Author: therawinformant

At the start of each week I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.

I believe it is worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.

With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:

• Myer Holdings Ltd (ASX: MYR) is now the most shorted ASX share with short interest of 12.9%. Last week QBE Insurance Group Ltd (ASX: QBE) stopped providing insurance to suppliers who want to cover the risk of not getting paid by Myer. Australia’s largest provider of trade credit insurance told the ABC that it has severe doubts about Myer’s ability to pay its way.
• Speedcast International Ltd (ASX: SDA) has short interest of 11.7%. The communications satellite technology provider is currently in the process of declaring itself bankrupt, much to the delight of short sellers.
• Webjet Limited (ASX: WEB) has seen its short interest rise to 9.7%. Concerns over its valuation and a recent spike in coronavirus cases in Victoria appear to be weighing on this travel agent’s shares.
• Inghams Group Ltd (ASX: ING) has 9.25% of its shares held short, which is down slightly week on week. Short sellers may believe that FY 2020 will be a disappointing year because of the pandemic’s impact on its sales mix.
• Bank of Queensland Limited (ASX: BOQ) has seen its short interest lift to 8.8%. A soft half year result and a weak outlook have been weighing on the regional bank’s shares.
• Nearmap Ltd (ASX: NEA) has seen its short interest edge lower again to 8.6%. Short sellers appear to be closing positions after the recent release of a positive update by the aerial imagery technology company.
• Clinuvel Pharmaceuticals Limited (ASX: CUV) has seen its short interest fall to 8.2%. The biopharmaceutical company’s shares may have been targeted on valuation grounds. They are currently changing hands for 70x earnings.
• Southern Cross Media Group Ltd (ASX: SXL) has entered the top ten with short interest of 8%. Weak advertising markets during the pandemic have weighed heavily on this media company’s shares.
• Galaxy Resources Limited (ASX: GXY) has 7.6% of its shares held short. Last week, rival Orocobre Limited (ASX: ORE) reported record low lithium carbonate sale prices. Galaxy is likely to be experiencing similar weakness with its pricing.
• Metcash Limited (ASX: MTS) has 7.2% of its shares in the hands of short sellers. The loss of some major supply contracts could be why short sellers are going after this wholesale distributor.

More reading

• 3 ASX shares to own for the next 10 years
• ASX beware: RBA warns on bank loan deferrals
• These were the worst performing ASX 200 shares last week
• ASX 200 rebounds 1.5%, Qantas drops on capital raising
• Why Kogan, Myer, Orocobre, & Qantas shares are dropping lower

James Mickleboro owns shares of Galaxy Resources Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Nearmap Ltd. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Nearmap Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Luckily in this low interest rate environment, there are still a good number of ASX shares paying generous dividends.

But which ones should you be adding to your portfolio? Three ASX dividend shares that I would buy are listed below. Here’s why I like them:

Dicker Data Ltd (ASX: DDR)

Dicker Data is a wholesale distributor of computer hardware and software. I think it is one of the most underrated shares on the local market and have been very impressed with its strong growth over the last few years. Pleasingly, this positive form has continued in FY 2020, with first quarter profit before tax jumping 36.3% to $18.4 million. And with management appearing confident that demand will remain strong over the rest of the financial year, it has guided to a 31% increase in its dividend this year. This will bring it to 35.5 cents per share, which equates to a fully franked 5.1% yield.

Fortescue Metals Group Limited (ASX: FMG)

Another quality dividend share to consider buying is Fortescue Metals. With iron ore prices at sky high levels, Fortescue appears well-placed to reward shareholders handsomely with dividends again in FY 2020 and FY 2021. Especially given the company’s improving grades and ultra low costs. This should mean the miner is generating very high levels of free cash flow right now from its Pilbara operations. I estimate that its shares provide investors with a forward fully franked dividend of ~6%.

Woolworths Limited (ASX: WOW)

I think Woolworths is a good option for income investors. I like the conglomerate due to its quality brands (Woolworths supermarkets, Dan Murphy’s, BWS) and their defensive qualities. Combined with its supply chain improvement plans, I believe the company is well-positioned to continue growing its earnings and dividend at a solid rate over the next decade. At present I estimate that the company’s shares provide investors with a fully franked 3% FY 2021 dividend yield.

