Category: Stock Market

At present, Commonwealth Bank of Australia (ASX: CBA) offers income investors a yield of 0.4% on its term deposits. This is broadly in line with what the rest of the banks are offering.

This means that even if you $1 million invested into these term deposits, you would yield just $4,000 each year. Clearly, this isn’t enough to live from.  

The good news is that far greater yields can be found on the Australian share market.

With that in mind, listed below are two ASX dividend shares that are attractively priced and have generous yields. Here’s what you need to know about them:

Telstra Corporation Ltd (ASX: TLS)

The first ASX dividend share to look at is Telstra. This telco giant looks well-placed to return to growth in the near future thanks to the success of its T22 strategy and its improving mobile outlook.

Another positive is its plan to split into three separate entities. This is expected to allow the telco giant to take advantage of potential monetisation opportunities and unlock value for shareholders.

Analysts at Goldman Sachs are positive on the company. They recently reiterated their buy rating and lifted their price target on its shares to $4.00. It is also forecasting a fully franked 16 cents per share for the foreseeable future.

Based on the current Telstra share price, this will mean a 4.9% dividend yield.

Westpac Banking Corp (ASX: WBC)

With the worst of the pandemic behind us and vaccines rolling out, the banking sector’s outlook is looking significantly more positive now.

Especially given the relaxation of responsible lending rules, the rebounding housing market, and mortgage loan growth.

Another positive is that with the banks well-capitalised and APRA removing dividend restrictions, Westpac and the rest of the big four have been tipped as generous dividend payers in the future.

For now, analysts at Morgans are expecting the banking giant to pay a $1.32 per share fully franked dividend in FY 2021. Based on the latest Westpac share price, this represents a 5.5% dividend yield.

Morgans has an add rating and $27.50 price target on Westpac’s shares.

More reading

• ASX 200 Weekly Wrap: ASX lower despite bumper dividends
• Top brokers name 3 ASX shares to buy next week
• Is the Westpac (ASX:WBC) share price a buy?
• 2 fantastic ASX dividend shares to buy
• Vita Group (ASX:VTG) share price up on results, despite Telstra woes

Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of and has recommended Telstra 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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Brokers regularly review the ASX share market for where they think the best value is available to investors.

There are a number of different global brokers that provide commentary on ASX shares such as Citi and Credit Suisse.

Sometimes those brokers can have very different thoughts about the same business. One broker might think that BHP Group Ltd (ASX: BHP) shares are a buy and another might think that BHP shares are a sell.

Here are two ASX shares that several brokers can all agree on (though they could all be wrong):

News Corporation (ASX: NWS)

News Corp is rated as a buy by at least four brokers.

This business runs a global media empire with many of the world’s most known publishers including the Wall Street Journal, New York Post, Market Watch, The Sun, The Times (UK), The Australian, The Daily Telegraph (Australia), Herald Sun, the Courier Mail, Vogue Australia and News.com.au. It also owns stakes in other assets like REA Group Limited (ASX: REA), Move, Foxtel, Fox Sports and Harper Collins Publishers.

Brokers like Morgan Stanley are a fan of some of News Corp’s assets like Move. Morgan Stanley puts Move at a valuation of between US$5 billion to US$7 billion, meaning the company’s share of Move Inc is worth between US$7 per share to US$10 per share.

UBS thought that the ASX share’s second quarter was noticeably better than expected, with revenue rising 5.5% and operating earnings growing 40%.

The broker believes the strong result from the ASX share was because of good execution of businesses like Dow Jones and Move.

News Corp has also been in the news recently after reaching a global licensing deal with Google to provide news from its news sites around the world in return for “significant payments” by Google.

UBS currently has a share price target of $32.20 for News Corp.

Pinnacle Investment Management Group Ltd (ASX: PNI)

Pinnacle is rated as a buy by at least three brokers.

