Author: therawinformant

The SeaLink Travel Group Ltd (ASX: SLK) share price has been a very strong performer on Thursday.

In morning trade the travel and transport company’s shares are up 8.5% to a record high of $6.02.

Why is the SeaLink share price surging higher?

Investors have been buying the company’s shares on Thursday after it announced a major contract win.

According to the release, following a competitive tender, the Land Transport Authority of Singapore has awarded SeaLink’s Tower Transit business the PT217 contracts to operate both the Bulim package and the Sembawang-Yishun package of public bus services in Singapore.

Tower Transit has been operating public bus services in Singapore for the Land Transport Authority since 2016.

Two new five-year contracts have been signed, with two-year extension options. These commence from 30 May 2021 for Bulim services and 5 September 2021 for Sembawang-Yishun. The Bulim contract is a renewal, which management notes extends its long track record of successful contract retention.

These contracts secure more than S$1 billion (A$1.02 billion) of contracted revenue over the first five years. They involve the operation of a total of 56 bus routes and the maintenance of more than 700 buses, two depots, five interchanges, and a terminal.

A milestone.

SeaLink Group’s CEO, Clint Feuerherdt, appeared to be very pleased with the agreement and notes that it is a milestone for its Singapore business.

He commented: “This announcement is a milestone for SeaLink’s subsidiary, Tower Transit Singapore, as it means a doubling of the scale of our operations in Singapore in terms of the number of routes, staff, buses, facilities and revenue.It also reinforces our presence in Singapore, one of the top-ranked cities in the world for public transport. SeaLink remains passionately committed to designing, delivering and operating world class services that reflect the needs of the community and our customers.”

“With two bus packages, Tower Transit Singapore will be in a strong position to continue to contribute to Singapore’s world-class, innovative bus network. We look forward to working on a smooth implementation for these contracts with the Land Transport Authority in the coming months and continuing to support its plans to improve and enhance Singapore’s land transport industry.” he concluded.

More reading

• Why BHP, Paradigm, Reliance, & SeaLink shares are charging higher today
• 3 ASX shares making all-time highs today
• Why Northern Star, SeaLink, THC Global, & Whitehaven Coal shares are dropping lower
• ASX shares to own now for the Santa Claus rally of all time
• The best ASX stocks to buy for the COVID-19 recovery play

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 SeaLink (ASX:SLK) share price surges to record high on major Singapore contract win appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3jjNd9d

The Paradigm Biopharmaceuticals Ltd (ASX: PAR) share price is charging higher again on Thursday.

In morning trade the biopharmaceutical company’s shares are up a sizeable 9% to $2.89.

This latest gain means the Paradigm share price is now up over 25% since the start of the week.

Why is the Paradigm share price rocketing higher?

Investors have been fighting to get hold of the company’s shares this week following a series of positive updates.

On Monday Paradigm announced that it has received positive feedback from the European Medicines Agency after its recent scientific advice meeting.

Then on Tuesday Paradigm revealed that it has extended and expanded its exclusive license and supply agreement with bene pharmaChem. This is a big positive for Paradigm as bene pharmaChem is the only FDA approved manufacturer/supplier of Pentosan Polysulphate Sodium (PPS). PPS is used in the company’s Zilosul product.

Speaking of Zilosul, this morning Paradigm provided an update on a study involving the promising product.

What did Paradigm announce?

Today, Paradigm has provided an update on a study which saw patients receive Zilosul under the Therapeutic Goods Administration (TGA) Special Access Scheme (SAS) for the treatment of knee osteoarthritis.

According to the release, the company has received additional data on 42 patients. This data brings the cumulative average Western Ontario and McMaster Universities Osteoarthritis Index (WOMAC) reduction in pain from the baseline for the 76-patient cohort to 47.3%.

This compares to 44.9% from the first 34 patients.

The release explains that 73.7% of the 76 patients reported at least a 25% reduction in WOMAC pain, with 52.6% of patients reporting a greater than 50% reduction in WOMAC pain.

Pleasing outcomes.

The company’s CEO, Paul Rennie, was pleased with the data.

He said: “As we progress toward regulatory submissions for Paradigm’s proposed Phase 3 global study, it’s pleasing to receive consistent patient WOMAC pain reduction outcomes through the TGA Special Access Scheme.”

