Day: 1 June 2022

The Bitcoin (CRYPTO: BTC) price finished the final day of May on a positive note, up 4% from the previous day to US$31,685 (AU$43,865).

But that last minute rally wasn’t enough to stem some hefty losses incurred earlier in the month, leaving the Bitcoin price down 17% since 1 May. The world’s top token by market cap is now down 36% year-to-date.

In a sign of the ongoing volatility that comes with crypto investing, the Bitcoin price hit a high of US$39,903 in May and plumbed lows of US$26,350, according to data from CoinMarketCap.

So why did it end the month down 17%?

US Fed sent Bitcoin price spiralling lower

Much of the pressure facing Bitcoin and most every crypto has come from rising inflation and the resulting interest rate hikes.

This has seen risk assets, like cryptos and high growth tech shares, come under heavy selling pressure.

On 6 May, the Bitcoin price tumbled 11%. This followed on the US Fed’s 0.50% interest rate increase in the world’s biggest economy, which also saw the tech-heavy Nasdaq lose 5% in a single day.

Commenting on that selloff at the time, Valkyrie Investments head of research Josh Olszewicz said:

Bitcoin has become increasingly correlated with US trading hours and US traditional market indices, likely due to a combination of increasing US institutional presence as well as the absence of China after the sweeping bans last year.

Warren Buffett and Charlie Munger sure didn’t help

The Oracle of Omaha, Warren Buffett, and his long-time partner at Berkshire Hathaway, Charlie Munger, are well known for their general disdain of cryptos.

But with the Bitcoin price already under pressure, the closely-followed billionaire investors surely didn’t spark a bull run with their comments at their annual shareholder meeting early in May.

Munger led the charge saying:

When you have your own retirement account and your friendly adviser suggests you put all your money into Bitcoin, just say no… In my life, I try and avoid things that are stupid and evil and make me look bad in comparison with somebody else. Bitcoin does all three.

Bitcoin price fell sharply amid Terra stablecoin collapse

Another blow to the Bitcoin price in May was the collapse of Terra.

On 12 May, Australians woke to the news that a top-ranked stablecoin – TerraUSD (CRYPTO: UST) – had lost its peg to the US dollar. Over the following days, UST would drop to as low as 10 US cents.

The token meant to help UST maintain that US$1 peg – Terra (CRYPTO: LUNA) – fell even harder, losing more than 99% of its value.

The collapse sent almost every top crypto into the red. The Bitcoin price dropped 5% to US$29,830.

And with fewer tailwinds than headwinds in May, it finished the month well into the red.

The post Down 17%, what went so wrong for the Bitcoin price in May? appeared first on The Motley Fool Australia.

More reading

• Bitcoin price decouples from tech shares, but not as hoped
• Why Bitcoin, Dogecoin, and Shiba Inu are falling today
• This is the top performing crypto in 2022 so far, and it sure isn’t Bitcoin
• What do NFTs mean for the gaming industry?
• Looking to spend your crypto? Here are 5 things you can buy in 2022

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin. The Motley Fool Australia has positions in and has recommended Bitcoin. 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) was well and truly out of form in May. Over the month, the benchmark index fell a disappointing 3% to 7,229 points.

Fortunately, some shares were able to defy the selloff and storm higher. Here’s why these were the best performers on the ASX 200 last month:

PolyNovo Ltd (ASX: PNV)

The PolyNovo share price was the best performer on the ASX 200 last month with a 30.5% gain. The catalyst for this gain was the release of a large number of announcements revealing that the medical device company’s chairman, David Williams, was buying shares through on-market trades. However, this hasn’t spooked short sellers, who continued to increase their holdings during the month.

Allkem Ltd (ASX: AKE)

The Allkem share price was on form and charged 11.9% over the period. This appears to have been driven by optimism that lithium prices will remain higher for longer. Particularly after a rival’s spodumene concentrate digital auction received a new record winning bid. This was the fourth consecutive increase in prices and well ahead of expectations.

Codan Limited (ASX: CDA)

The Codan share price wasn’t far behind with a 10.8% gain last month. This was driven by the release of the metal detector focused technology company’s trading update and guidance for FY 2022. Codan revealed that business is booming and it expects to match its record first-half profit in the second half. This would mean a record full-year profit of $100 million, which will be a 56% increase year on year.

