Category: Stock Market

The Corporate Travel Management Ltd (ASX: CTD) share price has continued to push higher in recent weeks despite the many lockdowns across Australia.

Since this time last month, the corporate travel specialist’s shares are up 5% to $21.63.

This means the Corporate Travel Management share price is now up 26% since the start of the year and trading within sight of its two-year high.

As a comparison, the Flight Centre Travel Group Ltd (ASX: FLT) share price and Webjet Limited (ASX: WEB) share price are down 7% and 1%, respectively, year to date.

Why is the Corporate Travel Management share price outperforming its peers?

The Corporate Travel Management share price has been outperforming its fellow travel bookers this year due to its focus on corporate travel.

This side of the market has been performing significantly better than the leisure market during the pandemic. In Australia, this is due largely to strong demand from the government and mining sectors. Whereas internationally, the reopening of economies has underpinned a rebound in business travel.

So much so, Corporate Travel Management broke even during March and was expecting to be profitable during the fourth quarter of FY 2021.

And while recent lockdowns may make this a bit more challenging, brokers remain positive on the company.

What are brokers saying?

A note out of UBS from the end of last month reveals that its analysts have retained their buy rating and lifted their price target on the company’s shares to $24.00.

Based on the current Corporate Travel Management share price, this implies potential upside of 11% over the next 12 months.

It believes the successful rollout of vaccines in Europe and the US will support a rebound in their respective travel markets. In fact, UBS notes that agent bookings for domestic travel in the US are now higher than in 2019, with US business travel already at 50% to 55% of pre-pandemic levels.

It is also seeing similarly positive trends in Europe, with short-haul capacity at European airlines now at 80% of pre-pandemic levels.

In light of this, it appears to believe Corporate Travel Management shares are good value and could keep rising from here.

The post Why the Corporate Travel Management (ASX:CTD) share price is outperforming appeared first on The Motley Fool Australia.

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• How to turn $20,000 into $250,000 in 10 years with ASX shares
• Fresh blow to ASX 200 travel shares as Victoria lockdown looms large

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 owns shares of and has recommended Corporate Travel Management Limited and Webjet Ltd. 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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The Mineral Resources Limited (ASX: MIN) share price jumped 2.15% higher on Tuesday to close at $60.30 per share. That’s despite large parts of Australia still being subject to strict lockdown conditions.

Let’s take a look at how the Aussie lithium and iron ore miner’s value has changed during past lockdowns.

How does the Mineral Resources share price perform during lockdowns?

While there have been multiple lockdowns across the country in the past 18 months, there are a few that particularly stand out. The countrywide shutdown in March 2020, Victoria’s stage 4 restrictions from August to October 2020, and the current Sydney/Melbourne lockdowns.

Let’s take a look back to February and March 2020. The S&P/ASX 200 Index (ASX: XJO) was in freefall. Borders slammed shut and investors were in panic mode as COVID-19 took hold. But the Mineral Resources share price weathered the bear market and climbed higher.

Shares in the Aussie miner closed at $40.48 per share on 8 January. While the rest of the market took a turn around 20 February, Mineral Resources shares had already dipped lower and were climbing back towards that $40 per share mark.

What about more recent lockdowns?

After this initial lockdown, the Victorian stage 4 restrictions came into place in August 2020 and lasted until the end of October. The Mineral Resources share price did fall lower in August but managed to lift 5.8% by the end of October.

This period of restrictions also coincided with climbing lithium and iron ore prices which were good for earnings.

That brings us to the current state of play. The Mineral Resources share price has rocketed 56.75% in 2021 so far. Since 16 June, when the first Bondi cluster case was detected, the miner’s value has jumped 23.69% higher.

Once again, commodity prices appear to be the name of the game. Many in the market are forecasting a continued strong pricing environment for iron ore and lithium thanks to strong demand and supply deficits.

The post How does the Mineral Resources (ASX: MIN) share price perform during lockdowns? appeared first on The Motley Fool Australia.

