Category: Stock Market

It’s been a decent start to both the month of July and the 2025 financial year for ASX shares so far. Since the end of FY24, the All Ordinaries Index (ASX: XAO) has risen by a tentative 0.25%. But let’s talk about one ASX healthcare stock that has started FY25 off with a bit more of a whimper.

That ASX healthcare stock is none other than Medadvisor Ltd (ASX: MDR). Sure, Medadvisor shares didn’t have a spectacular start to the trading week on Monday, finishing the day flat at 50 cents a share.

But when you consider that those same shares started the 2024 calendar year at just 22 cents apiece, it’s hard to feel sorry for owners of this ASX healthcare stock.

Yes, Medadvisor shares are up a whopping 127.27% over 2024 to date. This company is also up 108.33% over the past 12 months, and has gained 11.11% over the past month alone.

Check that all out for yourself below:

So how has this ASX healthcare stock pulled off such significant gains, especially over the past month alone?

How has this ASX healthcare stock risen 127% in 2024?

Well, excitement over Medadvisor shares arguably started building after the ASX healthcare stock released an impressive quarterly update back in April. As we briefly covered at the time, this saw Medadvisor post a 42.4% rise in operating revenues for the quarter ending 31 March 2024 to $24.2 million. That was up from $17 million over the same quarter of 2023.

Medadvisor’s gross profits for the quarter increased by an even more impressive 48.5% to $15.3 million.

The positive sentiment following this quarterly update seemed to intensify over the following month. In May, Medadvisor followed up this quarterly update with some guidance for the full 2024 financial year. The company revealed that it is expecting to bring in $120-$123 million in revenues over FY24, which would be a huge improvement over the $98 million it saw over FY23.

The ASX healthcare stock is also anticipating to book its first-ever net profit after tax in FY24. It has told investors to expect a net profit of between $500,000 and $800,000 for the year, which again is a massive improvement over FY23’s net loss of $11.3 million.

So now it’s probably becoming clear why Medadvisor has become such a sought-after stock on the ASX in recent months.

EBOS buys up Medadvisor shares

But it’s not just ordinary investors that seem keen on this ASX healthcare stock. An announcement earlier this month confirmed that another healthcare stock in EBOS Group Ltd (ASX: EBO) has been buying up shares in Medadvisor. The ASX filing revealed that EBOS has recently acquired just over 27.5 million shares of Medavisor, increasing its stake in the company to 9.8%.

Here’s how EBOS explained its move:

EBOS initially acquired a 14.1% interest in MedAdvisor in October 2017, which has been diluted by subsequent share issuances.

EBOS regards its shareholding in MedAdvisor as an investment and does not intend to make a change of control proposal in respect of MedAdvisor.

So it seems that Medadvisor’s recent financial statements are largely behind this ASX healthcare stock’s remarkable ASX run in recent months. It probably doesn’t hurt Medadvisor shares’ fortunes that EBOS is buying up additional stock either. Let’s see what FY25 has in store for this ASX high flyer.

The post Up 127% in 2024, why this ASX healthcare stock is surging again this month appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Tuesday
• The Wesfarmers share price rocketed 32% in FY 2024! Here’s how
• Here’s the 3 best ASX artificial intelligence (AI) shares of FY24
• Up 6% in FY 2024, what’s ahead for the Flight Centre share price in FY 2025?

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. has positions in and has recommended MedAdvisor. 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 Scott Phillips.

On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week in a disappointing fashion. The benchmark index fell 0.75% to 7,763.2 points.

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

ASX 200 expected to rebound

The Australian share market is expected to rebound on Tuesday following a decent start to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 22 points or 0.3% higher. On Wall Street, the Dow Jones was down 0.1%, but the S&P 500 rose 0.1%, and the Nasdaq pushed 0.3% higher. The latter two indices closed at all-time highs.

Buy Evolution shares

The Evolution Mining Ltd (ASX: EVN) share price could be undervalued according to analysts at Goldman Sachs. This morning, the broker has reiterated its buy rating on the gold miner’s shares with an improved price target of $4.15. Ahead of the release of its quarterly update, the broker said: “Following the production update in mid-June, we expect FY24 production to be in-line with implied guidance of ~723koz. With reduced uncertainty over the medium-term, particularly following Northparkes/Cowal site visits, our expectations for ~750koz/75kt of gold/copper production appear consistent with market expectations.”