Mineral Resources Limited (ASX: MIN)

The Mineral Resources share price was a positive performer and rose 9.1% in May. Investors were buying this mining and mining services company’s shares due to its exposure to two hot commodities – iron and lithium. With both commanding high prices, investors appear to be betting on strong profits in the coming years. A note out of Credit Suisse is also likely to have given its shares a boost last month. The broker initiated coverage on the company’s shares with an outperform rating and $73.00 price target.

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

More reading

• What went wrong for the Wesfarmers share price in May?
• 5 things to watch on the ASX 200 on Wednesday
• Why has May been such a great month for the Allkem share price?
• VAS is a unique ETF on the ASX. Here’s why
• 3 junior miners with initial public offerings and ASX floats in June

Motley Fool contributor James Mickleboro has positions in Allkem Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended POLYNOVO FPO. 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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Welcome to June and winter. Since it is the first day of a new month (and season in this case), it’s a good opportunity to reflect on the month that was, and see how some of the ASX’s most prominent shares fared. So today, let’s examine why the ASX 200 retail and industrial conglomerate Wesfarmers Ltd (ASX: WES) share price had such a dreary month last month.

Wesfarmers shares had a painful May, no way around it. The company began May at $49.41 a share, but finished up yesterday at a price of $47.19 apiece. That represents a one-month fall of 4.49%. Not that the S&P/ASX 200 Index (ASX: XJO) had a good month, mind you. The ASX 200 lost 3.01% over the same period. But still, that makes Wesfarmers a market-losing ASX share over the month just gone.

So what went wrong for Wesfarmers over May? Well, it’s not entirely clear. Wesfarmers released no major news, reports, or announcements over the month.

Why were ASX investors taking the Wesfarmers share price to the cleaners in May?

However, we can point to one event that may have dictated this miserly May performance. On 19 May, the Wesfarmers share price was smashed, falling almost 8% in one day. This was devoid of any company-specific news. However, it did coincide with similar moves across the ASX retail space.

As my Fool colleague Brooke dug into at the time, this sector-wide rout “[seemed] to have been spurred by United States retail monoliths Target Corporation (NYSE: TGT) and, to a lesser degree, Walmart Inc (NYSE: WMT)”.

At the time, Target (the US retailer, not the Wesfarmers subsidiary) had just dropped a disappointing quarterly earnings report. This contained a revelation that the company’s earnings per share (EPS) had dropped a staggering 48%. Walmart had also given its own investors a disappointing update the day before that.

Most US retailers were sold off heavily on this news, with the pessimism spilling over the Pacific to the ASX and our own ASX retail sector. After this mid-month drop, the Wesfarmers share price did recover somewhat. But it wasn’t enough to stem the losses from that one-day shocker. As such, this seems to be the primary reason why the Wesfarmers share price underperformed the ASX 200 over May and delivered investors such a miserly return.

At the last Wesfarmers share price, this ASX 200 retailer had a market capitalisation of $53.51 billion with a dividend yield of 3.6%

The post What went wrong for the Wesfarmers share price in May? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• VAS is a unique ETF on the ASX. Here’s why
• 3 junior miners with initial public offerings and ASX floats in June
• Why did the BHP share price jump in May?
• Why the decision to keep AGL as one makes sense: expert

Motley Fool contributor Sebastian Bowen has positions in Walmart Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Target. 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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Ask A Fund Manager

The Motley Fool chats with the best in the industry so that you can get an insight into how the professionals think. In this edition, Shaw and Partners senior investment advisor Adam Dawes examines three potential bargains.

Cut or keep?

The Motley Fool: A2 Milk Company Ltd (ASX: A2M) has lost around 40% since October. Would you cut or keep it?

Adam Dawes: So A2 Milk has been a definite under-performer.

[But] I like the whole idea of Dogs of the Dow theory, where last year’s stocks that were underperforming are going to be this year’s stocks that are going to perform quite well. 

I think A2 Milk has shown to the market that potentially the daigou [Chinese reseller] channel was a lot more than what they originally expected it to be. And that daigou channel was what we thought was not going to be a lot of their revenue, but now we worked out that it is a fair bit of their revenue going forward. So I think that channel definitely has hurt them. 

