Month: May 2022

The Bank of Queensland Limited (ASX: BOQ) share price dropped in April 2022, materially underperforming the S&P/ASX 200 Index (ASX: XJO) which only fell by 1% last month.

Last month, the bank announced its FY22 first half result for the six months to February 2022. Let’s have a look at some of the numbers that BOQ reported to investors:

Half-year earnings recap

A lot of investors like to pay close attention to the results that businesses report every six months. It can give an indication of profitability as well as the outlook.

BOQ reported that it generated $212 million of statutory net profit after tax (NPAT). This was an increase of 38%. Cash earnings after tax rose by 14% to $268 million. Profitability can have an influence on companies’ share prices.

Meantime, the bank’s operating expenses declined by 3% to $461 million.

However, the net interest margin (NIM) declined 12 basis points to 1.74% in the second half of FY21. The bank said the majority (seven basis points) of the decline was due to “industry dynamics including ongoing competition, higher fixed rate lending volumes and volatile swap rates, and a further five basis points relating to increased liquidity during the period”.

BOQ managed to grow its housing loans by $2.6 billion and business loans by $0.6 billion.

The bank’s common equity tier 1 (CET1) ratio declined by 12 basis points from the second half of FY21 to 9.68%.

BOQ said that the result demonstrated the “disciplined execution of the ME integration and digital transformation program” and represented the fifth consecutive half of improved underlying performance.

It said that key integration milestones for ME Bank have been delivered on the accelerated timeline and within the committed expense profile, with $33 million of run-rate synergies delivered during the half. Synergy benefits have been increased from a range of $70 million to $80 million to the new goal of $95 million in FY24 and beyond.

Management noted that its asset quality remains “sound” with “prudent” collective provision levels.

The challenger bank’s board decided to pay an interim dividend of 22 cents per share, representing a dividend payout ratio of 53% for the first half of FY22.

BOQ outlook

Investors may take the outlook into consideration when it comes to the BOQ share price.

It said that Australia is well placed for a continued economic recovery though there is uncertainty with elevated inflation, rising interest rates, and other disruptions.

BOQ is focused on delivering 2% positive ‘jaws’ in FY22. It also noted that momentum continues to build, with BOQ and Virgin Money Australia gaining market share.

It’s expecting the NIM headwinds to ease while the continued benefits of its integration and productivity programs should reduce costs by at least 1%.

What do brokers think of the BOQ share price?

Citi thinks that BOQ is a buy, with a price target of $10.25 but noted it may have been revenue growth that disappointed the market.

Morgans is more optimistic, with a price target of $11 – that implies a potential rise of more than 30%. This broker’s numbers put the BOQ share price at nine times FY23’s estimated earnings with a potential grossed-up dividend yield of 9.5% in the 2023 financial year.

The post Why did the Bank of Queensland share price tank 7% in April? appeared first on The Motley Fool Australia.

More reading

• These were the best performing ASX 200 shares in April
• Hoping to bag the Bank of Queensland dividend? Read this
• Direct indexing: What is this latest investing fad?
• 5 things to watch on the ASX 200 on Monday
• These were the worst performing ASX 200 shares last week

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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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?

The cryptocurrency market is seeing another day of sell-offs today. The prices of Shiba Inu (CRYPTO: SHIB), Ethereum (CRYPTO: ETH), and Dogecoin (CRYPTO: DOGE) tokens were losing ground in conjunction with the sell-off momentum. They were down roughly 5%, 2.1%, and 1.6%, respectively, over the previous 24 hours of trading as of 10:15am Sunday.

Nearly every top-100 cryptocurrency token has seen sell-offs over the last day of trading. In fact, excluding stablecoins, only TRON‘s token was in the green over the period.

So what?

Investors have been taking money off the table lately and moving out of investments that have high-risk profiles, and it’s led to major pullbacks that have shaped the overall momentum for cryptocurrencies and stocks. To put the trend in perspective, the tech-heavy Nasdaq Composite index just had its worst month since 2008, and rising bearish sentiment is also shaping trading in the crypto space. 

It’s also possible that recent comments from Berkshire Hathaway‘s CEO Warren Buffett and vice chairman Charlie Munger are factoring into the sell-off. Berkshire held its shareholder meeting in Omaha yesterday, and the executives made some scathing comments about Bitcoin (CRYPTO: BTC) and the cryptocurrency market as a whole. Speaking on the current crypto market leader, Buffett had this to say: “If you told me you owned all the Bitcoin in the world and you offered it to me for $25, I wouldn’t take it. What would I do with it?”

