Day: 23 May 2022

The BetMakers Technology Group Ltd (ASX: BET) share price is edging ahead on Monday morning.

At the time of writing, shares in the betting technology company are up 2.91%, trading at 53 cents.

What did BetMakers announce?

Investors are rallying up the BetMakers share price after the company was selected as the new tote provider in Norway.

In its release, BetMakers advised its Global Tote division has secured a 10-year deal with Norsk Rikstoto.

Founded in 1982, Norsk Rikstoto is the sole purveyor of betting on horse racing in Norway.

Under the agreement, Global Tote will become the new tote technology and services provider for the Nordic country. This will replace Norsk Rikstoto’s current pari-mutuel betting solution.

As such, Global Tote will deliver its software-as-a-solution (SaaS) for integration with Norsk Rikstoto’s web, mobile and terminal platforms.

The system will be hosted from Global Tote’s AWS computing environment with operations serviced from its centres in Europe and the United States.

Features as well as key software customisations are expected to be in line with local betting and regulatory requirements.

Both parties will work closely together to better position Norsk Rikstoto and develop Norway racing as a global wagering product. This includes expanding international opportunities and increasing revenue by importing or exporting content for wagering customers in their respective markets.

What did management say?

BetMakers CEO Todd Buckingham touched on the milestone agreement, saying:

BetMakers, through its Global Tote division, is delighted to broaden its engagement with Norsk Rikstoto to deliver a new betting system that both parties believe will allow Norsk Rikstoto to leverage its investment in existing web, mobile and terminal platforms while also expanding its system capabilities and increasing access to new markets and new content through international commingling.

Further to this new Norway deal expanding Global Tote’s footprint in Europe, we are particularly proud of the fact that, as a Company, BetMakers now provides key tote betting services to three of the four Nordic countries that offer betting on racing. Global Tote is the chosen national tote services provider of the Nordics in Denmark, Finland and Norway.

Global Tote is also the national tote technology service provider in Turkey, and supports key racetracks across Spain, Cyprus, Ireland and the United Kingdom.

About the BetMakers share price

Despite today’s gains, the BetMakers share price has fallen by almost 65% over the last 12 months.

When looking at the year to date, its shares are down roughly 33%.

Based on valuation grounds, BetMakers has a market capitalisation of roughly $465.28 million.

The post BetMakers share price climbs on multi-year agreement appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• These are the 10 most shorted ASX shares
• Betmakers share price slides despite ‘momentous occasion’
• These are the 10 most shorted ASX shares
• These are the 10 most shorted ASX shares

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Betmakers Technology Group Ltd. The Motley Fool Australia has recommended Betmakers Technology Group Ltd. 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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The IGO Ltd (ASX: IGO) share price is running higher for the second consecutive day, seemingly getting a boost from a broker upgrade.

Shares in the nickel and lithium miner added 3.85% to reach a two-week high of $12.11 in early trade. In comparison, the S&P/ASX 200 Index (ASX: XJO) is up 0.24% at the time of writing.

The IGO share price gain today is on top of Friday’s 5.1% surge after the company announced its first and consistent production of battery-grade lithium hydroxide from the Kwinana Lithium Hydroxide Refinery in Western Australia.

IGO share price boosted by de-risking milestone

The news significantly de-risks the project, according to UBS. The broker took the opportunity to upgrade IGO shares to buy.

It also helps that the IGO share price is looking even better value after it fell around 20% in the last month.

Another positive is that IGO is getting closer to acquiring Western Areas Ltd (ASX: WSA).

Biggest valuation driver

The Kwinana Refinery is a joint venture (JV) between IGO and its Chinese partner Tianqi Lithium Corporation. This JV accounts for around 75% of UBS’ valuation on the ASX miner and it includes IGO’s indirect 25% ownership in the Greenbushes mining asset.

The next step is a four- to six-month qualification period with its four off-take partners as production from Kwinana increases.