This business invests in a number of investment managers and gives them governance framework, working capital, seed funding and a range of institutional quality and cost effective distribution and other non-investment support services.

Pinnacle believes this model works because it allows investment professionals to be free of unnecessary distractions relating to regulations, compliance and risk, company secretarial and legal counsel, human resources and so on.

The ASX share recently announced its FY21 half-year result which said that net profit after tax increased by 120% to $30.3 million.

Pinnacle’s share of affiliate’s net profit grew 80% to $31.8 million. Aggregate affiliate funds under management (FUM) was $70.5 billion at 31 December 2020. This was up 20% from June 2020, or up 14% year on year.

Aggregate retail FUM of $16.7 billion at 31 December 2020, up 28% from June 2020 and up 17% year on year.

Broker Morgans was impressed by this result and sees a sustainable increase in underlying earnings. It has increased its expectations for the rest of the year to due higher FUM, stronger net inflows expectations.

Morgans has a share price target of $9.40 for the ASX share.

More reading

• 2 of the best ASX 200 blue chip shares to buy
• Facebook vs Australia feud escalates as government pulls ads
• Facebook news ban to devastate ASX: expert
• One year on and 50% up, the All Technology Index is booming
• 2 high quality blue chip ASX shares to buy

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has recommended REA 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 New Hope Corporation Limited (ASX: NHC) share price will be on watch today after releasing its FY21 second quarter update.

New Hope is one Australia’s biggest coal miners with operations in both Queensland and NSW.

New Hope’s second quarter update

The coal company said that its total saleable coal production for the quarter to January 2021 fell 18% to 2.88 million tonnes, while total coal sold decreased by 14.8% to 3.02 million tonnes.

Looking at the half-year to January 2021, total saleable coal production was down 27.9% to 6.21 million tonnes and total coal sold fell by 23.3% to 6.36 million tonnes.

New Hope said that there had been stronger demand for coal forecasted as economic activity increases across Asia. Total coal sales for Bengalla were better than planned at 2.47 million tonnes.

In its NSW operations, the company said the operation produced less bypass coal than expected due to market pricing supporting delivery of processed coal to maximise value. Prime material movement is ahead of plan with good performance of the excavator and truck fleets, and the dragline since its return to full operations. Recent storms and wet weather in Newcastle resulted in port closures and rail network outages during the quarter with some cargoes slipping into the next quarter. Bengalla expects to deliver above plan sales tonnes for the full financial year.

Regarding the new Acland Mine, the High Court of Australia handed down its decision on an appeal by the Oakey Coal Action Alliance against the rulings of the Queensland Court of Appeals. The High Court upheld the appeal and ordered the matter be re-heard in the Queensland Land Court for a third time.

The West Moreton operations continued to focus on rehabilitation, monitoring and maintenance activities at the Jeebropilly, New Oakleigh and Chuwar sites during the quarter. At the New Oakleigh site, 241,000 bank cubic metres of material has been removed from remnant spoil and relocated into the Normanton Pit void. The preliminary cattle grazing trial result showed that the productivity of the rehabilitated pasture is comparable to, or greater than, the pre-mining levels.

Coal prices

New Hope said that the monthly average Newcastle coal price (in US dollar terms) has increased by 48% since October 2020 on the back of robust demand supported by a colder than expected northern hemisphere winter.

The high ash thermal coal market has seen similar gains despite China’s continued ban on the importation of Australian coal.

New Hope expects that pricing will flatten as the northern hemisphere comes out of the peak winter buying period.

Economic activity in Asia is exhibiting levels stronger than expected and this is turning into stronger than forecast thermal coal demand, according to New Hope.

More reading

• Did China just blink on its Aussie coal ban? ASX energy shares in the spotlight
• Fossil fuels vs renewables: What’s ahead for ASX energy shares?
• ASX coal stocks increasingly isolated with rise of start-ups like MGA Thermal

Motley Fool contributor Tristan Harrison 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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On Monday the S&P/ASX 200 Index (ASX: XJO) was out of form and started the week in the red. The benchmark index fell 0.2% to 6,780.9 points.