While bearish comments from the two Berkshire luminaries are nothing new, it’s possible that the latest round of critiques from the pair have been particularly resonant amid the current market conditions. Worrying levels of inflation have the Federal Reserve on track to raise interest rates well above current levels before the year is out, and rising rates have typically meant a challenging backdrop for speculative investments. 

Many investors and analysts have raised the concern that rising interest rates could push the US economy into recession because loans becoming more expensive will make businesses less likely to pursue new growth initiatives. The same general principle can be applied to buying stocks and cryptocurrencies. When taking on debt is cheap, some of that capital flows into relatively high-risk assets and stocks. When rates are higher, those kinds of investments typically become less attractive.

Now what?

In some respects, the current macroeconomic situation is without recent historical precedent to draw comparisons to. The cryptocurrency market also remains relatively young in the scheme of things, and that makes it difficult to forecast how it will perform if economic conditions worsen significantly. 

The Department of Commerce recently published a report showing that the US economy had contracted 1.4% year over year in the first quarter. Given that the Fed only implemented a 25 basis point rate increase in the middle of March, the fact that gross domestic product unexpectedly slipped in the quarter while inflation continued to run hot is concerning, and it could point to a tough backdrop for cryptocurrencies and other high-risk investments going forward. 

While Ethereum provides a blockchain network that applications and services can be built on, cryptocurrencies like Shiba Inu and Dogecoin primarily function as mediums of exchange and as speculative assets. That suggests that Ethereum’s Ether token might hold up relatively well if turbulence continues to roil the broader crypto market, but again, there’s not a whole lot in the way of historical precedent to base projections on. 

Bitcoin kicked off the cryptocurrency trend with its release back in 2009, but even the current crypto market leader didn’t start to see significant adoption until years later. Outside of the pandemic market-driven crash that occurred in March 2020, in which leading cryptocurrencies performed worse than stocks before roaring back to big gains, there’s not much to look at when it comes to determining how digital tokens might fare amid intense bearish conditions. As such, it’s probably best to move forward with the understanding that most cryptocurrencies are high-risk, high-reward investments.

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

The post Why Shiba Inu, Ethereum, and Dogecoin are sinking today appeared first on The Motley Fool Australia.

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Keith Noonan 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 Berkshire Hathaway (B shares), Bitcoin, and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), short January 2023 $200 puts on Berkshire Hathaway (B shares), and short January 2023 $265 calls on Berkshire Hathaway (B shares). The Motley Fool Australia has recommended Berkshire Hathaway (B shares). 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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Experts are liking the look of some ASX lithium shares. The growing interest in lithium stocks comes on the back of escalating lithium prices on global markets over the past year.

In fact, one Australian lithium miner has just achieved a price of US$5,650 per dry metric tonne of spodumene concentrate through a Battery Material Exchange (BMX) auction.

Here are two lithium ASX shares rated as buys by brokers:

Pilbara Minerals Ltd (ASX: PLS)

Pilbara is the business that just benefited from that auction.

The company also said there was a “strong sales price dynamic” during the three months to March 2022. Further, battery grade chemical pricing is suggesting another “significant step-up” in the offtake concentrate sales price during the quarter for the three months to June 2022.

The ASX lithium share said that its production of 81,431 dry metric tonnes for the last quarter was impacted by “resourcing shortfalls” in staff and contractors due to COVID-19 impacts and the tight labour market.

It generated operating flow of $113.9 million and it’s investing in projects to capture more of the lithium value chain. Pilbara said a scoping study has provided preliminary support for the development and construction of a demonstration plant chemicals facility at Pilgangoora, producing value-added lithium phosphate salts through a calcination and refining process.

The broker Citi rates Pilbara as a buy, with a price target of $3.60 because of the strong pricing environment. That implies a potential rise of more than 20%.

Allkem Ltd (ASX: AKE)

Allkem is another ASX lithium share that is benefiting from the rise in the lithium price. Over the last year, the Allkem share price has risen by more than 80%.

This company has a strategy to increase its lithium production threefold by 2026 and maintain a 10% market share of the global lithium market over the next decade.

