The Commonwealth Bank of Australia (ASX: CBA) share price is trading flat on Thursday.

Which isn’t a bad outcome considering the S&P/ASX 200 Index (ASX: XJO) is down 0.25% at the time of writing.

This means the CBA share price remains up almost 27% since the start of the year at $106.09.

Is the CBA share price good value?

One leading broker that still sees a lot of value in the CBA share price is Bell Potter.

According to a note from last week, the broker has retained its buy rating and $118.00 price target on the bank’s shares.

Based on the current CBA share price, this suggests there’s still potential upside of 11.2% for its shares. And if you include the $4.06 per share fully franked dividend the broker is forecasting in FY 2022, the potential return stretches to 15%.

What did the broker say?

Bell Potter notes that CBA will soon be releasing its first quarter update and is expecting a solid result.

It commented: “Net interest income is expected to be up by around 3%. This is based on higher overall banking volumes (back to the traditional business of mainly mortgage and retail consumer loans) that more than offset a fall in NIM of around 3bp (to 2.01%). The main drivers are thus home loans [+4% for Retail Banking Services (RBS), +3% for Business Bank/Institutional Banking and Markets (BB/IBM)] and other loans (+4% for RBS although BB/IBM was negative).”

Overall, this is expected to lead to the bank reported an unaudited cash NPAT of ~$2.36 billion for the quarter.

Valuation

Bell Potter also explained why it thinks the CBA share price is good value at the current level.

It uses a combination of earnings multiples and a sum of the parts (SOTP) valuation to come up with its price target.

The broker said: “We have, however, moved the prospective (FY22) PE multiples around (and thus Sum-of-Parts) to better capture the various segments: RBS 17.0x; BB/IB&M 18.0x; and New Zealand 17.0x. The composite valuation is thus $117.22, being an equal measure of: DCF $186.5bn; dividend yield $197.9bn; ROE $198.2bn; and Sum-of-Parts $171.2bn. There is also surplus capital of $11.6bn to top it off. The price target is the same as before, being $118.00 per share, and likewise the Buy rating based on a 12-month TSR of greater than 15%.”

The post Is the CBA (ASX:CBA) share price a bargain buy? appeared first on The Motley Fool Australia.

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• Own CBA shares? Here’s the bank’s latest green initiative
• Analysts name 2 ASX dividend shares to buy
• CBA (ASX:CBA) share price struggles amid financial planning arm closure
• Here’s why the 90-year old CBA (ASX:CBA) school banking program is no longer
• Is the CBA (ASX:CBA) share price a great deal right now?

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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Shares of software giant Microsoft (NASDAQ: MSFT) had jumped 4% as of 11:50 a.m. EDT Wednesday after the company reported better-than-expected sales and earnings in its fiscal first-quarter 2022 report last night.

Instead of the $2.07 per share earned on sales of $44 billion that analysts were expecting, Microsoft reported a $2.27 per share adjusted profit on sales of $45.3 billion.

So what

And that wasn’t even the best news. When calculated according to generally accepted accounting principles (GAAP), Microsoft’s earnings actually came in at $2.71 per share for the fiscal first quarter, up 49% year over year — way better than the 25% reported improvement in adjusted profits.

The improvement in earnings was also significantly stronger than Microsoft’s already strong 22% growth in Q1 2022 sales over Q1 2021. Across the board, Microsoft booked improvements in revenue:

• Intelligent cloud sales — up 31%.
• Productivity and business processes — up 22%.
• More personal computing — up 12%.

Now what

And Microsoft plans to keep outperforming expectations in the second quarter, as revealed in the company’s post-earnings conference call, which was covered by TheFly.com.

There, Microsoft confided that it is on course to book revenue between $50.15 billion and $51.05 billion in Q2 — several percentage points faster growth than the $48.9 billion that Wall Street had been forecasting. The results, and the forecast, were good enough to elicit higher stock price targets from a range of Wall Street banks, as analysts from Barclays to Citi to Goldman Sachs hiked their target prices as high as $407 a share on this $324 stock, predicting as much as 25% gains above and beyond what Microsoft is collecting today.

No wonder investors are excited.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why Microsoft shares jumped on Wednesday appeared first on The Motley Fool Australia.

