Author: therawinformant

ASX big bank stocks could soon be facing a new challenge after a recent survey found that more than half of borrowers on deferred mortgages are suffering from poor financial health.

What’s more, the banks may not be fully aware of how much financial pain these distressed borrowers are suffering, according to UBS who undertook its sixth mortgage survey.

This is the same broker that warned about “liar loans” in past surveys, where borrowers overstated their income and understated their liabilities in order to secure a home loan.

Are ASX banks underestimating the number of zombies?

Lenders have allowed customers to defer loan repayments till end of September due to COVID-19. The banks are contacting these mortgagees to see if they are able to resume regular loan repayments.

There could be more “zombie mortgages” out there than the market believes. These are loans that are kept alive only because of the temporary goodwill shown by the banks and government support payments.

The problem is made worse by liar loans. UBS anonymously surveyed 904 borrowers from late July to September who took out a new loan in the past year.

Liar loans remain an ongoing issue

“Once again, we found 37% of the sample stated their mortgage application was not ‘completely factual and accurate, a level consistent with the previous five vintages,” said UBS.

“Of more concern, the credit quality of customers who misstated their mortgage were significantly weaker than truthful customers.”

Majority of distressed borrowers still in trouble

The latest survey found that 53% of those on deferred loans did not intend to return to normal payments, while 32% intend to switch to Interest Only (IO) and 21% intended to ask to extend deferral.

“However, the credit quality of customers intending to ask their bank to extend their deferral is concerning,” warned the broker.

Of these borrowers, 40% had overstated their income by an average of 21% in their mortgage application. UBS also found that 15% understated other debts, 67% are on JobKeeper and 25% are on JobSeeker.

Threat to ASX bank profits

This group also reported a 19% drop in average income due to COVID-19, and this is on top of the overstated income on their loan application!

“Unfortunately, we found the financial position of those asking to move to IO is only marginally better,” added UBS.

“We believe the banks need to undertake significant due diligence before extending deferrals or moving deferred customers to IO, as a large number of these borrowers are likely to be under more stress than the banks perceive.”

No turnaround for ASX bank stock share prices

Bank stocks have underperformed the S&P/ASX 200 Index (Index:^AXJO). The Commonwealth Bank of Australia (ASX: CBA) share price, National Australia Bank Ltd. (ASX: NAB) share price, Westpac Banking Corp (ASX: WBC) share price and Australia and New Zealand Banking Group (ASX: ANZ) share price have fallen between 20% and 30% in 2020.

In contrast, the ASX 200 lost around 12% over the same period.

More reading

• ASX 200 rises 1%, Reliance Worldwide (ASX:RWC) climbs 11%
• ASX 200 up 1.6%: CBA higher on COVID-19 loan deferrals update, Reliance rockets
• Investors push for 40% women in ASX 200 exec roles
• Commonwealth Bank (ASX:CBA) share price higher on COVID-19 loan deferral update
• Potential ASX winners from government’s $1.5bn manufacturing blueprint

Motley Fool contributor Brendon Lau owns shares of Australia & New Zealand Banking Group Limited, Commonwealth Bank of Australia, National Australia Bank Limited, and Westpac Banking. Connect with me on Twitter @brenlau.

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 OceanaGold Corp (ASX: OGC) share price returned from its trading halt with a thud on Thursday.

The gold miner’s shares crashed as much as 10% lower to $2.12 at one stage today before ending the day down 9% at $2.15.

Why did the OceanaGold share price sink lower?

Investors have been selling OceanaGold’s shares after it announced a C$150 million (A$157.1 million) equity raising.

According to the release, the company has entered into an agreement with a syndicate of underwriters, led by Scotiabank and BMO Capital Markets. They have agreed to purchase, on a bought deal basis, 73 million shares at a price of C$2.06 per new share.

This represents a discount of almost 9% to the last close price of its Canada-listed shares.

In addition to this, OceanaGold has granted the underwriters the option to purchase up to an additional 10.95 million shares at the offer price. These options are exercisable in whole or in part until and including 30 days following the closing date of 30 October.

Why is OceanaGold raising funds?

The company advised that the net proceeds from the equity raising will be used to fund organic growth projects.

This includes the Haile underground development in the United States and ongoing exploration and development of its mineral properties in New Zealand.

In addition to this, some of the proceeds will be used for working capital and general corporate purposes.

What about Australian retail investors?

Unfortunately for local retail investors, the company doesn’t have plans to offer them the chance to pick up shares at the same price through a share purchase plan.