In the three months to March 2022, Mt Cattlin produced 48,562 dmt of spodumene concentrate, generating revenue of US$143.8 million. The Olaroz lithium facility produced 2,972 tonnes of lithium carbonate with sales of 3,157 tonnes, generating revenue of US$86 million. It said that lithium carbonate prices for the fourth quarter of FY22 are expected to be approximately US$35,000 per tonne.

Allkem’s group gross operating cash margin was approximately US$189 million which, it said, reflected “strong market demand and high sales prices”.

The ASX lithium share said that Olaroz stage 2 reached 77% construction completion with first production expected to commence in the second half of the calendar year. At Naraha, plant commissioning works will occur during the three months to June 2022 with first production expected in the three months to September 2021. Pond construction at Sal de Vida stage 1 started in January and first production is expected in the second half of 2023.

Citi also rates Allkem as a buy, with a price target of $16. That’s a potential rise of 30% over the next year if the broker ends up being right.

The post 2 ASX lithium shares to buy in May 2022: brokers appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• Here are the 3 most heavily traded ASX 200 shares on Friday
• Despite dropping 17% in April, is the Pilbara Minerals share price still overvalued?
• Why Cettire, Newcrest, Silver Lake, and Whispir shares are tumbling lower
• Why AMP, Fortescue, Pilbara Minerals, and Sandfire shares are racing higher

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 Liontown Resources Limited (ASX: LTR) share price is trading lower on Monday despite the release of a positive update.

At the time of writing, the lithium developer’s shares are down 3.5% to $1.41.

Why is the Liontown share price falling on Monday?

Investors have been selling down the Liontown share price on Monday after broad market weakness offset the release of a positive update out of the lithium miner.

In respect to the latter, this morning the company confirmed that it has executed its first definitive full-form offtake agreement for the supply of lithium spodumene concentrate from the Kathleen Valley Lithium Project in Western Australia.

According to the release, LG Energy Solution (LGES) has signed a five-year deal and agreed to purchase 100,000 dry metric tonnes (dmt) of lithium spodumene in the first year. This will then increase to 150,000 dmt per year in subsequent years, which represents almost one-third of the project’s start-up SC6.0 production capacity of ~500,000 tonnes per annum.

LGES is a global leader in delivering advanced lithium-ion batteries for electric vehicles (EVs), mobility and IT applications, and energy storage systems.

In addition, the release reveals that pricing will be determined using a formula-based mechanism referencing market prices for battery-grade lithium hydroxide monohydrate.

Both volume and pricing are in line with what was agreed by the two parties in a term sheet announced by Liontown in January.

Management commentary

Liontown’s Managing Director and CEO, Tony Ottaviano, was pleased to see the talks progress to a full form agreement.

He commented: “We are delighted to have concluded negotiations with LG Energy Solution allowing us to execute our first full form Spodumene Concentrate Offtake Agreement for up to 30% of our production. This establishes the foundation for a long-term partnership and we are proud that we will be supplying lithium from the Kathleen Valley Project to LGES, a respected global leader in the lithium battery value chain.”

The post Liontown Resources share price tumbles despite lithium update appeared first on The Motley Fool Australia.

More reading

• Here are the 3 most heavily traded ASX 200 shares on Wednesday
• Why is it such a mixed day of trade for ASX lithium stocks?
• What are the 10 biggest ASX shares in the lithium space
• Why has the Liontown share price tumbled 20% in 8 days?
• Which ASX lithium shares does Macquarie tip to outperform?

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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Experts have rated the two ASX dividend shares in this article as a buy. That means that brokers think the share price is attractively valued and the projected dividend yield is relatively high.

Businesses that pay a sizeable part of their profit out each year as a dividend can provide investors with elevated income.

Here are two businesses that are buy-rated:

Inghams Group Ltd (ASX: ING)

Inghams is one of the biggest poultry businesses in Australia. In the first half of FY22, the company’s core poultry volume was 237.1kt [kilotons]. To put into context how much poultry we’re talking about, one kt is equivalent to 1,000 metric tonnes.

The company’s shares are currently rated as a buy by the broker Credit Suisse, with a price target of $4.05. In FY23, the broker is expecting Inghams to pay a grossed-up dividend yield of 8.6%.