More reading

• Microsoft (NASDAQ:MSFT) share price climbs after a record quarterly profit
• Why valuation multiples can be ‘useless’ in assessing ASX shares: expert
• The best day in 10 months, and Zip’s Microsoft deal. Scott Phillips on Nine’s Late News

Rich Smith has no position in any of the stocks mentioned. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Citigroup is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Microsoft. 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.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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At lunch on Thursday, the S&P/ASX 200 Index (ASX: XJO) is on course to record a decline. The benchmark index is currently down 0.2% to 7,431.4 points.

Here’s what is happening on the ASX 200 today:

ANZ full year results

The Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price is pushing higher today after outperforming expectations in FY 2021. The banking giant reported a 65% increase in full year cash earnings from continuing operations to $6,198 million and declared a fully franked 72 cents per share final dividend. Goldman Sachs was impressed. It commented: “ANZ reported 2H21 cash earnings (company basis) from continued operations of A$3,208 mn, which was up 37% on pcp and 11% ahead of GSe, with the beat driven by higher revenues and a lower BDD charge.”

Fortescue Q1 update

The Fortescue Metals Group Limited (ASX: FMG) share price is edging higher today following the release of its first quarter update. Fortescue shipped 45.6 million tonnes of iron ore during the three months. This was up 3% on the prior corresponding period and a record for the first quarter. However, it also reported a 30% quarter on quarter reduction in average revenue per tonne to US$118. This represents revenue realisation of 73% of the average Platts 62% CFR Index, compared to 84% during the fourth quarter.

Coles sales update

The Coles Group Ltd (ASX: COL) share price is rising today after the release of its first quarter sales update. The supermarket operator reported a 1.5% increase in total sales to $9,756 million. This growth was driven by its Supermarket and Liquor businesses, which offset weakness in the Express business.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Thursday has been the Boral Limited (ASX: BLD) share price with a 5% gain. This follows the release of an update at its annual general meeting. The worst performer has been the Pointsbet Holdings Ltd (ASX: PBH) share price with an 11% decline following the release of its quarterly update.

The post ASX 200 (ASX:XJO) midday update: ANZ result impresses, Fortescue higher appeared first on The Motley Fool Australia.

More reading

• ANZ (ASX:ANZ) share price higher after beating expectations in FY21
• PointsBet (ASX:PBH) share price slides 8% after Q1 trading update
• Fortescue (ASX:FMG) share price rises on record Q1 shipments
• Coles (ASX:COL) share price in focus following Q1 update
• ANZ (ASX:ANZ) share price on watch after FY21 profit surge

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 Pointsbet Holdings Ltd. The Motley Fool Australia owns shares of and has recommended COLESGROUP DEF SET. The Motley Fool Australia has recommended Pointsbet 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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The market may be in the red today, but the same cannot be said for the Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price.

In late morning trade, the banking giant’s shares are up 1.5% to $28.80.

Why is the ANZ share price outperforming today?

Investors have been bidding the ANZ share price higher today following the release of its full year results for FY 2021.

For the 12 months ended 30 September, the bank reported a 72% jump in statutory profit after tax to $6,162 million and a 65% increase in cash earnings from continuing operations to $6,198 million.

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

Also potentially giving the ANZ share price a boost was its strong capital position. The bank finished the period with a CET1 ratio up 100 basis points to 12.3%. This means the bank has $6 billion of surplus capital above of APRA’s requirements, which could bode well for potential share buybacks in the future.

In light of its strong performance, the ANZ Board was able to declare a fully franked final dividend of 72 cents per share, bringing its full year dividend to 142 cents per share. This is up from 60 cents per share in COVID-impacted FY 2020.

How does this compare to expectations?

The team at Goldman Sachs responded positively to the release, noting that ANZ’s results came in ahead of its expectations.

The broker commented: “ANZ reported 2H21 cash earnings (company basis) from continued operations of A$3,208 mn, which was up 37% on pcp and 11% ahead of GSe, with the beat driven by higher revenues and a lower BDD charge. As such, 2H21 PPOP came in 6% higher than GSe, with the better-than-expected result driven by higher trading income and a better-than-expected performance on NIMs, partially offset by higher expenses. We note that even adjusting for the better than expected trading income, 2H21 revenues were still c. 1.5% better than GSe.”

