Stock Pick

  • Sonic Healthcare share price pushes higher on FY 2020 guidance update

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    The Sonic Healthcare Limited (ASX: SHL) share price is pushing higher on Wednesday after the release of a trading update.

    At the time of writing the healthcare company’s shares are up almost 3% to $29.76.

    What did Sonic Healthcare announce?

    After withdrawing its FY 2020 guidance in March because of the pandemic, this morning the company revealed that it is now in a position to provide guidance once again.

    Management notes that its trading results in March and April were substantially below forecast, but things have picked up since then. In May, its performance was stronger than expected and in June this positive trend has continued.

    As a result of the above, the company expects to report statutory earnings before interest, tax, depreciation, and amortisation (EBITDA) at a similar to level to what it achieved in FY 2019 (excluding the impact of the new lease accounting standard AASB 16). In FY 2019 Sonic reported statutory EBITDA of $1.075 billion.

    Sonic’s CEO, Dr Colin Goldschmidt, was pleased with the way the company performed during the crisis.

    He commented: “Sonic’s global leadership teams have responded magnificently to the Covid crisis, making use of established executive experience, trusted culture, team spirit and wide-open Sonic collaboration channels at national and international level.”

    “Our leaders have shown great flexibility and have adapted rapidly to an entirely new operating environment. Sonic continues to play a crucial frontline role in combating the pandemic, with our laboratories in Australia, the USA and Europe testing thousands of patients per day for Covid-19,” he added.

    What about FY 2021?

    Due to the uncertainty caused by the pandemic, Sonic advised that it is not in a position to provide guidance for FY 2021 at this time. Though, it does intend to provide a further update with the FY 2020 results release in August 2020.

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    Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Sonic Healthcare Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

    The post Sonic Healthcare share price pushes higher on FY 2020 guidance update appeared first on Motley Fool Australia.

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  • Can Novavax’s Huge Rally Continue? This 5-Star Analyst Sees ‘Only’ 25% Upside Ahead

    Can Novavax’s Huge Rally Continue? This 5-Star Analyst Sees ‘Only’ 25% Upside AheadAnyone following the market in 2020 will be aware of the massive gains made by biotechs fighting the coronavirus. For companies in search of a vaccine or treatment, valuations have soared dramatically, as investors have piled in on the hope one can bring a viable solution to market.Among those making headlines, vaccine specialist Novavax (NVAX) has earned its place as one of 2020’s star performers. Based on a 1,658% year-to-date increase, there’s no doubt regarding its success.Yet, Cantor analyst Charles Duncan argues there are more gains on the way. In fact, the 5-star analyst has just increased his price target for the vaccine player by almost 100%.In addition to reiterating an Overweight rating, the price target moves from $45 to $88. There’s upside of "only" 25%, should Duncan’s target be met over the next 12 months. (To watch Duncan’s track record, click here)Novavax is one of the companies developing an experimental COVID-19 vaccine, deeming its candidate NVX-CoV2373. However, the biotech was excluded from the list of five companies chosen to receive support as part of the Trump administration’s Operation Warp Speed program. Along with being further behind in development, a possible reason for the omission was the company’s lack of resources compared to pharma giants such as J&J, Merck and Pfizer. However, Duncan notes recent grants from the CEPI ($384 million in total) and $60 million from the DoD to fund the vaccine’s development, in addition to the sale of 4.4 million shares worth $200 million, have strengthened the balance sheet considerably as well as levelled the playing field.Furthermore, the recruitment of established biotech veterans for the roles of CMO and SVP of Corporate Affairs is another indication that Novavax can compete with more established names.Duncan said, “To us, this trilogy of events enhances our conviction in Novavax’s pipeline potential… As a result of the DoD and CEPI funding and logistical support, we believe that large-scale manufacturing capabilities are being put in place for NVXCoV2373. With assistance from these organizations, it is our belief that potential manufacturers have been identified and that, in conjunction with a tech transfer process that should not be overly complicated, the company can deliver a high quantity of vaccines.”The majority of the Street concurs. Novavax’s Strong Buy consensus rating is based on 5 Buys and 1 Hold. However, after soaring so high over the past few months, the average price target of $56 suggests possible downside of nearly 20% over the coming months. (See Novavax stock analysis on TipRanks)To find good ideas for biotech stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

    from Yahoo Finance https://ift.tt/31evVnB

  • How ASX 200 shares like Xero could help you retire early

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    Buying and holding ASX 200 shares can be a powerful way to build wealth and retire early.

    If equities are to form a crucial part of your retirement plans, obviously selecting the right shares to buy today is extremely important.

    For example, the Xero Limited (ASX: XRO) share price has rocketed more than 400% higher over the last 5 years. Xero is a leading Australian tech company with a specialist, easy-to-use accounting software platform.

    If you’re a long-term investor in this ASX 200 tech share, you’d be sitting on a tidy capital gain right now.

    But Xero isn’t the only company with long-term growth potential on my radar. Here are a couple of my other favourite picks in the current market.

    ASX 200 shares that could help you retire early

    I like the look of NextDC Limited (ASX: NXT) for its potential growth trajectory.

    The NextDC share price is up 51.7% this year alone and 333.9% in the last 5 years. Whilst this could mean NextDC has been overbought, I still think there’s further growth ahead for this Aussie data centre operator.

    NextDC is a leader in the Australian data storage and security space. The ASX 200 tech share has been surging in 2020 as demand for its services has increased.

    NextDC posted a $4.9 million half-year loss in February as it continues to re-invest in the business and fuel expansion plans.

    It’s a risky play, but one that could have a big payoff if successful in the decades ahead.

    Outside of the tech sector, I also like the prospects of Polynovo Ltd (ASX: PNV) right now.

    Polynovo is an ASX 200 company that specialises in the treatment of burns and which also produces other biotechnology solutions. 

    The Polynovo share price is up an impressive 2,644% in the last 5 years including a 25.4% gain in 2020.

    I think despite these gains, Polynovo shares could be set for more growth over the next decade. 

    Polynovo’s NovoSorb product is already active in an addressable $1.5 billion market, but planned applications for hernia devices and breast implants could boost this towards the $7.5 billion mark.

    That leaves a lot of potential growth for the ASX 200 biotech share if it can execute its strategy and capture a larger market share.

    Foolish takeaway

    These are just a couple of ASX 200 growth shares on my radar for building a comfortable retirement. As always, it’s important to consider your own investment horizon and lifestyle goals when it comes to purchasing shares. Also, ensure you maintain a balanced portfolio to help maximise your return whilst minimising your risk exposure.

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    Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Xero. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

    The post How ASX 200 shares like Xero could help you retire early appeared first on Motley Fool Australia.

    from Motley Fool Australia https://ift.tt/2NqIa8o

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