Oil prices tumble

It could be a poor session for ASX 200 energy shares Santos Ltd (ASX: STO) and Karoon Energy Ltd (ASX: KAR) after oil prices pulled back overnight. According to Bloomberg, the WTI crude oil price is down 1.1% to US$82.26 a barrel and the Brent crude oil price is down 1% to US$85.66 a barrel. Traders were selling oil after assessing the impact of tropical storm Beryl.

Sell IGO shares

IGO Ltd (ASX: IGO) shares are a sell according to analysts at Bell Potter. This morning, the broker has downgraded the battery materials miner’s shares to a sell rating and cut its price target to $5.15 (from $7.60). It commented: “In our view there remains considerable further short-term downside risk to the share price if sentiment deteriorates further.”

Gold price falls

It looks like ASX 200 gold miners Gold Road Resources Ltd (ASX: GOR) and Regis Resources Limited (ASX: RRL) could have a tough session on Tuesday after the gold price tumbled overnight. According to CNBC, the spot gold price is down 1.3% to US$2,366.7 an ounce. Traders were selling gold after risk appetite grew and demand for safe havens reduced.

The post 5 things to watch on the ASX 200 on Tuesday appeared first on The Motley Fool Australia.

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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. has positions in and has recommended Goldman Sachs Group. 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 Scott Phillips.

The Wesfarmers Ltd (ASX: WES) share price just completed a banner financial year.

Shares in the S&P/ASX 200 Index (ASX: XJO) retail stock – whose subsidiaries include global household names like Bunnings Warehouse, Kmart Australia, Officeworks and Priceline – closed out FY 2023 trading at $49.34.

On 28 June, the last trading day of FY 2024, shares finished the day changing hands for $65.18 apiece.

That put the Wesfarmers share price up a whopping 31.1% over the 12 months, as shown in the chart below. For some context, the ASX 200 gained 7.8% over this same period.

And that strong performance doesn’t include the two fully franked dividends Wesfarmers paid out over the financial year. Wesfarmers shares currently trade on a trailing dividend yield of 2.9%.

Here’s why ASX 200 investors sent the retail stock soaring in FY 2024.

Why did the Wesfarmers share price skyrocket in FY 2024?

The strong run higher for the Wesfarmers share price was driven by equally strong underlying performances from most of its core business segments.

The company reported its full-year results for FY 2023 on 25 August. These results are relevant to the past 12 months’ performance as they were released well into FY 2024 and impacted the share price over the 2024 financial year.

Highlights of those results included an 18.2% year-on-year increase in revenue to $43.5 billion, while net profit after tax (NPAT) was up 4.8% to $2.5 billion. Also really drawing analyst interest was the 81.6% boost in the company’s operating cash flow, which hit $4.2 billion.

With these strong metrics in the background, management boosted the full-year dividend by 6.1% to $1.03 a share.

“Wesfarmers’ financial results were underpinned by strong divisional earnings growth of 12.9% for the year, as the group’s operating businesses continued to respond well to trading and market conditions,” managing director Rob Scott said on the day.

ASX 200 investors clearly took note. The Wesfarmers share price gained 8.6% over the three trading days in August following the results announcement.

And the company didn’t disappoint with its half-year results either.

Wesfarmers reported its H1 FY 2024 results on 15 February, the most recent price-sensitive announcement out from the company.

Once more, investors were greeted with strong growth metrics, sending the ASX 200 retail stock up 5.0% on the day.

Highlights included a 0.5% year-on-year increase in half-year revenue to $22.7 billion and an NPAT up 3.0% to $1.4 billion.

Operating cash flows also continued to impress, increasing 47% from H1 FY 2023 to $2.9 billion.

This saw management lift the interim dividend by 3.4% to 91 cents a share.

And in a promising sign for the full FY 2024 results, management noted, “For the first five weeks of the second half of the 2024 financial year, Kmart Group has continued to deliver strong sales growth.”

As for FY 2025, the Wesfarmers share price was trading at $66.10 at the close on Monday. That’s up almost 1.5% in the nascent new financial year.

The post The Wesfarmers share price rocketed 32% in FY 2024! Here’s how appeared first on The Motley Fool Australia.

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• ASX passive income: How to make $1,000 per month
• What is the outlook for ASX 200 dividend shares in FY25?
• Can Wesfarmers shares keep beating the ASX 200 index?
• 3 reasons to buy Wesfarmers shares like there’s no tomorrow

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Wesfarmers. The Motley Fool Australia has positions in and has recommended Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

FY24 was a banner year for ASX artificial intelligence (AI) shares — and not just in Australia. AI was a global phenomenon as stock market indices around the world were also driven by large investments in AI shares that could potentially shape our future.