More reading

• The ASX reporting wrap-up: Challenger, Megaport, James Hardie
• Why ASX lithium shares are surging to new highs today
• How is the Mineral Resources (ASX:MIN) share price holding up against the materials sector?
• Top brokers name 3 ASX shares to sell next week
• These were the worst performing ASX 200 shares last week

Motley Fool contributor Ken Hall 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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There are a group of high-quality ASX dividend shares that may be options for investors to consider for consistent investment income.

In an uncertain world, it could be a good idea to think about businesses that are seemingly capable of still paying a dividend.

Here are two ASX dividend shares that may be candidates:

Rural Funds Group (ASX: RFF)

Rural Funds is a leading real estate investment trust (REIT) which specialises in owning a portfolio of quality farms around Australia.

It owns several different farm types including almonds, cattle, vineyards, macadamias and cropping (sugar and cotton).

The farm landlord has a number of major tenants signed up on long-term contracts, giving clear rental income visibility. Some of those tenants include JBS, Olam, Select Harvests Limited (ASX: SHV) and Treasury Wine Estates Ltd (ASX: TWE).

One of the main aims of Rural Funds is grow the distribution for investors by 4% per annum. It has achieved this goal since it listed several years ago and started paying a distribution.

It achieves this distribution through two organic methods. One way is that it regularly invests in its farms either to make them more productive for tenants, or change the farm type to a better/more profitable use.

The other ‘organic’ way Rural Funds achieves distribution growth is thanks to the rental increases that are built into the rental contracts. That rental indexation is either a fixed 2.5% annual increase, or linked to CPI inflation, with some contracts containing market reviews.

Based on the FY22 distribution guidance of 11.73 cents per unit, that equates to a forward distribution yield of around 4.5% for the ASX dividend share.

Brickworks Limited (ASX: BKW)

Brickworks is a business that has had one of the most consistent dividends over the last few decades.

It hasn’t cut its dividend in over 40 years. Brickworks says that it’s proud of its long history of dividend growth and the stability it provides to shareholders. Indeed, it has maintained or increased its dividend every year for 45 years.

Brickworks points to its 39.4% stake in the investment company Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) as an important contributor. Soul Patts, according to Brickworks, has a track record of delivering outperformance during difficult market periods. This was seen during the year to 31 January 2021, where Soul Patts’ return was 29.5% and the ASX All Ordinaries Accumulation Index return was a return of negative 0.7%.

With its portfolio of assets like telecommunications, IT, financial services, mining, energy and pharmaceuticals, Soul Patts is expected to continue to deliver a stable and growing stream of earnings and dividends over the long-term.

Whilst the current COVID-19 outbreak is hurting the ASX dividend share’s Australian building products production, it is hopeful about the long-term potential of its joint venture industrial property trust.

Regarding that trust, Brickworks says there is a trend towards online shopping, and demand for more sophisticated facilities to drive growth. The completion of pre-committed facilities over the next two years will result in a significant uplift in rental income and asset value, according to Brickworks.

At the current Brickworks share price, it has a grossed-up dividend yield of 3.5%.

The post 2 ASX dividend shares that could provide steady income in retirement appeared first on The Motley Fool Australia.

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• Why the Brickworks (ASX:BKW) share price could still be a buy
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• Brickworks (ASX: BKW) share price down 5% as operations curtailed
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• 3 ASX shares insiders are buying ahead of reporting season

Motley Fool contributor Tristan Harrison owns shares of RURALFUNDS STAPLED and Washington H. Soul Pattinson and Company Limited. 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 Brickworks, RURALFUNDS STAPLED, Treasury Wine Estates Limited, and Washington H. Soul Pattinson and Company 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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The Telstra Corporation Ltd (ASX: TLS) share price reached a 52-week high yesterday on the back of its upcoming results. It appears investors are upbeat about the company’s performance in FY21, sending its shares on an upwards trend.

After the market close on Tuesday, the telco’s share price rallied 0.79% higher to $3.85. This means that its shares are now 30% higher than its November 2020 lows of $2.66.

Below, we take a closer look to see what we can learn from the Telstra share price performance last earnings season.

