Category: Stock Market

A poor start to the week ultimately led to the S&P/ASX 200 Index (ASX: XJO) recording a small decline last week. The benchmark index lost 0.2% of its value over the five days to end the period at 7,443 points.

Fortunately, not all shares dropped with the market. Here’s why these were the best performers on the ASX 200 last week:

Gold Road Resources Ltd (ASX: GOR)

The Gold Road share price was the best performer on the ASX 200 last week with a 16.7% gain. Investors were buying gold miners following a rise in the gold price in response to hawkish comments out of the US Federal Reserve. For the same reason, the shares of fellow gold miners Evolution Mining Ltd (ASX: EVN), St Barbara Ltd (ASX: SBM), Resolute Mining Limited (ASX: RSG), and Regis Resources Limited (ASX: RRL) recorded gains of over 11% last week.

Fortescue Metals Group Limited (ASX: FMG)

The Fortescue share price was the next best performing (non-gold miner) share with a 10.4% gain. Investors were buying Fortescue after the iron ore price rebounded. This appears to have been driven by favourable policies in China which analysts feel could put a floor on prices. In addition, news that its Fortescue Future Industries business has signed a jet fuel deal gave its shares a boost.

Lynas Rare Earths Ltd (ASX: LYC)

The Lynas share price was on form and jumped 10.3% last week. This could have been driven partly by news that the Greenland Government had passed legislation that essentially blocked Greenland Minerals Ltd (ASX: GGG) from developing a rare earths project. Management has previously stated its belief that the Kvanefjeld rare earth project has the potential to become the most significant western world producer of rare earths.

Champion Iron Ltd (ASX: CIA)

The Champion Iron share price wasn’t far behind with a gain of 9.6% over the five days. As with Fortescue, investors were buying Champion’s shares after iron ore prices rebounded. In addition, investors may believe its shares are in the bargain bin after recent declines. Macquarie certainly appears to believe that is the case. It has an outperform rating and $7.40 price target on Champion’s shares.

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

More reading

• These were the worst performing ASX 200 shares last week
• Brokers think the tanking Ansell (ASX:ANN) share price will rebound
• Here are the top 10 ASX shares today
• Why are ASX 200 resources shares booming again on Friday?
• Why has the Lynas (ASX:LYC) share price just hit a 9-year high?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Are you looking for dividend shares to buy next week? If you are, then you may want to look at the two listed below.

Here’s why these ASX dividend shares could be in the buy zone:

Australia and New Zealand Banking GrpLtd (ASX: ANZ)

The first dividend share to look at is this banking giant. It recently released its full year results and reported a 72% jump in statutory profit after tax to $6,162 million and a 65% increase in cash earnings from continuing operations to $6,198 million.

This result was underpinned by a significant reduction in provisions compared to the prior corresponding period, tightly managed expenses, and profit growth in the Australian Retail and Commercial segments.

And while this level of growth is clearly not sustainable, analysts at Morgans are still expecting solid dividend growth in the coming years.

The broker is forecasting a 147 cents per share dividend in FY 2022 and a 164 cents per share dividend in FY 2023. Based on the current ANZ share price of $28.26, this will mean yields of 5.2% and 5.8%, respectively, for investors.

Morgans has an add rating and $31.00 price target on the bank’s shares.

BHP Group Ltd (ASX: BHP)

Another ASX dividend share to look at is this mining giant.

The well-documented weakness in iron ore prices has been weighing heavily on BHP’s shares in recent months. While this is disappointing for shareholders, it could be a buying opportunity for the rest of us. Particularly given strong prices of many other commodities that BHP mines.

Macquarie remains very bullish on BHP despite the iron ore price weakness. In fact, last week the broker retained its outperform rating and $52.00 price target on the Big Australian’s shares.

It still believes BHP’s shares are trading on a 19% free cash flow yield at current levels despite the iron ore price pullback. Macquarie expects this to underpin fully franked dividends of $3.76 per share in FY 2022 and $2.81 per share in FY 2023. Based on the current BHP share price of $37.70, this will mean yields of 10% and 7.5%, respectively.

The post Analysts name 2 ASX dividend shares with big fully franked yields to buy appeared first on The Motley Fool Australia.