“The proposed final DPS of A72¢ was slightly higher than GSe A70¢ and implies a payout ratio of 63% and will come with a non discounted DRP that will be neutralised by acquiring shares on market. The 2H21 CET1 ratio of 12.3% (18.35% globally-harmonised) was 13bps stronger than GSe,” it added.

Goldman currently has a buy rating on the ANZ share price with a price target of $30.71. Though, this recommendation and target could change once it has fully absorbed the result.

The post ANZ (ASX:ANZ) share price higher after beating expectations in FY21 appeared first on The Motley Fool Australia.

More reading

• ANZ (ASX:ANZ) share price on watch after FY21 profit surge
• 5 things to watch on the ASX 200 on Thursday
• Leading brokers name 3 ASX shares to sell today
• Here’s why Morgans is tipping 21% upside for the ANZ (ASX:ANZ) share price
• 2 excellent ASX dividend named as buys

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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Shares of Robinhood (NASDAQ: HOOD) sank 10.4% on Wednesday after the online brokerage’s third-quarter financial results disappointed shareholders amid a shortfall in cryptocurrency trading volumes.  

So what

Robinhood’s revenue rose 35% year over year to $365 million. That was well below Wall Street’s expectations for revenue of $431.5 million. It also represented a sharp decline from the $565 million in revenue Robinhood generated in the second quarter. 

Worse still, monthly active users declined 11% sequentially, to 18.9 million. 

Robinhood said the declines were due in part to a downturn in cryptocurrency-related trading activity. The company’s crypto transaction-based revenue fell to $51 million, down from $233 million in the second quarter. 

“Looking back at Q2, we saw a huge interest in crypto, especially doge [Dogecoin (CRYPTO: DOGE)], leading to large numbers of new customers joining the platform and record revenues,” CEO Vlad Tenev said during a conference call with analysts. “In Q3, crypto activity came off record highs, leading to fewer new funded accounts and lower revenue as expected.” 

Now what 

Robinhood expects the muted trading activity to persist into year-end. In turn, management guided for revenue of no greater than $325 million in the fourth quarter and 2021 full-year revenue of less than $1.8 billion.

This muted forecast was unsurprisingly met with jeers from shareholders. Warnings of stagnating growth are often troublesome for premium-priced stocks. Robinhood, which is trading at roughly 20 times sales, might be priced for much greater growth than its new guidance suggests it can deliver. Investors are now resetting their expectations — and driving Robinhood’s stock price down in the process. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why Robinhood shares crashed on Wednesday appeared first on The Motley Fool Australia.

More reading

• Why Robinhood Should Worry About PayPal’s New Payments App

Joe Tenebruso 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.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Shares in gold giant Newcrest Mining Ltd (ASX: NCM) are losing ground in early trading and changing hands at $24.89 apiece, down 0.64% on yesterday’s closing price.

This follows the company releasing its Q1 FY22 activities and earnings report today.

Here we cover the salient points of Newcrest’s performance in the three months ending 30 September 2021.

Newcrest Mining share price dips as Q1 gold production slides

Newcrest outlined several investment highlights in its quarterly report, including:

• Group gold production of 396,214 ounces and copper production of 24,527 tonnes
• All-In Sustaining Cost (AISC) of USD$1,270 per ounce, up from $799/ounce from the previous quarter
• AISC margin of $406 per ounce, down 58% from the last quarter of $975/ounce
• No fatalities on site, in continuation with FY21
• Realised gold price of $1,722/oz, down from $1,780/oz the quarter prior
• Realised copper price of $9,348 per tonne, a 15% increase on FY21, but 36% quarter on quarter decrease
• Gold and copper production expected to increase in Q2.

What else happened this quarter for Newcrest?

Gold production decreased by 27% from the previous quarter at about 396,000 ounces. Gold sales were realised on a spot price of $1,722/oz, which was also a slight decrease from the last quarter.

Newcrest sold a total of 350,000 ounces of gold across its operations.

The decrease in gold production was attributed to “lower mill throughput rates” at its Cadia, Lihir and Teffer sites.

Newcrest also saw a higher AISC on its gold production in Q1, reflecting lower gold and copper sales numbers. It also had more mining waste and lower realised copper prices.

The company also released the findings from pre-feasibility studies (PFS) at its Red Chris, Haveiron, Lihir and Cadia sites. Newcrest stated that each of the “four organic growth options” are estimated to deliver an internal rate of return (IRR) of 16% or more.

