Author: therawinformant

Big brokers continue to update their price targets throughout the S&P/ASX 200 Index (ASX: XJO) quarterly updates. Here are five ASX 200 shares that have received broker updates amidst October quarterly earnings. 

Afterpay Ltd (ASX: APT) 

Macquarie raised its Afterpay share price target from $90.00 to $97.50 but retains a neutral rating. The broker is impressed with the September quarter trading update. However, it notes that the US result was flat, but as expected given seasonal trends. Likewise, Morgan Stanley retained its overweight rating on Afterpay and its share price target of $115. It says that the trading update was slightly better than expected. While Afterpay’s Stripe partnership is a positive which should enable increased penetration in the US market. 

Conversely, UBS retains its gloomy sell rating with a price target of $28.25. While it expects continued improvement in transaction frequency in the next quarter as consumption increases into Christmas, it cannot find a reason to amend its target. 

Coles Group Ltd (ASX: COL) 

A series of price upgrades came in for the Coles share price including: 

• Citi raising its price target from $21.00 to $21.20 with a buy rating 
• Credit Suisse raising its price target from $20.16 to $21.04 with an outperform rating 
• Morgan Stanley raising its price target from $19.75 to $20.25 with an overweight rating 

All three brokers provided upbeat commentary anticipating strong demand for groceries in the December quarter. 

Galaxy Resources Limited (ASX: GXY) 

The lithium sector is getting some love from brokers following the fears that Tesla would solely source its lithium from Nevada. 

Citi raised its Galaxy Resources share price target from $1.25 to $1.40. It notes that the company is doing enough to manage lower prices and demand with its production. It sees the Altura Mining failure as a positive for lithium prices. 

Likewise, Credit Suisse raised its price target from $0.84 to $1.30. It anticipates that growth in lithium demand is on the horizon. 

Hub24 Ltd (ASX: HUB) 

The Hub24 has been a standout performer amongst ASX200 shares. However, the share price run has been backed by improving business performance and brokers have reacted positively to its recent acquisitions, earnings and growth opportunities. 

Credit Suisse upgraded its rating from underperform to neutral with a revised price target from $18.70 to $21.50. While Macquarie also raised its price target from $22.50 to $23.50. 

Super Retail Group Ltd (ASX: SUL) 

The Super Retail Group share price received a series of upgrades from multiple brokers. This includes: 

• Citi raising its price target from $11.90 to $13.10 
• Credit Suisse raising its price target from $11.83 to $12.21 
• Macquarie raising its price target from $10.80 to $11.30 
• Morgan Stanley retains its price target of $11.40 
• UBS raising its price target from $10.70 to $11.30 

All brokers were pleased with its sales performance and sees further growth ahead. 

More reading

• It’s not just Aussie Millennials driving the Afterpay (ASX:APT) share price to new records
• Sezzle (ASX:SZL) share price charges higher on Q3 update
• 5 things to watch on the ASX 200 on Friday
• Are ASX retail investors ‘dumb money’?
• Down 4% in 10 days: Is it time to buy ASX 200 shares?

Motley Fool contributor Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Hub24 Ltd and Super Retail Group Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO and COLESGROUP DEF SET. 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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Finding an ASX dividend share with a yield over 5% these days is a tough ask, let alone 9%. The (hopefully temporary) demise of ASX bank shares as hefty dividend payers, together with the coronavirus pandemic, has caused a dearth of dividends on the ASX.

2020 has seen a myriad of former dividend heavyweights slash their payouts, including Transurban Group (ASX: TCL), Sydney Airport Holdings Pty Ltd (ASX: SYD), and Ramsay Health Care Limited (ASX: RHC). The latter sadly broke a 20-year streak of annual dividend increases as well.

So, where to turn for hefty dividends in 2020?

Well, here are 2 ASX shares offering such a yield right now.

2 ASX dividend shares with yields over 9% today

Alumina Limited (ASX: AWC)

Alumina is Australia’s largest aluminium and alumina producer, and has amassed a reputation as a heavy-hitting dividend share in recent years. That’s despite its share price sliding more than 50% over the past 2 years or so.

Alumina’s last 2 dividends (paid in March and September this year) came in at 3.79 cents a share and 5.55 cents a share respectively. That would give Alumina a trailing dividend yield of 6.49% on current prices, or 9.29% grossed-up with Alumina’s full franking credits.

