The LiveHire Ltd (ASX: LVH) share price is rocketing higher today on the back of a new contract win. After being up by as much as 22.73% in early trade, LiveHire shares have pulled back somewhat to sit at an 11.36% gain for the day at the time of writing.

About LiveHire

LiveHire is a recruitment platform that enables employers to keep digital track of candidates within one ecosystem. According to LiveHire, its platform can help save its enterprise clients time and money by streamlining the recruitment process and potentially even cutting out recruiters’ sky-high fees. 

LiveHire was founded in 2011 in Melbourne and went on to publicly list on the ASX in 2016 at an initial public offering price of 20 cents per share. The company’s client base includes leading brands like Vodafone, Asics, Nissan, and Xero Limited (ASX: XRO).

What did LiveHire announce?

Shortly before market open this morning, LiveHire revealed it has won a contract with the Victorian State Government to provide technology to help deploy staff into critical areas of need.

More specifically, the state government will use LiveHire’s platform to profile, match, and engage current employees in order to transition them into critical roles across the state government.

According to the announcement, the Victorian government contract is approximately 8 times the average annualised recurring revenue per client across LiveHire clients. 

The initial term of the contract is 12 months, and the state government has the option to extend the term for a further 12 months.

Commenting on the contract win, CEO Christy Forest said:

“LiveHire has unique capabilities in search, match, skills profiling and personal communications, making our solution highly suitable for organisations which are now increasingly required to bring a more agile approach to workforce mobility.”

“Similar to our work for other Australian State Governments, we will leverage our platform to assign well-fitted, available employees to in-demand roles from a newly created Talent Community for Victoria’s Jobs and Skills Exchange,” she added.

While today’s announcement was welcome news for investors, it’s important to note that LiveHire is on the smaller end of the ASX in terms of market capitalisation. Factoring in the 11.36% share price rise at the time of writing, LiveHire shares have a market capitalisation of just $74 million.

More reading

• The ASX 200 just hit an 11-week high. Here are 3 reasons we might be in overvalued territory
• What ASX investors can do before 30 June to save tax
• The ASX 200 stocks in the tax-loss selling firing line
• 2 unbelievable ASX 200 value shares to buy today
• Why didn’t Warren Buffett buy more shares in the recent bear market?

Cathryn Goh owns shares of Xero. 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 Small-cap ASX tech share rockets 23% higher on government contract win appeared first on Motley Fool Australia.

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The end of the financial year could complicate the recovery of some beaten down ASX shares.

These underperforming stocks on the S&P/ASX 200 Index (Index:^AXJO) may see the rebound in the share prices capped by shareholders looking to unload these losers for tax-loss purposes before the June 30 deadline.

If you aren’t already thinking about the tax implications for the financial year, you should be!

Waiting longer for a recovery

This is particularly so because the V-shaped economic recovery that many were hoping to see once the COVID-19 emergency passed is unlikely to materialise.

The debate is now focused on whether we will get a “U” or “L” shaped recovery instead. This means the short- to medium-term outlook for some coronavirus-impacted shares is likely to stay dim.

No point holding on to some of these losers if you can utilise the loss to offset your capital gains liabilities, especially if you think you can buy these laggards back later at a discount or around the same price.

What’s tax-loss selling?

For those who need a refresher on what tax-loss is, if you sell a stock below what you paid, the loss can be used to offset any profit you make on other investments.

For instance, if you made a loss of $100 on a stock and made a $100 profit on another, your capital gains liability is likely to be zero. You should check with your accountant to ensure you stay within the rules.

You should also note that the tax office takes a dim view of those who sell a stock for tax loss and then buy it back almost immediately. Again, be sure to speak to your tax professional for advice.

Poor foundations

But coming back to stocks that I believe make ideal tax-loss selling candidates, there are several that come to mind.

One stock that fits the bill is building materials group Boral Limited (ASX: BLD). The Boral share price was already under pressure before the COVID-19 disaster due to poor management that drove multiple profit downgrades.

The market’s patience ran out and this forced its chief executive Mike King to announce his departure in August.

The transition to a new leader usually marks a volatile period for shareholders. Newly installed chief executives of embattled companies almost always make dramatic cuts and changes that includes big write-down of assets.

A better option to Boral

If you are hanging on because you believe construction activity in the US and Australia will experience a speedy recovery, you probably would do better buying its better run rival James Hardie Industries plc (ASX: JHX).

Sure, you will be paying a premium for the switch, but you are getting a higher quality investment – and it’s particularly worth paying for quality during highly uncertain periods.

Weak properties

Another group of stocks that I think make good tax-loss selling targets are those own shopping malls and apartment projects.

I can’t see a V-shape recovery for this group and I am not swayed by arguments that their shares are trading below book value.

The problem is that there is lots of room to lower the value of their assets if structural changes to mega malls are afoot.

The outlook for apartment sales are also bleak as this segment of the property market is overly dependent on property investors and international students.