Here in Australia, companies like Dicker Data Ltd (ASX: DDR), Life360 Inc (ASX: 360), and Megaport Ltd (ASX: MP1) are leading the pack in very interesting ways.

These companies have not only delivered impressive financial performance but also positioned themselves at the forefront of AI technology integration and innovation.

Here’s a closer look at the top 3 ASX AI shares in FY24, based on share price movement.

ASX AI shares perform in FY24

Dicker Data Ltd (ASX: DDR)

Dicker Data comes in at third place on the list of top ASX AI shares. Investors started buying Dicker Data shares at the start of FY24 when the stock was priced at $8.20 apiece. The ASX AI share secured an 18% gain as the FY24 year came to a close.

It shot to highs of $12.25 by December before consolidating gradually towards its current level, trading at $10.21 apiece at the close on Monday.

Dicker Data made its mark in the AI space by strategically distributing AI-capable hardware and software. The company facilitates the “AI transition” for numerous businesses by supplying critical tech components from top manufacturers.

In FY24, Dicker Data enhanced its position through key partnerships and an expanded product range that supports companies implementing AI.

Goldman Sachs rates the stock a buy with a $9.86 price target, implying a 3.5% upside potential.

Megaport Ltd (ASX: MP1)

Second on the list of ASX AI shares in focus today is Megaport. Its share price hit a high of $15.39 in March as investors went on a feeding frenzy for shares in the AI sector.

Over the 12 months to June 28, Megaport rallied from $7.22 per share to $11.22 apiece, eclipsing a total gain of 55%. Shares in Megaport closed on Monday trading at $11.17.

Like the other two ASX AI shares, Megaport has unique exposure to AI. The company offers a Network as a Service (NaaS) model that is crucial for businesses adopting new technologies.

In its most recent quarterly update, the ASX AI share grew sales 30% year over year, fueled by increasing demand for its services.

With plans to enter new markets and upgrade its platform, Megaport might be poised for further growth in FY25. Citi thinks so, recently rating Megaport a buy with a $16.05 per share price target.

After its FY24 run, the stock now trades at a price-to-earnings ratio (P/E) of more than 192.59 times.

Life360 Inc (ASX: 360)

In first place — and the top-performing ASX AI share in terms of share price – is Life360. In FY24, Life360 showed that AI can enhance safety and connectivity for families worldwide through its mobile app of the same name.

As a reminder, the company’s AI tools provide real-time location updates, safety alerts while driving, and rapid emergency responses, securing a place in the lives of millions.

The ASX AI share finished the financial year at $16.37 apiece after starting the period at $7.60 – a more than 115% jump.

Most of this came in the second half of the year, as seen in the chart below. The Life360 share price closed at $16.05.

This reflected a year of significant growth driven by its AI innovations in personal security.

Life360’s revenues were up 15% year over year in Q1 due to a jump in premium subscriptions. It booked US$78.2 million at the tip line, with the expansion of its safety features said to have drawn more users but also sharply cut churn rates.

Bell Potter rates the stock a buy with a $17.75 price target.

ASX AI shares in focus

It’s no secret investors are focused on ASX AI shares as emerging technologies sprout in the space. Investment returns have been stellar, but there could be plenty of speculation in the mix as well.

As always, remember to conduct your own due diligence.

The post Here’s the 3 best ASX artificial intelligence (AI) shares of FY24 appeared first on The Motley Fool Australia.

More reading

• 10 ASX shares to buy in FY25
• The best ASX 200 share of each market sector in FY24
• Here’s the outlook for 3 ASX artificial intelligence (AI) shares in FY25
• Shares vs. property: Which delivered the best growth in FY24?
• Leaders and laggards of the ASX market sectors in FY24

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group, Life360, and Megaport. The Motley Fool Australia has positions in and has recommended Dicker Data. The Motley Fool Australia has recommended Megaport. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Flight Centre Travel Group Ltd (ASX: FLT) share price closed out the financial year just past in the green. Though the S&P/ASX 200 Index (ASX: XJO) travel stock couldn’t quite match the performance of the benchmark index.

Shares in the travel agent closed out FY 2023 at $19.05. On 28 June, the last trading day of FY 2024, shares ended the day changing hands for $20.18 apiece.

That saw the Flight Centre share price up 5.9% over the 12 months.

For some context, the ASX 200 gained 7.8% over this same period.