The PFS also projected a 50% reduction in the company’s AISC over the next decade, whilst maintaining projected gold production of about 2 million ounces per annum through to FY30.

Aside from this, Newcrest explained that the commissioning of the Moly Plant at its Cadia site is ongoing and first production is expected by November.

What did management say?

Speaking on the announcement, Newcrest managing director and CEO, Sandeep Biswas said:

Newcrest’s production in the September quarter was in line with our expectations and reflects the replacement and upgrade of the SAG mill motor at Cadia, the completion of the re-bricking of Autoclave 4 at Lihir and other planned maintenance shutdowns across the Group which is consistent with prior years. We expect gold and copper production to increase in the December quarter with lower planned shutdown activities and completion of the SAG mill motor replacement and we remain on track to meet our FY22 guidance.

What’s next for Newcrest Mining?

The company maintains that it is tracking well to meet its FY22 guidance. It projects gold production of 1,800koz to 2,000koz from all its operations.

That appears to be a slight decrease on FY21 production volumes of 2,093,322 ounces.

It also forecasts copper production of 125kt to 130kt in FY22, mostly from Newcrest’s Cadia and Red Chris sites.

Those estimates appear to be wound back from FY21 as well, where Newcrest produced 142,724 tonnes of copper.

The Newcrest Mining share price has struggled year to date, posting a loss of 7.85% since January 1. The share price has dropped 18.66% over the past year.

The post Newcrest Mining (ASX:NCM) share price slides on production decrease appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• Can the Newcrest (ASX:NCM) share price hit $32 by the end of 2021?
• 5 things to watch on the ASX 200 on Friday
• Newcrest (ASX:NCM) CEO reveals the company’s gold, copper and Bitcoin mining plans
• Northern Star (ASX:NST) share price wanes as quarterly production falls

The author Zach Bristow has no positions 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 Sandfire Resources Ltd (ASX: SFR) share price is sinking in early trade, down 2.81%.

Below, we take a look at the highlights from the ASX 200 miner’s quarterly report.

Record final dividend paid during the quarter

The Sandfire share price is sinking in early trade despite the company recapping its record net annual profit of $170.1 million for the 2021 financial year (FY21).

The healthy profit saw Sandfire also pay out a record final dividend of 26 cents per share, 100% franked, during the quarter. That dividend was paid on 22 September.

The ASX 200 miner finished the quarter with $405.5 million cash on hand, after the US$100 million initial deposit for its US$1.87 billion (AU$2.57 billion) MATSA Mining Complex acquisition in Spain.

That complex includes 3 underground mines feeding a 4.7Mtpa central processing facility producing 100-120ktpa of copper equivalent (Cu Eq). According to Sandfire, this now makes it one of the largest copper-focused producers in Australia.

The transaction is fully-funded following a $1.25 billion fully underwritten equity raising and committed debt facilities.

After the quarter ended, Sandfire sold its 16% investment in Adriatic Metals Plc (ASX: ADT), delivering gross proceeds of $97 million.

Commenting on the MATSA acquisition and the quarterly results, Sandfire’s CEO Karl Simich said:

It is extremely rare to find a base metals asset that offers MATSA’s compelling combination of scale, grade, mine life and exploration upside, and I am delighted that we have been able to move so quickly and decisively to complete the acquisition and lock in the required debt and equity funding. This has been ranked as the largest all-cash deal ever done by an Australian miner, and it is a real credit to everyone involved.

And Sandfire had lots more than MATSA going on during the quarter.

Atop updates from its other mines, Simich added, “All of this has been achieved against the backdrop of another period of strong performance from the DeGrussa Copper-Gold Mine, which delivered another solid production and cost performance in line with guidance and continues to deliver outstanding operating margins.”

Looking ahead, Sandfire forecast its FY22 production will be within the range of 64-68,000 tonnes of contained copper and “at the upper end” of 30-34,000 ounces of contained gold.

The Sandfire share price may be under some pressure today after the miner said it expects its cash operating costs to come in towards the upper end of the range of US$1-$1.10 per pound.

Sandfire share price snapshot

Over the past 12 months the Sandfire share price is up 37%. By comparison the S&P/ASX 200 Index (ASX: XJO) is up 23% in that same time.

Sandfire shares are up 3% over the past month.