What happened in the first half of FY21?

In mid-February 2021, Telstra delivered its half-year results to the ASX, reporting a fall across key metrics.

Here’s a quick summary of the highlights mentioned in the H1 FY21 release:

• Total income decreased by 10.4% to $12 billion due to a drop off in consumer and small business revenue.
• Earnings before interest, tax, depreciation and amortisation (EBITDA) declined by 14.2% to $3.2 billion due to NBN headwinds and COVID-19 impact
• Net profit after tax (NPAT) shed 2.2% to $1.1 billion.

Despite the disappointing performance, investors pushed up Telstra shares from $3.17 on 10 February to $3.33 in the days following. However, its share price rise was short-lived, soon plummeting to as low as $3.04 on 11 March. This represents a decline of around 10% in the space of 4 weeks.

What should investors look out for this earnings season?

With Telstra scheduled to report its full-year results on Thursday, investors may be wondering what’s on the cards.

According to Goldman Sachs, the market is expecting another loss for its second-half FY21 results.

Total income is forecasted to fall around 11% to $23.2 billion. Although, this is within the upper end of its previous guidance range of $22.6 billion to $23.2 billion.

EBITDA is also projected to fall 16% to $7.6 billion, consisting of underlying EBITDA down 8% to $6.81 billion. Again, this is within prior estimates of $6.6 billion and $6.9 billion.

NPAT is predicted to fall 27% to $1.7 billion.

Regardless of the lower results, Telstra is assumed to pay a fully-franked final dividend of 8 cents per share.

Telstra share price snapshot

In 2021, the Telstra share price has gained close to 30%, reaching pre-pandemic levels. If the company’s share price can surge above the $4 mark, it will be at a multi-year high from 2017.

Telstra commands a market capitalisation of around $45.8 billion, making it the 12th largest company on the ASX.

The post How did the Telstra (ASX:TLS) share price respond last earnings season? appeared first on The Motley Fool Australia.

More reading

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• The Telstra (ASX:TLS) share price just hit another new 52-week high
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• 2 ASX dividend shares with 4%+ yields

Motley Fool contributor Aaron Teboneras owns shares of Telstra Corporation Limited. 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 Telstra Corporation 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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The Woolworths Group Ltd (ASX: WOW) share price has climbed 18.0% in the last 12 months. That’s a solid growth number, but shares in the Aussie conglomerate actually lag the S&P/ASX 200 Index (ASX: XJO) over this period.

The benchmark Aussie index is up 23.2% in the last year after closing at 7,562.60 points

Why is the Woolworths share price underperforming the ASX 200?

It’s worth taking a look at which industries Woolworths actually operates in. According to the group’s half-year results, Woolworths has segments comprising Australian Food, New Zealand Food, Big W, Endeavour Drinks (since spun-off) and Hotels.

That means there are multiple industry factors that could explain recent Woolworths share price performance.

The coronavirus pandemic has been a major factor disrupting markets in recent months. On-again, off-again lockdowns have hit business earnings and caused share price slumps in various sectors.

Lockdowns are clearly not good for venue-based hospitality. Fewer people are able to leave their homes to spend in these venues. However, alcoholic drinks retailers and supermarkets can often benefit from a spike in sales as lockdowns kick in.

That leaves the Woolworths share price subject to opposing forces impacting valuations. Meanwhile, ASX 200 shares have been pulled higher with particularly strong gains in the technology and mining sectors.

Those are notably two sectors that Woolworths doesn’t have operations in. That means the Woolworths share price has lagged behind the broader ASX 200 index which has been propelled by the likes of Afterpay Ltd (ASX: APT) and BHP Group Ltd (ASX: BHP).

Then there’s the recent Endeavour Group Ltd (ASX: EDV) spin-off. Endeavour completed its initial public offering (IPO) on 24 June 2021 and has gained steadily in the weeks since.

Foolish takeaway

The Woolworths share price has seen some strong gains in the past 12 months. However, the ASX 200 share still lags the benchmark index with tech and mining gains propelling the broader market higher.