Now, that doesn’t include the two fully franked dividends the company paid out over the year, totalling 28 cents a share.

FY 2024 saw the return of Flight Centre’s dividends. Those were last paid in 2019 and suspended after the outbreak of the global pandemic brought domestic and international travel to a standstill in 2020.

What were ASX 200 investors considering in FY 2024?

Flight Centre reported its full-year FY 2023 results on 30 August.

Highlights included a 127% year on year increase in revenue to $2.3 billion. And after posting a loss before tax of $378 million in FY 2022, the company posted a $70 million profit before tax. This helped it end the last financial year with cash holdings of $1.3 billion.

“After an incredibly challenging period, we are pleased to report material profit and sales uplifts in improved conditions during FY23, leading to stronger shareholder returns,” managing director Graham Turner said of the results.

Despite the strong growth metrics, the Flight Centre share price closed down 2.8% on the day.

Fast forward to 28 February, and we find the ASX 200 travel stock’s results for H1 FY 2024.

Flight Centre reported a 565% year on year increase in half-year underlying profit before tax of $106 million. That was spurred by a 15% lift in total transaction value (TTV) of $11.3 billion.

And management reported the company was on track to beat its record FY 2019 $23.7 billion TTV result in FY 2024.

Once more, investors looked to have been expecting even more, sending the Flight Centre share price down 3.9% on the day.

That’s what ASX 200 investors learned over the financial year just past.

Now, what might they expect from the Flight Centre share price in FY 2025?

What’s next for the Flight Centre share price in FY 2025?

With six trading days of FY 2025 already in the bag, the Flight Centre share price is up 5.85% in the emerging new financial year, closing yesterday at $21.36 a share.

As for what we might expect in the months ahead, a lot of this will hinge on how a range of macroeconomic factors come together to impact global travel demand.

Airline ticket prices are one to watch. These will, in part, be affected by the costs of jet fuel, which represent around 20% of airlines’ annual expenses.

The trajectory of inflation and interest rates, both in Australia and internationally, will also influence the overall levels of travel demand. As will the Aussie government’s cost of living relief measures and the extra cash most workers can expect in FY 2025 from the new stage three tax cuts.

Should inflation and interest rates surprise to the downside, I suspect the Flight Centre share price will benefit from an uptick in travellers.

Turning to recent broker coverage, Morgans has a bullish outlook for the company in FY 2025.

The broker recently stated that, “FLT has the greatest risk, reward profile of our travel stocks under coverage.”

Morgans has an add rating on Flight Centre stock, with a $27.27 share price target.

That’s almost 28% higher than yesterday’s closing price.

The post Up 6% in FY 2024, what’s ahead for the Flight Centre share price in FY 2025? appeared first on The Motley Fool Australia.

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

If you are in the process of building a retirement portfolio, then it could be worth looking at the ASX shares in this article.

That’s because they are high-quality companies and appear well-positioned to grow their earnings and dividends over the long term.

Let’s see what analysts are saying about them now:

Brickworks Limited (ASX: BKW)

Analysts at Bell Potter think that Brickworks could be an ASX share to buy. Its analysts are very positive on the building products company’s outlook and appear to believe its long run of dividend increases can continue. The broker commented:

Despite some recent normalisation in market rent growth and vacancies, near-term supply in BKW’s precincts continues to remain heavily pre-committed. BKW has recently secured DA approval for Oakdale East 2 (250k sqm GLA) and last month announced Amazon (58k sqm GLA) as its anchor tenant, providing the group with strong optionality and, in our view, an effective 12 to 18 month lead on most incoming local supply. Over FY25- 26e we see development potentially approaching 100k+ sqm p.a. (+$20- 25m p.a. gross rent or 11-13% p.a.). Given BKW’s relatively short-WALE and 30-35% under-rented book, a relatively benign annual mark-up should then see rent growth in the mid-teens fairly comfortably, in our view.

Bell Potter expects dividend yields in the region of 2.5% in the near term. It also sees room for its shares to climb from current levels with its buy rating and $29.00 price target.

Woolworths Limited (ASX: WOW)

Woolworths could be an excellent ASX share for a retirement portfolio in FY 2025. This is because the supermarket giant’s shares were sold off in the last financial year, which appears to have created a compelling buying opportunity today.

Goldman Sachs certainly believes this is the case. The broker explained:

We are Buy rated on the stock as we believe the business has among the highest consumer stickiness and loyalty among peers, and hence has strong ability to drive market share gains via its omni-channel advantage, as well as its ability to pass through any cost inflation to protect its margins, beyond market expectations. The stock is trading below its historical average (since 2018), and we see this as a value entry level for a high-quality and defensive stock.

