Category: Stock Market

The pandemic prompted many companies to be prudent with capital. With the depth and duration of a recession unknown, many ASX-listed shares battened down the hatches by suspending dividends and raising additional capital.

Thankfully, 16 months on and the Australian economy has enjoyed what some would describe as a ‘V’ shape recovery.

In a news release today, asset manager Janus Henderson Group CDI (ASX: JHG) revealed that it’s expecting that much of these funds will flow back into the pockets of investors.

It pays to be thrifty

In the release, Janus Henderson points out that total global debt has barely budged since January 2021. However, in the year before, debt jumped 10% to a record $13.5 trillion – illustrating the sudden rebound in economic activity.

By Janus Henderson’s estimates, a record-setting $5.2 trillion globally. The $1.1 trillion increase in 2020 was twice as much as the previous five years combined.

So then, with bountiful supplies of capital sitting on corporate balance sheets, the asset management anticipates a boom in capex, dividend payments, and share buybacks through the tail-end of the year and beyond.

Head of Australian fixed interest at Janus Henderson, Jay Sivapalan said:

Companies around the world have weathered the last 16 months with impressive skill. An investment boom is highly likely after the Covid-19 freeze. This will account for a large portion of the reduction in cash balances this year but share buybacks and higher dividends will be part of the story too.

ASX shares flicking back on the dividend dispenser

Leading broker UBS picked up the discrepancy between earnings and dividends earlier in the year. UBS analyst Pieter Stoltz noted:

There appears to be a disconnect between earnings and dividends that the market is missing at the stock level but is visible from the top down. We think analysts are assuming that companies will maintain payout ratios at low levels despite the improved outlook and improved balance sheets since the peak of the COVID crisis.

Additionally, UBS disclosed a handful of ASX shares that it consider to be top candidates for dividend upgrades. These included AusNet Services Ltd (ASX: AST), Bendigo and Adelaide Bank Ltd (ASX: BEN), Downer EDI Limited (ASX: DOW), OZ Minerals Limited (ASX: OZL), Spark Infrastructure Group (ASX: SKI), Suncorp Group Ltd (ASX: SUN), and Vicinity Centres (ASX: VCX).

Together with a declining payout ratio and an improving balance sheet, the broker considered these companies to be possible contenders with dividend revisions lagging earnings revisions.

Big four dividend dilemma

Janus Henderson is not the only ones forecasting big payouts. Similarly, analysts at Morningstar last week estimated there to be $34 billion of excess capital sitting on the balance sheets of the big four banks.

Equity analyst, Nathan Zaia noted his forecast that a portion of the capital will be returned to shareholders through off-market share buybacks over the next 12 months.

From there, Zaia expects boosted dividends between 2021 to 2024 for ASX bank shares. Investors will no doubt be keeping a close eye out for high-yielding, quality companies as dividends resume.

The post A dividend bonanza could be inbound for ASX shares, here’s why appeared first on The Motley Fool Australia.

More reading

• Forget CBA! Here are the 5 best performing ASX bank shares of FY21
• Suncorp (ASX:SUN) share price bucks market downtrend on ~$84m divestment
• Why the Suncorp (ASX:SUN) share price is on the rise today
• ASX 200 down 0.9%: Big four banks drop, Metcash charges higher
• Bank of Queensland shares outperforming all ASX 200 banks this month

Motley Fool contributor Mitchell Lawler 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 Magellan Financial Group Ltd (ASX: MFG) share price is having a rollercoaster day today. Earlier in the day, the Magellan share price was falling. But in late afternoon trading, Magellan shares are up 0.24% to $53.83 a share.

So what’s the latest from this ASX fund manager?

Well, this morning, we got Magellan’s latest funds under management (FUM) figures. And they make for some interesting reading.

Magellan reported that its FUM as of 30 June 2021 stood at $113.9 billion. That’s up 7.4% from the previous month’s figure of $106.05 billion. This was made up of $30.88 billion in retail investor FUM. And $83.02 billion in institutional FUM. These figures were both up from last month’s $23.03 billion and $77.02 billion respectively.