The post Why the Woolworths (ASX: WOW) share price has underperformed the ASX 200 in the last year appeared first on The Motley Fool Australia.

More reading

• Woolworths (ASX:WOW) share price struggles after online order outage
• ASX 200 Weekly Wrap: Blockbuster Afterpay deal turbocharges ASX to new record highs
• Woolworths (ASX:WOW) share price rises as it launches new homewares range
• Woolworths (ASX:WOW) share price unhurt by call for COVID bouncers
• Woolworths (ASX:WOW) share price up as stores converted to online hubs

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. 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 QBE Insurance Group Ltd (ASX: QBE) share price will be one to watch tomorrow.

The company is due to release its results for the first half of the 2021 calendar year tomorrow morning.

The release of results is always exciting, no matter the company, but eyes will be on QBE in particular tomorrow.

That’s because QBE’s shares have previously reacted positively to the release of its results, even if said results were undesirable.

The insurance company’s shares finished Tuesday’s session trading for $11.62 a piece. But all that could soon change.

Let’s take a look at how the QBE share price moved last time the company released results.

How QBE stock responded last earnings season

The QBE share price might be in for a wild ride tomorrow when the company releases its results for the first half of 2021.

QBE released its latest half year results in August last year. They included a sizeable loss of US$712 million.

However, the company stated it has done better than it expected.

QBE’s half year results included an increase in catastrophe insurance claims.

The claims followed large amounts of damage caused by hail, storms, and bushfires in Australia.

In addition to the natural disasters, COVID-19 made a huge economic impact on Australia, and QBE was among many companies suffering as a result.

The QBE share price gained 6.7% on the back of its 2020 half year results despite the blow to the company’s budget.

The last time the company released results was in February when it issued its full year results for 2020.

QBE reported it lost more than US$1.5 billion over 2020. It also didn’t pay a dividend to its shareholders.

Despite the notable loss, its share price surged 8.8% over the 2 days following the results’ release.

QBE share price snapshot

The QBE share price has been performing well lately.

It’s gained 35% year to date. It has also increased 15% over the past 12 months.

The post How did the QBE (ASX:QBE) share price respond last earnings season? appeared first on The Motley Fool Australia.

More reading

• Here are the 10 top moving ASX shares on Monday
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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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All eyes will be on the Commonwealth Bank of Australia (ASX: CBA) share price on Wednesday.

This follows the release of the banking giant’s highly anticipated full year results this morning.

CBA share price on watch after announcing $6 billion share buyback

• Net profit after tax up 19.7% year on year to $8,843 million
• Cash earnings up 19.8% to $8,653 million (versus analyst consensus estimate of $8,464 million)
• Loan impairment expense and provisions down 78% to $554 million
• Net interest margin down 4 basis points to 2.03%
• CET1 ratio up 150 basis points to 13.1%
• Fully franked final dividend of $2.00 per share declared. Full year dividend up 17% to $3.50 per share
• $6 billion off-market share buy-back, which is expected to reduce its share count by ~3.5%.

What happened in FY 2021 for CBA?

The CBA share price could be on the rise today after Australia’s largest bank delivered a result ahead of the market’s expectations.

For the 12 months ended 30 June, the bank reported cash earnings of $8,653 million. This was 19.8% higher year on year and driven by an improvement in economic conditions and its outlook. This led to lower loan impairment expense and a strong contribution from volume growth in all core markets. The analyst consensus estimate was for cash earnings of $8,464 million in FY 2021.

This strong form was driven by growth across business lending, home lending, and household deposits. Business lending grew over 3x system, home lending was 1.2x system, and household deposits grew 1.2x system.

Holding back its profit growth slightly was a 3.3% increase in operating expenses to $11,359 million. This was driven by its investment in the franchise, higher volumes, and remediation costs. Excluding the latter, operating expenses would have been up 2.4% year on year.

Management also advised that its net interest margin was 2.03%, down by 4 basis points. This was due to higher liquid assets, with the impact of the low-rate environment largely offset by management actions, lower wholesale funding costs, and favourable funding mix.

