Stock Pick

  • Lufthansa Plans Far-Reaching Restructuring to Repay Bailout

    Lufthansa Plans Far-Reaching Restructuring to Repay Bailout(Bloomberg) — Deutsche Lufthansa AG signaled the start of a company-wide revamp spanning job cuts to asset disposals to help repay its 9 billion-euro ($10 billion) bailout from the German government.Europe’s biggest airline will slash employee expenses and look at spinning off non-core units in an effort to reduce costs and bolster cash flow as the coronavirus crisis depresses revenue, it said in a statement Wednesday. The group had a 2.1 billion-euro net loss in the first quarter.“In view of the very slow recovery in demand, we must now take far-reaching restructuring measures to counteract this,” Chief Executive Officer Carsten Spohr said in the release.Lufthansa’s pledge to slash costs is likely to lead to a struggle with Germany’s powerful labor unions, which in the years prior to the pandemic thwarted efforts to trim expenses with pilot and cabin-crew strikes. The situation may be complicated by the state’s 20% holding in the airline as part of the pending rescue, which will involve government representatives in its affairs.The company set out more precise cuts for its foreign airline units, where labor protection laws are less stringent than in Germany. Austrian Airlines will see staff costs pared by 20%, with Brussels Airlines suffering a 25% reduction in the workforce and a 30% cut to its fleet.While Lufthansa has said its liquidity position is becoming “urgent,” the statement gave no details on cash levels. The deal will dilute the holdings of current investors, though they’re expected to back it in a June 25 vote rather than risk insolvency.Airlines worldwide are reeling as the Covid-19 pandemic brings decades of travel growth to a shuddering halt, with industry executives suggesting it may take several years for demand to return to previous levels, especially in the long-haul markets targeted by premium carriers such as Lufthansa.At the same time the German carrier, previously regarded as among the most stable and successful, is negotiating bailout that’s the biggest for the industry so far. Its predicament highlighs both the impact of the virus and Germany’s willingness to come to the aid of its leading businesses.Lufthansa posted a first-quarter loss of 1.22 billion euros, widening from 336 million euros a year earlier. The imposition of travel lockdowns from mid-February led to an 18% drop in sales, with fuel-hedging losses also hurting the numbers.The picture will be far worse in the current quarter, during which almost all of the carrier’s 760 planes have been grounded.Spohr said it’s impossible to provide full-year guidance, beyond saying the result will be significantly worse.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

    from Yahoo Finance https://ift.tt/2z2sKUu

  • ASX 200 jumps 1.8%, Australian headed for recession

    ASX 200

    The S&P/ASX 200 Index (ASX: XJO) climbed another 1.8% today to 5,942 points as investors learned what the GDP figures were in the quarter to 31 March 2020. The ABS said Australia’s economy contracted 0.3% last quarter.

    Indeed, Treasurer Josh Frydenberg has said that Australia is already in a recession. Though that can’t be officially confirmed until the end of June 2020.

    Here are some of the highlights from the ASX 200 today (and other smaller shares):

    Zip Co Ltd (ASX: Z1P) soars again

    Zip zoomed higher yesterday and it climbed by a further 21.7% today. Investors seem really excited by the prospect of the buy now, pay later business expanding in the US by fully acquiring QuadPay. America is a huge market if you can deliver an exciting product for consumers. The company seems on course to enter the ASX 200.

    QuadPay has a high transaction margin and a solid number of customers and merchants.

    Big takeover deal for Infigen Energy Ltd (ASX: IFN)

    The wind farm business, which was previously in the ASX 200, saw its share price climb 36.4% today as it announced that it has received a takeover offer of $0.80 per share from UAC Energy. UAC Energy is ultimately owned by a Philippine listed business which has large renewable energy projects across Asia.

    There is speculation that there could be a bidding war for Infigen, which is why the share price is currently at the takeover price.

    Diverging share price movements

    At the large end of the ASX 200 the major banks all saw large share price gains. The Commonwealth Bank of Australia (ASX: CBA) share price went up 3.25%, the Westpac Banking Corp (ASX: WBC) share price climbed 4.4%, the Australia and New Zealand Banking Group (ASX: ANZ) share price went up 5% and the National Australia Bank Ltd (ASX: NAB) share price grew 4.6%.