As for income, its analysts believe that Woolworths is positioned to increase its dividend each year until at least FY 2026. This will mean 3%+ dividend yields each year.

But the biggest positive is arguably its valuation. Goldman has a buy rating and $40.20 price target on Woolworths shares, which suggests that they could rise 19% from current levels.

The post 2 ASX shares to buy for a retirement portfolio in FY25 appeared first on The Motley Fool Australia.

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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. has positions in and has recommended Brickworks and Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Brickworks. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

For a stable and secure retirement, I think retirees need a few different assets to help things go smoothly.

Our golden years will hopefully be the best years of our lives, and our nest egg is probably one of the most important elements for funding our living expenses after we stop working.

The ASX share market is regularly volatile, so that shouldn’t come as a surprise to anyone. However, real-life downturns and recessions can occasionally happen.

The retirement phase may last decades, so it’s crucial to be well-prepared for whatever may happen and how long we may live.

An emergency fund can protect retirees

I believe every adult in Australia should have an emergency fund. We never know when an emergency will happen, so having that financial foundation can be useful if an issue arises. For young Aussies, I’d suggest having at least $1,000 in a high-interest savings account, and for the breadwinners of a family, I’d suggest having three to six months of living expenses as cash.

Retirees need to have cash saved to ride out a downturn. Selling assets such as ASX shares during a period of falling share prices could be very detrimental to the nest egg fund.

Financial planners can help figure out how much a retiree should have as cash set aside, but I’d suggest an amount equivalent to at least a year of living expenses, perhaps up to two years, if the savings account is earning a good interest rate.

On the ASX, there is an exchange-traded fund (ETF) called Betashares Australian High Interest Cash ETF (ASX: AAA). This ETF allocates money into deposit accounts with selected banks in Australia. It pays interest monthly at a rate that’s competitive with ‘at call’ bank deposits. However, an investment in this ETF does not have any government guarantee. The current interest rate on the AAA ETF is 4.45%. This ETF may appeal to investors with significant cash balances or non-individual entities.

Growing investments

The other ASX investment that I think every retiree should have is investments that are growing.

We may need our portfolios to last a really long time, perhaps three or four decades. In the last three years, we’ve seen how inflation can degrade the value of a dollar, and the costs of various products and services have jumped significantly. Protecting against long-term inflation is a good idea.

I like the idea of investing in assets that can deliver long-term growth without us having to worry about or monitor them, which is often why diversified ETFs can be so appealing. However, some ETFs don’t offer an adequate level of passive income due to their dividend yield or dividend growth.

Some of my favourite investments for dividend and earnings growth are Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), Brickworks Limited (ASX: BKW), and Collins Foods Ltd (ASX: CKF).

Of course, ETFs like Betashares Global Quality Leaders ETF (ASX: QLTY) and VanEck MSCI International Quality ETF (ASX: QUAL) can be very effective, too; they just don’t have large dividend yields.

The post 2 ASX investments I think all retirees should have appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Brickworks, Collins Foods, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Collins Foods. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

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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. has positions in and has recommended Audinate Group, Johns Lyng Group, Lovisa, and Pro Medicus. The Motley Fool Australia has positions in and has recommended Audinate Group. The Motley Fool Australia has recommended Johns Lyng Group, Lovisa, and Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Brickworks Limited (ASX: BKW) share price went nowhere over the last six months.

Brickworks owns a significant portfolio of investment assets, including a 26.1% stake in Washington H Soul Pattinson Ltd (ASX: SOL) and property development ventures, partnering with Goodman Group (ASX: GMG).

During the same period, its business partner Goodman Group (ASX: GMG) saw its share price gain nearly 50%.

In this article, I will explore recent developments in Australia’s industrial property market, with a focus on Sydney, and what they mean for Brickworks shares.

Australia’s industrial property vacancy is the lowest level globally

Last week, CBRE Group released its property market review report for the six months ending 30 June 2024. In this report, the property group emphasised that although there was an increase in the nation’s industrial property vacancy, it remains among the lowest globally. According to CBRE:

The national vacancy rate has increased to 1.9% for H1 2024, with upward movement recorded for most major markets across Australia. This rate is still the lowest level globally.

Despite the rise in space availability, we still do not expect to see the national average vacancy rate to surpass 4% in 2024.