The ASX dividend share’s FY22 first half reflected the “resilience” of the business, according to management, as well as the “ongoing benefits of the company’s continuous improvement program”.

Inghams has faced COVID-19 impacts, like many other businesses. However, the company is confident about the future as the impacts of the Omicron variant recede. Inghams has dealt with “significant” cost pressures with overtime, transport, and compliance costs.

HY22 saw underlying net profit after tax (NPAT) growth of 5.9% to $39.7 million, though the first few weeks of the second half saw the company’s profitability hit by Omicron impacts.

Nick Scali Limited (ASX: NCK)

Nick Scali is one of the largest furniture businesses in Australia. It operates both Nick Scali and Plush-Think Sofas, after acquiring this business.

It’s currently rated as a buy by the broker Citi, with a price target of $17.60. That implies a potential rise of around 70% over the next year.

Citi was impressed by the FY22 half-year result.

Nick Scali reported in HY22 that net profit (only) fell by 6.6% to $35.6 million. The Nick Scali division saw its gross profit margin rise by another 30 basis points to 64.3%.

The outstanding order bank at the end of January 2022 was 70% higher than in the previous year and the ASX dividend share’s suppliers have reinstated normal lead times, which “should facilitate revenue growth over the coming months”.

Nick Scali has a long-term target of at least 85 Nick Scali stores and 90 to 100 Plush stores.

Online sales are another area of potential profit growth for the business. They offer a relatively high earnings before interest and tax (EBIT) margin compared to the rest of the business. In HY22, Nick Scali’s online revenue was $13.7 million, generating an incremental $8 million EBIT contribution.

However, in a trading update, Nick Scali said that trading in January in Nick Scali stores was down 6% due to a 25% decline in store traffic.

Citi is expecting Nick Scali to pay a grossed-up dividend yield of 10.5% in FY22.

The post 2 buy-rated ASX dividend shares that experts like appeared first on The Motley Fool Australia.

More reading

• 2 ASX dividend shares to buy this month: expert
• Be as overweight ‘as you can possibly stomach’ in ASX shares right now: fundie

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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Motley Fool Australia Chief Investment Officer Scott Phillips joined Peter Overton on Nine’s Late News on Sunday night to discuss the big economic week ahead, including the RBA’s big rates decision, job ads, retail sales, and a soft start to the week for the ASX.

[youtube https://www.youtube.com/watch?v=mJqxoUXH35o?feature=oembed&w=500&h=281]

The post Buckle up! Rates, jobs and more. The biggest economic week in ages: Scott Phillips on Nine’s Late News appeared first on The Motley Fool Australia.

More reading

• Here are 2 ASX tech shares to buy according to brokers
• These were the best performing ASX 200 shares in April
• Buy these 2 impressive ASX shares in May 2022: experts
• NAB share price drops amid AUSTRAC update
• Own Newcrest shares? Here’s how the share price performed in April

Motley Fool contributor Scott Phillips 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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ASX tech shares could be attractive investments, according to some of Australia’s leading investment brokers.

The first few months of 2022 have seen volatility pick up on the ASX amid strong inflation and the prospect of rising interest rates.

After the recent declines, brokers think these two ASX tech shares are opportunities.

Booktopia Group Ltd (ASX: BKG)

Since the start of the 2022 calendar year, the Booktopia share price has dropped around 50%.

The company has seen revenue continue to grow, however profitability declined in the first half of FY22. It said that revenue increased by 15.5% to $130 million, while earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 49% to $4.1 million.

Booktopia explained that first-half revenue and profit were impacted by the Sydney lockdowns. Its distribution centre is located in one of the areas of Sydney that saw the most restrictive lockdowns. The company decided to limit marketing and forego sales to focus on protecting employees and comply with government regulations.

Management said that operations have largely returned to a more normal environment and the business can “now resume strong revenue growth but with a renewed focus on improving earnings” without compromising areas required to support longer-term growth.

The ASX tech share is aiming to secure a market share of the growing online book market.

It’s currently rated as a buy by the broker Morgans, with a price target of $1.85. That’s around 160% higher than where it is today.

Life360 Inc (ASX: 360)

Life360 operates a platform for families with features including communications, driving safety, and location sharing.

In its latest quarterly update, it said that it achieved 63% year-on-year growth in subscription revenue. Annualised monthly revenue has increased to US$166.1 million. Monthly active users increased 36% year on year to 38.3 million, an 8% increase quarter on quarter.