“Consistency is key here. We are seeing consistent clinically meaningful reduction in pain and improvement in joint function in OA patients who have failed to respond to other medications. Paradigm remains primarily focussed on our upcoming submissions to the multiple regulatory agencies as we continue to progress toward commercialisation,” he concluded.

More reading

• Why Flight Centre, MoneyMe, Paradigm, & Zip shares are pushing higher today
• Why the Paradigm (ASX:PAR) share price is storming 12% higher today
• Why the Paradigm (ASX:PAR) share price has rocketed 8% higher today
• Why Flight Centre, OneVue, Paradigm, & PointsBet shares are charging higher

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 Paradigm (ASX:PAR) share price rockets higher on Zilosul update appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3iiX6m3

The Commonwealth Bank of Australia (ASX: CBA) share price is pushing higher on Thursday following the release of an update.

At the time of writing the banking giant’s shares are up 0.5% to $63.94.

Why is the CBA share price pushing higher?

Investors have been buying the bank’s shares after it released an update on its COVID-19 temporary loan repayment deferral data through to the end of August.

According to the release, Commonwealth Bank’s total loan deferrals stood at 174,000 at the end of August, down slightly from 182,000 in July and 210,000 in June.

In respect to dollar value, the balance of these loan deferrals reduced to $59 billion from $62 billion in July and $67 billion in June.

Home loan deferrals.

Commonwealth Bank’s home loan deferrals represented 7.4% of its portfolio at the end of August, down from 7.6% in July and 8.2% in June.

These loans account of 9.8% of its home loan portfolio by balance. Which was down from 10.1% in July and 10.8% in June.

Of these loans, 32.6% are investment loans, 14.6% are interest only, and 13.5% have an LVR >90%.

Small business deferrals.

Approximately 15.5% of small to medium sized enterprises (SME) loans were being deferred at the end of August. This was a reduction from 16.4% in July and 19.4% in June.

These appear to be higher value loans, with 24.1% of the portfolio (by balance) on deferral. This is down from 26.4% in July and 28.4% in June.

The end (of deferring) is coming.

Commonwealth Bank’s CEO, Matt Comyn, commented: “Since the onset of the pandemic, our priority has been to do what we can to assist our customers in managing the challenges of COVID19, including providing temporary loan repayment deferrals on approximately 250,000 home, personal and business loans.”

The chief executive notes that the end of the initial deferral period is coming and the bank is working with customers on what to do next.

“As we approach the end of the initial deferral periods, we have been contacting all customers with deferred loans to talk with them about their options, including returning to full or part payment, or converting their loans to interest only. Many of those contacted will be able to recommence their repayments. For customers who are facing financial hardship, we are reaching out to offer solutions tailored to their individual needs,” he concluded.

More reading

• Forget term deposits and buy these ASX dividend shares for income
• ASX investors were buying Tesla (NASDAQ:TSLA) and Apple (NASDAQ:AAPL) shares last week
• Banks rejoice: Mortgages back to pre-COVID levels
• Where to invest your CBA dividends
• The ASX big bank stock that’s most at risk of a dividend cut

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 Commonwealth Bank (ASX:CBA) share price higher on COVID-19 loan deferral update appeared first on Motley Fool Australia.

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

AMP Limited (ASX: AMP) will reportedly cut as much as 30% of its workforce in some business units.

The share price for the investment giant has been in freefall for a couple of years. It was $5.43 in March 2018 but now sits at a sorry $1.30.

In that time AMP has gone through sexual harassment scandals and been busted for multiple fee-for-no-service and overcharging scams. It has churned through board members as a result.

This week staff were informed that two of its biggest divisions would have its duplicate operations merged.

Chief executive Francesco De Ferrari reportedly said in the memo that some sections could have 30% of its workforce lopped off.

AMP confirmed the restructure to The Motley Fool.

“AMP has made changes to its teams that will centralise some business services,” said a company spokesperson.

“Our focus is on continuing to reshape the organisation to drive efficiency and support the delivery of AMP’s strategy to become a simpler, client-led organisation.”

The changes involve its investment arm AMP Capital and the banking brand AMP Australia.

De Ferrari had already put in place a billion-dollar “transformation” plan last year to rejuvenate the company.

But this year new chair Debra Hazelton flagged it was looking at the possibility of carving up AMP for potential bidders.

The Australian Mutual Provident Society was established in 1849 as a non-profit mutual society. The company demutualised to list in 1998 and has a market capitalisation of $4.5 billion.