Super prime grade stock is still being readily absorbed in the market at strong rental levels, and we do not anticipate demand for good quality assets in core locations to fall.

The vacancy rate in Sydney, where Brickworks is developing its land holdings with Goodman Group, rose from 0.5% six months ago to 2% in 1H CY24.

While it was disappointing to see the upward movement, the CBRE report highlights that this is still below the equilibrium rate of 4% and pre-pandemic level of above 5%.

As the shortage in the industrial property market continues, the current pre-commitment rate for the new supply is strong at 75%.

What does it mean for Brickworks shares?

The high pre-commitment rate for industrial properties is one of many reasons Bell Potter remains positive on Brickworks shares. The analysts at the broker said:

Despite some recent normalisation in market rent growth and vacancies, near-term supply in BKW’s precincts continues to remain heavily pre-committed.

BKW has recently secured DA approval for Oakdale East 2 (250k sqm GLA) and last month announced Amazon (58k sqm GLA) as its anchor tenant, providing the group with strong optionality and, in our view, an effective 12 to 18 month lead on most incoming local supply.

Brickworks appears undervalued compared to the company’s own estimation of its net asset value (NAV). In its May 2024 trading update, the company estimated its NAV at around $5.6 billion or $36.68 per share. This is far above its share price of $26.84 today.

In the same update in May, the company highlighted its current rent is well below the market. This indicates there’s room for further income growth from its property ventures as rental terms come into effect. Management said:

Theses structural trends, along with land supply issues, have driven up rent for prime industrial property in western Sydney by 55% in the past two years. We estimate that the current passing rent within the Industrial JV Trust of $147/m2 is now 35% below average market rent of $225/m2.

The Brickworks share price is flat today at $26.84.

The post Time to buy Brickworks shares on Australia’s world-beating stat? appeared first on The Motley Fool Australia.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Kate Lee has positions in Brickworks. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon, Brickworks, and Goodman Group. The Motley Fool Australia has positions in and has recommended Brickworks. The Motley Fool Australia has recommended Amazon and Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

I’m excited by the potential of certain ASX growth shares that are expanding globally. Businesses that are growing beyond Australia’s shores have the potential to unlock larger addressable markets.

Australia is a great country that ranks well on measurements like per-person wealth and income. However, there are fewer than 30 million people in this sunburnt country. Thus, if a company can successfully expand into North America or Europe, it could be a winner.

In this article, I’ll discuss the ASX small-cap share, Close The Loop Ltd (ASX: CLG), as a potential market-beating opportunity.

Two of the main things I look for in an ASX growth share are whether it has a compelling future and whether it’s trading at an appealing price to buy. I think Close The Loop ticks both boxes.

Exciting potential

The ASX growth share describes its activities as collecting and repurposing products through takeback programs across its resource recovery division. It also provides sustainable packaging products through its packaging division, which enables “greater recoverability and recyclability”.

The world wants to be more sustainable over the long term, and Close The Loop is one of the businesses that could enable that change.

One of Close The Loop’s key clients is HP, which aims to achieve 75% circularity for its products and packaging by 2030. HP ships around 40 million PCs every year, and there are approximately 300 million HP PCs in the market right now, not including HP printers and other products.

The ASX growth share is the first provider to be appointed as an ‘HP platinum global certified renew partner’. ‘HP renew solutions’ is a global and strategic positioning to “insert HP into the refurbishing and resale of the company’s returned products.” Close The Loop is pursuing a global product takeback programme as a “strategic priority”.

Over the next 12 months, the company expects to establish new facilities in the US, Europe and Middle East to better serve its global clients in those regions.

The company also recently mentioned it is opening a new IT refurbishment in Mexico.

I think the business is capable of delivering ongoing organic growth, synergies with the ISP Tek Services acquisitions and it could potentially make more add-on acquisitions in the future.

In the FY24 first-half result, Close The Loop’s revenue rose 76%, the gross profit margin improved by 3.4 percentage points to 36.2% and underlying net profit after tax (NPAT) increased by 164% to $13.25 million.

Attractive valuation of the ASX growth share

How much is this promising ASX growth share valued at?

According to the forecast on Commsec, the Close The Loop share price is valued at 7x FY24’s estimated earnings, 6x FY25’s estimated earnings and under 6x FY26’s estimated earnings.

Considering the exciting appeal of the business, I think the earnings multiple of under 8 times is very appealing.

The post I’d buy this ASX growth share in a heartbeat appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Close The Loop. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Close The Loop. The Motley Fool Australia has recommended Close The Loop. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.