This is a volatile share to own, make no mistake. But I also think it could be extremely attractive for a long-term income play as well. If aluminium/alumina prices increase materially, you can expect a hefty share price appreciation in Alumina shares as a result, along with a potentially massive bump in dividend income (at least in my opinion). And with a starting yield today of more than 9%, it could be a great time to buy in.

WAM Research Limited (ASX: WAX)

WAM Research is another ASX divided share with a yield over 9% to consider today. This company is a Listed Investment Company (LIC), which means it acts more as a fund manager than a traditional company – buying and selling shares on behalf of its owners.

It does this very well, as the company’s performance over the past decade proves. Since 2010, WAM Research has returned an average of 15% per annum in growth and dividends (before fees and taxes).

Yes, dividends form the lion’s share of these returns. Over the past year, WMA Research has paid out 9.8 cents per share in dividends. That gives the LIC a trailing dividend of 6.9% on current prices. However, like Alumina, WAM Research’s dividends also come with full franking credits. That means it’s already-hefty dividend grosses-up to 9.86% with this franking included.

The company looks like it will be able to keep these payouts rolling out as well. As of 30 September, WAM Research has 34.9 cents per share in its profit reserve. That should be enough to cover its current dividend for at least 3 years.

More reading

• Virtual AGMs rob retail investors: fundie
• Attention: This ASX dividend share offers a fully franked 10% yield
• Why the Alumina (ASX:AWC) share price climbed higher today
• New WAM Alternative Assets LIC appoints portfolio manager
• Top brokers name 3 ASX dividend shares to buy today

Sebastian Bowen owns shares of Ramsay Health Care and WAM Research Limited. The Motley Fool Australia owns shares of Transurban. 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 Nutritional Growth Solutions Ltd (ASX: NGS) share price has hit the ASX boards in style on Friday.

The children’s milk formula company’s shares jumped as much as 90% higher than its listing price to 38 cents this morning.

The Nutritional Growth Solutions share price has since dropped back a touch but is still up 58% to 31.5 cents at the time of writing.

The Nutritional Growth Solutions IPO.

Nutritional Growth Solutions landed on the Australian share market today after successfully completing an IPO which raised $7 million at 20 cents per share.

Management advised that the IPO was heavily oversubscribed and received strong support from both retail and institutional investors.

It also advised that the funds raised through the IPO will predominantly be used to support sales and marketing initiatives, branding, new product launches, research and development, and for the general working capital requirements of the business.

What does the company do?

Nutritional Growth Solutions was founded by expert paediatricians and is commercialising a range of patented, clinically tested children’s milk formulas.

The formulas have been designed to ensure children receive all the necessary vitamins and minerals for their growth.

Its premier product is a protein powder designed to help kids optimise their height gain called Healthy Height. It is already generating revenues and is now sold in the United States, China, and Israel. It is also sold by Unilever in India under license as Horlicks Growth Plus.

In addition to this, the company has a range of new products undergoing clinical testing and development, as well as new product launches in the short to medium term. These new products will significantly expand the commercial opportunities for the company.

The company’s Managing Director and CEO, Ms Liron Fendell, commented: “We are very appreciative of the strong support shown by investors during the IPO process. I am thankful for the opportunity to bring our nutritional solutions to more children around the world. NGS operates in large and growing international markets and we look forward to executing on the broad range of commercial opportunities that we have identified “

More reading

• 2 ASX dividend shares with yields over 9%
• It’s not just Aussie Millennials driving the Afterpay (ASX:APT) share price to new records
• ASX stock of the day: iCar Asia (ASX:ICQ) share price explodes on takeover offer
• Why the Credit Clear (ASX:CCR) share price is up 125% in 3 days
• The Cirralto (ASX:CRO) share price slammed after quarterly report

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 Tyro Payments. The Motley Fool Australia owns shares of and has recommended Telstra 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 Afterpay Ltd (ASX: APT) share price hit a new all-time high on Wednesday, with shares trading for $102.97.

The stock has retreated to $99.19 per share at time of writing, alongside the wider selling in the S&P/ASX 200 Index (ASX: XJO). But year-to-date Afterpay’s share price remains up a stellar 222%. By comparison the ASX 200 is down 11% so far in 2020.

