Author: therawinformant

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

On Wednesday, Tesla Inc (NASDAQ: TSLA) will report its third-quarter results. After announcing record third-quarter deliveries, expectations for the electric-car maker’s financial performance during the period are high. Even more, a soaring stock price over the past year has raised the stakes for Tesla to keep growing its business rapidly.

Will the automaker be able to live up to the hype?

Ahead of the earnings report on Wednesday, some investors may be wondering whether or not they should buy shares of the growth stock before the update. After all, if Tesla announces better-than-expected revenue and earnings per share (EPS), the stock could jump.

To better understand whether the electric-car company’s shares are attractive today, here’s a quick earnings preview and an analysis of the stock’s current valuation.

Strong momentum

Earlier this month, Tesla said it delivered a record 139,300 vehicles during its third quarter. This was a huge jump from Q2 — when the automaker’s main vehicle factory temporarily forced to shut down because of the coronavirus. Vehicle deliveries surged 53% sequentially in Q3. However, growth was also impressive when compared to the year-ago quarter — a period Tesla’s operations were at full capacity. Deliveries soared 43% year over year.

In 2020, Tesla’s business is benefiting from the launch of its new Model Y SUV earlier this year. As the company’s most affordable vehicle yet, management expects Model Y sales to eventually rival sales of is Model 3 — Tesla’s best-selling vehicle.

Analysts expect Tesla’s strong sales growth to lead to impressive top- and bottom-line growth, too. On average, analysts expect revenue to rise 31% year over year to $8.26 billion and non-GAAP (adjusted) earnings per share to jump 51% to $0.56.

Tesla stock: Buy, sell, or hold?

With Tesla’s business firing on all cylinders, is Tesla stock a buy ahead of earnings?

The automaker’s earnings report could, indeed, send the stock soaring following the report. But shares could just as easily crater if Tesla misses the mark in some area. It’s simply too difficult to predict which direction the stock will move in the wake of the report.

Even more, an investment in the stock should be based on an investors’ view of the company’s long-term potential anyway — not based on the results of a single quarter.

Zooming out beyond the current quarter, investors should note that Tesla stock’s valuation already prices in massive growth over the next decade. The company has a market capitalisation of more than $400 billion despite trailing-12-month revenue coming in at just $26 billion. Free cash flow, or excess cash flow left over after both regular operations and capital expenditures are taken care of, was just $800 million over this same period.

The market has arguably already priced in both continued leadership in electric cars and significant market share gains in the overall global auto market. Because so much optimism is already priced into the stock, I’d prefer a better entry point than $445 per share. Perhaps if investors get lucky and the stock falls below $400 following the earnings report then the stock might begin to look attractive.

For now, however, I’d rate Tesla stock a “hold” going into its earnings report on Wednesday. Of course, there’s no guarantee Tesla stock will ever retreat to this level again. But I don’t mind waiting on the sidelines, hoping for a more reasonable valuation.

Tesla’s third-quarter earnings will be posted after market close on Oct. 21.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• How this fund manager’s 60% UP in the year of COVID-19
• Billionaire investor says Tesla (NASDAQ:TSLA) is a $2 trillion stock
• Short-sellers are stepping up their attack on these ASX stocks
• Could these US-based ASX lithium shares land a deal with Tesla (NASDAQ:TSLA)? 
• ASX investors were buying Tesla (NASDAQ:TSLA) and Apple (NASDAQ:AAPL) shares last week

Daniel Sparks 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 Tesla. 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 Is Tesla Inc (NASDAQ:TSLA) stock a buy ahead of earnings? appeared first on Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

from Motley Fool Australia https://ift.tt/3m0homQ

The Brainchip Holdings Ltd (ASX: BRN) share price surged to a one-month high this morning after it released its quarterly update.

Shares in the artificial intelligence company jumped 13.2% to 43 cents at the time of writing. In contrast, the All Ordinaries (Index:^AORD) (ASX:XAO) and the S&P/ASX 200 Index (Index:^AXJO) gained around 0.8% each.