Though, given the weakness in its share price on Thursday, investors would have been buying in at roughly the same level as these institutional investors if they picked up shares earlier today.

More reading

• Why EOS, Jumbo, Nearmap, & OceanaGold shares are dropping lower today

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.

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Is silver a good investment in 2020?

In the department of precious metals, it’s normally gold that gets the attention as an attractive asset class to invest in. Gold has been the foundation of the world’s monetary system practically until the 1970s. So it makes sense that investors are still attracted to its use as a store of value.

In 2020 so far, gold has indeed attracted a lot of attention, helped of course by surging demand. Over the course of the year to date, the gold price has appreciated from US$1,520 an ounce to a high of US$2,061 an ounce that we saw back in early August. This broke the previous all-time high of US$1,921 an ounce that was set back in 2011. Today, gold has cooled somewhat at the current price of US$,1898. But it’s still a popular choice for portfolio diversification and hedging against economic, monetary and geopolitical uncertainty.

Silver as an investment

But what has been less prevalent (or at least obvious) in 2020 is the fortune of another precious metal: silver. Although not as conspicuous as gold, silver also has a history of monetary use. Coins used to be minted in silver after all, and there have been instances in history where it was also used as a monetary foundation for currencies. Silver functions a little differently to gold in reality though. Unlike its yellow cousin, silver has a myriad of industrial uses. Perhaps the most pertinent in our modern age is silver’s status as a key ingredient in rechargeable batteries and solar panels. This tends to translate into a more volatile price for silver. As an example, in 2020 so far, silver has fluctuated between US$12 and US$29 an ounce.

But what of silver as an investment?

It’s certainly offered and available today as such a vehicle. Physical silver bullion is always an option. And alongside gold, there are exchange-traded funds (ETFs) on the ASX that allow access to silver. A primary example is the ETFS Physical Silver ETF (ASX: ETPMAG). So the question now is not ‘can you buy silver as an investment?’ but ‘why should you?’

Is silver a good idea for an ASX portfolio?

Many of the reasons that attract investors to gold as an investment can also be applied to silver. It is a scarce and precious metal with intrinsic value. In this way, it demonstrates some of the similar perceived ‘inflation/deflation’ protections that gold offers. And unlike currencies these days, silver cannot be ‘printed’ on-demand, which is another factor that some investors appreciate.

However, as I mentioned earlier, silver is also far more volatile than gold, which provokes some scepticism for its use as an effective store of wealth. I think ordinary investors will probably find little use for silver as an investment because of this. There is nothing that silver can offer against gold as a better alternative apart from the more potential upside fuelled by its volatility, in my view.

Foolish takeaway

If you are interested in pursuing silver as an investment, I would recommend using a ‘rebalancing strategy’ for a small and predetermined allocation in your portfolio, say 5%. This strategy might have the potential to lend some diversification from an asset not correlated with your ASX shares. But otherwise, I think silver is set to remain a fringe option for most ASX investors. Thus, I wouldn’t bother with silver as an investment unless you really want to.

More reading

• Where to now for the Flight Centre (ASX:FLT) share price?
• ASX 200 rises 1%, Reliance Worldwide (ASX:RWC) climbs 11%
• 2 high yield ASX dividend shares to solve your income needs
• ASX big bank profits haunted by zombie mortgages
• Why the OceanaGold (ASX:OGC) share price sank 10% lower today

Motley Fool contributor Sebastian Bowen owns shares of ETFS Physical Silver ETF. 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 ClearVue Technologies Ltd (ASX: CPV) share price is currently trading higher after the company announced it has received a large order for 500sq m of its product. As a result of the news, the ClearVue share price has surged 10.71% higher to 31 cents at the time of writing.

What ClearVue does

ClearVue is an Aussie tech company focused on the integration of solar technology into building surfaces, specifically glass and building facades, to provide renewable energy. It has developed advanced glass technology that aims to preserve the transparency  and aesthetics of the glass whilst generating electricity at the same time. ClearVue worked closely with experts from Edith Cowan University in Perth, Western Australia to develop the technology, which has been used across the building, construction and agricultural industries. 

ClearVue share price rising on record order

The ClearVue share price is surging as the company announced it has received its first order out of South America from local company, AMB Brasil. AMB Brasil has been appointed the exclusive ClearVue distributor in Brazil.

This first order is for 500sq m of ClearVue product, worth approximately $278,700. The order represents ClearVue’s largest order to date and reinforces proof of product for the company’s technology.