More reading

• ANZ (ASX:ANZ) board member says banks will lose income if they don’t adapt to crypto
• Why are ASX 200 resources shares booming again on Friday?
• ASX 200 (ASX:XJO) midday update: BHP & Fortescue rise, Zip completes acquisition
• BHP (ASX:BHP) will reap US$1.35 billion from its coal asset sales. Where might the cash go?
• Fortescue (ASX:FMG) share price surges 9% to shrug off falling iron ore price

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The coming week might be a big one for the AMP Ltd (ASX: AMP) share price. The company is reportedly struggling to keep a hold of its $7 billion office fund as investors band together to vote AMP Capital out of its management position.

According to reporting by The Australian, a group of investors against AMP Capital’s management of the AMP Capital Wholesale Office Fund (AWOF) could be made up of half the fund’s register.

As The Motley Fool Australia recently reported, an independent committee is expected to table its recommendations for the fund’s management next week.

If AMP Capital loses control of AWOF, it might find itself in a weak position ahead of its demerger from AMP.

As of Friday’s close, the AMP share price is $1.17, 2.18% higher than it ended Thursday’s session. That’s also 0.8% lower than it was this time last week.

Let’s take a closer look at the battle that might soon be heating up.

The AMP share price could soon be in focus

Market watchers might want to keep their eyes peeled for news on AMP Capital next week.

AWOF’s investors are reportedly demanding that control of the fund be shifted to an entity with stronger governance, more alignment with investors’ interests, and a quality management platform.

The Australian reports that it understands local superannuation funds are leading the push against AMP Capital’s management. They might have convinced around half of the fund’s investors to vote against AMP Capital.

AMP Capital needs to receive support from 75% of the fund’s register to keep its seat at the head of AWOF’s table.

However, The Australian also reports that some investors claim most of the voting parties are still undecided.

Their decision will be between AMP Capital, GPT Group (ASX: GPT), or Mirvac Group (ASX: MGR).

GPT reportedly plans to merge the fund with its own wholesale office fund if it wins AWOF’s reins. Mirvac’s expected to run the fund as a pooled vehicle if it gains control.

Right now, the AMP share price is 24% lower than it was at the start of 2021. However, it has gained 3% over the last 30 days.

The post Why AMP (ASX:AMP) shares might be in the spotlight next week appeared first on The Motley Fool Australia.

More reading

• Can AMP (ASX:AMP) maintain control of its $7 billion office fund?
• How to get more women trading ASX shares for a living
• AMP (ASX:AMP) share price climbs despite ratings downgrade
• So far, so good for the AMP (ASX:AMP) share price in November. Here’s why
• Here are the top 10 ASX shares today

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) fought hard on Friday but it wasn’t enough. The benchmark index lost 0.2% of its value over the five days to end the period at 7,443 points.

While a number of shares dropped with the market, some fell more than most. Here’s why these were the worst performers on the ASX 200 last week:

Nearmap Ltd (ASX: NEA)

The Nearmap share price was the worst performer on the ASX 200 last week with a 19% decline. This followed the release of the aerial imagery technology and location data company’s guidance for FY 2022 ahead of its annual general meeting. Nearmap advised that it expects annual contract value (ACV) of between $150 million and $160 million on a constant currency basis in FY 2022. This is up from $128.2 million in FY 2021 and represents growth of 17% to 24.8%. The market may have been expecting stronger growth.

Polynovo Ltd (ASX: PNV)

The PolyNovo share price was a poor performer and tumbled 14% over the period. The medical device company’s shares were sold off amid the surprise resignation of its Managing Director, Paul Brennan. According to the release, Mr Brennan’s interactions with senior staff and his management style led to increasing differences between him and the Board.

Eagers Automotive Ltd (ASX: APE)

The Eagers Automotive share price wasn’t far behind with an 11% decline. This was despite there being no news out of the auto retailer. However, with new car sales being impacted by chip shortages and lockdowns, some investors may be concerned that Eagers Automotive’s could be underperforming expectations.

Clinuvel Pharmaceuticals Limited (ASX: CUV)

The Clinuvel share price was out of form and sank 9.4% over the period. Investors were selling the biopharmaceutical company’s shares in response to a recent broker note out of Jefferies. According to the note, the broker has downgraded the company’s shares to a hold rating. Jefferies has a few concerns over the launch of a new product competing with Clinuvel’s Scenesse therapy in the treatment of EPP.

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

More reading

• Brokers think the tanking Ansell (ASX:ANN) share price will rebound
• Here are the top 10 ASX shares today
• Why Greenland Minerals, Liontown, Nearmap, and Pushpay shares are tumbling lower
• ASX 200 (ASX:XJO) midday update: BHP & Fortescue rise, Zip completes acquisition
• 5 things to watch on the ASX 200 on Friday

Motley Fool contributor 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 and has recommended Nearmap Ltd. and POLYNOVO FPO. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in Flight Centre Travel Group Ltd (ASX: FLT) are worth holding onto, according to the travel company’s boss.