Management announced that a number of well-known companies have signed up to its Early Access Program (EAP).

Brainchip shares jumps on key customer trials

These include the Ford Motor Company, Valeo, Vorago Technologies and the National Aeronautics and Space Administration (NASA).

The program allows organisations to evaluate and test Branchip’s Akida Neuromorphic System-on-Chip (NSoC) offering. Brainchip receives a fee to cover its costs from these organisations to participate in the EAP.

The fee is not the reason why Brainchip got a boost to its cash holdings recently.

Brainchip’s cash position improves

The company reported a cash balance of US$12.2 million ($17.2 million) at the end of the September quarter. This was increased by around US$5 million to around US$17.6 million this month.

The extra cash came from the proceeds from the Put Option Agreement with LDA Capital, as well as the exercise of employee and investor stock options.

Brainchip filed for the listing of eight million new shares this morning from the conversion of options that were well in the money. Of the total, 4.5 million of these options had a strike price of 15 cents, while 3.5 million had a strike of 20 cents.

How Brainchip’s technology works

The company is touting Akida as a complete AI chip for neural networks as it doesn’t require external memory or other components to function.

The key areas that Akida is targeting are AI Edge applications for Smart Transportation, Smart Home, Smart Health and Smart Industrial IoT.

“With a unique ability to process information such a sight, sound, smell, touch and taste in real-time with incremental learning the Akida technology addresses the burgeoning AI Edge market that is forecasted to reach US$50Bby 2025 according a Tractica report,” said Brainchip in its ASX statement.

“Akida provides solutions in a manner that cannot be accomplished with traditional Convolution Neural Networks.”

BRN share price outperforms WAAAX

The Brainchip share price has outperformed the WAAAX tech darlings since the start of 2020. The BRN share price is up over 780% when the Afterpay Ltd (ASX: APT) share price is up over 230%.

The WiseTech Global Ltd (ASX: WTC) share price, Altium Limited (ASX: ALU) share price and Xero Limited (ASX: XRO) share price are trailing with gains of 60% or less.

More reading

• How I’d position my ASX share portfolio for the next market crash
• ASX 200 up 1%: Crown sinks on AUSTRAC news, South32 & CIMIC storm higher
• How the RBA is refuelling this ASX bull market
• Got a spare $10,000 to invest? Smart investors should buy these ASX shares
• ASX 200 Weekly Wrap: Promises of easy money push ASX 200 to post-crash high

Brendon Lau 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 Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Xero. The Motley Fool Australia owns shares of AFTERPAY T FPO, Appen Ltd, and WiseTech Global. 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 Brainchip (ASX:BRN) share price jumps on quarterly update appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/37fE9yZ

Many investors were spooked by the March bear market. ASX share prices were hammered across most sectors and even experienced players were worried. So, how can you position your portfolio for another ASX share market crash?

How to position your ASX share portfolio for another market crash

I think portfolio construction can sometimes be overcomplicated. In the end, it’s all about cash flow which flows through to valuation and growth.

Normally, when the market is volatile, cash is king. There’s a ‘”bird in the hand” theory, that returns today in the form of dividends are worth more than future returns from promised growth.

However, we’ve almost seen the opposite in 2020 thanks to the ‘two-speed’ economy. Growth shares like Afterpay Ltd (ASX: APT) and Xero Limited (ASX: XRO) have outperformed the S&P/ASX 200 Index (ASX: XJO) by some margin.

That might tempt some investors to go all-in on growth and do away with ASX blue-chip dividend shares. I won’t be following that trend as I think diversification is really the key here.

If we see another market crash, I’d like to have a bit of gold exposure in my portfolio. ASX gold shares have been surging as investors’ hawkishness continues to push global gold prices higher.