Product to fulfil the order will be produced through ClearVue’s manufacturers in China and will ship in early 2021 for installation into a number of projects being undertaken by AMB Brasil. The first of these projects is a commercial office tower, which will use roughly 250sq m of the product.

Commenting on ClearVue’s first South American order and the appointment of its new Brazilian distributor, ClearVue CEO, Ken Jagger, said:

AMB Brasil’s upcoming high-rise deployments of ClearVue technology is a perfect fit for our target market. A very near-term showcase retrofit, two commercial towers and further deployment opportunities within the wider AMB Brasil development site(s) represents a sensational example of environmentally focused high-rise construction globally. We are very much looking forward to a successful future with AMB Brasil as ClearVue’s Brazilian sales partner in this key South American territory.

What now for the ClearVue share price?

With the appointment of AMB Brasil as a ClearVue distributor, the Aussie tech company adds to a growing list of global distributors and manufacturers of its technology. Shareholders will be encouraged by the fact the company is continuing to expand its reach abroad.

The ClearVue share price is currently trading a huge 63% higher so far this year.

More reading

• Where to now for the Flight Centre (ASX:FLT) share price?
• ASX 200 rises 1%, Reliance Worldwide (ASX:RWC) climbs 11%
• 2 high yield ASX dividend shares to solve your income needs
• ASX big bank profits haunted by zombie mortgages
• Why the OceanaGold (ASX:OGC) share price sank 10% lower today

Motley Fool contributor Daniel Ewing 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 A2 Milk Company Ltd (ASX: A2M) share price was uncharacteristically among the worst performers on the S&P/ASX 200 Index (ASX: XJO) in September.

The infant formula and fresh milk company’s shares lost approximately 17.5% of their value during the period.

Why did the a2 Milk share price sink lower in September?

The entirety of the a2 Milk share price decline came in the final week of the month following the release of a trading update.

That update revealed that the company has started to observe emerging disruption to the corporate daigou and reseller channel. This was particularly the case during the Stage 4 lockdown in Victoria.

As a result of this disruption, management advised that it is witnessing a contraction in the daigou channel beyond its previous expectations. It is also not seeing the replenishment orders that would typically be anticipated at this point.

Combined with headwinds associated with pantry destocking following panic buying during the height of the pandemic, a2 Milk expects its first half sales to be lower than the prior corresponding period.

Management explained: “This disruption in the daigou channel is impacting our September sales and it is currently anticipated that this will continue for the remainder of the first half of FY21. Sales in the daigou channel represent a significant proportion of infant formula sales in our Australia & New Zealand (ANZ) business and, as such, we now expect ANZ revenue to be materially below plan for the first half.”

FY 2021 guidance.

It is forecasting first half sales in the range of NZ$725 million to NZ$775 million, which will be down 3.9% to 10.1% from NZ$806.7 million a year earlier.

And while it expects things to pick up in the second half and lead to full year sales and profit growth, the level of growth is much slower than investors have become accustomed to.

In FY 2021 sales are expected to be NZ$1.8 billion to NZ$1.9 billion, which represents a 4% to 9.8% increase year on year.

As for its earnings, the company is forecasting an earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 31%. This would result in EBITDA of NZ$558 million to NZ$589 million for FY 2021, up 1.5% to 7.1% from NZ$549.7 million a year earlier.

Is this a buying opportunity?

I expect trading conditions will remain subdued in the daigou channel for a little while to come due to international tourism restrictions, however, this appears to have been factored into its share price now.

In light of this, I think this share price weakness could be a good opportunity for investors looking to make a buy and hold investment.

Especially given its very positive long term growth outlook. This is thanks to its expanding fresh milk footprint, its growing distribution network in China, and its modest market share in the key market.

More reading

• 2 top ASX shares I’d buy with $2,000 for October and beyond
• Top brokers name 3 ASX shares to buy today
• Why a2 Milk, BrainChip, Oil Search, & Starpharma shares are dropping lower
• Could the Bubs (ASX:BUB) share price be an A2 Milk (ASX:A2M) contender? 
• These are the ASX blue chip shares I’d buy today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended A2 Milk. 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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Healthcare shares have long been outperformers on the S&P/ASX 200 Index (ASX: XJO) and in the general sharemarket. But in recent weeks, many ASX 200 healthcare shares have faced setbacks in the wake of significant share price run ups, weaker than expected earnings and sharp selloffs.