Average revenue per subscription (including Tile and Jiobit) increased 16% year on year, with 15% growth for the ‘core’ Life360 business.

However, the ASX tech share did announce that its US dual listing plans have ceased.

Management said that there were highly encouraging trial results of the Tile upsell offer, which led to a 35% uplift in Life360 subscriptions compared to the control group.

Life360 is accelerating the integration of Tile and Jiobit (tracking devices) to deliver targeted sustainable cash flow by late 2023. The company expects 2024 to be the first full year of positive cash flow.

In 2022, the tech company expects its core Life360 subscription revenue to rise more than 50%. It expects consolidated revenue to be in a range of between US$245 million to US$275 million. And it expects underlying EBITDA to be a loss of between US$32 million to US$38million.

Life360 is currently rated as a by the broke Morgan Stanley, with a price target of $8.60.

The post Here are 2 ASX tech shares to buy according to brokers appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• Why analysts say investors should buy these beaten down ASX shares
• These were the worst performing ASX 200 shares last week
• Here’s why ASX 200 tech shares are having such a stellar end to the week
• Why Appen, Block, Life360, and Northern Star shares are dropping

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 Life360, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Booktopia Group Limited. 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 S&P/ASX 200 Index (ASX: XJO) ended its winning streak in April. The benchmark index shed 0.9% of its value during the month to end it at 7,435 points.

Fortunately, not all shares dropped with the market. Here’s why these were the best performers on the ASX 200 in April:

Ramsay Health Care Limited (ASX: RHC)

The Ramsay Health Care share price was the best performer on the ASX 200 in April with a sizeable 24.5% gain. Investors were buying the private hospital operator’s shares after it received a takeover approach from a consortium led by KKR. The consortium has tabled a non-binding $88.00 cash per share offer to acquire the private hospital operator. This will be reduced by any dividends paid. Ramsay has granted the consortium due diligence access.

GrainCorp Ltd (ASX: GNC)

The GrainCorp share price was on form and charged 21.7%. This was despite there being no news out of the grain exporter. However, with global grain prices reaching 25-year highs recently, it appears as though investors are confident that GrainCorp will (at least) deliver on its recently upgraded earnings guidance for FY 2022.

AMP Ltd (ASX: AMP)

The AMP share price wasn’t far behind with a gain of 20.2% last month. This was driven by the announcement of a number of sale agreements for its private markets business, Collimate Capital. This culminated in the announcement of an agreement to sell its international infrastructure equity business to DigitalBridge for up to A$699 million late in the month. In total, the deals value the total Collimate Capital business at up to A$2.04 billion including the value of retained assets, and up to A$2.5 billion when including the maximum earnouts. AMP intends to return the majority of the sale proceeds to shareholders.

Viva Energy Group Ltd (ASX: VEA)

The Viva Energy share price was on form and raced 19.6% higher during the month. Investors were buying the fuel retailer’s shares after its positive form continued during the first quarter. Viva Energy reported a 9% increase total group volumes despite battling mobility restrictions caused by the floods. In addition, Viva Energy reported a big improvement in its Geelong Refining Margin. This went down well with UBS, which retained its buy rating and lifted its price target to $2.95.

The post These were the best performing ASX 200 shares in April appeared first on The Motley Fool Australia.

More reading

• Direct indexing: What is this latest investing fad?
• 5 things to watch on the ASX 200 on Monday
• These were the worst performing ASX 200 shares last week
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• 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 Ramsay Health Care 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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Experts currently have a very favourable opinion about some impressive ASX shares. May 2022 could be the month to jump on some of these stocks.

Businesses that are growing revenue and profit at a double-digit rate could be opportunities after their recent declines.

Here are two such buy-rated ASX shares:

REA Group Limited (ASX: REA)

REA Group claims to be the leading property portal business in Australia with realestate.com.au.

It also has several other property-related digital assets including realcommercial and flatmates as well as investments in a number of international sites in Asia and the US.

Since the start of 2022, the REA Group share price has fallen almost 25%.

The ASX share has been growing profit and is seeing a recovery in listing volumes. In the FY22 first half, the company reported an “exceptional” performance. Core operations saw revenue growth of 37% to $590 million and net profit after tax (NPAT) growth of 31% to $226 million.

