In late morning trade the S&P/ASX 200 Index (ASX: XJO) is on course to record another very strong gain. At the time of writing the benchmark index is up 1.3% to 6,018.3 points.

Four shares that have failed to follow the market higher today are listed below. Here’s why they are dropping lower:

The Austal Limited (ASX: ASB) share price is down over 3% to $3.37. The shipbuilder’s shares have come under pressure since it announced the retirement of its CEO on Wednesday. Austal has found its replacement already, though. Chief Operating Officer, Patrick Gregg, will take over from the retiring David Singleton on 1 January 2021. Until then, Mr Singleton will continue to work closely with his replacement to ensure there is a smooth handover.

The Ecofibre Ltd (ASX: EOF) share price has crashed 7% lower to $2.88. This morning the hemp products company advised that the protests in the United States are expected to impact near term sales in its core Ananda Health business. In light of this, Ecofibre has withdrawn its second half guidance.

The Northern Star Resources Ltd (ASX: NST) share price is down 7% to $13.27. Investors have been selling Northern Star and the rest of the gold miners on Wednesday after the price of the precious metal sank lower. Improving risk appetite is weighing heavily on the price of gold and other safe haven assets. At the time of writing the S&P/ASX All Ordinaries Gold index is down 3.8%.

The Nufarm Limited (ASX: NUF) share price has dropped almost 9% to $5.01. This appears to have been driven by a broker note out of Macquarie this morning. According to the note, the broker has downgraded Nufarm’s shares to an underperform rating with a $4.85 price target. Its analysts appear concerned over the company’s prospects in the important fourth quarter.

More reading

• The latest ASX 200 stocks to be upgraded to “buy” amid the recession
• Why Austal, Evolution, Newcrest, & Pro Medicus are tumbling lower
• 3 cheap ASX manufacturing shares for the supply chain boom
• Forget cheap stocks. Why investors should watch ASX gold shares instead
• These 5 ASX 200 shares were last week’s biggest winners

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Austal Limited. 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 Why Austal, Ecofibre, Northern Star, & Nufarm are dropping lower appeared first on Motley Fool Australia.

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Don’t panic. The racing share market may have you wondering where to invest, but you haven’t missed it yet. There are still plenty of opportunities to buy great shares for income, growth or value. In fact, there are always opportunities. 

If I had $2,000 spare today I would be looking squarely at dividing it between both growth and value opportunities. I believe many of today’s shares are still oversold and represent great value. Personally I would be looking to divide it 25% in growth and 75% in value shares.

Income investing requires a different focus and timeframe, in my experience. 

Where to invest for growth

Of the available growth shares, I would be looking very hard at Zip Co Ltd (ASX: Z1P) even after the recent rise. Growth shares can be a risky business and it is difficult to know where to invest. Today, it’s easy to see that Amazon.com (NASDAQ: AMZN) was going to be a behemoth. It was a lot harder to see it clearly in 2010, though.

In fact, I thought it was overpriced!

At Tuesday’s close, Zip Co was valued at $2.4 billion. A massive leap in two days to be sure. But I believe the company still has a long way to go. Potentially further, even, than Afterpay Ltd (ASX: APT).

Zip has more financial products than Afterpay and a track record of making profits. The recent US acquisition gives it access to a $5 trillion retail market. It may be hard to see now, but in the future, I believe we will think today’s price was cheap. 

Value investing

When considering where to invest for value, I have always looked for undervalued mature growth shares. The COVID-19 pandemic has created this opportunity for us. 

I believe that Altium Limited (ASX: ALU) and Jumbo Interactive Ltd (ASX: JIN) are two really great examples of this. 

Altium, the PCB design software producer, has returned investors over 130 times their initial investment since 2010. Its sales growth in the past two years has been better than the previous 7 years. I believe it is slightly undervalued in the market today.

Jumbo Interactive is one of the great shares on the S&P/ASX 200 (INDEXASX: XJO). It has returned 25 times the initial investment since 2010. Despite this, it had a greater leap in sales last year than in any previous years. In addition, it was forecasting another increase this FY before the coronavirus.

In average times, approximately 75% of lottery sales are via retail outlets. With these closed, but lottery continuing, it is likely they have picked up additional revenues via internet sales.

Foolish takeaway

The ASX is full of cheap value opportunities for people with limited funds who are wondering where to invest. You just need to spend some time looking for them.

More reading

• Why the shares of Afterpay rival Openpay are up 840% since March
• Is the CBA share price cheap today?
• Meet the ASX stocks to benefit from the new $688m home stimulus
• Why Zip Co and these ASX shares just zoomed to new highs
• Should the Xero share price have a P/E ratio of 4,000?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon and Jumbo Interactive Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO, Altium, and ZIPCOLTD FPO and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia has recommended Amazon and Jumbo Interactive 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.

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The Openpay Group Ltd (ASX: OPY) share price has been an incredible performer over the last two and a half months.

Since crashing as low as 32 cents on 23 March, the Afterpay Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P) rival’s shares have jumped a whopping 840% to $3.02.

Why is the Openpay share price rocketing higher?

Investors have been buying Openpay and other buy now pay later providers in recent weeks for a number of factors.

One is the belief that the pandemic has accelerated the rapid adoption of the payment method due to retail spending shifting online during the lockdowns.

Both Afterpay and Zip Co have reported stellar sales and customer growth throughout the pandemic. And this has come without any notable deterioration in bad debts. This appears to have convinced the market that their business models are more robust than first believed.

Openpay has also reported strong growth of its own. During the third quarter the company reported a 203% increase in active plans, a 113% lift in active customers, and a 63% jump in active merchants on its platform. This strong form continued in May.

Its active merchants now include the likes of Bunnings Warehouse, Bupa, JD Sports UK, Repco, Smiggle, and Spotlight.

But Openpay’s shares won’t be building on its strong gains today. This morning the payments company requested a trading halt.

Why are its shares in a trading halt?

It appears as though management has decided to take advantage of its incredible share price gain to raise capital.

No details have been released officially by the company, but the AFR is reporting that Openpay is seeking to raise $30 million to accelerate its expansion in the UK market and strengthen its balance sheet.

According to the report, the company is aiming to raise the funds at $2.40 per share, which represents a 20.5% discount to its last close price.

These certainly are exciting times for Openpay and the buy now pay later space in general.

More reading

• Where to invest $2,000 in cheap shares
• Why Zip Co and these ASX shares just zoomed to new highs
• ASX 200 jumps 1.8%, Australian headed for recession
• Sezzle Inc shares and 2 other small cap ASX techs surge higher today
• Afterpay share price hits a new record high: Is it too late to invest?

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and ZIPCOLTD FPO. 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 Why the shares of Afterpay rival Openpay are up 840% since March appeared first on Motley Fool Australia.

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