Could these 2 ASX 200 healthcare shares be in the buy zone yet? Let’s take a look.

1. Nanosonics Ltd (ASX: NAN) 

Nanosonics has been able to trade at an eye-watering valuation on the hopes that it would become the next CSL Limited (ASX: CSL) within the ultrasound probe disinfection market. The company boasts a $1.75 billion valuation with a price-to-earnings (P/E) ratio of 180. 

Following a weak FY20 earnings report on 25 August, the Nanosonics share price has drifted 10% lower. The company delivered a 19% increase in revenue to $100.1 million while profit before tax fell to $12.4 million. This compared to $16.8 million in FY19.

In the first three quarters of the year, total revenue was up 26% on pcp. In Q4, when the main impacts of COVID-19 were experienced, revenue increased by only 1%. While Nanosonics has experienced a weak earnings period, the significant global market opportunity remains intact. The company has approximately 20% global market penetration of the ultrasound probe disinfection market.

Key geographic opportunities include North America, Europe, the Middle East and Asia. The business continues to focus on its Japan market development strategy with distribution agreements in place with five key distributors and the continued development of a China market entry strategy. Nanosonics could be a solid ASX 200 healthcare share to own for long-term investors given the significant global market opportunity at hand. 

2. Fisher & Paykel Healthcare Corp Ltd (ASX: FPH) 

The Fisher & Paykel share price has soared more than 45% this year following the tailwinds that COVID-19 has brought for its business. In its latest business update announced on 18 August, the company cited strong demand for its hospital respiratory care products with hospital hardware sales in the first four months of FY21 increasing 390% on pcp. The company is seeing that revenue by geography tends to follow the incidence of COVID-19 cases and the recent resurgence of COVID-19 cases across Europe, India and US could see further earnings tailwinds for its respiratory products. 

The business update also forecasted FY21 operating revenue to be approximately $1.61bn and net profit after tax to be within the range of $365 million to $385 million. This would represent an increase of 27-34% on FY20. I believe Fisher & Paykel could see an elevated growth trajectory for the short to medium term driven by COVID-19 related tailwinds. I believe its recent pullback could be a buying opportunity. 

More reading

• 5 ASX shares held by leading fund managers
• Are these blue chip ASX 200 shares worth buying?
• ASX 200 falls 0.7%, UK and travel shares drop
• Why Collins Foods, ResMed, Regional Express, & Xero shares are pushing higher
• ASX technology stocks to buy during this global tech sell-off

Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and Nanosonics Limited. The Motley Fool Australia has recommended Nanosonics 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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Vanguard Australian Share ETF (ASX: VAS) is one of the biggest and most popular ETF investments for Aussie investors. But should you buy it?

A quick overview of Vanguard Australian Share ETF

An exchange-traded fund (ETF) allows you, through a stock exchange, to buy a fund which enables you to own lots of assets in a single investment.

This particular one aims to track the S&P/ASX 300 Index (ASX: XKO). So you get the exposure to the large caps like Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP) and CSL Limited (ASX: CSL). But you also get a little bit of exposure to names like ELMO Software Ltd (ASX: ELO), Integrated Research Limited (ASX: IRI) and Lovisa Holdings Ltd (ASX: LOV).

It has an annual management fee of 0.10% per annum. This is one of the lowest that ASX investors can get access to. 

Why it’s a good investment

One of the best reasons to consider Vanguard ETFs is that they have extremely low fees compared to their active management competitors. The lower the fees, the more net returns that are left in the hands of the investors like you and me.

Diversification is a key part of investing in ETFs. Diversification is great at lowering company-specific risks if you own hundreds of businesses. Vanguard Australian Share ETF gives you exposure to 300 names for a very cheap fee.

Australia has been a good place to be invested over the past century, giving returns of about 10% per annum. Perhaps Australia won’t be the best place over the next 100 years, but I expect it will do reasonably well for ASX investors.

During normal, non-COVID-19 times, the ASX is a good place for dividend income because of the fairly high dividend payout ratios as well as the bonus of franking credits. However, banks in-particular are paying out smaller dividends at the moment because of the COVID-19 recession.

Why I believe there are better alternatives

The Vanguard Australian Share ETF is weighted towards the largest businesses in Australia which are typically resource businesses like Rio Tinto Limited (ASX: RIO) and banks like Westpac Banking Corp (ASX: WBC). Australia has been the lucky country for a long time. But I don’t think these are the best industries to be invested in for the coming years and decades ahead.