Its US investment Move Inc saw revenue growth of 19%, while REA India revenue growth was 125%.

In the first half of FY22, national residential listings were up 17%. January 2022 saw national residential listings rise another 14% year on year.

REA Group is rated as a buy by the broker Morgan Stanley, with a price target of $178. That’s an upside of around 40%.

Volpara Health Technologies Ltd (ASX: VHT)

Volpara is a ASX healthcare technology share. It provides software for breast screening as well as administration tools for clinics.

The Volpara share price has fallen almost 20% in 2022.

The company has built up a market position in the US with coverage of 35.5% of women being screened at 31 March 2022.

This ASX share generates a large amount of its revenue from subscriptions through a software as a service (SaaS) model. Annual recurring revenue (ARR) is now around NZ$31.8 million. The quarter for the three months to 31 March 2022 showed subscription revenue growth of 39% to NZ$7.5 million, with SaaS client churn remaining “low”.

While the company has a leading position in the US, it is expanding in other regions with contracts. It has signed a distribution deal with IMS Giotto in Italy. Multiple orders are in place, with the possibility of up to 100.

It has also signed its first deal in the Middle East with Cleveland Clinic Abu Dhabi, which was recently named the top hospital in the UAE.

The company has a very high gross profit margin. In the FY22 first half, its gross margin was 91.4%.

Volpara is working on growing its average revenue per user (ARPU) by selling more modules to clients. It is also working on its lung cancer screening opportunity.

It’s rated as a buy by the broker Morgans with a price target of $1.94.

The post Buy these 2 impressive ASX shares in May 2022: experts appeared first on The Motley Fool Australia.

More reading

• 2 highly rated blue chip ASX 200 shares brokers rate as buys
• 2 ASX 200 shares Goldman Sachs rates as buy
• 2 rapidly growing ASX shares that are on sale: experts
• Volpara share price slips despite milestone CEO change
• 2 highly rated ASX 200 shares analysts are tipping as buys

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 VOLPARA FPO NZ. The Motley Fool Australia has positions in and has recommended VOLPARA FPO NZ. The Motley Fool Australia has recommended REA Group 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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In morning trade, the National Australia Bank Ltd (ASX: NAB) share price is in the red.

At the time of writing, the banking giant’s shares are down over 1% to $32.24.

Why is the NAB share price in the red?

The NAB share price is falling on Monday after the bank released an update on its AUSTRAC investigation.

According to the release, NAB has entered into an Enforceable Undertaking (EU) with the government financial intelligence agency.

This follows an enforcement investigation undertaken by AUSTRAC, which commenced in June 2021, in relation to NAB’s compliance with Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) laws.

Under the terms of the EU, NAB is required to:

• Complete a Remedial Action Plan (RAP) approved by AUSTRAC by 31 December 2024
• Address to AUSTRAC’s satisfaction any deficiencies or concerns with activities in the RAP identified by AUSTRAC
• Appoint an AUSTRAC-approved External Auditor who will provide a final report by 31 March 2025.

Taken longer to fix that ‘it should have’

NAB’s CEO, Ross McEwan, acknowledged that it has taken the bank longer than it should have to fix its AML/CTF issues.

He explained:

“We take our AML/CTF obligations very seriously. We acknowledge the concerns that led to AUSTRAC’s investigation. We will continue to work closely with AUSTRAC as we deliver the agreed further actions.

“We recognise it has taken us longer to fix the concerns raised than it should have. We welcome AUSTRAC’s acknowledgement that NAB has undertaken significant work to date – and we accept that there is more to do.

Mr McEwan highlights that the money laundering threat is evolving at an incredible rate and NAB is making it a priority to address this.

He commented:

“It is essential that everyone in our bank is focussed on getting the basics right, every time, and keeping our customers and bank safe. Keeping criminals out of the financial system is a top priority for NAB. We recognise our opportunity to better detect, deter and disrupt the flow of illegal money at a time when the threat is evolving at an incredible rate.

“We have a plan to make our bank simpler for customers to use, while safeguarding against the criminal threat. The EU provides a clear timeline as we further build capability, increase resourcing, continue to modernise our systems and improve controls and governance.”

The post NAB share price drops amid AUSTRAC update appeared first on The Motley Fool Australia.

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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. 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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