Risk factors to consider

But it isn’t all good news. Additional capital will be needed to expand the project and it costs three times more to build capacity in Western Australia compared to China.

Further, the broker thinks volumes might disappoint given the disappointing track record of Kwinana. This drags on UBS’ valuation on the IGO share price, although the volume issue is partially offset by the broker’s above-market commodity price forecast.

UBS commented:

The growth and earnings potential from Greenbushes was becoming clearer, but the Kwinana downstream had been perceived as a risk given its history.

We maintain our structurally bullish view on lithium and nickel in the medium and long term, looking through potential short-term volatility…. We reduce our PT [price target] to A$12.15/sh on lower realised spodumene prices but upgrade to Buy on a lower share price.

How is the IGO share price performing?

The IGO share price has gained close to 65% over the past year while the S&P/ASX 200 Index is up 1.4%.

It isn’t only IGO that has outperformed on the back of surging lithium prices. The Allkem Ltd (ASX: AKE) share price and Pilbara Minerals Ltd (ASX: PLS) share price have both more than doubled over the same period.

The post Why the IGO share price is rallying on Monday appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• Is the CBA share price a buy following the bank’s digital mortgage launch?
• Is QBE considered an ASX dividend share?
• These were the worst performing ASX 200 shares last week
• Here are the 3 most traded ASX 200 shares on Friday

Motley Fool contributor Brendon Lau has positions in Independence Group NL and Orocobre Limited. 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 Scott Phillips.

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The Elders Ltd (ASX: ELD) share price has come flying out of the gates on Monday morning.

In early trade, the agribusiness company’s shares jumped 9% to a multi-year high of $14.98.

Elders share price jumps amid strong first-half profit growth

• Sales revenue up 38% to $1,514.8 million
• Earnings before interest and tax (EBIT) up 80% to $132.8 million
• Net profit after tax up 34% to $91.2 million
• Interim dividend increased 40% to 28 cents per share

What happened during the first half?

For the six months ended 31 March, Elders reported a 38% increase in revenue to $1,514.8 million.

This was driven by growth across all product areas and geographies. The star of the show, though, was the Rural Products business, which reported a 47% jump in sales to $312.9 million. This reflects strong demand for fertiliser and crop protection products following favourable seasonal conditions across key cropping regions.

As for earnings, the company delivered an 80% jump in EBIT to $132.8 million and 34% increase in net profit after tax to $91.2 million. This was underpinned by its strong sales growth and the early success of its Eight Point Plan.

This strong profit growth allowed the Elders board to declare a 30% franked 28 cents per share interim dividend, which is up 40% year on year.

How does this compare to expectations?

As you might have guessed from the Elders share price performance today, this result outperformed expectations.

According to a note out of Goldman Sachs, its analysts were expecting Elders to report a 13% increase in sales revenue to $1,245.2 million and a 27% lift in EBIT to $93.7 million.

Elders has smashed both estimates with its sales revenue of $1,514.8 million and EBIT of $132.8 million.

Outlook

In light of the company’s performance during the first half and strong start to the second half, management has upgraded its earnings guidance for FY 2022.

Instead of underlying EBIT growth of 20% to 30%, it is now forecasting EBIT growth of 30% to 40% for the 12 months.

Managing Director and Chief Executive Officer, Mark Allison, said:

The strong first half performance has continued in April and we now expect to deliver full year 2022 Underlying EBIT in the range of 30% to 40% above full year 2021 Underlying EBIT. This expectation replaces the guidance we gave to the market on 14 March 2022.

Though, the company warned that its guidance could be impacted by potential supply chain disruptions as a result of COVID-19 and geopolitical events, unexpected changes to seasonal conditions and severe weather events, and unexpected changes in commodity prices.

The post Elders share price jumps 9% on stellar first-half profit growth appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• 2 high quality ASX 200 dividend shares analysts have named as buys
• Top ASX dividend shares to buy in May 2022
• Here are the top 10 ASX shares today

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 recommended Elders Limited. 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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The Woolworths Group Ltd (ASX: WOW) share price lifted after the company offered to buy MyDeal.com.au Ltd (ASX: MYD) on Friday.