All of Magellan’s fund groups experienced increases. But in pole position was Global Equities, which managed to grow from $79.33 billion of FUM in May to $85.44 billion by the end of June.

Additionally, Magellan informed investors that it had also experienced net outflows of $351 million for the quarter ending 30 June 2021. This means that the lion’s share of the increase in FUM would have come from rising share markets and asset prices. These were clearly enough to overcome this net outflow of invested capital.

On a final note, the company also told the markets that it is entitled to collect approximately $30 million in performance fees for the 2021 financial year.

How are Magellan’s funds performing?

Let’s also take a quick look at how Magellan’s funds are performing. The flagship Magellan Global Fund (ASX: MGF) is currently up 10.77% (as of 30 June) over the past 12 months. It (or its unlisted equivalent) has also averaged 13.21% per annum over the past 3 years, 14.37% over the past 5 and 11.92% since the fund’s inception in 2007. Meanwhile, the Magellan High Conviction Fund, which is mirrored by the ASX listed Magellan High Conviction Trust (ASX: MHH), is up 17.38% over the past 12 months. It has averaged 12.09% over the past 3 years, 15.15% per annum over the past 5 and 15.03% since its inception in 2013.

The post Magellan (ASX:MFG) share price rises after falling earlier appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Monday
• Why the Magellan High Conviction Trust (ASX:MHH) share price is soaring
• WAM’s WAR on the ASX! Wilson’s new LIC hits the share market
• 2 ASX 200 shares that might be buys for growth

Motley Fool contributor Sebastian Bowen owns shares of Magellan High Conviction Trust. 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 fortunes of ASX healthcare shares can often swing on one momentous milestone.

Examples of such a make-or-break event could be a breakthrough invention, successful product trial, or regulatory approval (or rejection).

Such incidents can see health stocks unambiguously rocket up or crash down.

As such, it’s always wise to be aware of when stock-turning news might be expected.

Helpfully, Bell Potter analysts this week identified some ASX healthcare shares that could have company-changing events coming up this year.

It’s worth noting again that there’s no telling whether the resulting news will turn out to be good or bad. So Bell Potter staff do classify them as “speculative buys”.

Anyway, here are 3 of them:

Extending life for brain cancer patients

Kazia Therapeutics Ltd (ASX: KZA)’s flagship product is called paxalisib, which is a treatment for glioblastoma — an aggressive type of brain or spinal cord cancer.

“Kazia is expected to release final data from its phase 2 study investigating the use of paxalisib in glioblastoma,” Bell Potter analyst John Hester said in a memo to clients.

“The interim data showed a 5-month extension in overall survival.”

The Australian company has been invited to join an international study in the United States called GBM Agile.

“This is an approval study and patients are currently recruiting. If approved, the drug will have exclusivity until at least 2031 and likely longer following the grant of further patents.”

Kazia shares were trading at $1.32 on Wednesday afternoon. That’s up 11.34% this year.

Bell Potter has set a target price of $2.50.

Will heartache turn into joy for Mesoblast shareholders?

While they would have known it was a speculative purchase, the past 12 months nevertheless have been rough on Mesoblast Limited (ASX: MSB) investors.

The stock has plummeted more than 43% over the last year.

But the current quarter could see a massive shakeup in the shares’ fortunes.

“Potential closure of Novartis deal for remestemcel-L with US$50m upfront in 3QCY21 will be a key catalyst,” said Bell Potter analyst Tanushree Jain.

The paediatric use for its flagship product remestemcel-L could also be re-submitted to the Food and Drug Administration (FDA) in the US this year.

“Potential approval and sales by mid-CY22 [would be] earlier than our current expectations and would be a material catalyst.”

Mesoblast stocks were going for $2.03 on Wednesday afternoon. Bell Potter has set a target of $3.60.

Is this the ‘holy grail’?