Given the potential mega-merger announced in recent weeks, I think the Northern Star Resources Ltd (ASX: NST) share price is worth a look. The Northern Star share price is up 44.3% this year and could climb higher if we see another ASX market crash.

I also think a non-cyclical blue-chip share is good to have. That means I’d probably look to buy something like Coles Group Ltd (ASX: COL) for stable earnings and dividends through another period of volatility.

Finally, it’s worth thinking longer-term. The federal budget signalled that infrastructure could be the ticket out of the current recession. That means I’m looking at major construction and infrastructure groups for potential earnings on the back of juicy government contracts.

I think a major provider like Lendlease Group (ASX: LLC) could be worth buying as a speculative play for some growth and income upside in another ASX market crash.

No one has a crystal ball, so these are just a few shares I’d like to buy in the next downturn. Until we see another ASX market crash, however, I’m happy to sit tight with my current portfolio.

More reading

• Brainchip (ASX:BRN) share price jumps on quarterly update
• ASX 200 up 1%: Crown sinks on AUSTRAC news, South32 & CIMIC storm higher
• 4 ASX shares to buy for a rare Christmas surprise
• How the RBA is refuelling this ASX bull market
• ASX 200 Weekly Wrap: Promises of easy money push ASX 200 to post-crash high

Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Xero. 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.

The post How I’d position my ASX share portfolio for the next market crash appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2T3bOU6

At lunch on Monday the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a stellar gain. The benchmark index is currently up 1% to 6,236.6 points.

Here’s what has been happening on the market today:

Crown sinks lower on AUSTRAC news.

The Crown Resorts Ltd (ASX: CWN) share price is sinking notably lower on Monday after revealing that AUSTRAC has contacted the casino and resorts operator. According to the update, AUSTRAC has identified potential non-compliance by Crown Melbourne with anti-money laundering and counter-terrorism financing rules. AUSTRAC has concerns over ongoing customer due diligence and adopting, maintaining, and complying with an anti-money laundering and counter-terrorism financing program.

South32 delivers solid Q1 update.

The South32 Ltd (ASX: S32) share price is pushing higher today after the release of its first quarter update. For the three months ended 30 September, South32 achieved solid production across the board. In light of this, the company has been able to reaffirm its full year production guidance. Another positive was that management has ended its share buy-back suspension. It notes that its strong operating performance and financial position have allowed its resumption.

CIMIC to sell 50% of Thiess business.

The CIMC Group Ltd (ASX: CIM) share price is surging higher today after announcing a deal to sell 50% of its Thiess business. It has signed an agreement with Elliott Advisors, which values the world’s largest mining services provider at an enterprise value of $4.3 billion (on a 100% basis). The transaction is expected to generate a pre-tax gain of around $2.2 billion for CIMIC, and a post-tax gain of around $1.4 billion.

Best and worst ASX 200 performers.

The best performer on the ASX 200 on Monday has been the Lynas Corporation Ltd (ASX: LYC) share price with a gain of almost 8%. This is despite there being no news out of the rare earths producer. The worst performer has been the Crown share price by some distance with a 8.5% decline. This follows its AUSTRAC update this morning.

More reading

• Why Cleanaway, Crown, Opthea, & Zoono shares are sinking lower today
• Why Dicker Data, South32, Tyro, and Uniti shares are pushing higher today
• South32 (ASX:S32) share price up 3% on solid Q1 update
• CIMIC (ASX:CIM) share price 5% higher after agreeing to sell 50% of Thiess
• How the RBA is refuelling this ASX bull market

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Crown Resorts 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 ASX 200 up 1%: Crown sinks on AUSTRAC news, South32 & CIMIC storm higher appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2T4WB59

The Aerometrex Ltd (ASX: AMX) share price is trading flat today despite the company’s release of a positive update on its MetroMap service. At the time of writing, the Aerometrex mapping share price is hovering at $1.31, after pulling back from $1.35 in early trade. This compares to the All Ordinaries Index (ASX: XAO) which is 0.9% higher at 6,442 points.