One positive that could boost the CBA share price today was its loan impairment expense, which fell 78%. The bank has, however, maintained a strong provision coverage ratio of 1.63%. This reflects the economic uncertainty from the continuing impacts of COVID-19.

What did management say?

Commonwealth Bank’s Chief Executive Officer, Matt Comyn, was pleased with the bank’s greatly improved performance during FY 2021.

He said: “The continuing strength of our businesses, combined with a focus on customer needs, digital engagement and consistent operational excellence has contributed to a strong financial result this year.”

“A highlight of the result is our continued balance sheet strength and very strong capital position that has allowed us to support our customers while delivering strong and sustainable returns to shareholders. As a result, a final dividend of $2.00 per share, fully franked, has been determined, with shareholders receiving a full year franked dividend of $3.50.”

“Strategic divestments have generated $6.2 billion1 in excess capital since 2018. Today we have announced an off-market buy-back of up to $6 billion of CBA shares as the most efficient and appropriate way to commence the return of surplus capital, as shareholders will benefit from a lower share count that will support return on equity and dividends per share,” he added.

What’s next for CBA?

Mr Comyn acknowledges that the pandemic continues to have an impact on the Australian economy. Nevertheless, he believes the bank is prepared for a range of scenarios.

He explained: “As the past 18 months have shown, Australia has a very strong, stable and secure financial system. This includes well-capitalised and strong banks like the Commonwealth Bank, which together with the support of the federal and state governments, regulators and the broader industry, have helped the country through the worst pandemic in living memory.”

“We are prepared for a range of different economic scenarios and are well placed to support our customers. We’re committed to new and ongoing support measures for those most impacted by COVID-19 and other events. We will continue to work closely with our retail and business customers to understand their needs.”

The Chief Executive revealed that this uncertainty won’t stop the bank from investing to strengthen its offering and leadership position.

Mr Comyn concluded: “Looking ahead, we anticipate ongoing economic impacts and earnings pressure from lower interest rates. We will continue to invest in the business to reinforce our product offering to our retail and business customers and extend our digital leadership. Through disciplined execution and our people’s care and commitment, we will continue to deliver for our customers, community and our shareholders as we build tomorrow’s bank today.”

CBA share price outperforms in 2021

Prior to today, the CBA share price was up 27% since the start of the year. This is more than double the ASX 200’s return over the period. Shareholders will no doubt be hoping today’s result and buyback announcement will be enough to extend the CBA share price outperformance on Wednesday.

The post CBA (ASX:CBA) share price on watch after FY21 results & $6bn buyback appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• The ASX reporting wrap-up: Challenger, Megaport, James Hardie
• Is now a good time to buy Bendigo and Adelaide Bank (ASX:BEN) shares?
• How did the CBA (ASX:CBA) share price respond last earnings season?
• Why the CBA (ASX:CBA) share price will be on watch today

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 term “smart money” is often bandied about without self-consciousness in the finance profession. But Marcus Today director Marcus Padley pointed out the concept is horribly condescending to retail investors.

“It is demeaning to individual investors and used by the finance industry to imply they are smart and the rest of you are by implication ‘dumb’,” he wrote on his website last week.

“But a lot of supposedly smart professionals do some very dumb things, and a lot of non-professional investors do some very clever things.”

Padley argued perhaps a more accurate term for institutional investments could be “big money”.

He did admit the professionals do have some advantages, such as access to initial public offerings and share issues.

But there are many privileges retail investors have that institutional investors can only dream of.

How? How can the ‘little guy’ have an advantage over Goliath?

Here are 6 that Padley mentioned:

You don’t have to answer to a client

This is the most obvious difference between retail and professional investors. But how is this advantageous for the little guy?

“You don’t have a mandate controlling what you do. You can do what you want. You can change what you do at any time without reason or explanation. You don’t have to publish an investment philosophy and strategy and stick to it,” said Padley.