And obviously COVID has definitely hurt them as well. 

I think management is very, very good in A2 Milk. So I’d be okay to hold A2 Milk going forward.

It’s a business that will continue to do well and I think it’s a business that overall has a lot of promise because now I think it’s been rebased, it’s settled down and the market has grappled with potentially that revenue from that daigou channel that’s not there anymore. 

So I’m happy to hold. I wouldn’t sell it.

MF: How about Magellan Financial Group Ltd (ASX: MFG), which has lost 65% since August?

AD: This one is an interesting one because generally there is this whole side of what goes on with the business and the re-rating. Basically it comes down to three profit downgrades, a management change, and then… potentially the new management will get all the skeletons out of the closet and then continue to move from there. 

So Magellan’s one of those ones where we’ve had that three downgrades, we’ve had the management change. So if that rebasing is about to happen. 

For me, it’s definitely a hold. 

But the concern is that when the new management comes out and potentially reduces the fees — because Magellan is quite high in their overall management fees, if Magellan reduces those fees, it’s a sell.

At the moment the funds are underperforming. There’s a lot of cash that’s sitting there as far as those funds, they’re soaking up that cash and they’re hopefully getting that performance back up and on track, but the new management potentially will come in and reduce those fees. If they do that, then it’s a sell because you are not going to get as much revenue going forward. You’re not going to get as much revenue or money coming in. 

So I’d be really cautious about Magellan. It’s a hold, definitely here for where we are around $14, $14.50, $15. I think it’s definitely a hold. 

But if new management comes in and reduces those fees, then it’s definitely a sell for me.

MF: Hold onto it, but really keep a close eye on it.

AD: Absolutely.

MF: Life360 Inc (ASX: 360) shares have been slaughtered this year. What should we do? 

AD: Look, this one’s an interesting one because Life360 is certainly back in the green, after the company redressed its 2022 guidance. And putting it out there, I think this company is a takeover target. No doubt about it.

Because of its subscription revenue, that’s grown by more than 50% this year. So I think it’s actually one of those ones that will do quite well. Life360 boasts more than 40 million active users per month and 25 million of those, which was in the US. And it’s got 1.3 million paying circles at the end of April. That’s up from the previous corresponding period. 

But it’s been a rough space and a rough time because the share price has obviously tumbled more than 60% since the start of the year. And it’s fallen 25%, since this last time, this year as well.

So I think overall Life 360 is an interesting business. I think you’ve got to be careful, but I think it’s a takeover target.

You never buy a stock for a takeover, right? You never do that, but I think [if you’ve already got it], you’d hold onto it. 

I don’t think it’s a sell because I think the tech space is definitely for a rerating at the moment, [with the] Nasdaq Composite (INDEXNASDAQ: .IXIC) down 26% or whatever it is today year to date. 

I think there’s some value that’s started to come into that space and the likes of Xero Limited (ASX: XRO), the likes of 360, there’s some value there because of what they’ve actually got, that user base. 

And [Life360] actually does make money. It’s just not what the valuations were six months ago to a year ago. So I’d be a little bit careful, but I think Life 360 has got the user base, it’s got the revenue coming through the door and is potentially a takeover target down the track.

The post What to do with these 3 pummelled ASX shares: advisor appeared first on The Motley Fool Australia.

More reading

• Can A2 Milk shares cash in on a US deal like Bubs?
• Can the Magellan share price stage a comeback in June?
• ASX 200 midday update: Beach, Santos rise but EML, Zip tumble
• 3 ASX 200 shares off to a cracking start to the week
• Why Alkane Resources, Block, Bubs, and Telix shares are storming higher

Motley Fool contributor Tony Yoo has positions in Life360, Inc. and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360, Inc. and Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool Australia has recommended A2 Milk. 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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Shares in Kogan.com Ltd (ASX: KGN) have endured a stretch of dampened sentiment, dating back to October 2020. This is despite the eCommerce company bringing New Zealand-based Mighty Ape under its arm, which now accounts for ~20% of gross profits.

Disappointingly, the founder-led business has swung into unprofitability. However, this has been partially attributed to increased inventory. Ongoing issues within the supply chain have forced many retailers to choose whether to order in advance and risk oversupply, or to run inventory-light and potentially miss out on some sales.