Let’s take a look at the company’s MetroMap developments.

What is MetroMap?

Aerometrex’s flagship service, MetroMap, is an online imagery web-serving application that offers high-quality imagery to a subscriber base. Each year, MetroMap provides its users up to four captures of each major capital city, and regional towns.

The company operates in an array of sectors including government, urban planning, construction, mining, transport, telecommunications, insurance and marketing.

Aerometrex estimates the addressable market opportunity for its service to be roughly between $75 million to $85 million annually.

MetroMap developments

The Aerometrex share price is flat today despite the company advising it has rolled out its MetroMap aerial imagery capture program to cover over 75% of the Australian population. The company said it flew over every capital city as well as 49 regional cities and towns within three months.

The increased coverage has been using Aerometrex’s large-format aerial camera system, MetroCam. This is a high-resolution camera that captures high-quality images at a 5cm pixel size. The company said its system is a 36:1 pixel ratio improvement on the best available commercial satellite imagery.

In addition, Aerometrex implemented a processing workflow and software system for its MetroCam service. The new system, called Pixel Cruncher, is designed to speed orthophoto processing by 800%. The critical component will see processing times reduce substantially to 12 to 24 hours, as opposed to one week.

What did the CEO say?

Aerometrex Managing Director, Mark Deuter, commented on MetroMap’s new developments. He said:

We have clearly demonstrated our ability to scale up MetroMap to a massive capture and processing program while still maintaining accuracy and further improving the quality and resolution of the product. Turnaround times for image processing are the equal if not better than any comparable product in the market.

We are very pleased to be providing the same quality and resolution of imagery to regional cities and towns as our major capital cities. The value of our MetroMap offering is increasing daily and is being appreciated by our subscribers.

About the Aerometrex share price

The Aerometrex share price has risen 87% since falling to its 52-week low of 70 cents in March. Although materially higher of late, the Aerometrex share price is down over 30% since the start of the calendar year and nearly 50% from its all-time high achieved in February.

More reading

• Here’s why the shares of this Nearmap (ASX:NEA) rival are surging higher today

Motley Fool contributor Aaron Teboneras 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.

The post Aerometrex (ASX:AMX) share price flat despite positive update appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/37fDnlz

In late morning trade the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a strong gain. At the time of writing, the benchmark index is up 1% to 6,240.2 points.

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

Cleanaway Waste Management Ltd (ASX: CWY)

The Cleanaway share price is down almost 2% to $2.25. This decline could be in response to media reports over the weekend. Those reports allege that workers were transferring medical waste from bins without protective gear at the height of the COVID-19 crisis. This was believed to be part of a plan to ship waste interstate to ensure it didn’t exceed its environmental license restrictions.

Crown Resorts Ltd (ASX: CWN)

The Crown share price has sunk 10% lower to $8.08. This morning Crown revealed that it has been contacted by AUSTRAC. According to the release, AUSTRAC has identified potential non-compliance by Crown Melbourne with anti-money laundering and counter-terrorism financing rules. This includes concerns in relation to ongoing customer due diligence and adopting, maintaining, and complying with an anti-money laundering and counter-terrorism financing program.

Opthea Ltd (ASX: OPT)

The Opthea share price has crashed 13.5% lower to $2.40 after announcing the pricing of its initial public offering in the United States. The biopharmaceutical company is offering 8,563,300 American Depositary Shares (ADS), representing 68,506,400 ordinary shares, at a price of US$13.50 per ADS. The aggregate gross proceeds are expected to be approximately US$128.2 million. Based on the current exchange rate, this offer equates to a 14.4% discount of A$2.38 per share.

Zoono Group Ltd (ASX: ZNO)

The Zoono share price has dropped a further 5% to $1.36. Investors have been selling the antimicrobial solutions provider’s shares since the release of its first quarter update last week. In fact, today’s decline means the Zoono share price is down 26% since that update. Zoono, which sells antimicrobial hand sanitisers and sprays, reported first quarter sales of NZ$15 million. This was down 28.2% from the NZ$20.9 million it achieved in the fourth quarter of FY 2020.