Will the market be able to bounce back from this on Tuesday? Here are five things to watch:

ASX 200 expected to rise

The Australian share market looks set to push higher on Tuesday despite a mixed start to the week on international markets. According to the latest SPI futures, the ASX 200 is expected to open the day 18 points or 0.3% higher this morning. In late trade on Wall Street, the Dow Jones is up 0.45%, the S&P 500 is down 0.2%, and the Nasdaq index has sunk 1.4%.

Oil prices jump

It looks set to be a good day for energy producers Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) after oil prices surged higher. According to Bloomberg, the WTI crude oil price is up 3.6% to US$61.35 a barrel and the Brent crude oil price is up 3.2% to US$64.93 a barrel. The catalyst for this was speculation that it could take US energy producers longer to return from the winter freeze.

SEEK results

The SEEK Limited (ASX: SEK) share price will be in focus today when it releases its half year update. Earlier this month analysts at Goldman Sachs tipped the job listings company to upgrade its FY 2021 guidance. The market is currently expecting SEEK to deliver operating earnings of $404 million in FY 2021, but it feels this could be lifted to $420 million. This is due to the continual improvement in macro trends relative to the October levels when its guidance was given.

Gold price storms higher

It could be a positive day for gold miners such as Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) after the gold price stormed higher. According to CNBC, the spot gold price rose 1.7% to US$1,807.80 an ounce overnight after investors chose for the precious metal as a hedge against rising inflation.

Crown hit with Royal Commission

The Crown Resorts Ltd (ASX: CWN) share price could come under pressure today after being hit with a Royal Commission. The inquiry will look to establish the suitability of Crown to hold its Victorian casino licence. Helen Coonan, Crown’s Executive Chairman, said: “Crown welcomes the announcement from the Victorian Government as it provides an opportunity to detail the reforms and changes to our business to deliver the highest standards of governance and compliance, and an organisational culture that meets community expectations.”

More reading

• Crown (ASX:CWN) share price on watch on VIC royal commission
• ASX 200 drops 0.2%, Costa soars, BOQ is buying ME Bank
• 2 of the best ASX 200 blue chip shares to buy
• The QBE (ASX:QBE) share price jumps to 2021 high on broker upgrades
• These ASX gold shares have reported record profits and dividends

Motley Fool contributor James Mickleboro owns shares of SEEK Limited. The Motley Fool Australia has recommended Crown Resorts Limited and SEEK 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 Crown Resorts Ltd (ASX: CWN) share price will be on watch tomorrow on news that it’s facing a royal commission from Victoria.

This is the latest setback facing Crown Resorts after the casino operator was deemed to be unsuitable to operate the new casino in Sydney.

What was announced today?

Crown Resorts announced this evening that it had been informed by the Victorian Government that it has established a royal commission into Crown Melbourne’s suitability to hold its Victorian casino licence, as well as the suitability of its associates, including Crown.

The casino business said that it will fully co-operate with the royal commission and will engage with the Victorian government about its reform agenda and any further remedial steps identified in response to the NSW inquiry.

The Crown executive Chair, Helen Coonan, said:

Crown welcomes the announcement from the Victorian Government as it provides an opportunity to deliver the reforms and changes to our business to deliver the highest standards of governance and compliance, and an organisational culture that meets community expectations.

Victorians should be assured we recognise the responsibility placed on us by the community, governments and regulators and we will fully co-operate with the royal commission.

The Crown royal commission

The Victorian government also released an announcement about this. It said that establishing a royal commission will ensure the most appropriate access to information regarding Crown Melbourne’s suitability to hold the casino licence given the commission’s powers to compel witnesses and documentation.

Raymond Finkelstein QC will serve as commissioner and chairperson of the royal commission and will hand down his recommendations by 1 August 2021.