But could the S&P/ASX 200 Index (ASX: XJO) company’s latest attempt to get onto the online marketplace scene put the Woolworths share price in the ‘buy’ zone?

Is Woolworths a buy after MyDeal offer?

Brokers are sceptical of Woolworths latest acquisition attempt despite the company’s share price trading in the green following its announcement.

The supermarket giant has offered to buy an 80% stake in MyDeal for around $218 million – or $1.05 per share. The proposal values the business at $271.8 million.

Woolworths’ offer represents a 62.8% premium on the MyDeal share price’s previous undisturbed close. Perhaps unsurprisingly, stock in the online marketplace rocketed nearly 56% on Friday.

Woolworths’ intent to snap up MyDeal might remind readers of Wesfarmers Ltd (ASX: WES)’s 2019 acquisition of Catch.com.au. It might also raise eyebrows after the supermarket giants’ unsuccessful attempt to integrate EziBuy into its Big W brand. After acquiring EziBuy in 2013, Woolies offloaded it in 2017.

What are the experts saying?

Barrenjoey analyst Tom Kierath is reportedly perplexed about the proposed transaction.

He questioned why Woolworths would pay such a premium for MyDeal. Particularly as the online marketplace suffered a $5.8 million loss last financial year, The Age reports.

If [MyDeal] didn’t make money through the COVID period, will it ever?

Barrenjoey’s Tom Kierath, as quoted by The Age.

The analyst also noted the supermarket giant has previously struggled to make profits in non-food businesses. It has racked up notable failures in Dick Smith and Masters.

Morgans analyst Alex Lu is also reportedly sceptical. Lu noted the transaction comes as many Australians worry about the cost of living – which could dampen demand for general merchandise – according to the newspaper.

Meanwhile, Citi is reportedly drawing parellels between Woolworths’ bid for MyDeal and its EziBuy flop.

“Both businesses are not market leaders and we are also concerned that visibility on MyDeal’s performance will be low once consolidated as EziBuy’s was previously,” The Australian quoted Citi analyst Adrian Lemme as saying.

The broker has a $40.30 price target and a ‘buy’ rating on Woolworths shares.

Woolworths share price snapshot

The Woolworths share price has struggled through 2022 so far.

It has tumbled 8.1% year to date. Meanwhile, the ASX 200 has slumped 5.8%.

In early trading on Monday, shares in the supermarket giant are up 0.11% at $35.39.

However, the company and the index have recorded respective gains of 0.3% and 1.4% over the last 12 months.

The post Is the Woolworths share price a buy following the latest acquisition or a no deal? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• Woolworths share price lifts following $218m online marketplace deal
• ASX 200 midday update: BHP, IGO, and Woolworths charge higher
• Here’s why the MyDeal share price is rocketing 56% today
• Woolworths share price in focus on MyDeal acquisition proposal

Motley Fool contributor Brooke Cooper 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 positions in and has recommended Wesfarmers Limited. 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Earlier this month, the Terra (CRYPTO: LUNA) blockchain effectively collapsed. The breakdown started when stablecoin TerraUSD (CRYPTO: UST) lost its peg to the U.S. dollar and the built-in arbitrage mechanism failed to resolve the problem. At that point, panicked investors started selling Luna and TerraUSD hand over fist.

However, Terraform Labs founder Do Kwon has a plan to revive the broken blockchain, and optimism surrounding that plan has both coins soaring today. As of 3:00 pm ET, Luna and UST were up 62% and 25%, respectively, in the last 24 hours.

So what

Kwon discussed his revival plan for Terra in a recent blog post. Specifically, the blockchain will be forked to create a new chain, but the new chain will not include the UST stablecoin. Kwon’s plan also outlines the creation of 1 billion new Luna coins, which will be distributed among developers alongside pre- and post-crash holders of Luna and UST.