Graham ‘Skroo’ Turner recently told the Australian Financial Review‘s How I Made It the company would likely take 3 years to get back to pre-pandemic business levels. However, Turner isn’t looking to sell any time soon.

As of Friday’s close, the Flight Centre share price is trading at $20.47, 0.99% higher than it was at the end of Thursday’s session. That brings its gains for the week to 2.45%.

Let’s take a closer look at why the company’s boss is keeping his stake.

Flight Centre CEO holds shares for growth

Insider ownership is generally a good sign that management has confidence in a business, but Turner is going a step further. He said he was now holding his Flight Centre shares for growth.  

According to podcast host Julie-Anne Sprague, in August 2018 when the Flight Centre share price was at a record high, Turner’s stake in the company was worth around $900 million.

Then, in 2020, Flight Centre underwent a $700 million capital raise to ward off the effects of the pandemic.

As a result, its outstanding shares nearly doubled. Thus, Turner’s stake in the company fell to around 8% right as its share price was tumbling.

When asked if he regretted not selling some of his holdings when the Flight Centre share price hit its pre-pandemic high, Turner stated:

It’s never a good time, particularly as CEO and as a founder, to sell. The main thing is that you have the business at heart…

The other founders… and I tended to keep our shares generally because we think it’s a good long term investment. The fact is, considering the capitalisation of the company at the moment isn’t too far off $5 billion, which considering we’re still losing money, is rather extraordinary.

To return the business to its pre-pandemic profit line might take around 3 years, according to Turner. However, when COVID-19 first halted international travel, he hadn’t expected it to be that long.

Turner said prior to COVID-19, the biggest negative impact an outside influence had had on the business slowed profits for a just few months:

COVID is nothing like that…when this happened and international travel stopped out of Australia… [we] immediately had to hibernate our costs.

Our costs were around $230 million a month and we had to get that down to about $70 million a month, which is basically what we are now.

The post Flight Centre (ASX:FLT) shares a ‘good long term investment’, says CEO appeared first on The Motley Fool Australia.

More reading

• Flight Centre (ASX:FLT) share price dips as WA government plays hardball on borders
• Leading brokers name 3 ASX shares to sell today
• The Flight Centre (ASX:FLT) share price is still trading 40% below pre-COVID highs. So, what now?
• These are the 10 most shorted ASX shares
• Here’s why travel shares led the ASX 200 on Monday

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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A board member within the Australia and New Zealand Banking Group Ltd (ASX: ANZ) business said that banks need to adapt to cryptocurrency or will lose income and could miss out.

What was the ANZ warning?

ANZ’s New Zealand chairman John Key recently said that both retail and central banks need to take the opportunities presented by cryptocurrencies or risk being left behind.

At an event hosted by the think tank NZ Initiative he said he believes that cryptocurrencies can make the overall payments system more efficient:

I can’t tell you where Amazon and Facebook and these guys are going to end up, but what I can tell you is they could easily become part of a very globally integrated system – not only just for purchasing goods and services, but within the payments for that.

There’s a lot of money there and a huge amount of volume and I just think over time that space is going to change dramatically and banks are going to have to adapt. If they don’t adapt, their income streams are going to fall.

An unstoppable trend?

Mr Key thinks that the economic shift to cyber finance and digital currency is going to keep going, with or without the big current players.

This could have important ramifications for all of Australia’s large, listed financial institutions, not just ANZ, including Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB), Macquarie Group Ltd (ASX: MQG), Bank of Queensland Limited (ASX: BOQ), Bendigo and Adelaide Bank Ltd (ASX: BEN) and Suncorp Group Ltd (ASX: SUN).

Andrew Cornell, the managing editor of ANZ’s bluenotes – a digital newsroom and blog – noted:

There’s no doubt the rules of battle will be determined by regulation and national jurisdictions but that will be to restrain illegal activity, money laundering and tax avoidance while maintaining power for national governments.

Within those constraints, regulators, supervisors and the market recognise the opportunity new technologies are bringing for new products and services and greater efficiency with existing ones.

Mr Cornell also points out that central banks, regulators and other stakeholders are now taking a greater interest in cryptocurrency and digital currency.