Aroa Biosurgery Ltd (ASX: ARX) has developed soft tissue regeneration technology branded Endoform.

“It provides a ‘holy grail’ solution to the notorious trade-off between safety, efficacy, and cost versus competitors,” said Bell Potter analyst Elyse Shapiro.

“FY22 revenue guidance incorporates conservative growth assumptions and leaves room for upside.”

But the exciting recent development seems to be the recent launch of its Myriad soft tissue matrix for use in surgery.

“The September-December quarter remains, in our view, the timing for an inflection point of account conversion and improved sales momentum for both Myriad and distribution partner Tela Bio Inc.”

Aroa shares were trading at $1.22 on Wednesday afternoon, up 7% on the year. 

Bell Potter’s speculative price target is $2.

The post 3 ASX healthcare shares with big news coming appeared first on The Motley Fool Australia.

More reading

• 5 worst-performing ASX 200 healthcare shares of FY21
• Mesoblast (ASX:MSB) share price surges 5% in early trade today
• ASX 200 Weekly Wrap: Share market breaks 5 week winning streak
• These were the worst-performing ASX 200 shares last week
• Here’s why the Kazia Therapeutics (ASX:KZA) share price got a 6% boost today

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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The Damstra Holdings Ltd (ASX: DTC) share price is firmly in the green during mid-afternoon trade. This comes after the workplace management solutions company announced a multi-year contract extension with NBN Co Limited (nbn).

At the time of writing, Damstra shares are swapping hands for 84 cents, up 3.70%. In comparison, the All Ordinaries Index (ASX: XAO) is sitting at 7,596 points, up 0.9% for the day.

Damstra secures extended partnership

Investors are buying Damstra shares after the company provided a positive update to the ASX this morning.

According to its release, Damstra advised it has signed a multi-year Master Services Agreement (MSA) with its existing customer, nbn.

Under the contract, Damstra will continue to supply its dedicated workforce management platform, enAble to Australia’s national wholesale broadband provider. This will allow over 25,000 workers and contractors nationwide to have access to the specially designed and branded platform for nbn.

The enAble platform can perform a number of functions. This includes storing worker’s skills and competencies, hosting online training, and providing real-time information about nbn accreditations with auditing capability. In addition, the software ensures that all nbn employees and contractors have the required skills to carry out tasks.

Damstra plans to employ digital ID cards which will provide further processing efficiencies, allowing contractors to deliver nbn services faster.

The deal has an initial term of 3 years and includes three 1-year contract extensions (end date up until 2027). Damstra expects the total revenue over the full-life of the contract to generate up to $7 million. This is broken down to $5 million in monthly fees, and a variable $2 million on expected platform usage.

Damstra CEO, Christian Damstra commented:

We are very pleased to announce the signing of this MSA with nbn; already a valued customer of Damstra. We are proud of the work we have put into developing and evolving the enAble platform and this agreement clearly demonstrates the confidence nbn has in Damstra’s ability to provide critical services for their workers and contractors across Australia. We look forward to continuing the relationship with nbn for many years to come.

About the Damstra share price

It has been a turbulent 12 months for Damstra shareholders, with the company’s shares down almost 40%. The downfall began after Damstra reported its disappointing half-year results for FY21 in February.

Damstra has a market capitalisation of roughly $155 million, with approximately 186 million shares on its books.

The post Why the Damstra (ASX:DTC) share price is on the move today appeared first on The Motley Fool Australia.

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• 3 small cap ASX shares for your watchlist

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. owns shares of and has recommended Damstra Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Damstra Holdings 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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BHP Group Ltd (ASX: BHP) has been a solid performer on the ASX 200 in 2021, with the BHP share price rising over 13% so far this year.

After a solid first half to the year, investors will no doubt be keen to discover where analysts think the BHP share price will go from here.

What are leading brokers saying about the BHP share price?

Although the BHP share price is currently up 13% in 2021 to $48.73, a number of leading brokers believe it can still go higher.