Despite the recent share price drop, AMP stocks are still trading at an astonishing 107 price to earnings (P/E) ratio.

More reading

• The next ASX stock to be rocked by board shakeup after Rio Tinto (ASX:RIO)
• Is the AMP (ASX:AMP) share price a buy after Friday’s fall?
• ASX 200 Weekly Wrap: ASX 200 snaps 4 week losing streak… just
• These were the worst performing ASX 200 shares last week
• ASX 200 drops 0.3%, gold miners keep rising

Motley Fool contributor Tony Yoo 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 AMP flags mass job cuts to reverse sinking share price appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/36hKRnD

The S&P/ASX 200 Index (ASX: XJO) was out of form in September and recorded a sizeable decline. The benchmark index lost 4% of its value over the period to end it at 5,815.9 points.

While a large number of shares dropped lower during the month, a few stood out with particularly sharp declines.

The four worst performers on the ASX 200 in September are listed below:

Zip Co Ltd (ASX: Z1P)

The Zip share price was the worst performer on the ASX 200 last month with a 32.6% decline. Investors were selling the buy now pay later provider’s shares amid concerns over increasing competition in the US market. There are fears that PayPal’s launch of a buy now pay later product could damage Zip’s US ambitions. This is because Zip’s QuadPay business isn’t in as strong a position as some of its larger rivals to fend off PayPal in the lucrative market.

IOOF Holdings Limited (ASX: IFL)

The IOOF share price wasn’t far behind with a sizeable 27.8% decline in September. Investors were selling the financial services company’s shares after the completion of the institutional component of its $1,040 million capital raising. IOOF raised a total of $734 million from institutional investors at a massive 24.4% discount of $3.50. The company launched the capital raising to fund the acquisition of the National Australia Bank Ltd (ASX: NAB) wealth business, MLC Wealth for $1,440 million.

Unibail-Rodamco-Westfield (ASX: URW)

The Unibail-Rodamco-Westfield share price was out of form again last month and sank 26.9% lower. This stretched the shopping centre operator’s year to date decline to a massive 78.4%. September’s decline appears to have been driven by rising COVID-19 cases in the UK and Europe. Potential lockdowns and social distancing initiatives could lead to a significant reduction in shopping centre traffic.

Virgin Money UK (ASX: VUK)

The Virgin Money UK share price continued its slide and tumbled 25.2% lower in September. This also appears to be related to increasing COVID-19 cases in the UK. With cases getting out of control, the government has warned that lockdowns could be coming again. Health officials have warned that there could be upwards of 50,000 new cases per day in October if things aren’t brought under control.

More reading

• BrainChip (ASX:BRN) and Novonix (NVX) were among the most traded shares on the ASX last week
• Virgin Money (ASX:VUK) share price higher after interim CFO announced
• Why Flight Centre, MoneyMe, Paradigm, & Zip shares are pushing higher today
• 2 ASX shares I think are cheap today
• ASX 200 Weekly Wrap: Bank shares push ASX 200 higher

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 ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post These were the worst performing ASX 200 shares in September appeared first on Motley Fool Australia.

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

The federal government is set to announce a $1.5 billion plan and list six key sectors that will shape Australia’s manufacturing future.

The Australia Financial Review listed that the six priority areas that will receive the most government support. These are resources and critical minerals, food and beverages, medical products, recycling and clean energy, defence and space.

The $1.5 billion investment may not sound like much, but it’s only a start. The Morrison government is likely to provide further funding and other incentives to grow these sectors over the next decade.

This means there are a number of ASX stocks on the S&P/ASX 200 Index (Index:^AXJO) that could get a boost from the latest initiative.

ASX stocks in the winners’ circle

The plan was forged amid the COVID-19 economic firestorm. Prime Minister Scott Morrison defended picking these winners as he believes the Australia holds a competitive global advantage in these six key areas.

“The reality is we cannot and should not seek to reach global scale in a large number of sectors,” the AFR quoted the PM’s speech that will be delivered this afternoon.

“This is an important lesson from other small and medium-sized high-income economies which have leveraged home-grown manufacturing into global success, such as Singapore, the UK, Germany and Canada.”

Longer-term boost for these ASX shares

We are unlikely to see an immediate share price reaction to stocks that are well entrenched in the six priority sectors. But I believe they will see benefits starting to flow through over the coming months.