Reportedly, the global banking regulator, the Bank of International Settlements (BIS) has said that issuing central bank digital currencies (CBDCs) could improve the payment system, though there are still things to consider regarding the macroeconomic implications and the co-ordination of cross-border payments.

Australia’s Reserve Bank of Australia (RBA) said in its most recent annual report that it “has updated it strategic priorities for payments policy and will focus on the shift to digital payments, research CBDCs and other innovations, and understand the impact of new tech and players while identifying and resolving any competition and efficiency issues associated with new technologies and new players in the payments system.”

Impact on ANZ?

ANZ is one of the biggest financial institutions in Australia (and New Zealand). It will be interesting to see what part it plays in the shift to digital currency.

In ANZ’s FY21 result, it generated $6.2 billion of continuing operations cash profit after tax.

Net interest profit makes up a large portion of the business. But there is also the potential for the bank to gain exposure, or lose out, to cryptocurrency and digital currency.

The post ANZ (ASX:ANZ) board member says banks will lose income if they don’t adapt to crypto appeared first on The Motley Fool Australia.

More reading

• How does the CBA share price performance stack up against the other big banks?
• ANZ (ASX:ANZ) share price struggles despite CEO predicting economic boom
• Why ANZ, Clinuvel, PolyNovo, and Vulcan shares are dropping
• Why has the ANZ (ASX:ANZ) share price dropped 2% today?
• ASX 200 (ASX:XJO) midday update: Sydney Airport agrees to takeover, Wesfarmers’ strikes API deal

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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A couple of times in the last week, I’ve received a similar query: 

“How can I get started investing with $500 or $1,000?”

It’s a simple question.

And, if you’ve been investing for a while, you might have a good answer.

But if you’d never had a brokerage account, much less invested, and the whole thing seemed entirely foreign… 

Well, then it can feel like a question without a simple answer.

But we’ll get to that.

Because the most recent time I received that question was in reply to a tweet of mine.

I tweeted:

Investing is 95%:

Working hard.

Saving hard.

Buying well.

Leaving the hell alone.

…

That's it.#ausbiz #ausinvest #investing

— Scott Phillips (@TMFScottP) November 12, 2021

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So I thought we’d start there.

See, the team and I at The Motley Fool spend almost all of our time on the third one.

And I think we do it pretty well. Past performance is no guarantee, of course, but I work with smart, capable, committed people who want to help our members achieve their financial goals.

But you can do pretty well with just 1, 2 and 4.

No, that’s not sacrilege for a guy whose day job is picking stocks.

And no, I’m not going to get fired for saying so.

My point is that I think we can help you with the third bit, but you have to help us, help you.

You’ve gotta work and save hard. You’ve gotta leave things alone (though we’ll help you with that, too, with our regular advice).

But we can’t do any of those things for you.

You have to do that work, yourself.

Now, in terms of where to start, I reckon there are two really good options.

The first is to kick off with some instant diversification through a low-cost index-based exchange-traded fund (ETF).

Vanguard is excellent and has a low-cost fund that tracks the ASX 300: Vanguard Australian Shares Index EFT (ASX: VAS). Also one that tracks the rest of the developed world: Vanguard MSCI Index International Shares ETF (ASX: VGS). I own units in the latter, for full disclosure.

Other ETF providers have similar options.

Buying some of each gives you immediate diversification and global reach. Simples, as the meerkat says.

The second option is to go with individual company shares. If you’re taking that option, try to get to 15-20 companies as quickly as possible.

That has the dual benefit of ensuring one company’s share price movements don’t unduly impact your portfolio value and also is less likely to impact your emotional state. A meaningful loss, early on, can otherwise play with your mind, potentially derailing your long term wealth-building.

And then, of course, you can keep going, with either strategy or cross-pollinate them — adding individual companies to your ETFs, or some international ETFs (for example) to your ASX companies portfolio.

And then?

Yep, leave it the hell alone.

Not entirely, of course.

There may be times when selling is prudent.

That’s why I said ‘Investing is 95%…’ not ‘Investing is 100%…’ 

But for most of us…

Most of the time…

I reckon the working, saving and adding bit will drive most of the value of your long-term wealth building.

Or, as I said in another tweet:

To a man with a hammer, every problem looks like a nail.

But a man with too many tools easily becomes overwhelmed and tries to solve the 'nail' problem using a computer program and new percussion technology.

A man with a nail should just use the hammer.#ausbiz #investing

— Scott Phillips (@TMFScottP) November 11, 2021

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Sure, you can make investing more complex if you try.