Chief among them are the analysts at Goldman Sachs. A recent note out of the investment bank reveals that the broker has a buy rating on its shares. Furthermore, Goldman’s BHP share price target of $53.80 implies potential upside of 10.5% before dividends over the next 12 months.

And thanks to the strong free cash flow the mining giant is generating from favourable commodity prices, Goldman is very positive on the BHP dividend in 2021. It is estimating a fully franked dividend of $3.10 per share, which represents a very attractive 6.4% yield currently.

Goldman commented: “We retain our Buy rating on BHP on: (1): Strong earnings growth and FCF: We forecast a c. 50% increase in EBITDA and a doubling of FCF in FY21 (equating to c. 10-11% FCF yield), driven by our positive view on met coal, copper and oil prices. (2) Strong production growth: BHP’s group Cu Eq production should increase by 4-5% in FY22 and 6-7% in FY23, driven by a +250-270kt lift in copper volumes from Spence and Escondida, +10MMboe of oil volumes with new production from Mad Dog II/Atlantis Phase 3/Shenzi.”

Who else is positive on BHP?

Another broker that is bullish on the BHP share price is Macquarie. Its analysts have an even higher BHP share price target of $63.00. This represents potential upside of over 29% for BHP shares over the next 12 months.

And like Goldman Sachs, Macquarie is expecting the BHP dividend in 2021 to be very generous. It has pencilled in a fully franked $4.08 dividend per share, which equates to a massive 8.4% yield.

Macquarie notes that BHP’s iron ore operations are generating material free cash flow at current spot prices. It is expecting this to support solid shareholders cash returns in the near term.

UBS is sitting on the fence

One leading broker isn’t as positive, though. Analysts at UBS currently have a neutral rating and $42.00 BHP share price target. This implies potential downside of almost 14% over the next 12 months.

While it sees positives from potentially strong cash returns, it does have concerns over risks to the iron ore price. It suspects that a recovery in Brazilian supply and slowing Chinese demand could weigh on prices.

Nevertheless, the broker doesn’t expect this to stop BHP from paying a big dividend in 2021. It is forecasting a fully franked dividend of $3.58 per share, which represents a 7.3% yield.

The post Here’s what leading brokers are saying about the BHP (ASX:BHP) share price in July 2021. appeared first on The Motley Fool Australia.

More reading

• ASX 200 Weekly Wrap: ASX finishes FY21 on a high
• ASX blue chips set to unleash buybacks and dividends! But which is better?
• These high yield ASX dividend shares could be buys
• BHP (ASX:BHP) share price caught between bulls and bears in June
• Why this broker thinks the BHP (ASX:BHP) share price can storm higher

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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Today’s a good day for shares on the S&P/ASX 200 Info Tech Index (ASX: XIJ). Currently, the index is up 2.65%.

For comparison, the rest of the S&P/ASX 200 Index (ASX: XJO) is up 0.71% right now.

The tech index’s gains have seemingly been spurred by a strong night’s trade on the tech-heavy Nasdaq Composite (NASDAQ: .IXIC).

Let’s take a look at some of the ASX 200 tech shares reaping the rewards today.

5 ASX 200 tech shares flying higher today

Afterpay Ltd (ASX: APT)

Afterpay shares are performing solidly today, despite the company not releasing any news.

Right now, the Afterpay share price is 4.17% higher than it was at yesterday’s close. Shares in the ASX 200 buy now, pay later giant are swapping hands for $119.58.

Some brokers are bullish about Afterpay over the rest of 2021, and it looks like parts of the market are too.

Xero Limited (ASX: XRO)

The Xero share price is also gaining today. The company’s shares are up 4.08% at the time of writing, trading for $137.57.

The business and accounting software provider hasn’t announced anything new today either. But it’s also had brokers feeling bullish lately, with Goldman Sachs putting a $151 price target on Xero shares on Monday.

WiseTech Global Ltd (ASX: WTC)

Joining today’s high-flying ASX 200 tech shares club is Wisetech. And, once more, there’s been no news from the company.