“You don’t have competitors screwing with your state of mind. You can walk away without anyone knowing or minding. You can take the day off. You can take a month off. You can take a year off. You can stop managing funds forever without one email asking you why.”

You’re not constantly competing against a benchmark

Funds and fund managers are compared to their benchmark index each month, quarter and year. This means they can’t necessarily take a long-term view of their shares.

The constant benchmarking incentivises short-term moves.

The retail investor doesn’t have to worry about any of that.

“You are not criticised. Reputation doesn’t matter. You don’t lose your job if you underperform… No one is comparing you to a compounding benchmark with no costs.”

If you have some periods of underperformance, you can just ride it out. If you get it wrong you don’t lose investors,” said Padley.

Liquidity doesn’t matter

Retail investors very rarely have to worry about whether buying or selling an ASX share will change the market.

“Liquidity issues don’t matter,” said Padley.

“Moving prices when you decide to buy or sell is a big issue for fund managers. When [retail investors] buy and sell you don’t affect the share price in a counterproductive way. You get better and quicker execution.”

Investment costs are minuscule compared to a professional

Ever wondered why fund managers take such a chunky percentage fee from their clients?

Yes, they are making a decent salary for themselves, but they also have many overheads that retail investors never need to worry about.

“You don’t have any compliance issues burning time and money. You don’t have to publish, let alone comply, with your financial services guide,” said Padley.

“You don’t have to pay for a compliance manager. You don’t have the threat of ASIC turning up at your door with a ‘please explain’. You don’t need an Australian Financial Services Licence (AFSL). You don’t have the cost of an AFSL. You don’t have the administration of an AFSL.”

Instant diversification is not a failure

The diversification advantages of listed investment companies (LICs) and exchange-traded funds (ETFs) are a massive advantage for the average punter.

They are options that institutional investors would not dare touch.

“If you buy an ETF or a LIC and it’s not seen as a ‘failure’,” Padley said. “It is for a fund manager.”

Freedom, sweet freedom

Agility and liberty are some of the best weapons for the retail investor versus the professionals.

And these days, with all the tools available online, punters have similar resources to the pros anyway, according to Padley.

“You don’t have to justify your decisions to a committee. You can react to events almost instantly,” he said.

“You don’t get emails from your investors distracting you from the job in hand… You can use mechanisms like stop losses if you want.”

The post 6 advantages retail investors have against the professionals appeared first on The Motley Fool Australia.

More reading

• 2 exciting ETFs for ASX investors in August
• 2 leading ASX shares benefiting from booming commercial property prices
• Telstra (ASX:TLS) and this ASX dividend share are rated as buys
• 2 top ASX growth shares that might be worth buying
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor Tony Yoo 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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If you’re looking for an easy way to invest in international shares for diversification, then exchange traded funds (ETFs) could be the answer.

This is because ETFs give investors access to a collection of shares from certain indices, industries, sectors, or themes through just a single investment.

But which ETFs should investors be looking at right now? Listed below are two exciting ETFs that could be worth getting better acquainted with:

BetaShares Global Cybersecurity ETF (ASX: HACK)

The first ASX ETF to look at is the BetaShares Global Cybersecurity ETF. As it names indicates, this ETF gives investors exposure to the leading companies in the global cybersecurity sector.

This is a sector that has been tipped to grow strongly over the next decade due to the ongoing shift to the cloud and the increasing threat of cyber attacks. Among the companies you’ll be buying a slice of are cybersecurity leaders Accenture, Cisco, Cloudflare, Crowdstrike, Okta, and Splunk.

Over the last five years, the index the BetaShares Global Cybersecurity ETF tracks has delivered a return of 23.7% per annum. This would have turned a $10,000 investment in 2016 into almost $29,000.

VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO)

Another exciting ETF for ASX investors to look at is the VanEck Vectors Video Gaming and eSports ETF. This ETF gives investors access to a portfolio of the largest companies involved in video game development, hardware, and esports.

This means you’ll be owning shares in companies such as Nvidia, Take-Two, and Electronic Arts. These companies are well-positioned to benefit from the increasing popularity of video games and eSports.