The challenging balancing act has left many investors uninterested in holding Kogan shares. Yet, Kogan is not alone in this struggle — so, could the fundamental case for the company still be intact?

What other retailers are stocking up?

In April 2021, Kogan informed the market that it had mismatched its inventory levels with customer demand. As a result, the company incurred higher warehousing costs due to the storage of excess inventory.

For context, it was revealed in the FY21 results that Kogan’s inventory had increased 102% from $112.9 million to $227.9 million. As of December 2021, the online retailer had managed to decrease this by ~14% to $196.8 million. Further, this amount was quoted to be $193.9 million at the end of March 2022 — indicating further improvement.

Meanwhile, many other retailers (including online ones) have experienced a significant increase in inventories year-over-year. Take a look at the table below:

Company	Inventory change (YoY)	Price change (YoY)
Cettire Ltd (ASX: CTT)	+517%	-69.4%
Mydeal.com au Ltd (ASX: MYD)	+287%	+47.1%
City Chic Collective Ltd (ASX: CCX)	+158%	-47.5%
Lovisa Holdings Ltd (ASX: LOV)	+68%	+7.7%
Adairs Ltd (ASX: ADH)	+49%	-51.7%
Nick Scali Ltd (ASX: NCK)	+48%	-19.4%
Amazon.com Inc (NASDAQ: AMZN)	+47%	-28.5%

As we can see from the above, inventories across many reputable retailers have jumped compared to a year ago. At the same time, most of those in the table above have also experienced share price weakness, much like Kogan shares have.

In fact, the biggest online retailer of them all — Amazon — reported a US$3.8 billion net loss in the first quarter.

What does it mean for Kogan shares?

From my own assessment, the inventory data illustrates that Kogan has been sold off partly on an issue that is widespread in the retailing industry at the moment. Already, the company has demonstrated it is right-sizing to where it should be.

Today, the Kogan share price is at levels not seen since March 2019. Meanwhile, active customers have increased by nearly 2.5 times to 4 million from that time.

For these reasons, I personally think Kogan shares make an attractive proposition. Ultimately, I’ll be looking for further improvement in inventory and EBITDA margins in the next update.

The post Stocked up: Kogan shares are not alone in their inventory woes 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
• These ASX All Ordinaries shares have the greatest margin risks from surging inflation: UBS
• Why is the Kogan share price leaping 5% today?
• These are the 10 most shorted ASX shares

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Mitchell Lawler owns shares in Kogan.com ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended ADAIRS FPO, Amazon, Cettire Limited, and Kogan.com ltd. The Motley Fool Australia has positions in and has recommended ADAIRS FPO and Kogan.com ltd. The Motley Fool Australia has recommended Amazon, Cettire Limited, and Lovisa Holdings 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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On Tuesday, the S&P/ASX 200 Index (ASX: XJO) was out of form and tumbled notably lower. The benchmark index fell 1% to 7,211.2 points.

Will the market be able to bounce back from this on Wednesday? Here are five things to watch:

ASX 200 expected to fall again

The Australian share market looks set to extend its losses on Wednesday following a poor night of trade in the US. According to the latest SPI futures, the ASX 200 is expected to open the day 34 points or 0.5% lower this morning. On Wall Street, the Dow Jones fell 0.7%, the S&P 500 dropped 0.6%, and the Nasdaq was down 0.4%.

BHP demerger

Today is payday for eligible BHP Group Ltd (ASX: BHP) shareholders. This morning the mining giant is scheduled to complete its demerger and pay shareholders new shares in Woodside Energy Group Ltd (ASX: WDS). Shareholders will receive one new Woodside share for every 5.534 BHP shares they owned on the ex-dividend date.

Oil prices mixed

Energy producers such as Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) will be on watch after a mixed night for oil prices. According to Bloomberg, the WTI crude oil price is down slightly to US$115.04 a barrel and the Brent crude oil price has risen 1% to US$122.84 a barrel. The latter was boosted by the EU banning most Russian oil imports.

AVZ Minerals shares due to return

The Avz Minerals Ltd (ASX: AVZ) share price is scheduled to return from its lengthy suspension on Wednesday. The lithium developer is currently battling legal action from a Chinese company that claims it owns a stake in the Manono Lithium project. There are fears that AVZ could end up owning as little as 36% of the project.