Mr Finkelstein QC has served more than 40 years at the Victorian Bar. He retired as a judge of the Federal Court and President of the Competition Tribunal in 2011 and has returned to private practice at the Victorian Bar.

Later this year, the government will legislate to enable the Victorian Gaming and Liquor Regulation Commission (VCGLR) to give effect to any findings of the royal commission.

Melissa Horne, Minister for Consumer Affairs, Gaming and Liquor Regulation, said:

The reports from New South Wales’ ILGA Inquiry were incredibly concerning, which is why we’re establishing a royal commission to get the answer we need about Crown Melbourne. The royal commission will establish the facts and the government and the VCGLR will take any necessary action of the conclusion of the investigation. We will not tolerate illegal behaviour in our gaming industry.

Victorian Premier Daniel Andrews said:

This is about making sure that those who hold a casino licence in Victoria uphold the highest standards of probity and integrity – and making sure they’re accountable for their actions.

The Crown share price finished 0.5% lower on Monday.

More reading

• Crown Resorts (ASX:CWN) share price rises despite earnings hit
• Why investors are watching the Crown (ASX: CWN) share price
• Crown (ASX:CWN) loses its CEO as fallout continues
• ASX 200 falls, Melbourne lockdown bites, Baby Bunting drops
• ASX 200 down 0.3%: Crown CEO hasn’t resigned, Mirvac update, Nearmap remains halted

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Crown Resorts 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 Tinybeans Group Ltd (ASX: TNY) share price is reaching for the sky today after the company announced it was eligible for United States OTC listing.

In closing trade this afternoon, shares in the mobile and web-based social media platform are up 18.4% to $1.80.

What did Tinybeans announce?

The Tinybeans share price is shooting higher after the company reported a favourable decision that will extend its reach to US-based investors.

In its release, Tinybeans advised that its OTCQX-quoted ordinary shares are now eligible for electronic clearing and settlement through the Depositary Trust and Clearing Corporation (DTCC) in the US. They will be listed under the code of OTCQX: TNYYF and operate in the same class as ordinary shares.

DTCC is a subsidiary of the Depositary Trust Company (DTC) that manages the electronic clearing and settlement of publicly-traded companies. Securing DTC eligibility means that Tinybeans can be traded in US dollars and in the North American time zone. This promotes a simplified trading process for the company as well as enhancing its liquidity of registered shares.

A range of online brokerage firms such as Ameritrade, Fidelity Investments, Charles Schwab and E*TRADE all offer OTCQX trades.

CEO commentary

Tinybeans CEO Eddie Geller hailed the positive result, saying:

I am delighted to share the news that Tinybeans Group now has DTC Eligibility. We receive requests almost daily from US investors who have had difficulty buying our stock and are extremely pleased to announce that we have obtained DTC eligibility, effective immediately. This means the company’s stock can now be traded in USD for those who wish to do so in the American time zone.

This represents an important step forward in increasing liquidity, broadening our shareholder base and building a strong presence for our company within the US capital markets. We would like to thank our DTC filing agent Glendale Securities, our transfer agent AST and our OTC Sponsor and legal advisor Rimon Law for their efforts

About the Tinybeans share price

In the past 12 months, the Tinybeans share price has increased by 26%. The company’s shares were hit hard during the COVID-19 rout in March last year, falling to a low of 51 cents. However, they have accelerated since October to touch a 52-week high today.

Based on the current share price, Tinybeans has a market capitalisation of around $81 million.

More reading

• ASX 200 drops 0.2%, Costa soars, BOQ is buying ME Bank
• Why the IOUpay (ASX:IOU) share price crashed 13% lower today
• 2 of the best ASX 200 blue chip shares to buy
• Why the Oventus Medical (ASX:OVN) share price is up 7%
• Why the Genetic Signatures (ASX:GSS) share price surged 10% higher today

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 Tinybeans Group Ltd. The Motley Fool Australia has recommended Tinybeans Group 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 S&P/ASX 200 Index (ASX: XJO) fell by around 0.2% to 6,781 points.