Afterpay’s record highs earlier in the week came after the company released its first quarter update for the 2021 financial year.

Afterpay reported strong results across all the regions it operates.

Underlying sales reached $4.1 billion, a 115% increase from the first quarter of the 2020 financial year. The company also noted that 45% of its like for like sales growth came from Millennials. In a sign that the BNPL space isn’t highly frequented by older generations, Gen X drove 25% of sales growth while Gen Z was responsible for 24%.

What does Afterpay do?

Afterpay is a leader in the buy now, pay later (BNPL) market. The company’s payment platform allows people to buy and receive goods and spread the cost of their purchase out over equal payments, without any interest fees.

The company was founded in 2015. Afterpay shares first began trading on the ASX in June 2017. The company now operates in Australia, the United States and the United Kingdom, with current expansion plans into the wider European market.

Why Afterpay’s soaring share price depends on US investors

Afterpay’s first quarterly report revealed its active global customers increased by 98% year-on-year. That’s seen its active customers reach 11.2 million. Notably, 6.5 million, or more than half, are in the United States.

Speaking to a virtual audience at the Australian Financial Review CFO Live event yesterday, Afterpay’s CFO Rebecca Lowde noted that the US isn’t just providing a huge lift in active users, it’s also providing a lot of investors:

A large part of our investor base is (in the) US and a large part of our expansion is into the US and UK, which are probably more the investors who do value growth rather than your EBTIDA multiple… The company has also been very open and transparent about what it is that it’s trying to achieve and has delivered to that well.

With its active user base in the US, and elsewhere, growing 98% over the past 12 months and underlying sales increasing 115%, the Afterpay share price may confound some analysts who believe it’s overpriced.

More reading

• ASX 200 flat: ResMed smashes expectations, AMP surges on takeover talks
• Sezzle (ASX:SZL) share price charges higher on Q3 update
• Why the AMP (ASX:AMP) share price could be set to rocket higher today
• 5 things to watch on the ASX 200 on Friday
• Are ASX retail investors ‘dumb money’?

Motley Fool contributor Bernd Struben owns shares in AFTERPAY T FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. 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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iCar Asia Ltd (ASX: ICQ) shares are exploding today after the auto platform received an indicative takeover offer. The iCar share price is trading at 43 cents per share at the time of writing, a 34.38% increase from yesterday’s closing price of 32 cents. We are, however, still aways off making a new 52-week high with iCar shares, since the company was trading as high as 48 cents per share earlier in the year (in January to be precise).

The iCar share price has also had an extremely volatile few years, going as low as 12 cents per share in the midst of the March ASX share market crash. This means that, at today’s prices, shareholders are up nearly 260% since 23 March. Before that, iCar shares rose 258% between 1 February 2019 and 21 February 2020, before plummetting 60% between 21 February and 20 March 2020. On the current share price, the company has a market capitalisation of approximately $185 million.

So what is iCar, and why is its share price rocketing so dramatically today?

What is iCar?

iCar describes itself as “the leading cars portal network” in Malaysia, Indonesia, and Thailand. It offers very similar services to a company ASX investors might be more familiar with – Carsales.Com Ltd (ASX: CAR), which coincidentally once invested in iCar. iCar’s platform offers marketplaces for buying and selling vehicles, connecting buyers with sellers as a middleman. The company tells us that its success is due to “consistent consumer audiences, and listings leadership due to deep car dealership penetration and engagement via our market-leading Response Management System (RMS) which is integrated into dealers’ businesses.”

iCar’s brands include the Carlist.my website (Malaysia’s premier car website, according to the company), Mobil123.com, the Indonesian equivalent, and one2car.com (Thailand’s No. 1). The company’s Carmudi website is also popular in Indonesia. iCar tells investors that its websites enjoy more than 8 million visits per month.

Why is the iCar share price on the highway today?

The company released two ASX announcements this morning before market open, which seem to be responsible for the dramatic expansion of the iCar share price today.

Firstly, a quarterly update for the quarter ending 30 September 2020 hit the markets this morning. In this update, iCar Asia told investors that the company had recorded its “best ever net operating cash flow for the second straight quarter”, despite the effects of the coronavirus pandemic. Even so, this number is still negative at an outflow of $1.05 million, although it did improve by 32% over the previous corresponding 2019 quarter.