There are some promising smaller ASX shares like A2 Milk Company Ltd (ASX: A2M), REA Group Limited (ASX: REA) and Magellan Financial Group Ltd (ASX: MFG). But they don’t move the needle enough to make a large impact on the returns of the ETF.

For me, there are better alternatives. You don’t have to pick individual shares yourself. There are other ETFs and listed investment companies (LIC) that offer more growth potential in my opinion.

These other options may have higher management fees, but it’s the net returns that I’m focused on. More earnings growth will hopefully continue to generate better investment returns.

I prefer other portfolio investment options like Betashares Global Quality Leaders ETF (ASX: QLTY), BetaShares Global Sustainability Leaders ETF (ASX: ETHI), WAM Microcap Limited (ASX: WMI), Ophir High Conviction Fund (ASX: OPH), MFF Capital Investments Ltd (ASX: MFF), Magellan Global Trust (ASX: MGG) and Magellan High Conviction Trust (ASX: MHH).

I think all of the above options would make better long-term investments than Vanguard Australian Share ETF, aside from any short-term US election volatility. In my opinion, the above options provide more growth potential than what ASX blue chip shares can provide.

Over the long-term, I believe it’s growth of earnings that help deliver the best returns for investors. If you want Australian dividends, then I think ASX shares like Brickworks Limited (ASX: BKW) could be more reliable options.

More reading

• Here are the 10 most popular ETFs on the ASX
• 3 top ASX ETFs to buy for long-term growth
• Why you’re better off investing in ASX shares in 2020 than paying off the mortgage faster
• Buy Fortescue and this ASX dividend share for a source of income
• The 3 best ETFs for passive investing

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 and recommends Elmo Software. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and Integrated Research Limited. The Motley Fool Australia owns shares of and has recommended A2 Milk and Brickworks. The Motley Fool Australia has recommended Elmo Software and REA Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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On Thursday eligible shareholders of Wesfarmers Ltd (ASX: WES) will be paid the conglomerate’s final dividend.

The Bunnings owner is rewarding shareholders with a fully franked 95 cents per share final dividend, which was up almost 22% year on year.

If you’re planning to reinvest these funds back into the share market, then you might want to consider the shares listed below.

I believe all three of these ASX shares could be great options for these funds. Here’s why I like them:

Bravura Solutions Ltd (ASX: BVS)

If you’re interested in a combination of growth and income, then you might want to take a closer look at Bravura Solutions. It is the financial technology company behind the Sonata wealth management platform and a number of other solutions with large addressable markets. Combined, I believe they have positioned Bravura perfectly for growth over the 2020s. And due to a pullback in its share price, Bravura’s shares currently offer an attractive estimated forward 3.2% dividend yield.

BWP Trust (ASX: BWP)

Investors that are looking purely for more dividends might want to look at BWP. It is a real estate investment trust (REIT) that invests in and manages commercial assets across Australia. The majority of these assets are leased to Wesfarmers’ home improvement business, Bunnings Warehouse. I believe BWP is well-placed to grow its distribution at a solid rate over the next decade thanks to the strength of the Bunnings business. For now, based on the current BWP share price, I estimate that it offers investors a forward 4.4% yield.

PolyNovo Ltd (ASX: PNV)

Finally, if you’re interested in investing these funds into a growth share, then you may want to consider PolyNovo. I think the medical device company has a very bright future ahead of it. This is thanks to its NovoSorb Biodegradable Temporising Matrix (BTM) product. This wound dressing product is designed to treat full-thickness wounds and burns and has a sizeable $1.5 billion addressable market. PolyNovo is also looking to expand its usage into other markets, which would add a further $6 billion to its addressable market.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Forget term deposits and buy these ASX dividend shares for income
• 3 ASX shares for growth, income, and value investors to buy in October
• Why I would buy these ASX dividend shares today
• Which ASX REITs are still worth buying in a post-COVID-19 world?

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 POLYNOVO FPO. The Motley Fool Australia owns shares of and has recommended Bravura Solutions Ltd. 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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The Envirosuite Ltd (ASX: EVS) share price strapped a rocket on today, zooming 25.8% higher to reach 20 cents in early afternoon trade. This follows a positive market update on its first quarter sales performance for the 2021 financial year.

What does Envirosuite do? 

Envirosuite is a global leader in environmental solutions, monitoring and managing weather impacts. The company uses its combination of air quality and metrology consultancy thoughreal-time and predictive technologies to reduce risk and improve efficiency and safety among industry and communities throughout the world.