Examples of companies exposed to these thematic are Vicinity Centres (ASX: VCX), Stockland Corporation Ltd (ASX: SGP) and Mirvac Group (ASX: MGR).

Clipped wings

A third example of a stock that I see little reason to hang on to for the near term is Flight Centre Travel Group Ltd (ASX: FLT). The Flight Centre share price made a very decent 60% bounce since its March bottom and is ripe for tax loss selling for those who have been in the stock for a while.

Shares in the travel agent is still down close to 70% this financial year and international travel is one of the last few industries to return to “normalcy” (whatever that looks like in the post-coronavirus world).

Its cost base is also higher than online rivals as it operates brick and mortar shops. I reckon there’s time to buy back the stock later when more of the COVID-19 dust has settled.

The wild card is government support. There’s speculation that the federal government may extend a financial helping hand to industries most stricken by the pandemic.

However, I would rather back other travel related stocks if I wanted to take a punt on the government stimulus.

More reading

• The ASX 200 just hit an 11-week high. Here are 3 reasons we might be in overvalued territory
• What ASX investors can do before 30 June to save tax
• 2 unbelievable ASX 200 value shares to buy today
• Why didn’t Warren Buffett buy more shares in the recent bear market?
• ASX 200 up 1.8%: Big four banks jump higher, Flight Centre and Webjet rocket again

Motley Fool contributor Brendon Lau owns shares of James Hardie Industries plc. Connect with me on Twitter @brenlau.

The Motley Fool Australia has recommended Flight Centre Travel Group 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 The ASX 200 stocks in the tax-loss selling firing line appeared first on Motley Fool Australia.

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During routine analysis on the weekend, 2 absolute fantastic S&P/ASX 200 Index (ASX: XJO) shares jumped out at me. I had previously written these off as far too expensive and turned my attention elsewhere. Both of these ASX 200 value shares have been among the best performing shares of the decade, increasing their share price by at least 10 times in the past 10 years. 

This is a unique window in time where shares of this calibre are available at what I believe are discount prices. 

Altium Limited (ASX: ALU)

Between 2010 and now, Altium has been one of the outperforming ASX 200 value shares, with its share price returning over 146 times the initial investment. That means a $10,000 investment 10 years ago would have become over $1.4 million today. This is not a company that is built on smoke or vapour – Altium develops software for the printed circuit board (PCB) design industries.

Over a 10-year period, it has achieved compound annual growth rates (CAGR) that are the envy of most organisations. It is clear Altium is a company built on solid technological foundations, managed with steel-like discipline. This includes a 10-year sales CAGR of 16.4%, an 8 year earnings per share (EPS) CAGR of 30.3%, and a cashflow CAGR of 39.3%. Over the past 5 years, using a USD to AUD conversion rate of $0.72, the company has an average return on capital employed (ROCE) of 20%.

This is an organisation that knows how to turn capital into profits. 

The company is sitting on a current price-to-earnings (P/E) ratio of 60, which immediately sounds high. It is way over the company’s 10-year average P/E of 23. However, when you factor in the compound growth rates I have mentioned with a horizon of 10 years, then the share price appears to be at a discount.

Personally, even if it was selling at a small premium I would be interested in owning this ASX 200 value share. Even with the recent hit from the coronavirus, it clearly has a long runway ahead of it. 

Domino’s Pizza Enterprises Ltd. (ASX: DMP)

Everyone knows Domino’s. Most readers have probably bought from Domino’s. We know the taste, the buying experience, the usefulness of the app. And for many of us, we know that we automatically choose Domino’s Pizza. It isn’t a thought-through process. This is what makes it one of the great ASX 200 value shares.

Like Altium, Domino’s was an outperforming share during the past decade, returning 12 times the initial purchase price. It has a sales CAGR of 21.9% and shows no signs of slowing, with last years sales growth exceeding that of the previous 2 years. Its 10-year cashflow CAGR is 22.3% and it has a 10-year EPS CAGR of 21.4%. Also like Altium, the company has demonstrated an ability to turn capital into profits, averaging a ROCE of 19% over the past 4 years.

On paper, its P/E is 39.16. That’s 9 points higher than its 10-year average. However, over a 10-year investing horizon and based on the above CAGRs, I believe it is selling at a discount.

Foolish takeaway

When searching for ASX 200 value shares it is important to dig a bit deeper than the initial summary statistics. If you were to look at headlines and P/E ratios alone, you will never have a full measure of an organisations true worth. 

More reading

• The ASX 200 just hit an 11-week high. Here are 3 reasons we might be in overvalued territory
• What ASX investors can do before 30 June to save tax
• The ASX 200 stocks in the tax-loss selling firing line
• Why didn’t Warren Buffett buy more shares in the recent bear market?
• ASX 200 up 1.8%: Big four banks jump higher, Flight Centre and Webjet rocket again

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Altium. The Motley Fool Australia has recommended Domino’s Pizza Enterprises 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 2 unbelievable ASX 200 value shares to buy today appeared first on Motley Fool Australia.

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