Here are some of the highlights from the ASX today:

Costa Group Holdings Ltd (ASX: CGC)

The Costa share price was the star performer in the ASX 200 today, rising by around 12%.

It reported its result for the full year ending 27 December 2020.

Costa revealed that its revenue increased by 11.2% to $1.2 billion. Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose 47.2% to $144.8 million and underlying net profit grew 108.4% to $59.4 million.

The horticultural business said that it has recovered from drought challenges. The international segment performance was well up on the previous year. There was a sustained Australian category momentum through the second half of the 2020 calendar year, driving increased earnings.

Costa said that there was improvement across the board with successful execution of business fundamentals including yields, quality, costs and COVID-19 management.

Favourable market conditions were supported by positive demand and pricing, especially in the citrus, berry and avocado categories.

Costa said that it’s continuing to manage the business for the long-term.

The company’s balance sheet ended with net debt of $143.9 million. The Costa board decided to declare a dividend of 5 cents per share.

Costa CEO Harry Debney said:

The company is committed to investing in new crop growing methods to achieve improved yields, reduce production costs, and address climate related risks. This is why in CY21 we will commence a commercialisation program for the planting of 40 hectares of protected, trellised high density substrate avocado trees, across a number of regions aligned to our existing avocado plantings. A small trial undertaken over the past three years has already delivered global leading results, including faster tree maturity, higher yield, better fruit quality and greater efficiency of water use versus conventional plantings.

BlueScope Steel Limited (ASX: BSL)

The company reported it FY21 half-year result today. It said that its net profit after tax (NPAT) went up by 78% to $330.3 million. BlueScope revealed that its underlying net profit after tax was $332.8 million.

Underlying earnings before interest and tax (EBIT) for the half-year was $530.6 million, an increase of 75% compared to the prior corresponding period.

The Australian steel products division delivered underlying EBIT of $259.1 million, this was an increase of 103% compared to the prior corresponding period. There has been particularly strong demand for coated and painted products, leading to the strongest domestic volumes since 2010 for the company.

The ASX 200 company’s building products division for Asia and North America generated underlying EBIT of $150.3 million, up 87% compared to the prior corresponding period. The North America business improved significantly, due to improved manufacturing performance and cyclical margin expansion. Its building North America business saw 189% growth of underlying EBIT to $70.5 million.

The BlueScope share price ended the day higher by more than 2%.

Macquarie Group Ltd (ASX: MQG)

The Macquarie share price went up more than 3% today after updating its profit guidance for FY21.

The ASX 200 investment bank said that it’s expecting its FY21 profit to now be up 5% to 10% on FY20.

Extreme weather conditions in North America have significantly increased short-term client demand for Macquarie’s capabilities in maintaining critical physical supply across the commodity complex and particularly in relation to gas and power.

Macquarie’s commodities and global markets (CGM) business physically ships gas on the majority of major pipelines across the US and over time has built capacity to support clients by delivering power and physical commodities to help them meet the unexpected needs of their customers.

Bank of Queensland Limited (ASX: BOQ)

Today, BOQ announced that it’s going to acquire ME Bank for $1.325 billion to create a true challenger to the big four banks.

BOQ said that it’s expected to deliver material scale, broadly doubling the retail bank and providing geographic diversification with strong trusted brands and customer-focused values.

The regional bank said that this is financial compelling. It’s expected to be low double-digit to mid-teens accretive for cash earnings per share (EPS) including full run-rate synergies in FY22.

It’s expected that the pre-tax synergies will be somewhere in the realm of $70 million to $80 million.

BOQ also said that it expects to announce FY21 first half statutory profit growth of 60% to 65% and cash profit growth of 8% to 10%.