Gold price tumbles

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a difficult day after the gold price tumbled overnight. According to CNBC, the spot gold price is down 1% to US$1,833 an ounce. The precious metal tumbled after bond yields widened, reducing its appeal.

The post 5 things to watch on the ASX 200 on Wednesday appeared first on The Motley Fool Australia.

More reading

• VAS is a unique ETF on the ASX. Here’s why
• Could another demerger be on the cards for BHP shares?
• 3 junior miners with initial public offerings and ASX floats in June
• Here are the 3 most traded ASX 200 shares on Tuesday
• Why Argosy, Arafura, Beach, and De Grey Mining shares are rising

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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Last month brought with it pretty frosty conditions for many ASX investors. But, will the storm clouds reveal any silver linings as we approach the end of the financial year in June? For their thoughts, we asked our Foolish contributors to compile a list of the ASX shares they reckon could deliver wealth over the investing rainbow. Here is what the team came up with.

7 best ASX shares for June 2022 (smallest to largest)

• DroneShield Ltd (ASX: DRO), $90.83 million
• BrainChip Holdings Ltd (ASX: BRN), $1.94 billion 
• Corporate Travel Management Ltd (ASX: CTD), $3.23 billion
• Pro Medicus Limited (ASX: PME), $4.41 billion
• Domino’s Pizza Enterprises Ltd (ASX: DMP), $6.15 billion
• Xero Limited (ASX: XRO), $13.35 billion
• National Australia Bank Ltd (ASX: NAB), $102.23 billion

(Market capitalisations as of 31 May 2022)

Why our Foolish writers love these ASX shares

DroneShield Ltd

What it does: DroneShield develops and sells hardware and software for the detection and disruption of drones.

By Bernd Struben: I believe this small-cap ASX share has significant growth potential. The company’s expanding customer base spans some 100 nations, including the United States, which makes up 40% of its revenue and sales pipelines.

Demand for counter-drone technology was already growing before Russia’s invasion of Ukraine. Since then, DroneShield has received numerous inquiries about its equipment from Ukrainian government agencies. While only one shipment has been sent to Ukraine to date, the country could provide additional future growth avenues.

DroneShield reported a cash balance of $8 million as at 31 March. Its latest quarterly figures showed a 32% year-on-year lift in customer cash receipts. The DroneShield share price has rallied 25% in 2022 so far.

Motley Fool contributor Bernd Struben does not own shares of Droneshield Ltd.

BrainChip Holdings Ltd

What it does: BrainChip develops software and hardware-accelerated solutions for advanced artificial intelligence (AI) and machine learning applications.

By Aaron Teboneras: I believe the BrainChip share price is trading in bargain territory after falling by around 12% since the start of last week.

The company is continuing to develop its Akida neuromorphic processor unit hardware product. The Akida chip is designed to think like a human brain and it can be used for a variety of purposes worldwide. These include in the manufacture of smart cars such as the Mercedes EQXX concept car as well as in home automation, unmanned aircraft, medical instruments, cybersecurity, and more.

This broad addressable market provides BrainChip with huge potential to materially grow in the future, particularly given its existing partnership with NASA. BrainChip’s technology reduces the count, size, and power consumption of existing components, which are paramount concerns in spaceflight and aerospace applications

Valued at $1.94 billion, BrainChip is still a relatively emerging company that is looking to dominate the AI market. Should BrainChip be able to deliver on its potential, I think its share price is extremely attractive at its current price of $1.135.

Motley Fool contributor Aaron Teboneras does not own shares of BrainChip Holdings Ltd.

Corporate Travel Management Ltd

What it does: Corporate Travel Management provides business travel management services.

By Brooke Cooper: The Corporate Travel Management share price has slipped by nearly 14% over the last 30 days despite the company releasing a positive update to the market in early May.

Following a series of acquisitions, Corporate Travel expects its monthly revenue in the current quarter to surpass that of 2019, prior to when the COVID-19 pandemic hit. It also has no debt, a strong cash balance, and is recovering faster than the broader corporate travel sector in its key operating regions.