The post Sandfire (ASX:SFR) share price sinking despite record quarterly dividend appeared first on The Motley Fool Australia.

More reading

• Why has the Sandfire Resources (ASX:SFR) share price rallied 12% in 2 days?
• Adriatic Metals (ASX:ADT) share price plunges 16% on Sandfire update
• Sandfire Resources (ASX:SFR) share price fizzles after sale of Adriatic Metals stake
• Which shares are set to finish the week as the top movers on the ASX 300?
• Why Saxo Market’s Q4 outlook bodes well for ASX copper shares

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 Openpay Group Ltd (ASX: OPY) share price is struggling to catch a bid on Thursday after the company released its first-quarter update for FY22.

At the time of writing, the Openpay share price is down 2.19% to $1.34.

Openpay share price lower despite UK and US expansions

Openpay recapped a strong first-quarter performance with successful expansions across the UK healthcare sector and its debut in the United States. Highlights included:

• Active merchants rose 87% against the prior corresponding period (pcp) to approximately 4,300;
• Its active customers increased by 56% to about 579,000;
• Active plans surged 110% to 2.2 million;
• Record 85% of new plans from repeat customers and 55% of active customers with multiple plans;
• Total transaction volumes (TTV) up 51% to $103 million; and
• Total revenues of $7.0 million, impacted by Australian lockdowns.

“Through Q1FY22, we delivered continued strong operating and financial results despite challenging market circumstances for our key verticals in ANZ,” said Openpay CEO Michael Eidel.

What happened to Openpay in Q1?

Openpay is currently undergoing an aggressive strategy to acquire new customers in the Australia and New Zealand regions. Its initiatives include Officeworks co-marketing program, Bunnings magazine placements, a Melbourne Storm campaign, and MyHealth1st engagement for health customers.

This helped the company achieve a 73% increase in active plans in the region and a record TTV of $73 million.

Openpay’s services went live in the UK’s healthcare sector with its partner ezyVet and integration with Software of Excellence, a provider of dental software. That was in addition to expanding its retail, luxury, and music partnerships.

While the UK’s growth figures are coming off a low base, the region nevertheless achieved a 279% and 204% increase in active merchants and active plans.

Yesterday, Openpay announced it has successfully gone live in the United States. However, the news didn’t excite investors and the Openpay share price ended the day about 1% lower.

The company’s consumer product offers differentiated, longer-term (up to 24 months), larger-value, and customised payment plans. These are focused on specific verticals including healthcare, auto repair, home improvement, education, and big-ticket retail.

Openpay believes its US product fills the gaps not met by traditional buy now, pay later offerings.

“Our first US plans were signed and transacted in October, taking Openpay into its third major geographic opportunity. This was a major scene-setter for the step-change in business performance expected as we welcome customers in the world’s largest consumer payments market,” said Eidel.

What’s next for Openpay?

Looking ahead, Openpay said the US company could represent approximately two-thirds of the business over the next three years, despite the concurrent growth across the UK and Australia.

Openpay also stated its growth, now taking place across three major regions, will allow the business to grow at scale. This will ensure a clear path to profitability in the mid-term.

Openpay share price snapshot

The Openpay share price has declined 43% year-to-date.

Its weak performance might come as no surprise given its struggling small-cap peers such as Splitit Ltd (ASX: SPT) and Laybuy Holdings Ltd (ASX: LBY) have both tumbled more than 60% in 2021.

The post Openpay (ASX:OPY) share price edges lower despite bumper Q1 update appeared first on The Motley Fool Australia.

More reading

• Why is the Splitit (ASX:SPT) share price wobbling on Wednesday?
• Openpay (ASX:OPY) share price rallies as services go live in the US
• Laybuy (ASX:LBY) share price surges 14% on record quarterly
• The Splitit (ASX: SPT) share price slumped 8% today. Here’s why
• Openpay (ASX:OPY) share price jumps 13% on US update

Motley Fool contributor Kerry Sun 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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It’s a week shareholders rather forget as the Codan Limited (ASX: CDA) share price tanked 23% despite announcing a new contract win.

The Codan share price crashed by another 7% this morning to a more than one-year low of $10.24. The loss is on top of the 19% hit yesterday on the contract news and annual general meeting.

While it’s often difficult attribute one reason for a share price collapse, Codan’s fall from grace is probably linked to its outlook.