More reading

• Why IDP Education, WiseTech, Zip, & Zoono shares are tumbling lower today
• Why the Zoono (ASX:ZNO) share price is sinking 9% lower today
• ASX 200 Weekly Wrap: Budget, US election sparks 5% surge in ASX shares
• 5 things to watch on the ASX 200 next week
• Why the SKYCITY share price jumped 23% in September

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Crown Resorts 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 Why Cleanaway, Crown, Opthea, & Zoono shares are sinking lower today appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/355GpGg

I think that ASX tech shares would be a great place to invest $1,000 into a portfolio right now.

Technology companies have some really strong advantages compared to typical industrial businesses. They can produce high profit margins and expand very quickly because software can be replicated for very little cost. That means they can rapidly grow profit, which usually equates to good share price performance.

Here are two ASX tech shares I’d gladly buy with $1,000 today. They are actually the same two ASX shares I wrote about a year ago and continue to look like strong opportunities.

Redbubble Ltd (ASX: RBL)

Redbubble is an ASX tech share which is an online marketplace company for selling artist products including wall art, phone cases, masks and so on.

It’s the type of business that benefits strongly from network effects. It’s already built the e-commerce platform, so selling more products will strongly help cashflow and profit.

The company is growing at a fast rate. In the first quarter of FY21 the company reported marketplace revenue growth of $147.5 million which represented growth of 116%. Gross profit soared 149%.

It was two other metrics that were the most pleasing in my opinion. The ASX tech share generated $22.1 million of earnings before interest and tax (EBIT) and operating cashflow of $27.1 million (up 165% compared to the prior corresponding period).

I think the above numbers show that Redbubble has now reached a very pleasing profitability phase. The fact that gross profit grew so much faster than revenue shows that its margins can keep increasing at a solid rate.

As the one of the largest artist website businesses in the world, Redbubble can attract the most potential customers, which then attracts more potential sellers and so on. It’s a very helpful cycle.

There’s still plenty of growth potential because of the global shift to online shopping. Redbubble can steadily open new product lines as well, which will increase its potential market.

Its balance sheet looks solid with $85.4 million of cash at 30 September 2020.

Pushpay Holdings Ltd (ASX: PPH)

Pushpay is another ASX tech share that is looking like a really strong growth candidate in my opinion.

It facilitates digital giving, which is very useful in this era of COVID-19 social distancing and restrictions. Its main client base is large and medium US churches. Pushpay provides them with an app to connect with its congregation. Livestreaming functionality is particularly helpful.

The company is seeing enormous growth. In FY20 it grew revenue by 32% and its total processing volume rose by 39%. I think the company can continue to generate good double digit growth for many years to come.

Indeed, in FY21 alone the company is expecting to at least double its earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) to a range of US$50 million to US$54 million.

As I mentioned in my introduction, one of the most attractive things about ASX tech shares is how quickly their profit margins can grow. In FY20 Pushpay saw its gross profit margin improve from 60% to 65%. It also saw its EBITDAF margin grow from 17% to 22%. This will mean that more revenue falls to the bottom line in the coming years.

Pushpay is actually aiming for US$1 billion of revenue from the large and medium US church sector. If the ASX tech share achieves that goal then it would be substantially more profitable later this decade compared to FY20.

At the current Pushpay share price it’s trading at 41x FY21’s estimated earnings. But I think there’s more growth to come.

More reading

• Is the Redbubble Ltd (ASX: RBL) share price a buy after soaring 30% this week?
• 10 must-buy ASX shares to snap up before it’s too late
• Where I’d invest $10,000 in ASX shares for growth
• Brokers name 3 ASX shares to buy right now
• Why Beacon Lighting, Medibank, Redbubble, & Tyro shares are racing higher today

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 PUSHPAY FPO NZX. The Motley Fool Australia has recommended PUSHPAY FPO NZX. 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 This is where I’d invest $1,000 right now into ASX tech shares appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3m0vG6U

The S&P/ASX 200 Index (ASX: XJO) has started the week in very strong form. In late morning trade the benchmark index is up 0.7% to 6,219.5 points.