One stock that I think is set to rise with the manufacturing tide is the Austal Limited (ASX: ASB). This is one of my favourite stocks for FY21 and the manufacturing blueprint only reinforces my bullish view on the shipbuilder.

Importantly, Austal is also benefiting from US government stimulus as the Trump Administration looks to beef up its defence capabilities. Austal is getting both sides of its bread buttered.

ASX stock with high strategic value

Another stock that’s riding this wave is the Lynas Corporation Ltd (ASX: LYC) share price. I can’t help but feel the Morrison government is specifically singling out the rare earths miner under the “critical minerals” category.

The US and other Western countries are trying to break their dependence on China for the supply of these critical minerals. It’s hard to see how Lynas won’t play a part in this tectonic shift.

Biggest winners are at the smaller end

Biotech and medical device companies are another obvious ASX group in the manufacturing spotlight.

But before you get too excited about the CSL Limited (ASX: CSL) share price and Resmed CDI (ASX: RMD) share price, it’s the smaller players that will benefit more from government incentives.

In that respect, I think it’s stocks like Starpharma Holdings Limited (ASX: SPL) that will enjoy a more material uplift than the industry giants.

More reading

• Why Mirvac (ASX:MGR) and these ASX REITs could boom in 2020
• 5 things to watch on the ASX 200 on Thursday
• Top ASX Stock Picks for October 2020
• Are Coles (ASX:COL) shares a top option for ASX dividend investors today?
• ASX 200 sinks 2%, Corporate Travel (ASX:CTD) soars 8%

Brendon Lau owns shares of Austal Limited, CSL Ltd., and Lynas Limited. Connect with me on Twitter @brenlau.

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Austal Limited, CSL Ltd., and Starpharma Holdings Limited. The Motley Fool Australia has recommended ResMed Inc. and Starpharma Holdings 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 Potential ASX winners from government’s $1.5bn manufacturing blueprint appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3jjvw9B

2020 has been a tough year for ASX real estate investment trusts (REITs). Many of the largest REITs operate in segments hit hard by the coronavirus pandemic.

The Mirvac Group (ASX: MGR) share price has been hammered and is down 31.7% for the year. It’s far from the only REIT underperforming the S&P/ASX 200 Index (ASX: XJO) right now.

However, it’s not all doom and gloom for the property sector. I think there are a few factors that support a strong outlook for REITs in 2021.

Why ASX REITs could surge higher in 2020

It’s important to note that different REITs have different sector exposures. Some have exposure to retail, office, logistics, residential or commercial markets among others.

I think retail REITs could see a bounce back in 2021. Easing coronavirus restrictions is good news for the Scentre Group (ASX: SCG) share price.

Scentre owns and operates Westfield shopping centres across Australia and New Zealand. Tight restrictions have reduced foot traffic and put more pressure on tenants, which has a knock-on effect to Scentre’s earnings.

2021 could see eased restrictions and potentially even a vaccine. Either way, I think it’s good news for Scentre provided the shift towards online retail isn’t permanent.

It’s not just ASX retail REITs I like right now. The Mirvac Group (ASX: MGR) share price is one on my watchlist.

Mirvac is diversified across a number of sectors with exposure to retail, residential, industrial and office assets. It’s shares are down 31.7% in 2020 but I think there’s potential for long-term growth.

The ASX REIT still owns and operates some high-quality assets across the company. That leaves it well-placed to unlock value and cash flow even if there is some short-term pain in the meantime.

I also like the National Storage REIT (ASX: NSR) right now. National Storage shares are down 1.4% this year and haven’t been hit as hard as many other Aussie REITs.

I think 2021 could see heightened activity in the residential property space. Whether that’s in a downward or upward direction, I don’t think it really matters for National Storage.

More people moving residences is good for the self-storage industry. That means more earnings for National Storage which flows through to investors with higher dividends.

More reading

• Potential ASX winners from government’s $1.5bn manufacturing blueprint
• 5 things to watch on the ASX 200 on Thursday
• Are Coles (ASX:COL) shares a top option for ASX dividend investors today?
• ASX 200 sinks 2%, Corporate Travel (ASX:CTD) soars 8%
• ASX 200 down 1.1%: Corp Travel Management surges higher, gold miners rise, Santos given approval

Motley Fool contributor Ken Hall 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 Why Mirvac (ASX:MGR) and these ASX REITs could boom in 2020 appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/36oCd6G

It was a disappointing month for the S&P/ASX 200 Index (ASX: XJO) in September. A heavy decline at the end of the month led to the benchmark index losing 4% of its value during the period to end it at 5,815.9 points.