In terms of revenue, the company told investors that revenue for the quarter increased by 33% compared with the previous quarter (the quarter ending 30 June 2020). It also mentioned that despite the pandemic, earnings before interest, taxes, depreciation and amortisation (EBITDA) remained positive for both the Malaysian and Thai markets. Even so, iCar also told investors that it has drawn down $1 million of a $5 million debt facility during the quarter, which was provided by major shareholder Catcha Group.

A takeover proposal on the cars

Secondly, and most importantly, iCar told investors that it has received a takeover offer from the United States-listed company Autohome Inc (NYSE: ATHM). Autohome, even though it’s US-listed, is based in China. In its release, iCar describes Autohome as “a leading destination for automobile consumers in China”. It currently has a market cap of US$11.54 billion.

The offer is non-binding, but does propose to acquire 100% of iCar shares at a price of 50 cents per share (a 16.28% premium to the current share price and a 56.25% premium to yesterday’s closing price).

Even so, iCar notes that the proposal is subject to a number of conditions, including “negotiation and signing of transaction documentation, FIRB approval and iCar shareholder and Court approval”. “There is no certainty that the proposal will result in a transaction being agreed and put forward to iCar shareholders for consideration”, the company has told investors.

It’s these caveats that have probably halted the iCar share price from rising to the level of the takeover proposal today.

Despite this, these announcements are almost certainly behind the massive appreciation we’ve seen in the iCar share price today. It will be interesting to watch this potential takeover play out over the following months.

More reading

• It’s not just Aussie Millennials driving the Afterpay (ASX:APT) share price to new records
• Why the Credit Clear (ASX:CCR) share price is up 125% in 3 days
• The Cirralto (ASX:CRO) share price slammed after quarterly report
• Here’s why the Ansell (ASX:ANN) share price hit a record high today
• GWA Group (ASX:GWA) share price down after AGM

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia has recommended carsales.com 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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Credit Clear Pty Ltd (ASX: CCR) had its ASX debut Tuesday 27 October. The company had an IPO offer price of 35 cents with an indicative market capitalisation at the offer price of $78 million. Despite a slow start to its ASX debut, closing at 46 cents, the Credit Clear share price proceeded to run more than 125% in the next 3 days. 

Who is Credit Clear 

Credit Clear is a fintech business that specialises in receivables management solutions. The ACCC definition of receivables management is when “creditors and collectors seek to secure payment from customers of businesses who are legally bound to pay or repay money they owe”.

Credit Clear sees this market in Australia as highly fragmented, with approximately 586 receivables management businesses operating nationally. It believes that the current operating model within the sector is open to disruption due to the increased demand for efficiency from the use of technology-based platforms. 

The company’s key clients include SMEs and large corporations, local councils and other government departments and domestic businesses and subsidiaries of global organisations. 

The company provides solutions to its clients through 3 lines of business: 

• Credit Clear: digital billing and communication technology platform 
• Credit Solutions: traditional receivables management 
• Oakbridge Lawyers: provider of legal services for debt recovery 

It generates revenues as a result of transactional platform income, platform licence income, traditional receivables management income and legal service income. 

In terms of the company’s financial performance, its pro-forma historical FY20 performance indicates revenues of $11.2 million with a gross profit of $5.6 million and a loss before income tax of $1.8 million. 

What Credit Clear aims to do with IPO funds 

The funds from the IPO will provide sufficient working capital to fund the business for 24 months based on existing levels of revenue, and provide additional financial flexibility with improved access to capital markets. Credit Clear has advised the funds will also be used to facilitate the company’s objectives including: 

• investing in technology and systems development to create a market-leading technology platform 
• accelerating sector penetration 
• achieving scale and reaching profitability. 

Foolish takeaway

The market is clearly excited about Credit Clear’s prospects. The company is in its early days and focused on ‘tech-enabling’ the receivables management sector. With the Credit Clear share price sitting at 1.01 per share at the time of writing (almost tripling the offer price), let’s see where the business goes from here. 

More reading

• The Credit Clear (ASX:CCR) share price has rocketed 133% since its IPO this week

Motley Fool contributor Lina Lim 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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The Cirralto Ltd (ASX: CRO) share price hit an all-time record high of $0.055 this morning. However, the price has since plummeted to 0.043% at the time of writing. Cirralto has had an eyewatering share price run from its lows of $0.002 back in May this year. 

