Europe’s Just Eat Takeaway and Grubhub are finalizing an all-stock deal in which Just Eat Takeaway would pay a small premium to $58 per Grubhub share, according to CNBC. Uber shares tumbled on the news its deal with Grubhub may be in jeopardy. Yahoo Finance’s The Final Round panel breaks down the details.
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Is the National Australia Bank Ltd (ASX: NAB) share price a buy right now?
The major ASX bank has seen its share price go up 31.4% since 22 May 2020. That’s an astonishing return in a short amount of time for such a big business.
Investors are getting more confident that the Australian economy won’t be harmed by the coronavirus as much as first feared. The overestimation of the cost of jobkeeper is a great example of things looking better than previously expected.
There is still a lot of economic pain out there. NAB included an $807 million provision for potential COVID-19 impacts in its FY20 half-year result. There’s a reason why investors sent the NAB share price lower. Only time will tell whether that provision was too much or too little.
NAB has been showing a rising level of loan arrears in recent reports. The 90+ day past due arrears of total loans was 0.71% at the end of FY18, 0.79% in the first half of FY19, 0.93% at the end of FY19 and 0.97% in the recent FY20 half-year result. That’s not a good trend.
Several weeks ago I thought the NAB share price was cheap if the economy recovered quicker than expected.
However, the strength of the NAB share price changes the value.
Low interest rates seem like they’re here to stay. This could cause the NAB net interest margin (NIM) to come under even more pressure. The NAB share price will follow earnings over time.
I like that NAB is investing in lifting skill levels, according to the Australian Financial Review. I also like the new NAB leadership team.
Who knows what’s going to happen with the NAB dividend this year? At the moment it has an annualised grossed-up dividend yield of 4.25%. However, if the economy is better than expected then perhaps the final dividend will be larger. I wouldn’t count on big dividends this year though.
Ultimately, I don’t see much compelling value at the current NAB share price. There are still risks to be wary of.
I think there are other ASX shares with much more growth potential…
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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. 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.
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On Wednesday the S&P/ASX 200 Index (ASX: XJO) fought back from a heavy decline at the open to record a small gain. The benchmark index rose slightly to 6,148.4 points.
Will the market be able to build on this on Thursday? Here are five things to watch:
The ASX 200 looks set to end its winning streak on Thursday. According to the latest SPI futures, the benchmark index is expected to drop 73 points or 1.2% at the open. This follows another mixed night of trade on Wall Street overnight. The Dow Jones dropped 1.05%, the S&P 500 fell 0.5%, and the Nasdaq defied the selling once again with a 0.7% gain.
Although the market is expected to sink lower today, Australian tech shares such as Altium Limited (ASX: ALU) and Appen Ltd (ASX: APX) could defy this and push higher. The local tech sector has a habit of following the lead of the Nasdaq index, which stormed higher and closed above 10,000 points for the first time.
Energy producers such as Oil Search Limited (ASX: OSH) and Woodside Petroleum Limited (ASX: WPL) could be on the rise today after oil prices edged higher. According to Bloomberg, the WTI crude oil price is up 0.3% to US$39.06 a barrel and the Brent crude oil price edged 0.1% to US$41.23 a barrel.
The U.S. Federal Reserve met overnight and kept rates on hold at zero. The central bank also suggested that interest rates will stay at this level until 2022. However, the U.S. Fed is not done with supporting the economy through the pandemic. Fed Chairman Jerome Powell commented: “What we’re thinking about is providing support for the economy. We think this is going to take some time.”
Gold miners including Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) could be pushing higher today after the gold price jumped. According to CNBC, the spot gold price rose 1.4% to US$1,746.30 an ounce after dovish comments by the U.S. Federal Reserve.
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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 Altium. The Motley Fool Australia owns shares of Appen Ltd. 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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