The voting period is still open, but the proposal has already surpassed the threshold for adoption, and the fork is set to take place on May 27. At that time, the old chain and cryptocurrency will be known as Terra Classic and Luna Classic, while the new chain and cryptocurrency will be known as Terra and Luna. Of course, Kwon’s proposal does not guarantee that investors will recoup all crash-related losses. The market will have to decide what the new Luna coin is worth.

Now what

Terra was once a thriving ecosystem of decentralized finance (DeFi) services. Anchor (CRYPTO: ANC) was the crown jewel, a lending protocol that paid 20% interest on UST deposits. But the platform included a number of other noteworthy applications. The Mirror protocol allowed investors to trade synthetic assets, and the Chai payments app had over 2 million users in South Korea.

After the blockchain’s collapse, the future of the Terra ecosystem is questionable at best. The relationship between UST and Luna was the primary source of value. DeFi products like Anchor were designed to drive demand for UST, and Luna was designed to absorb stablecoin price volatility. To that end, Luna was supposed to become more valuable as demand for UST increased. Instead, the opposite happened and investors lost over $40 billion.

Even if the new blockchain earns the trust of the crypto community, Terra won’t be the same without its native stablecoin. For that reason, I think this is a “watch and wait” situation. Terra may regain its former glory, or it may fade into the background of the crypto industry. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why Terra (Luna) just clawed back some losses appeared first on The Motley Fool Australia.

More reading

• Why the IGO share price is rallying on Monday
• Elders share price jumps 9% on stellar first-half profit growth
• Is the Woolworths share price a buy following the latest acquisition or a no deal?
• Why I think it’s a good time to buy the Vanguard MSCI Index International Shares ETF (VGS)
• Potential buys from experts: 2 compelling ASX shares

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 and has recommended Luna. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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After all of this volatility, I think now is a good time to buy the Vanguard MSCI Index International Shares ETF (ASX: VGS).

Inflation and central bank interest rate rises are getting a lot of investor attention right now. It could be a good time to consider a diversified, low-cost exchange-traded fund (ETF).

Amid all of the uncertainty, the global share market has been falling. The VGS ETF has fallen by 16% since the start of the year, including the effect of the decline of the Australian dollar.

What is the Vanguard MSCI Index International Shares ETF?

This ETF is about providing access to invest in many of the world’s largest companies.

It’s invested in businesses across the world. Geographically, it is diverse.

The United States, Japan, the United Kingdom, Canada, France, Switzerland, Germany, the Netherlands, Sweden, Hong Kong, Denmark, Spain and Italy each has an allocation of at least 0.5%

There is a total of almost 1,500 holdings in the ETF, so it looks very diversified in my opinion.

I’d also like to point out that it’s diversified across different sectors. There are five sectors that have a double-digit weighting in the portfolio – IT (22.1%), healthcare (13.4%), financials (13.1%), consumer discretionary (11.2%) and consumer staples (7.8%).

So that’s what the ETF is about. But why is it attractive? Here are some key points that I like about it.

Low fees

One of the main positives about the Vanguard MSCI Index International Shares ETF is that it has an annual management fee of 0.18%, which is low and attractive to me.

When the management fee is low, it means more of the net returns are left in the portfolio for investors. That can mean stronger compounding over the longer term.

The fund provider Vanguard aims to provide its investment funds for investors as cheap as it can. There are no performance fees with this ETF either.

Strong holdings

While it does have a large number of positions, the companies with the largest weightings are some of the strongest in the world.

I think one of the attractive features of the VGS ETF is that it has a good allocation to quality businesses. At the end of April 2022, these are some of the biggest positions in the portfolio: Apple, Microsoft, Alphabet, Amazon, Johnson & Johnson, Nvidia and Berkshire Hathaway.

Prior to the recent decline in the last few months, the VGS ETF had produced solid returns in my opinion. Past performance is not a reliable indicator of future performance, but even after the drop, the Vanguard International Shares ETF returned an average of 11.4% per annum in the five years to April 2022, according to Vanguard.

