the market this year, but this broker doesn’t believe it is too late to invest.

The post Could the Qantas (ASX:QAN) share price soar to $6.50 by the end of 2021? appeared first on The Motley Fool Australia.

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

Before you consider Qantas, 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 Qantas 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 August 16th 2021

More reading

Motley Fool contributor James Mickleboro 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.

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Leading broker names 2 fantastic ASX growth shares to buy now

A businessman lights up the fifth star in a lineup, indicating positive share price for a top performer

Investors searching for growth shares, may want to look at the shares named below.

These shares have been tipped to grow strongly over the 2020s and are currently named as buys by a leading broker.

Here’s what you need to know about them:

Hipages Group Holdings Ltd (ASX: HPG)

The first ASX growth share to look at is Hipages. It is a leading Australian-based online platform and software as a service (SaaS) provider that connects tradies with residential and commercial consumers. The Hipages platform not only helps tradies grow their businesses by providing job leads, but it also allows them to communicate with customers and run general admin duties.

Demand for the platform from both the tradie and consumer side has been strong, underpinning a solid full year result in FY 2021. Hipages reported a 22% jump in revenue to $55.8 million and a 27% increase in monthly recurring revenue (MRR) $5.2 million.

The team at Goldman Sachs are very positive on the company. The broker sees it as a great long term option due to its significant market opportunity. Its analysts estimate that Hipages currently captures around 5% of total industry advertising spend. However, it sees scope for this to increase to 40% to 60% in the future as the company builds out its ecosystem.

Goldman has a buy rating and $4.35 price target on the company’s shares.

Xero Limited (ASX: XRO)

Another ASX growth share that Goldman Sachs is a fan of is Xero. It is a cloud-based accounting solution provider to small and medium sized businesses.

As with Hipages, Xero was on form in FY 2021. It reported a 20% increase in subscribers to 2.74 million, a 38% jump in total subscriber lifetime value (LTV) to NZ$7.65 billion, and a 17% lift in annualised monthly recurring revenue (AMRR) to NZ$963.6 million.

The good news is that the company still has a significant market opportunity to grow into. Xero estimates that it has a total addressable market of 45 million subscribers globally, which means it has only captured a 6.1% share so far.

In addition, Goldman believes the company’s plan to monetise its growing user base via its app store could be a key driver of growth in the future.

Its analysts currently have a buy rating and $165.00 price target on its shares.

The post Leading broker names 2 fantastic ASX growth shares to buy now appeared first on The Motley Fool Australia.

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

Before you consider Xero, 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 Xero 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 August 16th 2021

More reading

Motley Fool contributor 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 and has recommended Hipages Group Holdings Ltd. and Xero. The Motley Fool Australia owns shares of and has recommended Xero. The Motley Fool Australia has recommended Hipages Group Holdings Ltd. 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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