The company operates in various sectors including construction, industrial, mining, wastewater, airports and cities.

First quarter update

Envirosuite reported total sales of $14.7 million in the three-month period ending September 30. This is despite the global impact of COVID-19 resulting in some deferral of spending by customers.

The company achieved strong contract renewals and new sales volumes for Q1 FY21 which was reflected by $12.2 million from ongoing business and $1.2 million in new targeted recurring sales. An additional $1.2 million was generated in one-off sales of equipment and services.

Customers remained active across all geographical regions and industry sectors. Most notably, Envirosuite secured an airport contract renewal by the AENA group, which manages 46 airports in Spain.

In the mining sector, the company carried out additional work for Vale Brazil and BHP Chile. Waste sector highlights included an odour monitoring project with the City of Denver, Colorado, and an outdoor management system for Verde South America in Chile.

Envirosuite signed water contracts with Welsh Water UK, and with the City of Garland Water Utilities Texas for odour monitoring and sewage treatment plants.

Envirosuite advised that its forward sales pipeline remains strong and currently stands at $28 million for FY21.

What did management say

Envirosuite CEO Peter White was happy with the result given the current climate, and upbeat about the company’s future growth. He said:

Contract renewals and new sales growth were spread across all the regions and industry sectors in which we operate. Q1 marks the commencement of the sales and marketing efforts post-integration which are steadily gathering momentum as noted in our latest release with a 300% increase in new sales leads from July to September. Coupled with the strong forward pipeline, this augers well for our sales growth to accelerate in coming quarters

Mr White highlighted the importance in Envirosuite’ presence to communities, saying:

One of the effects of COVID-19 for Envirosuite has been that the world is more aware than ever of the importance of not only ensuring environmental compliance, but of going beyond compliance and actively managing outcomes for the benefit of communities.

Envirosuite’s ability to help our customers maintain and enhance their social licence to operate will be a major focus of our sales growth strategy in the years ahead.

Foolish takeaway

Envirosuite has thrived throughout the COVID-19 pandemic, achieving robust sales so far this year. With the company looking to accelerate its growing revenue in FY21, I think Envirosuite is worth keeping an eye on for future investment.

More reading

• Why the Envirosuite (ASX: EVS) share price is up 9% today
• ASX All Technology Index swells with new additions
• The Envirosuite share price dropped 5% today. Here’s why

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.

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Australia’s top brokers have been busy adjusting their estimates and recommendations again, leading to the release of a large number of broker notes this week.

Three broker buy ratings that have caught my eye are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

BHP Group Ltd (ASX: BHP)

According to a note out of Credit Suisse, its analysts have upgraded this mining giant’s shares to an outperform rating with a $39.00 price target. The broker made the move after increasing its estimates for Chinese steel consumption over the next couple of years. It expects this to support demand for iron ore and keep prices elevated for longer. In addition to this, Credit Suisse has a positive view on coking coal. I agree with the broker on BHP and would be a buyer of its shares.

Corporate Travel Management Ltd (ASX: CTD)

Analysts at UBS have retained their buy rating and lifted the price target on this corporate travel specialist’s shares to $18.70. The broker appears pleased with the company’s business-changing acquisition of US-based Travel & Transport for $274.5 million. As well as the synergies it will provide, UBS believes that the increased scale will help it win a greater share of the North American market. I think UBS makes some great points and Corporate Travel Management could be worth considering.

Jumbo Interactive Ltd (ASX: JIN)

A note out of Morgans reveals that its analysts have retained their add rating and trimmed the price target on this online lottery ticket seller’s shares slightly to $13.89. This follows the announcement of an agreement with Lotterywest in Western Australia for its Powered by Jumbo SaaS platform. Although the broker expects softer revenue margins from the deal, it still sees it as a positive and believes it could help with its discussions with international lotteries. I agree with Morgans and think Jumbo would be a great long term option due to its SaaS business.

More reading

• Why EOS, Jumbo, Nearmap, & OceanaGold shares are dropping lower today
• Why BHP, Paradigm, Reliance, & SeaLink shares are charging higher today
• ASX 200 sinks 2%, Corporate Travel (ASX:CTD) soars 8%
• 2 exciting ASX mid cap ASX growth shares to buy for the long term
• Top brokers name 3 ASX shares to buy today

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Jumbo Interactive Limited. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited and Jumbo Interactive 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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