What does Cirralto do? 

Cirralto offers a Software as a Service (SaaS) that modernises business IT systems. This involves migrating data from current systems to the cloud. Cirralto also implements a client’s data into systems that help with areas such as driving scale, improving sales, integrating with other systems and driving down costs. The company has three SaaS offerings including: 

• Spenda, a platform that integrates data in real-time across PoS, inventory, warehousing, sales teams and mobile techs while automatically updating financial needs 
• Flash Convert, which allows customers to migrate data from their current system to the cloud quickly, easily and for a fixed price 
• Synk’d, which enables businesses to connect applications together to remove repetitious data entry and automate information exchange

Cirralto share price slammed

Interestingly, the company announced its quarterly report at 10.50am. Following the brief rally on open, its shares were sharply sold off and are currently down 15% at the time of writing. Here is the run down of its quarterly report. 

Financial highlights 

Its quarterly highlighted a 118% increase in revenue from $82,313 to $179,745 and quarterly Average Revenue Per User (APRU) up 57.5% from $21.17 to $33.40. This quarter included the successful completion of a $2.7 million capital raising and proposed Appstablishment acquisition planned for completion this year. 

The company currently has a market capitalisation of approximately $65 million with total cash at the end of the quarter of $1.98 million. 

Product development 

Early in the quarter the company released a new product, SpendaCollect. This software enables any business to collect debt from any customer. In a retail setting this involves functionality, allowing customers to pay for goods or services either in-store, online or on-the-go through its virtual terminal. For suppliers and wholesalers, this means a custom portal enabling customers to see outstanding invoices which they can pay off using Cirralto’s integrated payment collection system. 

During the quarter, the company continued to release product updates focused on scaling the core systems transactional processes capabilities. Its strategy moving forward is to bolster its integration services that support more payment services adoption and exploitation of its competitive advantage in this area. 

More reading

• Here’s why the Ansell (ASX:ANN) share price hit a record high today
• GWA Group (ASX:GWA) share price down after AGM
• How ASX investors can capture these ‘billionaire trends’
• Why AMP, Fortescue, JB Hi-FI, & ResMed shares are charging higher
• Why the ResApp (ASX:RAP) share price is falling 18% lower today

Motley Fool contributor Lina Lim 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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The Ansell Limited (ASX: ANN) share price is pushing higher on Friday afternoon after releasing an update on its guidance for FY 2021.

At one stage today, the personal protection safety solutions company’s shares hit a record high of $42.36.

They have since dropped back a touch, but are up over 1% to $40.79 at the time of writing. This compares to a 0.4% decline by the S&P/ASX 200 Index (ASX: XJO).

What did Ansell announce?

Ansell revealed that it has started the new financial year in a very positive fashion despite the continued uncertainties arising from COVID-19.

According to the release, the company has experienced better than anticipated production volumes and sales across all of its five strategic business units.

In addition to this, the company revealed that the Exam/Single Use business has successfully managed supplier cost increases to date. And while it expects further cost increases to occur in the second half, it is working to protect its margins and limit any decline.

Management also advised that its capital expenditure investments, including capacity increases, are progressing to plan, and that exchange rates have been more favourable than originally budgeted.

Guidance upgrade.

As a result of the above, the company is now expecting organic growth to be in the double digits and earnings per share to be in the range of 135 cents to 145 cents.

In respect to the latter, this is an increase of 7.1% from the low end and 5% from the high end of its previous guidance range of 126 cents to 138 cents.

Though, management has warned that there remains considerable uncertainty over the remainder of FY 2021 due to the risks of the evolving impact of COVID-19. It notes that the pandemic could disrupt its supply chains and operations, and has the potential for broader macroeconomic weakness and FX volatility.

More reading

• GWA Group (ASX:GWA) share price down after AGM
• How ASX investors can capture these ‘billionaire trends’
• Why AMP, Fortescue, JB Hi-FI, & ResMed shares are charging higher
• Why the ResApp (ASX:RAP) share price is falling 18% lower today
• The rationale behind the Coca-Cola Amatil (ASX:CCL) takeover bid

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Ansell 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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The GWA Group Ltd (ASX: GWA) share price is today falling lower following the company’s annual general meeting this morning. At the time of writing, the GWA share price is trading 2.51% lower at $2.72 after the company announced  downward results and near-term challenges facing the business.