Four shares that are climbing more than most today are listed below. Here’s why they are pushing higher:

Dicker Data Ltd (ASX: DDR)

The Dicker Data share price is up 5% to $8.89 following the release of its third quarter update. According to the release, the distributor of computer hardware and software has achieved revenue growth of 14.9% to $1,481.5 million for the nine months to 30 September. Things were even better on the bottom line, with net profit before tax up 28.3% to $60.8 million over the nine months.

South32 Ltd (ASX: S32)

The South32 share price is climbing almost 4% higher to $2.19. This follows the release of the mining giant’s first quarter update. South32 delivered production in line with expectations, which led to management reaffirming its full year guidance. In addition to this, its strong operating performance and financial position has allowed the company to resume its share buy-back program.

Tyro Payments Ltd (ASX: TYR)

The Tyro share price is up 3.5% to $4.30 following the release of its weekly COVID-19 trading update. That update revealed that Tyro has processed $1.025 billion of transactions month to date. This is up 11% on the prior corresponding period. In addition to this, this morning Ord Minnett retained its accumulate rating and lifted its price target on Tyro’s shares to $5.00.

Uniti Group Ltd (ASX: UWL)

The Uniti share price has risen over 2% to $1.27 following its first quarter update. The telco reported record net operating cash flow of $10.5 million for the quarter. Management also revealed that key financial performance metrics for first three months of FY 2021 are above budgeted levels. This includes above-budget growth in new FTTP connections and activations.

More reading

• South32 (ASX:S32) share price up 3% on solid Q1 update
• 5 things to watch on the ASX 200 next week
• ASX 200 falls, Tyro (ASX:TYR) up on merchant deal
• Why Beacon Lighting, Medibank, Redbubble, & Tyro shares are racing higher today
• Tyro (ASX:TYR) share price shoots higher on Bendigo and Adelaide Bank (ASX: BEN) deal

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 Dicker Data 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 Why Dicker Data, South32, Tyro, and Uniti shares are pushing higher today appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/35eZg1y

Shares in insurance software developer FINEOS Corporation Holdings plc (ASX: FCL) have soared almost 90% higher so far this year. Despite the market challenges posed by the COVID-19 pandemic, FINEOS has managed to achieve a number of impressive milestones in 2020, including signing the largest insurance company in the United States and recently acquiring software company Limelight Health, Inc.

FINEOS develops a suite of software for the life, accident and health insurance industries. Its AdminSuite platform is a centralised system that supports billing, claims and payments. Its customer-centric software automates and streamlines processes for insurance providers and can replace legacy insurance administration platforms.

In its FY20 results, Dublin-based FINEOS beat its own revenue targets, reporting growth in revenues of close to 40% year on year. Of the 87.8 million euros in total revenues in FY20, 27 million euros came from recurring subscriptions, while 58.3 million euros was services revenue from new clients and accelerated implementation and upgrades for existing clients. And despite the ongoing disruptions from COVID-19, the company is still optimistic for FY21, forecasting top line revenue growth of 20%, underpinned by 30% growth in subscription revenues.

The Limelight acquisition could help to rapidly accelerate the company’s growth forecasts. Silicon Valley-based Limelight Health is a leading provider of software for the United States insurance industry. The acquisition helps boost FINEOS’ presence in the US market, and it means that FINEOS can now leverage Limelight’s experienced US-based sales and marketing team to increase market penetration and brand recognition.

This also comes on the heels of FINEOS’ February announcement that it had signed the Prudential Insurance Company of America, the largest insurance company in the US. FINEOS is clearly sending the signal to the market that it views a US expansion as a key priority over the next 12 months.