The index the VanEck Vectors Video Gaming and eSports ETF tracks has generated an average return of 32.7% per annum over the last five years. This would have turned a $10,000 investment five years ago into just over $41,000 today.

The post 2 exciting ETFs for ASX investors in August appeared first on The Motley Fool Australia.

More reading

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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 BETA CYBER ETF UNITS. The Motley Fool Australia owns shares of and has recommended BETA CYBER ETF UNITS. The Motley Fool Australia has recommended VanEck Vectors ETF Trust – VanEck Vectors Video Gaming and eSports 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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Property prices are booming in most places in Australia, including the commercial market. Some ASX shares are benefiting from this.

There are a group of real estate investment trusts (REITs) that are reporting large valuation increases in the recent financial year.

Here are two that are benefiting from that trend:

Charter Hall Long WALE REIT (ASX: CLW)

This REIT recently reported its FY21 result. Within that, the business experienced a $523 million net valuation uplift, representing a 12.1% increase for FY21.

At the end of the financial year, it had a diversified portfolio across multiple property types with an occupancy rate of 98.3%. Major tenants provide reliability, tenants include government entities, Telstra Corporation Ltd (ASX: TLS), David Jones, Coles Group Ltd (ASX: COL) and Endeavour Group Ltd (ASX: EDV).

The portfolio is worth $5.6 billion across 468 properties with a long weighted average lease expiry (WALE) of 13.2 years. Management say this provides long-term income security.

Not only is the valuation increasing, but its operating earnings per security (EPS) is also rising. It grew 3.2% to 29.2 cents per unit in FY21, with expectations of an increase of at least 4.5% in FY22. The business has a distribution payout ratio of 100%, so investors receive all of the net rental profit each year.

Management say the REIT’s characteristics provide investors with a growing income stream and capital growth, whilst also providing the REIT ASX share with significant insulation from market shocks.

Charter Hall Long WALE REIT is currently rated as a buy by the broker Citi. The broker thinks Charter Hall Long WALE REIT has a FY22 distribution yield of 6.1%. The Citi price target is $5.68 over the next 12 months.

Centuria Industrial REIT (ASX: CIP)

Centuria Industrial REIT is another business that is experiencing sizeable increases in the valuation of commercial properties.

This one is Australia’s largest domestic pure play industrial REIT. In FY21 it experienced a $587 million valuation uplift, which was an increase of 25% in percentage terms. However, this actually led to a 36% rise of the net tangible assets (NTA) per unit to $3.83.

Centuria Industrial REIT said that valuations were being driven by heightened competition and investment demand for industrial and logistics assets with elevated transaction volumes setting new benchmarks for major asset and portfolio sales.

At the end of FY21, the ASX share had 62 properties worth almost $3 billion with an occupancy rate of around 97%. Its weighted average lease expiry is 9.6 years and the weighted average capitalisation (rental) rate was 4.54%.

In FY21 the REIT generated 17.6 cents per unit of funds from operations (FFO) and paid a distribution per unit of 17 cents.

In FY22 it’s expecting to generate FFO per unit of 18.1 cents and pay a distribution of 17.3 cents. At the current Centuria Industrial REIT share price, it has a forward distribution yield of 4.5%.

Centuria Industrial REIT fund manager Jesse Curtis said:

With rising e-commerce, there’s a shift in consumer expectations for rapid delivery times. This creates strong demand from occupiers for assets located in urban infill markets to help manufacture, fulfil or distribute orders quickly, and these markets are a focus for CIP. CIP’s focus centres on building critical mass in key urban infill markets and, through acquisitions, leasing and value-add projects, the REIT aims to deliver long-term sustainable income streams and capital growth to unitholders.

The REIT ASX share is currently rated as a buy by the broker Macquarie Group Ltd (ASX: MQG) with a price target of $4.

The post 2 leading ASX shares benefiting from booming commercial property prices 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 owns shares of and has recommended COLESGROUP DEF SET, Macquarie Group Limited, and Telstra Corporation 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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