Highlights from today’s AGM

• The company emphasised its operational discipline throughout the year in what has been a challenging market.
• Revenue for the financial year was $398.7 million, down 12% from FY19.
• Net profit after tax (NPAT) was $44.9 million, down 16.5% from FY19 – which does, however, include interest costs on debt related to the Methven acquisition.
• The earnings before interest and tax (EBIT) margin was maintained at 18% compared with FY19, which supports the company’s claim of operational discipline.
• A solid balance sheet was maintained, with no significant near-term refinancing commitments.
• The company expects FY21 trading to remain challenging due to a weak construction market caused by coronavirus.
• The board has determined a final dividend of 3.5 cents per share fully franked.  

Quick peek into GWA’s world

GWA Group operates in a single business division: bathrooms and kitchens. It also recently acquired Methven – a manufacturer of bathroom accessories, taps and valves.

GWA has strong branding in Australia with its Caroma brand in particular. The well-known quality of this brand allows for premium pricing. Caroma also distinguishes itself in the commercial market, and is known as the standard in disabled toilets. The remainder of GWA’s brand portfolio – Dorf, Fowler, Stylus, Radiant and Clark – does not enjoy the same level of brand awareness and hence provides less scope for pricing premiums.

GWA also has well established distribution channels and strong relationships with plumbing retailers like Wesfarmers Ltd (ASX: WES) owned Bunnings as well as Reece Ltd (ASX: REH) and Tradelink.

Challenges faced by GWA

As mentioned in today’s AGM, GWA’s business depends considerably on the boom cycle of the real estate market. The coronavirus-stricken Australian economy presented the company with a new challenge to an already depressed property market. Housing constructions across the country pretty much peaked in mid-2018, and have been in decline since.

Management has warned that the whole business sector could feel even more pressure as the bottom in construction activity may not come until late next year.

Competition is also gradually encroaching in the form of global industry leader Roca Sanitorio. The Spanish company has a current market share in Australia of about 2%, still one-tenth that of GWA. But inroads are being made fast by this new giant entrant.

Some good news ahead for GWA

Despite the gloomy market in FY20, the company was able to deliver some respectable results, as announced today.

Looking at the AGM slides, it’s also worth noting that more than half of GWA sales are derived from the repair and remodel market segment. As such, the company is somewhat insulated from the boom and bust cycle of the new constructions market.

Longer term, Australia’s expected population growth should provide continued support for GWA’s products. The impact from the coronavirus, although devastating, is also expected to be relatively short-lived.

How has the GWA share price been perforing?

Including today’s falls, and at the time of writing, the GWA share price price has declined by 19.53% year to date. This compares similarly with the sector’s average of a 20% decline, as indicated by the ASX 200 Industrial Sector Index (ASX: XNJ). 

Based on the current GWA share price, the company has a market capitalisation of around $729 million.

More reading

• How ASX investors can capture these ‘billionaire trends’
• Why AMP, Fortescue, JB Hi-FI, & ResMed shares are charging higher
• Why the ResApp (ASX:RAP) share price is falling 18% lower today
• The rationale behind the Coca-Cola Amatil (ASX:CCL) takeover bid
• Why the Tesserent (ASX:TNT) share price jumped as much as 10% today

Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of 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.

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A billion dollars is a lot of money.

Now that may sound like I’m stating the obvious. But the truth is a billion is such a mind-bogglingly large number it’s hard to really wrap your brain around. That’s why you generally see it written out as ‘$1 billion’ rather than $1,000,000,000.

So let’s break it down.

We all have a pretty good idea of what $1 million can get us. In Australia that would be a decent house in most capital city neighbourhoods. Or an exceptional house and property in most regional areas.

So $1 billion, then, would get you 1,000 of those houses.

And $29 billion – or $29,000,000,000 – would get you 29,000 of those houses. Enough to live in a different million-dollar home, every day, for more than 79 years.

Like I said. A mind bogglingly large number.

Yet for Gina Rhinehart, $29 billion (or $28.9 billion, to be more precise) is the number she sees listed for her wealth.

That’s according to the latest Australian Financial Review (AFR) Rich List, which reports Rhinehart’s wealth more than doubled – up 109% – since last year.

How did she achieve that?