Should you invest?

Along with other up-and-coming tech companies like Nitro Software Ltd (ASX: NTO), Bigtincan Holdings Ltd (ASX: BTH) and Megaport Ltd (ASX: MP1), I believe FINEOS Corporation is cementing itself as part of a new generation of young companies that could become the next WAAAX shares. Despite the upheaval caused by the pandemic, these junior companies have all found ways to thrive.

With a market capitalisation of a little over $1.5 billion, FINEOS has grown into a solid mid-cap stock. It is generating consistent subscription revenues and has a portfolio of top tier insurance companies as clients. It is taking on additional risk through a US expansion, however this is already showing results through key client wins. Plus, it has shown an appetite for strategic acquisitions that could complement its business model.

Despite challenging market conditions, I believe this company has laid a solid foundation for future growth. The FINEOS share price will be an exciting one to watch over the next 12 months.

More reading

• South32 (ASX:S32) share price up 3% on solid Q1 update
• Ampol (ASX:ALD) share price drops lower after Q3 update
• CIMIC (ASX:CIM) share price 5% higher after agreeing to sell 50% of Thiess
• 1 ASX share to buy for the WA housing boom
• What happened to the Mesoblast Limited (ASX:MSB) share price?

Rhys Brock owns shares of FINEOS Holdings plc, BIGTINCAN FPO, MEGAPORT FPO, and Nitro Software Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends BIGTINCAN FPO and MEGAPORT FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends FINEOS Holdings plc. The Motley Fool Australia has recommended BIGTINCAN FPO, FINEOS Holdings plc, MEGAPORT FPO, and Nitro Software 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 Why ASX software company FINEOS Corporation (ASX:FCL) could light up the market in FY21 appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3o6pT1h

The South32 Ltd (ASX: S32) share price has started the week in a positive fashion.

In morning trade the mining giant’s shares are up almost 3% to $2.17.

Why is the South32 share price pushing higher?

Investors have been buying South32’s shares on Monday following the release of its first quarter update this morning.

For the quarter, the company achieved alumina production of 1,315kt, aluminium production of 248kt, manganese ore production of 1,461kt, and metallurgical coal production of 1,651kt.

As a comparison, a note out of Goldman Sachs reveals that it was expecting production of 1,328kt, 248kt, 1,302kt, and 1,650kt, respectively. While this means it alumina production fell slightly short of expectations, its manganese made up for this with significantly better than forecast production.

This ultimately led to South32 delivering a US$70 million increase in its net cash position over the three months to US$368 million. This was despite a build in working capital as commodity markets improved.

Share buy-back to resume.

Pleasingly for shareholders, this strong operating performance and the further strengthening of its financial position, has allowed South32 to lift its on-market share buy-back suspension.

Its US$1.43 billion capital management program is 92% complete with US$121 million remaining to be returned to shareholders.

South32’s CEO, Graham Kerr, was very pleased with the quarter, particularly given the challenges it faces from operating in the current environment.

He commented: “Despite the health crisis, we have maintained annual production guidance at all operations. We delivered a 19 per cent increase in manganese ore production and a 22 per cent increase in metallurgical coal production.”

“With another quarter of strong operating performance behind us and the further strengthening of our financial position, we have lifted the suspension of our on-market share buy-back. Our capital management program has US$121 million remaining and recommencing our buy-back will deliver immediate value to our shareholders,” Mr Kerr concluded.

More reading

• 5 things to watch on the ASX 200 next week
• 2 ASX shares looking dirt-cheap today
• New Chinese government threat leaves these ASX mining stocks on tenterhooks
• ASX shares Tesla (NASDAQ:TSLA) needs to survive
• EcoGraf (ASX:EGR) shares up 72% in a week

Motley Fool contributor James Mickleboro 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.

The post South32 (ASX:S32) share price up 3% on solid Q1 update appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3jbglOM