I think the quality of the ETF can also be seen with the return on equity (ROE) ratio of 18.3%, according to Vanguard.

Foolish takeaway

I think that the VGS ETF looks more attractive after this decline. It’s full of good companies which are now, as a whole, cheaper. If I were looking to buy it, this could be a good time.

The post Why I think it’s a good time to buy the Vanguard MSCI Index International Shares ETF (VGS) appeared first on The Motley Fool Australia.

More reading

• 3 top ETFs for ASX investors to buy now
• VGS: Were you better off buying the S&P 500 ETF?
• 3 fantastic ETFs for ASX investors to buy this week
• How diversified is the Vanguard International Shares ETF?
• Here are 2 top ETFs for ASX investors to buy next week

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. 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 positions in and has recommended Alphabet (A shares), Amazon, Apple, Berkshire Hathaway (B shares), Microsoft, Nvidia, and Vanguard MSCI Index International Shares ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Alphabet (C shares) and Johnson & Johnson and has recommended the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), long March 2023 $120 calls on Apple, short January 2023 $200 puts on Berkshire Hathaway (B shares), short January 2023 $265 calls on Berkshire Hathaway (B shares), and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Berkshire Hathaway (B shares), Nvidia, 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 Scott Phillips.

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Experts have been on the lookout for ASX share opportunities that could have plenty of upside amid the current market volatility.

Businesses that have seen declines but are still doing well operationally could be ideas to consider, according to brokers.

The below two share ideas have price targets much higher than their current values. A price target is where brokers and analysts think the share price will be in 12 months’ time.

Breville Group Ltd (ASX: BRG)

Breville is a business that sells kitchen appliance products to more than 70 countries around the world.

It’s currently rated as a buy by the broker UBS with a price target of $34. That’s a potential rise of more than 60%.

The company recently reconfirmed its FY22 guidance. It said that it expects earnings before interest and tax (EBIT) for the full 2022 financial year to be consistent with the markets’ consensus forecast of around $156 million. This included an assumption of no material supply chain interruptions beyond what was experienced in the first half of FY22.

Breville also pointed out that the ASX share continues to geographically expand. It is now live in Norway, Finland, Denmark, and Sweden. In June, it’s planning to expand to South Korea and then to Poland in July.

UBS thinks that the company can deliver ongoing double-digit earnings per share (EPS) growth over the next few financial years.

According to UBS, the Breville share price is valued at FY23’s estimated earnings.

Michael Hill International Ltd (ASX: MHJ)

Michael Hill has more than 280 jewellery stores globally across Australia, New Zealand, and Canada. Its global HQ, wholesale, and manufacturing divisions are located in Brisbane, Australia.

Citi currently rates Michael Hill as a buy, with a price target of $1.61. That implies a possible upside of more than 40% on the business.

Citi thought that the company’s recent trading update was better than the broker was expecting, with good profit margins and sales.

As a refresher, in that quarter for the three months to March 2022, all store sales increased 11.1% while same store sales rose by 4.8%.

The ASX share also pointed to “sustained margin expansion”, with margin growth of between 200 basis points to 300 basis points in all markets and channels compared to the third quarter of FY21.

It’s also seeing “strong digital growth”. Digital sales in the year to date were up 31.1% and represented 7.6% of total sales, up from 6.3% of total sales in FY21. It’s doing strategic market analysis to identify new territories for international digital expansion. This is “progressing well”.

The company also said that it’s continuing to explore potential acquisition targets with its “strong balance sheet”. Management said that it’s being disciplined with its working capital management and there are no adverse supply chain impacts on its stock levels.

According to Citi, the Michael Hill share price is valued at 10 times FY23’s estimated earnings.

The post Potential buys from experts: 2 compelling ASX shares appeared first on The Motley Fool Australia.

More reading

• Leading brokers name 3 ASX shares to buy today
• Here are 2 ASX growth shares experts have named as buys
• 3 stellar ASX growth shares analysts are tipping as buys this month

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 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 Scott Phillips.