    However, at the red end of the ASX it seems investors decided gold miners were too expensive considering the rising share market and the growing Australian dollar.

    The Silver Lake Resources Limited. (ASX: SLR) share price fell 8.4%, the Regis Resources Limited (ASX: RRL) share price fell 6.6%, the Gold Road Resources Ltd (ASX: GOR) share price fell 6.3%, the Saracen Mineral Holdings Limited (ASX: SAR) share price dropped 6.2% and the Evolution Mining Ltd (ASX: EVN) share price declined 5.8%.

    NEW! 5 Cheap Stocks With Massive Upside Potential

    Our experts at The Motley Fool have just released a FREE report detailing 5 shares you can buy now to take advantage of the much cheaper share prices on offer.

    One is a diversified conglomerate trading over 30% off it’s all-time high, all while offering a fully franked dividend yield of over 3%…

    Another is a former stock market darling that is one of Australia’s most popular and iconic businesses. Trading at a significant discount to its 52-week high, not only does this stock offer massive upside potential, but it also trades on an attractive fully franked dividend yield of almost 4%.

    Plus, this free report highlights 3 more cheap bets that could position you to profit in 2020 and beyond.

    Simply click here to scoop up your FREE copy and discover the names of all 5 cheap shares.

    But you will have to hurry because the cheap share prices on offer today might not last for long.

    YES! SEND ME THE FREE REPORT!

    As of 2/6/2020

    More reading

    Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of 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 ASX 200 jumps 1.8%, Australian headed for recession appeared first on Motley Fool Australia.

    from Motley Fool Australia https://ift.tt/2MqS4Xi

  • These ASX 200 shares could be perfect for a retirement portfolio

    Retirement shares

    If you’re close to retirement, then I think it would be prudent to focus more on capital preservation and income than growth shares like Afterpay Ltd (ASX: APT).

    But which shares should you buy for a retirement portfolio? Below I have picked out two top shares which I think would be great options for retirees. Here’s why I like them:

    Goodman Group (ASX: GMG)

    The first company which I think would be a great addition to a retirement portfolio is Goodman Group. While property companies have been under a lot of pressure this year because of the negative impact of the pandemic, Goodman Group has come out of this relatively unscathed thanks to the way its portfolio is positioned.

    In fact, last month the integrated commercial and industrial property group reaffirmed its earnings and distribution guidance for FY 2020. Management advised that its performance remains strong thanks to customer demand in the online, logistics, food, consumer goods, and digital economy. Given the structural changes we are seeing in the retail sector and with consumer behaviour, I think Goodman Group is well-positioned to deliver solid earnings and distribution growth for retirees for a long time to come.

    Wesfarmers Ltd (ASX: WES)

    I think it is hard to look past Wesfarmers when constructing a retirement portfolio. I believe the conglomerate is one of the highest quality companies on the Australian share market. Furthermore, with its proud history tracking back all the way to 1914, I don’t think there is a danger of it going away anytime soon. Especially given the quality of its portfolio and the positive long term outlook that the majority of its businesses have.

    Overall, I believe it is well-placed to deliver solid earnings and dividend growth for the foreseeable future. This could make it a great long term retirement share to own.

    And below is another top option for retirees to consider buying. It’s no wonder it has been named the top dividend pick…

    NEW: Expert names top dividend stock for 2020 (free report)

    When our resident dividend expert Edward Vesely has a stock tip, it can pay to listen. After all, he’s the investing genius that runs Motley Fool Dividend Investor, the newsletter service that has picked huge winners like Dicker Data (+92%), SDI Limited (+53%) and National Storage (+35%).*

    Edward has just named what he believes is the number one ASX dividend stock to buy for 2020.

    This fully franked “under the radar” company is currently trading more than 24% below its all-time high and paying a 6.7% grossed-up dividend.

    The name of this dividend dynamo and the full investment case is revealed in this brand new free report.

    But you will have to hurry — history has shown it can pay dividends to get in early to some of Edward’s stock picks, and this dividend stock is already on the move.

    See the top dividend stock for 2020

    More reading

    Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO and Wesfarmers 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 These ASX 200 shares could be perfect for a retirement portfolio appeared first on Motley Fool Australia.

    from Motley Fool Australia https://ift.tt/2U4PFG5

The Latest