More reading

• 2 of the best ASX 200 blue chip shares to buy
• BlueScope (ASX:BSL) share price rises after growing HY21 profit by 78%
• The QBE (ASX:QBE) share price jumps to 2021 high on broker upgrades
• ASX 200 up 0.1%: Macquarie upgrades guidance, Costa impresses, NIB surges higher
• Why Costa, Lovisa, OZ Minerals, & Tyro shares are racing higher today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended COSTA GRP FPO and 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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It was another very disappointing day of trade for the IOUpay Ltd (ASX: IOU) share price on Monday.

The Malaysia-based buy now pay later (BNPL) provider’s shares ended the day 13% lower at 53.5 cents.

This means the IOUpay share price has now fallen 37% since peaking at a record high of 85 cents last Monday.

Why is the IOUpay share price under pressure?

Investors have been selling IOUpay’s shares since its surprise and opportunistic $50 million placement last week.

The placement saw sophisticated and institutional investors offered 100 million shares at 50 cents per share. This represented a 28.6% discount to its last close price at the time of 70 cents.

According to the release, the proceeds will be used for growth initiatives including digital payments and to accelerate new business development opportunities in the BNPL sector in South East Asia.

IOUpay’s Chairman, Aaron Lee, explained: “The Company is delighted to see the market respond so strongly to our plans to accelerate our market position as a leading operator in the digital payments and BNPL sectors in South East Asia.”

“This capital raising represents another important milestone in our roadmap to expand our existing and new product offerings and accelerate the growth potential of that expansion. We welcome all new shareholders and thank our existing shareholders for their continued support for this exciting new next chapter of IOU which combined with existing cash reserves provides us with a strong capital platform to execute our market validated business plan,” he concluded.

Is IOUpay the real deal?

At this stage it is too early to know whether IOUpay is the real deal. The company has only just launched its offering and has yet to report back on how that is progressing.

In addition to this, the company could soon have competition from Afterpay Ltd (ASX: APT). Last year it acquired Singapore-based but Indonesia-focused BNPL company EmpatKali.

If Afterpay decides to expand properly into the region, it seems only logical that Malaysia will be on its list eventually.

IOUpay shareholders will no doubt be hoping the company can gain a foothold before that happens.

More reading

• What to expect from the Afterpay (ASX:APT) half year result
• Why Chorus, Douugh, IOUpay, & Reliance shares are tumbling lower
• 6 high profile ASX 200 shares reporting results this week 
• Top brokers name 3 ASX shares to buy next week
• 5 things to watch on the ASX 200 next week

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of 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 illustrious S&P/ASX 200 Index (ASX: XJO) is home to a good number of shares with true blue chip status. So many, in fact, it can be hard to decide which ones to include in your portfolio.

In order to narrow things down, I have picked out two blue chip ASX 200 shares which are highly rated right now. They are as follows:

CSL Limited (ASX: CSL)

The first ASX 200 blue chip share to look at is CSL. It is one of the world’s leading biotechnology companies, responsible for the CSL Behring and Seqirus businesses.

Last week the company released its half year results and revealed a 16.9% increase in revenue to US$5,739 million and a massive 45% jump in net profit after tax to US$1,810 million. This was driven by a surge in flu vaccine sales, the successful transition to its own distribution model in China, and solid demand for immunoglobulins and HAEGARDA.

Disappointingly, despite this incredible profit growth, management only held firm with its guidance for FY 2021 net profit after tax of US$2,170 million to US$2,265 million in constant currency. This represents year on year growth of just 3% to 8% and implies a sharp profit decline in the second half.

While this is disappointing, the pullback in the CSL share price appears to have left it trading at a very attractive level for a long term focused investor.

For example, in response to its results, analysts at UBS retained their buy rating but trimmed their price target slightly to $330.00. This compares to the current CSL share price of $267.79.