Below we take a look at some of the ‘billionaire trends’ Rhinehart and a few other top rich-listers rode this past year to ever greater wealth.

It may not be shiny, but…

When it comes to this year’s billionaire-making trends, you can’t beat iron ore.

The iron ore price has been choppily trending higher since hitting lows of US$40 per tonne in December 2015. And it received a big boost this year from, of all things, the coronavirus pandemic.

First, the virus has hampered new supply from Brazil as mining operations were forced to close. And second, demand ramped up as China and other developed nations launch – or plan to launch – major infrastructure projects to bolster their virus weakened economies. (Iron ore is a core ingredient in making steel.)

This has seen the price rise from US$74 per tonne 6 months ago to US$120 per tonne today, a gain of 62%.

It was also a boon for Rhinehart’s Roy Hill mine and her company, Hancock Prospecting. According to IBISWorld, Hancock Prospecting notched up almost $11 billion (there’s that number again) in revenue, making it Australia’s biggest private company.

While you can’t buy shares of Rhinehart’s iron ore operations on the ASX, you can buy shares of the company founded by Australia’s second richest person, Andrew ‘Twiggy’ Forrest. His net wealth leapt 189% over the past year, to $23 billion.

Forest’s shares in Fortescue Metals Group Limited (ASX: FMG) – part of the S&P/ASX 200 Index (ASX: XJO) – helped drive that momentous growth.

Over the past 12 months, Fortescue’s share price is up 94%. And it pays an annual dividend yield of 10%.

According to the AFR, Forrest’s wealth grew as much as $500 million per week at one stage this past year.

Oh, and he collected $2 billion in dividends.

A growing, under the radar wealth trend

Both Forest and Rhinehart also have extensive agricultural property portfolios.

Rhinehart is not only Australia’s wealthiest person, she’s also the nation’s biggest private landowner. And Forest has continued to expand his own agricultural holdings this year, along with aquaculture where he plans to become a major producer of oysters.

While both of these multi-billionaires’ agricultural ventures remain private, ASX investors have a number of options for investing in Australia’s agricultural sector.

Rural Funds Group (ASX: RFF), for example, owns a range of quality Australian agricultural properties, including cattle ranches, almond farms, vineyards and sugar plantations.

Rural Funds’ share price is up 34% over the past 12 months. At the current share price, it pays an annual dividend yield of 3.5%.

Between the click and the collect

Coming in at number 3 on the AFR’s rich list is Anthony Pratt “and family”. The Visy Industries founder’s wealth surged 27% over the last year to reach $15.6 billion. Visy is one of the world’s largest privately owned paper, packaging and recycling companies.

Just as with the price of iron ore, a large part of Pratt’s success over the 12 months can be attributed to the pandemic. That’s because people working and shopping from home has ushered in a rapid growth in e-commerce. And after you click on the item you want to buy it needs to be packaged before it gets sent.

Visy Industries is a private company. But ASX investors wanting exposure to the packaging business could consider Amcor Limited (ASX: AMC). Headquartered in Melbourne, Amcor is a global packaging company operating across Australasia, North America, Latin America, Europe and Asia.

Amcor’s share price is up 8% over the last 12 months. It pays a dividend yield of 2.5%.

Tapping into the future

Coming in at number 4 and number 5 on the rich list are Mike Cannon-Brookes and Scott Farquhar. Both men are co-founders of US-listed, Australian software company Atlassian Corporation PLC (NASDAQ: TEAM).

Cannon-Brookes wealth grew by 73% over the year to reach $16.9 billion. Farquhar’s wealth grew by 71% to reach $9.6 billion.

Atlassian’s share price has soared 69% over the past year, giving the company a market cap of more than $52 billion.

The already rapidly growing technology sector was also given a boost by the outbreak of the global pandemic. And while some share prices may be looking stretched, technology continues to evolve at an increasingly rapid pace.

That should help support the share prices of technology companies, like Atlassian.

More reading

• Why AMP, Fortescue, JB Hi-FI, & ResMed shares are charging higher
• $14 trillion investor alliance warns Aussie mining companies
• Why market crashes are useful for buying ASX dividend shares
• How did ASX iron ore shares perform in the last quarter?
• Fortescue (ASX:FMG) share price lower despite record Q1 shipments

Motley Fool contributor Berndt Struben 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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