But sometimes you’re better off just keeping it simple… surely?

(See what I did there? And don’t call me Shirley.)

Have a great weekend.

Fool on!

The post 95% of investing in 4 simple steps appeared first on The Motley Fool Australia.

More reading

• 3 fantastic ETFs for ASX investors in November
• Why is the Vanguard MSCI Index International Shares ETF (ASX:VGS) off to such a great start in November?
• Why has the ETFS Semiconductor ETF (ASX:SEMI) leapt 14% in a month?
• 3 high quality ETFs getting ASX investors excited
• Here’s why Vanguard MSCI Index International Shares ETF (ASX:VGS) could be a top passive investment idea

Motley Fool contributor Scott Phillips owns shares of Vanguard MSCI Index International Shares ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Vanguard MSCI Index International Shares ETF. The Motley Fool Australia has recommended Vanguard MSCI Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Insurance Australia Group Ltd (ASX: IAG) share price has suffered a sharp fall over the past month. This is nothing new, however. Its shares have been on a rollercoaster ride since COVID-19 arrived on the world stage.

At the end of today’s market session, the insurance giant’s shares finished down 0.22% to $4.45 apiece. This means that the IAG share price has fallen by more than 16% since this time last month.

How has IAG performed recently?

The IAG share price has continued to decline since its most recent trading update in early November.

The company told investors it was expecting a rise in net natural perils claim costs for FY22. Severe storm and hail activity experienced in South Australia and Victoria during October were the cause.

In total, net natural perils claim costs for the current financial is forecasted to be around $1,045 million. This is a significant increase from the company’s previous estimates of $765 million.

IAG was forced to downgrade its FY22 insurance margin guidance range between 10% to 12%. Originally, the insurance margin level was in the 13.5% to 15.5% range. Lower vehicle claims made by customers were partly offset by inflationary pressure on claims costs in the company’s motor and home portfolios.

Pleasingly, gross written premium (GWP) improved in the first quarter of FY22, lifting in the mid-single-digit range.

While still trying to navigate its way through the tough trading conditions, IAG was recently hit with civil penalty proceedings.

The Australian Securities and Investments Commission (ASIC) took the embattled insurance company to the Federal Court of Australia over IAG’s failure to pass on the full discounts to a large number of NRMA customers. This relates to policyholders to took up NRMA Home, Motor, Caravan and Boat Insurance between March 2014 and September 2019.

IAG did self-report the issue to ASIC when it conducted a review in 2019 and has since embarked on a remediation program.

About the IAG share price

It’s been a rollercoaster ride for IAG shares, having moved unpredictably over the past 12 months. Its shares are currently down 15% since this time last year, and down 5% in 2021.

Based on valuation metrics, IAG has a market capitalisation of around $11.02 billion, with approximately 2.47 billion shares on issue.

The post Here’s why the IAG (ASX:IAG) share price is down 16% in a month appeared first on The Motley Fool Australia.

More reading

• The IAG (ASX:IAG) share price has gone backwards so far in 2021. Here’s why
• Why is the QBE (ASX:QBE) share price outperforming IAG lately?
• Is the IAG (ASX:IAG) share price cheap after hitting a 52-week low?
• These top brokers weigh in on the IAG (ASX:IAG) share price
• Why Bubs, Dalrymple Bay, IAG, and Redbubble shares are dropping

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Insurance Australia Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in Kogan.com Ltd (ASX: KGN) have had a rough start to November so far. The eCommerce company has been plagued with concerns of ongoing inventory mismanagement since the latter part of 2020. As a consequence, the former darling has become a popular company to short.

The Kogan share price lacked direction in the context of today’s session. After the closing bell, shares were at $9.14, up 0.22%.

A cyclical company currently out of fashion

It doesn’t take a rocket scientist to work out it hasn’t been a good time for Kogan shares over the last 12 months.

A backlog of inventory equating to increased warehousing costs has taken its toll on the company’s earnings for the past three quarters. While the bottom-line dwindled, so too has the Kogan share price, falling 53% since this time a year ago.

Overall, the market seems divided over whether now is a good time to buy Kogan shares. Some analysts and fund managers think yes, others are not so keen.

For instance, Chris Stott from 1851 Capital joined Livewire back in September to share his argument for rating the eCommerce company a sell. At that point in time, Stott highlighted his belief that Kogan was still dealing with inventory issues. In addition, the fundie expected this issue to continue for a while longer.