Thankfully, not all shares on the index tumbled lower with the market last month. Four ASX 200 shares that surged higher are listed below.

Here’s why they were the best performers on the index in September:

SKYCITY Entertainment Group Limited (ASX: SKC)

The SKYCITY share price was the best performer on the ASX 200 last month with a 21.2% gain. Investors were buying the casino and resorts operator’s shares following the release of its FY 2020 results. Although SKYCITY posted a disappointing decline in normalised earnings, its trading update gave investor sentiment a boost. Management revealed that local gaming in Auckland and Hamilton is now ahead of pre-COVID levels and local gaming in Adelaide is now consistent with pre-COVID 19 levels. As a result, the company is guiding to a return to profit growth in FY 2021.

CSR Limited (ASX: CSR)

The CSR share price was on form in September and charged 16.7% higher. This appears to have been driven partly by a broker note out of Macquarie. According to the note, the broker has an outperform rating and improved price target of $4.60 on the building products company’s shares. It likes CSR due to its strong balance sheet, which it feels will help it navigate tough markets. It is also becoming increasingly bullish on its building products segment and has lifted its estimates accordingly.

Boral Limited (ASX: BLD)

The Boral share price wasn’t far behind with a 13.7% gain over the month. The catalyst for this gain appears to have been a broker note out of Citi. It upgraded the building materials company’s shares to a buy rating on the belief that construction markets are rebounding. In addition to this, it notes that there is a new management team in place and a portfolio review is coming up in October. It has suggested the company could offload its landbank, which could be worth up to $1.23 per share.

Whitehaven Coal Ltd (ASX: WHC)

The Whitehaven share price finally found some form and charged 12.4% higher in September. A broker note also appears to be the driver of this gain. According to a note of UBS, its analysts retained their buy rating and lofty $2.00 price target on the coal miner’s shares. UBS notes that Whitehaven’s shares have fallen materially this year due to a decline in coal prices. However, it feels investors will be rewarded if they’re patient and coal prices recover. The Whitehaven share price ended the month at $1.04.

More reading

• Why the SKYCITY share price jumped 23% in September
• ASX 200 ends the day flat, BOQ (ASX:BOQ) shares drop on impairments
• The latest 3 ASX stocks that brokers just upgraded to “buy”
• Which shares to buy now with $10,000
• 3 profitable October ASX 200 trends

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Sky City Entertainment Group 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.

The post These were the best performing ASX 200 shares in September appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2Sdi9vR

The Reliance Worldwide Corporation Ltd (ASX: RWC) share price will be on watch today after the release of a trading update ahead of its investor day event.

What did Reliance announce?

This morning the plumbing parts company revealed that its sales have continued their strong recovery early in FY 2021.

According to the release, up to and including 25 September, the company’s sales performance in each of its three regions remains in line with what was reported in late August.

In the Americas its sales were up 15% in August and 29% in September compared to the prior corresponding period. Management revealed that it experienced improved sales in wholesale channels and a continued recovery in the Canadian market. US retail and hardware point of sales growth in September was relatively consistent with July and August trends.

Though, it has warned that it doesn’t expect this elevated demand to continue through FY 2021. Especially with COVID-19 stimulus measures winding down.

In the APAC region, Reliance recorded a 2% decline in sales in August and a 4% lift in September. This was driven largely by external sales growth.

Once again, management has warned that lower housing approvals and new dwelling commencements could cause headwinds.

Finally, in the EMEA region the company recorded a 5% increase in sales in August and a sizeable 24% jump in September. Management advised that this jump was driven by pent-up demand following lockdowns in Europe and inventory rebuilding.

Remaining cautious.

The company’s CEO, Heath Sharp, commented: “The first quarter of the 2021 financial year has been particularly strong from a sales perspective. Looking ahead, we remain cautious. The US has been boosted by the surge in DIY activity and the return of construction activity to pre-COVID levels, but without further government stimulus measures this growth is likely to slow.”