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The Codan Limited (ASX: CDA) share price has started the week strongly.

In morning trade, the metal detector focused technology company’s shares are up 10% to $7.41.

Why is the Codan share price rising?

The catalyst for the rise in the Codan share price on Monday has been the release of a trading update from the company.

According to the release, the company is expecting its record FY 2022 first half profit of $50 million to be matched in the second half of the financial year.

This would mean a record full year profit of ~$100 million for Codan, which represents a 56% increase on FY 2021’s profit of $64 million.

Though, this guidance does come with a warning. Management advised that the timing of project sales or unforeseen challenges in supply chains could still impact revenues and profitability as it approaches the end of the financial year.

What is driving Codan’s growth?

The release explains that this strong growth has been supported by its strategy to diversify revenues and profitability.

It highlights that the increased profitability of the Communications division has continued during the second half thanks to positive performances from the acquired DTC and Zetron businesses.

In addition, the company’s Minelab business is on course for its second-best year on record. But even better, management expects the business to form a new base from which it will grow in future years. This is being underpinned by continued penetration of new geographic markets and new product releases that will drive further market share increases.

Finally, Codan revealed that its inventory management has been successful. It explained that its “decision to invest in inventory rather than let customers down has proven to be the correct one.”

Notwithstanding its investment in inventory, this has led to $41 million of cash being generated from operating activities so far in the second half. This is a huge improvement on its operating cash outflow of $13 million during the first half.

The post Codan share price jumps 10% amid guidance for ‘record’ FY22 profit appeared first on The Motley Fool Australia.

More reading

• Where I’d invest $10,000 into ASX shares this week
• If you’d invested $10,000 in Appen shares 7 years ago, lucky you! Here’s what you’d have now
• Buy these ASX growth shares in May: experts
• The IAG share price has tumbled 27% in 5 years. Have the dividends been worth it?
• Is the Westpac share price the cheapest in the bank sector today?

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 Scott Phillips.

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I love investing in ASX shares at good prices for the long term. With all the recent volatility, there are some good-looking opportunities I’d put $10,000 into.

Legendary investor Warren Buffett once gave this very wise advice, which I think can be applied in 2022:

Be fearful when others are greedy, and greedy when others are fearful.

Washington H. Soul Pattinson and Co. Ltd (ASX:SOL)

I would start by investing $4,000 into Soul Pattinson shares, the investment conglomerate company.

I did actually buy some Soul Pattinson shares last week so I’m ‘eating my own cooking’ here.

There are a few things that made me invest. Firstly, the Soul Pattinson share price has dropped by 16% since the start of 2022. I believe in the long-term future of the business, so I view a pullback like this as a good time to buy. If it drops more, I’ll view it as even more attractive.

I really like the unconstrainted investing style of the ASX share. It can invest in any sector, small caps, large caps, globally-listed shares, private equity, debt, and so on.

It’s invested in many industries including resources, telecommunications, financial services, agriculture, technology, and so on. The portfolio is becoming more diversified as time goes on.

The dividend record is also attractive – it has grown its annual dividend every year since 2000.

Airtasker Ltd (ASX: ART)

Next, I’d invest $2,500 into Airtasker, the local services marketplace.

This is one of the smaller ASX shares that I’m most optimistic about for the long term.

One of the main reasons that I’m excited about the business is its very high gross profit margin. In the first half of FY22, Airtasker’s gross profit margin was 93%. This means that 93% of revenue turned into gross profit.

Such a high gross profit margin means that most of the new revenue it generates can be used to invest for more growth and improve the company’s capabilities. It’s also a promising sign in the long-term that the company can be very profitable when it chooses to be in the future.

I’m also impressed by the ASX share’s global plans. It’s doing well in Australia but it’s also rapidly scaling in the UK and the USA, which are much larger total addressable markets.