Record profits aren’t enough for Codan share price

Investors may have been hoping for a stronger start of the FY22 financial year than what the group is suggesting.

“While parts of our business remain difficult to forecast, we have made an excellent start to the financial year,” said Codan’s outgoing chief executive Donald McGurk.

“Our existing businesses are tracking in line with last year’s record first half profitability, while DTC and Zetron are transitioning and integrating well into the Codan group and are tracking in line with plan. 

McGurk is confident on delivering a new record first half result, but the market may have been hoping for a more bullish statement than “tracking in line”.

Codan share price dodges COVID bullet

At least the global pandemic didn’t seem to be affecting the Codan share price as much. Several ASX companies, such as the Audinate Group Ltd (ASX: AD8) share price, have been hit hard by shortages of electronic components.

Codan dodged that bullet by ordering ample inventory of Minelab equipment. Shut borders have also bolstered interest in outdoor recreational activity and that has helped sales of Minelab metal detectors. These are used by recreational gold explorers.

Contract win and growth outlook

The group is aiming to become a full-solution communications equipment provider and acquired video equipment business DTC Communications Inc.

The new contract worth $37.6 million that was announced yesterday relate to orders for DTC products – not that it mattered to the Codan share price.

The group’s covert surveillance business is also experiencing a resurgence in demand. It was recently awarded several contracts as governments increase spending on homeland security.

Codan expects to announce McGurk’s replacement in November and reaffirmed its long-term growth targets.

New CEO to be announced next month

“I can confirm that our detailed 3-year plan remains in place and that with the assistance of our high quality, committed executive team, no momentum will be lost as we work through the change of leadership,” said Codan’s chairman David Simmons.

“We fully expect that our new Managing Director will pick this plan up and own it. No big business or organisational review, just a simple plan to get on with it.”

Judging by the Codan share price, investors are yet to be reassured.

The post Codan (ASX:CDA) share price hits new one-year low appeared first on The Motley Fool Australia.

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• Why A2 Milk, Codan, EOS, and Woolworths shares are sinking
• Why is the Codan (ASX:CDA) share price free-falling 13% today?
• ASX 200 (ASX:XJO) midday update: A2 Milk crashes, Woolworths tumbles
• Why ASX 200 tech shares are leading the charge higher today
• 2 ASX shares having a shocker that could be bargain buys right now

Motley Fool contributor Brendon Lau owns shares of AUDINATEGL FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AUDINATEGL FPO. The Motley Fool Australia owns shares of and has recommended AUDINATEGL 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 Transurban Group (ASX: TCL) share price has been underperforming so far in 2021.

Since the start of the year, the toll road operator’s shares have risen just 1% to $13.75.

This compares unfavourably to the S&P/ASX 200 Index (ASX: XJO) and its solid 11% gain over the same period.

Is the Transurban share price good value?

According to a note out of Credit Suisse, its analysts believe the Transurban share price could be good value at the current level. This follows the release of the company’s first quarter update last week.

That update revealed a significant decrease in overall average daily traffic year on year, due to lockdowns in key markets. Transurban reported overall average daily traffic (ADT) volumes down 12.4% year on year and 34.5% when compared to 2019.

However, this wasn’t as bad a Credit Suisse was expecting. In light of this and the earlier than forecast reopening of Melbourne and Sydney from lockdowns, the broker has upgraded its earnings and dividend estimates materially.

Estimates upgraded

The broker is now forecasting dividends of 41.5 cents per share in FY 2022 and then 61.5 cents per share in FY 2023. Based on the current Transurban share price, this implies yields of 3% and 4.5%, respectively.

In addition, Credit Suisse has retained its outperform rating and increased its price target on the company’s shares to $15.15. This suggests there’s upside of 10% for its shares over the next 12 months.

And if you add in dividends, the potential return on offer stretches to over 13% for investors.

All in all, while the Transurban share price has underperformed this year, Credit Suisse appears to see this as a buying opportunity now.

The post Why Credit Suisse says the Transurban (ASX:TCL) share price could be a bargain appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• Transurban (ASX:TCL) share price slides as traffic volumes push lower
• Why is the Transurban (ASX:TCL) share price beating the ASX 200 today?
• Why now could be the time to buy the Transurban (ASX:TCL) share price
• Leading brokers name 3 ASX shares to buy today

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

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