Morgan Stanley is also optimistic about Corporate Travel shares. The broker has slapped the company’s stock with a $30 price target and a buy rating. The Corporate Travel share price closed Tuesday’s session at $22.17.

Motley Fool contributor Brooke Cooper does not own shares of Corporate Travel Management Ltd.

Pro Medicus Limited

What it does: Pro Medicus is a healthcare imaging software provider to a vast range of medical companies across Australia, North America, and Europe.

By Mitchell Lawler: The Pro Medicus share price has been an ultra-performer over the last decade, with the company’s shares increasing in value by more than 100 times. Yet, growth in the company’s underlying business remains as consistent as ever.

For the 12 months ending December 2021, Pro Medicus increased its revenue by 36% year on year. For reference, this is above its five-year compound annual growth rate of 23.2%. Reassuringly, profit margins are showing continual improvement – now at 47% — suggesting economies of scale are at play.

Analysts at Bell Potter currently have a buy on this company with a $55 price target. This represents a potential 30% upside from the current Pro Medicus share price of $42.13.

Motley Fool contributor Mitchell Lawler owns shares of Pro Medicus Limited.

Domino’s Pizza Enterprises Ltd 

What it does: Domino’s is a leading pizza chain operator with over 3,200 stores across the ANZ, Asian, and European markets.

By James Mickleboro: I think the recent weakness in the Domino’s share price has created a buying opportunity for investors in June. That weakness, which has seen the share price fall by around 40% in 2022, has been driven by softness in the Japanese market and overall concerns about inflation impacts.

And while these factors could weigh on Domino’s second-half performance, I believe investors should be focusing more on the company’s long-term growth outlook now. This outlook is, arguably, very positive thanks to management’s plan to double its store network in existing markets to 6,650 stores by 2033.

Combined with its strong balance sheet, which could support further acquisitions, this bodes well for the company’s revenue and earnings growth over the next decade.

Motley Fool contributor James Mickleboro does not own shares of Domino’s Pizza Enterprises Ltd.

Xero Limited

What it does: Xero is a global software business that provides subscribers with cloud accounting and business tools.

By Tristan Harrison: I think Xero is one of the highest-quality S&P/ASX 200 Index (ASX: XJO) shares around right now. Furthermore, the 40% drop in the Xero share price this year makes it look even more attractive.

The business is growing its global subscriber base, which increased by 19% in FY22 to 3.27 million. And, arguably, targeting a truly global addressable market gives the company a long growth runway.

Xero’s services are also very profitable. Its gross profit margin was 87.3% in FY22, allowing the company to re-invest a lot of new revenue into growth activities.

While it’s heavily investing at the moment, over the long term Xero intends to significantly improve its profitability.

Motley Fool contributor Tristan Harrison does not own shares of Xero Limited.

National Australia Bank Ltd

What it does: NAB is one of the big four Aussie banks and commands a significant chunk of the financial products market in Australia.

By Sebastian Bowen: No doubt, NAB is a name and an ASX share that needs little introduction. It’s part of the big-four-banks cohort and holds a prominent position on the ASX 200.

NAB could be worth a look this month as inflation continues to be a defining theme of our current investing climate. Banks are famously inflation-resistant businesses due to their easily adjustable margins.

In addition, NAB’s current fully franked dividend yield is well over 4% (and over 6% grossed-up), meaning inflation is almost covered by this dividend alone. As such, NAB could be worth a look for anyone who is keen to shore up an ASX share portfolio against rising prices in June.

Motley Fool contributor Sebastian Bowen owns shares of National Australia Bank Ltd.

The post Best ASX shares to buy in June 2022 appeared first on The Motley Fool Australia.

More reading

• Down 15% in a month, is the Corporate Travel share price a bargain?
• Why has the BrainChip share price performed so strongly in May?
• 3 ASX shares I’m telling my clients to buy: advisor
• Xero share price charges higher: Can this tech share keep rising?
• Here are 2 top ASX dividend shares to buy according to analysts

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended DroneShield Ltd, Pro Medicus Ltd., and Xero. The Motley Fool Australia has positions in and has recommended Pro Medicus Ltd. and Xero. The Motley Fool Australia has recommended Corporate Travel Management Limited, Dominos Pizza Enterprises Limited, and DroneShield 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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