More reading

• 3 ASX shares to own for the next 10 years
• Top brokers name 3 ASX shares to sell next week
• The best placed ASX stocks for the August reporting season
• Add the WOW factor to your investment portfolio. Why I think the Woolworths share price is a buy
• 2 ASX dividend shares with yields over 8%

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Dicker Data Limited. The Motley Fool Australia owns shares of Woolworths 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 Fortescue and these ASX dividend shares could be top income options appeared first on Motley Fool Australia.

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The Fisher & Paykel Healthcare Corp Ltd (ASX: FPH) share price could be on the move today after the release of a record full year result.

How did Fisher & Paykel Healthcare perform in FY 2020?

For the 12 months ended 31 March 2020, Fisher & Paykel Healthcare delivered operating revenue of NZ$1.26 billion. This was an 18% increase on the prior corresponding period or a 14% increase in constant currency.

On the bottom line, the medical device company reported a 37% jump in net profit after tax to NZ$287.3 million. This was positively impacted by tax changes including research and development tax credit and building tax depreciation. Excluding these and favourable currency movements, net profit after tax would have been up 23% year on year.

Both its operating revenue and profit after tax came in ahead of its guidance. Management had guided to operating revenue of NZ$1.24 billion and net profit after tax in the range of NZ$275 million to NZ$280 million.

What were the drivers of its growth?

The key drivers of its growth were increasing use of its Optiflow nasal high flow therapy, demand for products to treat COVID-19 patients, and strong hospital hardware sales throughout the course of the year.

Hospital product revenue increased 25% to NZ$801.3 million and Homecare product revenue lifted 9% to US$457 million.

The company’s Managing Director and CEO, Lewis Gradon, commented: “The 2020 financial year was already on track to deliver strong growth before the coronavirus impacted sales. Beginning in January, the demand for our respiratory humidifiers accelerated in a way that has been unprecedented.”

“With new processes, new procedures and new ways of working safely, we managed to double and in some instances triple, output for some of our hospital hardware products over just a few months at the end of the year. I’m incredibly proud of our people and their unyielding commitment to doing the right thing for patients,” he added.

FY 2021 outlook.

Mr Gradon warned that there was a lot of uncertainty for FY 2021 because of the pandemic.

He explained: “We cannot predict the scope, duration or impact of COVID-19 and its effects on our operations and financial results. In the midst of this uncertainty, we will continue doing what we are known for – expanding our range of innovative products with patients at the centre.”

Nevertheless, the company has started FY 2021 very strongly, particularly in respect to its Hospital product sales.

During the first three months of FY 2021, Hospital product sales have continued to accelerate, with hardware growth of over 300%. Hospital consumables are also up over 33% compared to the prior corresponding period.

Things aren’t quite as positive for its Homecare products, which are seeing evidence of both a lower obstructive sleep apnoea (OSA) diagnosis rate and mask resupply levels returning to normal levels. Homecare product revenue is up in the region of 9% over the first three months.

Looking ahead, management expects FY 2021 operating revenue to be approximately NZ$1.48 billion and net profit after tax to be in the range of NZ$325 million to NZ$340 million. This will be an increase of 17.5% and 13.1% to 18.3%, respectively.

This guidance is based on global hospitalisations due to COVID-19 peaking during the first quarter of this financial year, and hospitalisations for respiratory-related illnesses and OSA diagnostic activity steadily returning to normal by the end of the first half.

More reading

• 5 things to watch on the ASX 200 on Monday
• These were the best performing ASX 200 shares last week
• Australian businesses are running out of cash
• Is the share market facing another February 2020 moment?
• Top brokers name 3 ASX 200 shares to sell 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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The Australian share market was on form on Friday and raced notably higher.

While the majority of shares on the market climbed higher, some stood out by storming to new highs.