REA Group Limited (ASX: REA)

Another ASX 200 blue chip ASX share to look at is property listings company REA Group. After successfully battling through a tough period because of the pandemic, things are looking incredibly rosy for the company now.

In fact, REA Group just revealed a return to growth in the first half of FY 2021 thanks to its excellent cost control which offset softer revenues.

For the six months ended 31 December, the company reported a 2% decline in revenue to $430.4 million. But thanks to a 13% reduction in operating expenses to $145.8 million, REA Group reported a 9% increase in earnings before interest, tax, depreciation and amortisation (EBITDA) to $290.2 million.

Pleasingly, with the housing market improving, mortgage loan growth accelerating, and house prices tipped to rise strongly in 2021, listing volumes look set to rise strongly over the next 12 months. Thanks to this, its lower costs, potential price increases, and new revenue streams, this could lead to an acceleration in its profit growth.

One broker that is positive on REA Group is Morgan Stanley. It has an overweight rating and $175.00 price target on its shares. This compares to the latest REA Group share price of $150.56.

More reading

• The QBE (ASX:QBE) share price jumps to 2021 high on broker upgrades
• 3 ASX blue chip shares that just raised their dividends
• ASX 200 up 0.1%: Macquarie upgrades guidance, Costa impresses, NIB surges higher
• ASX 200 Weekly Wrap: ASX lower despite bumper dividends
• 5 things to watch on the ASX 200 on Monday

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 CSL Ltd. The Motley Fool Australia has recommended REA 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 Oventus Medical Ltd (ASX: OVN) share price moved higher today, jumping 7.32% to 22 cents a share at the time of writing.

The Oventus share price was sent flying after the medical device company released its half-year results for the period ended 31 December 2020  (1H FY21). 

Oventus reports strong financial results

The company reported a 192% increase in booked revenue compared to the prior corresponding period (pcp), with booked revenues coming in at $550,000 for the 1H FY21 period.

Cash receipts totalled $415,000, which was a 109% increase over the pcp.  

Oventus held $4.8 million in cash and cash equivalents at the end of the period. This compares to $6.2 million at the end of the pcp.

The company reported a loss for the first half, totalling $4.7 million. This is an improvement compared to the loss reported for the six months ended 31 December 2019, which was $5.1 million.

Overall, Oventus has accumulated losses of $37.3 million. However, the business notes that as of 31 December 2020, its current assets exceed its current liabilities by approximately $3.6 million.

A government stimulus of $265,243 was granted to the company during 1H FY21 to help it maintain staffing levels in Australia and Canada during the coronavirus pandemic.

CEO Commentary

Oventus founder and CEO, Dr Chris Hart commented on the company’s performance: 

We are very pleased with how our Lab in Lab model has performed through what has been one of the most volatile and unprecedented respiratory pandemics in history. Despite the significant hampering of footfall across North America, we’ve still managed to grow device sales by 143% when compared to the same period last year.

Looking ahead, he added:

Based on what we currently know and correlated with a drop in the rate of infection, we see an improved outlook for physical patient appointments in North America. To protect ourselves against further volatility, our homecare extension of Lab in Lab has been elevated and we’ve just launched a new direct to consumer site, goPAPfree.com, where patients in North America can access treatment completely virtually.

This fully virtual model is the same one that is being made available to VGM’s member-base. While it’s a nascent part of our business, with very low patient acquisition costs, no CAPEX, higher margins and no physical barriers, we expect the homecare model to become a very exciting part of our strategy.

Oventus share price snapshot

Oventus is a medical device company focused on treating sleep apnoea and snoring. 

The company’s market capitalisation is $32.4 million. There are 158.3 million shares outstanding.

The Oventus share price is up by 4% in 2021, but has fallen 68.7% over the past year

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Motley Fool contributor Gretchen Kennedy 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.

The post Why the Oventus Medical (ASX:OVN) share price is up 7% appeared first on The Motley Fool Australia.

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