The Wisetech share price has gained 3.9% today. The company’s shares are currently trading for $32.23 apiece.

While we haven’t heard much from Wisetech lately, brokers are continuing to feel positive about the cloud-based software provider. Morgan Stanley currently has an overweight rating and a $35 price target on the ASX 200 company’s shares.

Appen Ltd (ASX: APX)

The Appen share price is gaining 2.81% today, fetching $12.46 at the time of writing.

Appen develops data for machine learning and artificial intelligence.  

There’s been no news from Appen to explain its gains today. However, after it fell 5.9% yesterday, shareholders are likely to be relieved by today’s gains.

NextDC Ltd (ASX: NXT)

The NextDC share price isn’t soaring as high as the abovementioned ASX 200 tech shares, but it’s still up a respectable 0.93%.

The data centre operator’s shares are currently swapping hands for $11.96.

As The Motley Fool reported today, NextDC has been performing well lately and has been tipped as a buy by brokers.

The post These ASX 200 tech shares are beating the broader market today appeared first on The Motley Fool Australia.

More reading

• 3 ASX shares looking pretty cheap right now: expert
• Is momentum slowing for the Afterpay (ASX:APT) share price?
• The AFIC (ASX:AFI) share price just hit an all-time high
• Why Afterpay, Challenger, MyDeal, & St Barbara shares are charging higher
• Why the A2 Milk (ASX:A2M) share price is up more than 3% 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. owns shares of and has recommended AFTERPAY T FPO, Appen Ltd, WiseTech Global, and Xero. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO, Appen Ltd, WiseTech Global, and Xero. 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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On Monday, we discussed the then-imminent departure of the founder and long time CEO of Amazon.com, Inc. (NASDAQ: AMZN), Jeff Bezos. Monday (our time) was Mr Bezos’ last day as CEO of the company he founded back in 1994. Yes, anyone aged 27 or under has never experienced a world without an Amazon with Bezos at the helm. Amazon now has a new CEO in Andy Jassy. Mr Jassy was formerly the head of one of Amazon’s largest profit engines – Amazon Web Services (AWS).

Bezos steps back from his baby, Amazon

So with Bezos going quietly into the night (well, not entirely, he is set to stay on as company chair), what does the future of the one of the world’s largest and most dominant companies look like? That’s a question that broker eToro is trying to answer. Josh Gilbert, eToro market analyst, reckons Bezos is “handing the reins to Jassy at a critical time”. He noted that Jassy has been at Amazon for nearly as long as Bezos. Indeed, since his graduation from Harvard Business School in 1997. He also notes that Jassy was one of the architects behind AWS in the first place, and has helped it grow into “a crucial role in Amazon’s overall income… [which accounts for] 47 per cent of Amazon’s overall operating income”.

Here’s some more of what he had to say:

The company has grown from strength-to-strength, with revenues surging each year. However, this sort of growth often attracts scrutiny, which we have seen from antitrust regulators globally. The regulators’ plan is to ‘de-monopolise companies such as Amazon with the capital and power to buy any competitor that stands in its way, which Jassy will have to suppress.

Bezos’ leadership has also come under fire previously, with employees saying targets took a physical toll on their health. Jassy will undoubtedly have his work cut out in areas like these. Despite this, it’s

expected that Jassy’s softer personality could work in Amazon’s favour. I believe that Jassy will add a

character that we haven’t seen from Amazon before, making it a more friendly and appealing

company.

What can investors expect in the age of Jassy?

But what about Amazon’s legion of loyal investors? What can they expect from Amazon now that one of the world’s greatest wealth creators in Bezos is stepping back? Gilbert is equally sanguine:

The post What will Amazon (NASDAQ:AMZN) look like in a post-Bezos world? appeared first on The Motley Fool Australia.