Here’s why these ASX shares are flying high right now:

Mach7 Technologies Ltd (ASX: M7T)

The Mach7 share price jumped to a multi-year high of $1.01 at the end of last week. Investors have been buying the medical imaging data management solutions provider’s shares this month following the announcement of a major acquisition. Earlier this month Mach7 announced the acquisition of leading provider of an enterprise image viewing technology, Client Outlook. This acquisition has expanded its offering and increased its total addressable market from US$0.75 billion to US$2.75 billion. This is materially more than the revenue of $9.1 million it recorded during the first half. 

Marley Spoon AG (ASX: MMM)

The Marley Spoon share price hit a new record high of $1.68 last week. When the meal kit delivery company’s shares hit that level, it meant they were up a remarkable 500% year to date. Investors have been buying Marley Spoon’s shares after it reported a surge in demand for its meal kits. This led to the company delivering revenue of 42.8 million euros in the first quarter, up 46% on the prior corresponding period. As a result of this stronger than expected growth, the company revealed that its path to profitability is accelerating. Management is expecting to achieve positive operating EBITDA the second quarter.

ResMed Inc. (ASX: RMD)

The ResMed share price charged to a record high of $27.28 on Friday. The medical device company’s shares have been very strong performers this year thanks to the robust demand it is experiencing for its obstructive sleep apnoea solutions and ventilators. The latter is being driven by the pandemic. And given how case numbers continue to shoot higher in the United States, investors appear to be betting on ResMed having a particularly strong fourth quarter.

More reading

• 3 ASX shares to own for the next 10 years
• 10 high quality ASX shares to buy in FY 2021
• How I would construct a $50,000 growth portfolio
• 2 ASX shares to ride out a second wave of coronavirus
• Consider these 3 quality ASX healthcare shares to buy now

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 MACH7 FPO. The Motley Fool Australia has recommended MACH7 FPO and ResMed Inc. 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 ResMed and these ASX shares have just hit new highs appeared first on Motley Fool Australia.

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On Friday the S&P/ASX 200 Index (ASX: XJO) finished the week on a positive note. The benchmark index jumped 1.5% to 5,904.1 points.

Will the market be able to build on this on Monday? Here are five things to watch

ASX 200 set to fall heavily.

The ASX 200 looks set to fall heavily on Monday after a selloff on Wall Street on Friday. According to the latest SPI futures, the benchmark index is expected to open the week 91 points or 1.55% lower. On Wall Street the Dow Jones fell 2.8%, the S&P 500 dropped 2.4%, and the Nasdaq index tumbled 2.6%. A spike in coronavirus cases weighed on investor sentiment.

Oil prices edge lower.

Energy producers including Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could drop lower today after oil prices softened. According to Bloomberg, the WTI crude oil price fell 0.6% to US$38.49 a barrel and the Brent crude oil price edged 0.1% lower to US$41.02 a barrel. Concerns over the spike in coronavirus cases weighed on prices.

Gold price jumps.

Gold miners including Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) could have a positive day after the gold price jumped higher. According to CNBC, the spot gold price rose 0.8% higher to US$1,784.80 an ounce. Demand for safe haven assets rose after equities tumbled.

Fisher & Paykel Healthcare results.

The Fisher & Paykel Healthcare Corp Ltd (ASX: FPH) share price will be on watch today when it releases its full year results. In March the medical device company revealed that it expects full year operating revenue to be approximately NZ$1.24 billion. On the bottom line, it has forecast net profit after tax in the range of NZ$275 million to NZ$280 million. Investors will no doubt be interested to hear if demand for ventilators has remained strong since the end of its financial year.

Shares going ex-dividend.

A number of popular ASX 200 shares are going ex-dividend this morning and could trade lower. These include the likes of BWP Trust (ASX: BWP), Charter Hall Group (ASX: CHC), DEXUS Property Group (ASX: DXS), Goodman Group (ASX: GMG), and Mirvac Group (ASX: MGR).

More reading

• Fisher & Paykel Healthcare share price on watch after COVID-19 drives record profit result
• Could these ASX 100 shares help you retire early?
• 3 fantastic ASX dividend shares to buy next week
• 3 ASX share price trends to watch next week
• These were the best performing ASX 200 shares last 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.

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