“We expect some softening in the Australian market as the reduction in new housing construction approvals leads to lower building activity. In the UK we are uncertain as to where underlying demand levels will settle once the pent-up demand for products and plumbing services has been satisfied. We are also watchful as to the impact the recent rise in COVID-19 case numbers may have on demand and plumbing activities there,” he added.

In light of the above, the CEO has warned investors not to expect this level of sales growth to persist.

Mr Sharp concluded: “Given the continuing uncertainties in all our markets as a result of COVID-19 we would caution against extrapolating the first quarter’s sales performance for the full year.”

More reading

• Why 5G Networks, AMP, Clover, & Reliance shares are dropping lower today
• UBS picks the best and worst ASX stocks from the reporting season

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 Reliance Worldwide Limited. The Motley Fool Australia has recommended Reliance Worldwide 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 Reliance (ASX:RWC) share price on watch after strong Q1 sales growth appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/30mIVGs

I think there are some ASX growth shares that I’d buy today for growth and income.

Things are getting a bit more volatile as we get closer to the US election. But there are some businesses that will likely do well over the long-term, even if the short-term is tough. COVID-19 and vaccine hopes are also bubbling in the background.

Even if there’s volatility in the short-term, it can be nice to receive income along a bumpy ride.

Here are two ideas that I think that could be good for the long-term:

Magellan High Conviction Trust (ASX: MHH)

This is a listed investment trust (LIT) that tries to invest in the highest-quality international shares that it can find.

The ASX share is operated by highly respected fund manager Hamish Douglass and his team at Magellan Financial Group Ltd (ASX: MFG).

I think that it’s a good idea to get exposure to global shares because the large global ones have much better growth potential than most of the large ASX shares in my opinion.

As the name suggests, it’s a high conviction trust, meaning that it usually only has around 10 positions in the portfolio. That means it may be more volatile year to year, but it also has the potential to outperform materially if Magellan’s picks are good.

So, what are Magellan’s picks?

Some of its high-conviction picks include: Alibaba, Alphabet, Microsoft, Tencent and Facebook. These are some of the best technology businesses in the world. They have good gross profit margins, expanding user bases and online models which allow for quick expansion and continuing operations during COVID-19.

At 30 June 2020 its other investments included Starbucks, SAP, Visa and Estee Lauder.

Since inception in October 2019 it has returned 10.4% after its fees (the base fee is 1.5% per annum. That’s quite high, but you don’t get this kind of portfolio construction without paying a higher price.

It’s quite defensively positioned. At the end of August 2020, 20% of its portfolio was invested in cash. That provides protection against market selloffs and gives it the ammunition to buy beaten-down shares if they fall in price.

The ASX share targets a 3% distribution yield and the Magellan High Conviction Trust is currently trading at a 7.7% discount to the intraday indicative net asset value (NAV).

Collins Foods Ltd (ASX: CKF)

Collins Foods is a large franchisee of KFC outlets in Australia and Europe.

The ASX share is taking COVID-19 in its stride. I thought the FY20 result was impressive, revenue increased 8.9% to $981.7 million. This was partly helped by the continuing expansion of Taco Bell outlets in Australia, which grew to 12 in FY20.

Before AASB 16, underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 6.3% to $120.6 million and underlying net profit grew 5.1% to $47.3 million.

Collins Foods increased its total FY20 dividend to 20 cents per share, up from 19.5 cents last year.

The ASX share’s performance has been impressive over the short-term and the long-term in my opinion. Its steadily growing store count is helping increase its profitability. Decent same store sales (SSS) growth is helping the underlying business grow faster than inflation.

All Collins Foods needs to do is add a few more outlets to its network each year to improve its overall earnings capability. People seem to want to keep buying KFC, even during a pandemic, which is great news for the ASX share.

Collins Foods is currently trading at 25x the underlying net profit of FY20. It’s not cheap. But interest rates are really low, so I think the valuation is decent when combined with the grossed-up dividend yield of 2.8%.

More reading

• ASX 200 down 0.9%: Tech shares push higher, gold miners sink, New Hope results
• Why Collins Foods, ResMed, Regional Express, & Xero shares are pushing higher
• Magellan (ASX:MFG) reveals best share buys for September
• 2 stellar mid cap ASX shares to buy in September
• 3 ASX shares I’d happily buy every month

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Collins Foods 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 2 strong ASX shares I’d buy today for growth and income appeared first on Motley Fool Australia.

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