More reading

• A turning point: Jeff Bezos steps down as Amazon (NASDAQ:AMZN) CEO
• Amazon’s biggest threat in e-commerce
• Wondering which US shares Aussies bought last quarter? Here’s the answer
• FANG+ ETF (ASX:FANG) tumbles 10% on ex-dividend day
• Tesla back on top as the most popular US share for ASX investors

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen 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 Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool Australia has recommended Amazon. 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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a strong gain. At the time of writing, the benchmark index is up 0.8% to 7,319.9 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are tumbling lower:

Nanosonics Ltd (ASX: NAN)

The Nanosonics share price is down 4.5% to $5.14. This follows the release of a bearish broker note out of Goldman Sachs this morning. According to the note, the broker has downgraded the infection prevention company’s shares to a sell rating and cut the price target on them to $4.93. Goldman has reduced its earnings estimates due to concerns that the growth recovery may be shallower than it was previously expecting. The broker also warned that there could be competitive risks from new technologies.

Oil Search Ltd (ASX: OSH)

The Oil Search share price is down 2.5% to $3.97. Investors have been selling Oil Search and other energy producers on Wednesday following a pullback in oil prices overnight. Traders were selling oil after OPEC postponed its production meeting indefinitely following disagreements.

Opthea Ltd (ASX: OPT)

The Opthea share price is down almost 5% to $1.33. This decline appears to have been driven by profit taking after a particularly strong gain on Tuesday. The biotech company’s shot higher after its OPT-302 therapy was granted fast-track designation for wet age‑related macular degeneration by the US FDA. The regulator “fast tracks” the review of novel therapies for serious conditions for which there is an unmet medical need.

Piedmont Lithium Inc (ASX: PLL)

The Piedmont Lithium share price has sunk 7% to 94.5 cents despite there being no news out of the lithium explorer. However, this follows a similarly severe decline occurred overnight with its US listed shares. This could be due to profit taking. Especially given how its shares are up over 150% in 2021.

The post Why Nanosonics, Oil Search, Opthea, & Piedmont Lithium are tumbling appeared first on The Motley Fool Australia.

More reading

• ASX 200 up 0.55%: Challenger jumps, Nanosonics sinks
• Nanosonics (ASX:NAN) share price sinks 7% on broker downgrade
• 5 things to watch on the ASX 200 on Wednesday
• 5 worst-performing ASX 200 healthcare shares of FY21
• Why Bigtincan, Oil Search, Opthea, & Xref shares are racing higher

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 Nanosonics Limited and Piedmont Lithium Inc. The Motley Fool Australia owns shares of and has recommended Nanosonics 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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Despite some volatility, ASX shares are still trading at record highs.

So is everything just too expensive to buy now? Are there any cheapies left that are actually decent businesses?

Burman Invest chief investment officer Julia Lee certainly thinks so. She this week picked out 3 ASX shares that pique her interest:

Even cloud computing needs to live somewhere

Cloud computing has become all the rage in the past decade, but was given an extra push by the masses forced to work from home from last year.

But even the ethereal cloud needs a physical location to exist. So a data centre provider like NextDC Ltd (ASX: NXT) will continue to see strong demand, according to Lee.

“I think NextDC is looking pretty attractive at these prices,” she told Switzer TV Investing.

“What we have seen in the data storage area is that supply has been increasing. But I think that’s because we’ve seen demand increasing as well.”

Lee reckons the next financial results will show NextDC has seen a big increase in business from the COVID-19 pandemic accelerating the migration to the cloud.

“Megaport Ltd (ASX: MP1) has been doing pretty well… NextDC has a bit of catch-up to play and I’ll put a valuation of around $14 to $15 [per share].”

NextDC shares are going for $12.04 in afternoon trading Wednesday, which is 1.6% up on the day.

People will eventually fly somewhere

Qantas Airways Limited (ASX: QAN) is a value-buy ASX share for Lee at the moment.

“At these prices, if you’re looking out to 2023 it’s a bit of a no-brainer.”

While great uncertainty still looms for Qantas’ international operations, its money-making domestic business is going gangbusters already.