It seems much of the market would agree to some extent. Kogan shares have featured prominently in the 10 most shorted ASX shares recently. In our latest 10 most shorted ASX shares, the Ruslan Kogan-led business found itself in second place with a short interest of 10.7%.

Despite this negative sentiment, the company posted gross sales and active customer growth in its recent first-quarter update for FY22. In the same update, Kogan revealed it had resolved previous inventory pressures.

However, short levels have remained elevated since this announcement, indicating that perhaps the market had anticipated better results.

Contrarian take on the Kogan share price

The sentiment seems heavily skewed towards the negative end of the spectrum for Kogan, which would make Credit Suisse’s outperform rating quite a contrarian perspective. Analysts at Credit Suisse believe the eCommerce company will continue to benefit from the online shopping shift.

As such, the broker has a $13.88 price target on the Kogan share price. This would suggest a potential upside of 51%.

The post Why are Kogan (ASX:KGN) shares being shorted in November? appeared first on The Motley Fool Australia.

More reading

• Finally, a good day for the Kogan (ASX:KGN) share price. What’s happening?
• Why Chalice Mining, Life360, Kogan, and NAB shares are storming higher
• ASX 200 (ASX:XJO) midday update: NAB hits 52-week high, CSL upgraded
• These are the 10 most shorted ASX shares
• 2 top ASX tech shares rated as buys by brokers

Motley Fool contributor Mitchell Lawler owns shares of Kogan.com ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Kogan.com ltd. The Motley Fool Australia owns shares of and has recommended Kogan.com ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Selfwealth Ltd (ASX: SWF) share price has dropped by 18% in the last month.

That’s despite the share brokerage company continuing to grow at a very quick pace.

Both FY21 and the first quarter of FY22 showed a high level of growth.

FY21 report

Whilst the FY21 result wasn’t within the last month, it may have featured in investors’ minds in recent months.

The last financial year saw revenue growth of 135% to $18.4 million, with a 105% increase in active traders. Operating cashflow was a positive $1.1 million in FY21, driven by “strong” revenue growth and disciplined cost control.

Selfwealth has been working on diversifying its revenue streams. US trading was launched in December 2020 and was adopted by 29% of total active traders within the first six months.

The company said it demonstrated its scalable business model in FY21, with increasing profitability. The gross profit margin increased from 33.4% in FY20 to 41.4% in FY21. Operating expenses increased by 41% compared to revenue growth of 135%.

Selfwealth’s mission is to increase its market share to be the number two in online trading. It said it was number four at the time. The company said it is the top platform for attracting people switching from banks and other platforms.

The Selfwealth share price has fallen by around 17.5% since the release of the FY21 result.

FY22 first quarter update

Just over a month ago, the business reported the first quarter of its FY22.

It has reported accelerating quarter on quarter growth. Active traders increased 13% to 107,461, quarterly trade volume grew 22% to 435,620 and client cash rose 15% to $600 million. The operating revenue rose by 7.8% quarter on quarter to $5.5 million and 32% year on year.

Selfwealth has been working on increasing engagement through content, with new development and investment webinars attended by thousands of customers every week.

It has also been working on adding value with production innovations like instant deposits, live pricing and integration of ESG data.

After a capital raising a few months ago, the business has been increasing its investment and it’s seeing the advantages of that, with expectations the company will keeping benefiting for the rest of the year and beyond.

Selfwealth experienced a cash outflow of $1.1 million for the quarter to 30 September 2021. It ended the quarter with $17.5 million of cash with no debt.

AGM

The latest market sensitive announcement that may have impacted the Selfwealth share price was the annual general meeting (AGM).

At the AGM, it outlined the business case for Selfwealth, its FY21 result and the FY22 first quarter numbers.

The company is also on track in the second quarter of FY22 for cryptocurrency and new international markets. It’s also looking to refresh its user interface and add more education and content for members.

In the third quarter it’s looking to launch ‘dynamic notifications’, tax reporting, provide a advisor platform update, community insights and the news feed 1.0.

Then, in the fourth quarter of FY22, it’s working on new products, news feed 2.0 and the dynamic trading feature.

Selfwealth says that it has high growth potential on a scalable platform with diversified revenue and significant operating leverage.

Selfwealth share price snapshot

Whilst Selfwealth shares may be down more than 50% over the last nine months, it has risen more than 70% over two years and 210% from the bottom of the COVID-19 crash.

The post Why has the Selfwealth (ASX:SWF) share price dumped 18% in a month? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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