The third quarter of FY22 was a sign of the company’s rapid progress. In the last quarter, revenue rose 21.1% year on year to $8.6 million. UK gross marketplace volume (GMV) rose 138% year on year, while US posted task growth was 90% quarter on quarter.

It made $1 million of operating cash flow for the quarter, showing that the company can probably self-fund its growth. That means it doesn’t really need to tap its cash reserves.

Despite the progress the ASX share is reporting, the Airtasker share price has fallen 53% in 2022, making it more attractive in my opinion.

Betashares Global Quality Leaders ETF (ASX: QLTY)

I would put $3,500 towards the QLTY ETF.

With a lot of volatility happening, I think it could be appropriate to consider high-quality businesses which now seem much better value.

The QLTY ETF is about investing in businesses that have a number of quality metrics, including low levels of debt, good cash flow, and a high return on equity (ROE).

Many businesses have declined amid worries about rising interest rates and inflation. The QLTY ETF itself has dropped more than 20% in 2022. I think the current price is more attractive.

Some of the bigger positions in the portfolio (of around 150 names) are: AIA, Johnson & Johnson, Novo Nordisk, Pfizer, Visa, and Adobe.

Those names are spread across a number of countries as well as different sectors. The US and Japan make up more than 70% of the country allocation, while IT and healthcare get over 60% of the sector allocation.

The post Where I’d invest $10,000 into ASX shares this week appeared first on The Motley Fool Australia.

More reading

• I’ll never sell this ASX dividend share. Here’s why
• 3 top ASX growth shares I’d buy next week
• Buy these great value 2 ASX growth shares: experts
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Motley Fool contributor Tristan Harrison has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Adobe Inc., Visa, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Airtasker Limited and Johnson & Johnson and has recommended the following options: long January 2024 $420 calls on Adobe Inc. and short January 2024 $430 calls on Adobe Inc. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Adobe Inc. 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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The Appen Ltd (ASX: APX) share price has enjoyed strong returns since making its debut on the ASX.

The language technology data and services provider had a minuscule market capitalisation of $47.3 million when it listed on the ASX through an initial public offering (IPO) on 7 January 2015.

The IPO raised $15 million from various investors with an offer price of 50 cents per share.

At today’s valuation, Appen is now worth more than $829.14 million.

Below, we take a look at the power of long-term investing. I will calculate how much you would have made if you’d invested $10,000 in Appen shares 7 years ago.

What if you had invested $10,000 into Appen shares after they made their ASX debut?

If you had invested $10,000 in Appen shares on this day in 2015, you would have bought them for around 70 cents apiece. This gives you approximately 14,285 shares, without topping up along the way.

Fast-forward to today, the current Appen share price is at $6.72. This means that those 14,285 shares would be worth an astonishing $95,995.20.

In percentage terms, the initial investment implies a return of 860% or a yearly average return of 38.14%. For context, an ASX 200 index-tracking fund would have given back 24.8% since 2015 or a yearly average of 3.23%.

What about the dividends?

Over the course, Appen has made a total of 14 dividend payments from September 2015 to March 2022. It’s worth noting that the last few dividend distributions have been relatively steady despite its shares tanking in recent times.

Adding those 14 dividend payments gives us an amount of 52.2 cents per share. Calculating the number of shares owned against the total dividend payment gives us a figure of $7,456.77.

When putting both the initial investment gains and dividend distribution, an investor would have a total amount of $103,451.97.

Should you invest $10,000 in Appen shares right now?

A couple of brokers rated Appen shares with different price points following the company’s FY21 results in February.

The first was JPMorgan, which downgraded Appen shares to neutral from overweight.

In addition, its analysts also slashed the 12-month price target by 48% to $7 per share, which is in line with today’s price.

Following suit, the team at Citi also lowered its outlook by 38% to $9.15. It appears the broker believes that Appen shares are undervalued, representing an upside of 36%.

The post If you’d invested $10,000 in Appen shares 7 years ago, lucky you! Here’s what you’d have now appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has positions in Appen Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Appen Ltd. 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 Scott Phillips.

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