“If we have a look at financial year 2022, it’s predicting that Jetstar capacity will get up to 122% of pre-COVID-19 levels, and Qantas to 107%,” she said.

“When things open up again we’re probably going to see everyone rushing to try to travel, so we’ll actually see demand initially spike up quite strongly.”

The Qantas share price is down 1.02% on Wednesday afternoon, trading at $4.86. It was up in the $6s and $7s early last year.

A nice sell-off makes for a bright future

Logistics and infrastructure provider Qube Holdings Ltd (ASX: QUB) sold off its Moorebank facilities in western Sydney for $1.7 billion on Monday.

Lee reckons this is a great move for holders of this ASX share.

“I think this is a really great price. It’s a price that equates to $1.36 per share plus about 32 cents in a deferred payment.”

The types of freight that Qube helps transport are all in high demand, meaning more business for the logistics provider.

“Consumer spending is pretty strong at the moment. Not only that, commodity prices are strong… If you have a look at soft commodities — like grains and cereal —  not only is the outlook strong but prices are quite strong at the moment.”

Qube shares were up as high as $3.20 on Monday morning after the asset sale news. They’re now at $3.05 on Wednesday afternoon, currently down by 0.65% for the day so far.

The post 3 ASX shares looking pretty cheap right now: expert appeared first on The Motley Fool Australia.

More reading

• ASX travel shares slip as Sydney lockdown extends for another week
• 2 top ASX tech shares rated as buys by brokers
• 2 high quality ASX shares that could be buys
• Here are the 5 best performing ASX 200 tech shares from FY21
• Qube (ASX:QUB) share price lifts on $1.67 billion asset sale update

Motley Fool contributor Tony Yoo owns shares of Qantas Airways Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended MEGAPORT FPO. The Motley Fool Australia has recommended MEGAPORT 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 Ramsay Health Care Limited (ASX: RHC) share price is pushing higher on Wednesday.

In afternoon trade, the private hospital operator’s shares are up 1.5% to $63.83.

Why is the Ramsay share price pushing higher?

The Ramsay share price was given a boost today by a positive broker note out of Citi this morning.

In response to Ramsay increasing its takeover offer for Spire Healthcare in the UK, the broker retained its buy rating and $76.00.

Based on the current Ramsay share price, this implies potential upside of 19% excluding dividends over the next 12 months. This potential return stretches to almost 22% if you include them.

What did Citi say?

Citi notes that Ramsay has increased its offer for Spire Healthcare to 250 pence per share. This values the UK-based private healthcare company’s equity at GBP1,040 million (A$1,900 million), which is an increase of ~$75 million.

According to the note, the broker believes that for Ramsay to maintain its investment grade rating, it will need to raise somewhere in the region of $600 million to $1,000 million. However, this is already factored into its valuation.

In light of this, it is focusing on the future and suspects that a successful acquisition and integration of Spire and a recovery in healthcare demand could drive a re-rating of the Ramsay share price later this year.

Citi commented: “We previously calculated that for RHC to maintain its investment grade rating, it will need to raise ~$850m in capital (we assume a hybrid security), which we include in our forecasts. Given the variables, the final capital gap could be between $600m and $1bn.

“Our TP implies RHC should trade on FY23E (normal year) PE of ~23x. There is risk to the FY21 result given the pandemic and more recently Australian lock downs – post the August result, we believe the market will focus on the recovery phase and integration of Spire, which will result in a re-rating of the stock,” the broker concluded.

The post Ramsay (ASX:RHC) share price higher on bullish broker note appeared first on The Motley Fool Australia.

More reading

• 2 growing ASX dividend shares named as buys
• 5 worst-performing ASX 200 healthcare shares of FY21
• ASX 200 drops, Myer soars, Ramsay down
• ASX 200 up 0.2%: Westpac asset sale, Ramsay increases Spire offer
• Ramsay (ASX:RHC) share price lower on UK acquisition update

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 recommended Ramsay Health Care 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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