The Afterpay Ltd (ASX: APT) share price continues to take its investors on a rollercoaster ride, down 3.25% to $118.99 at the time of writing.

Afterpay has been relatively quiet on the announcement front, with its last price-sensitive piece of news being its FY21 full-year results.

Instead, the Afterpay share price has largely tracked the performance of its soon-to-be parent company, Square Inc (NASDAQ: SQ).

What’s driving the Afterpay share price on Monday

Square tumbles overnight

The Square share price tumbled US$10.67 or 4.28% last Friday to US$238.49.

Taking into consideration its takeover offer of 0.375 Square shares for each Afterpay share and current exchange rates, this values the Afterpay share price at $122.50.

Investors should note that Afterpay has typically traded at a small discount to its theoretical value.

The Square transaction is expected to close in the first quarter of calendar year 2022.

Tech shares under pressure

Tech shares have traded under a heightened level of volatility amidst surging bond yields and rising interest rate hike expectations.

The tech-heavy Nasdaq Composite underperformed major US indices, down 75 points or 0.51% last Friday.

By comparison, the Dow Jones Industrial Average edged 8.7 points lower or 0.03% while the S&P 500 fell 8.4 points or 0.19%.

Headlining the tech sell-off was a jump in benchmark US 10-year Treasury yields, surging to a 4-month high of 1.62%.

Rising bond yields impact how fast growing tech shares are valued, making all-important future cash flows appear less valuable in the present.

Interest rate rate hikes on the horizon

Also troubling the Square and Afterpay share price is the likelihood of an interest rate hike in the United States.

According to Reuters, futures on the federal funds rate are pricing in a 94% chance of a rate hike by November 2022 and 100% by December next year.

With the era of ultra-low interest rates coming to a close, this could spell a heightened level of volatility for tech shares in the near term.

The post Why the Afterpay (ASX:APT) share price is down 3% today appeared first on The Motley Fool Australia.

More reading

• Here’s what happened to the Afterpay (ASX:APT) share price in the FY22 first quarter
• How did ASX fintech shares perform in the FY22 first quarter?
• Here’s why ASX 200 tech shares are surging today
• Why Afterpay, Austal, Baby Bunting, & Nick Scali shares are storming higher
• Why the Afterpay Ltd (ASX:APT) share price is bouncing back on Wednesday

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. owns shares of and has recommended AFTERPAY T FPO and Square. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3DxWm7P

The Insurance Australia Group Ltd (ASX: IAG) share price is lifting from the opening of trade this morning. The IAG share price jumped 3.5% before settling back to its current price of $5.29 apiece.

IAG shares are on the move as the company released a key update. Today’s news relates to a second business interruption test case heard in the Federal Court of Australia.

Here’s what we know.

What’s led us to this point?

To understand what’s got us here, we need to step back into the thick of the pandemic in 2020. This is when businesses and enterprise alike were forced into lockdown.

According to the Insurance Council of Australia, the insurance industry has “long maintained that pandemics are not intended to be covered under most business interruption policies.”

Hence when some policyholders went to claim their insurance benefits due to “business interruption”, many were shocked to find out that a number of business interruption policies sought to exclude cover for pandemics.

At the time, the insurers’ group was denying acting on its liabilities through a reference to the Quarantine Act.

But the Quarantine Act was repealed in 2016, replaced with the Biosecurity Act.

As such, a test case was held last year to debate this issue. The aim was to establish key definitions and criteria on what the new legislature meant in real-world practice, given the pandemic was in full effect by then.

The New South Wales Court of Appeal heard the case. It ruled in favour of the policyholders – stating there were grounds to claim on business interruption. The judgement was further upheld in June 2021, when the High Court denied the insurers’ leave to appeal applications.

That decision meant insurers “cannot rely on references to the Quarantine Act to deny liability in policies written in the same terms as the policies considered in the first test case.”

IAG share price spikes after judgement handed down

A second test case was arranged to provide further clarity and establish “the meaning of policy wordings around disease definition, COVID-19 outbreak proximity, the impact of government mandates,” and other matters.

Today IAG advised that a Federal Court judgement “found in favour of insurers on a significant number of policy wording questions and for policyholders on other questions.”

As per the Insurance Council, the Court’s ruling upheld 8 of the 9 matters put forward by insurers. It upheld the arguments of policyholders on 1 of the issues.

As a result of the ruling, IAG is reviewing the judgement to determine whether to appeal any aspect of it. IAG will also consider the potential impact of its business interruption provision announced in November last year.

IAG notes there is time set aside in November to hear any appeal in the Full Court so that decisions can be finalised by the end of the year.

The insurance giant looks forward to the issues being resolved as quickly as possible for its customers with business interruption policies, per the release.

IAG shares have struggled this year to date amid a wave of regulatory challenges. They have still gained 10%, adding to the 9.7% earned over the last 12 months.

The post IAG (ASX:IAG) share price lifts after Federal Court makes judgement appeared first on The Motley Fool Australia.

More reading

• 2 ASX 200 shares surging this week despite inflation worries
• What happened to the IAG (ASX:IAG) share price in the FY22 first quarter?
• When was the best ever day on the IAG (ASX:IAG) share price chart?
• Why this broker thinks the IAG (ASX:IAG) share price is a bargain
• Top brokers name 3 ASX dividend shares to buy today

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 owns shares of and has recommended Insurance Australia Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3amAxeS

The PointsBet Holdings Ltd (ASX: PBH) share price is trading lower on Monday amid broad weakness in the tech sector.

At the time of writing, the sports betting and iGaming company’s shares are down 0.5% to $10.05.

This means the PointsBet share price is now down 13% since the start of the year.

Can the PointsBet share price bounce back?

Fortunately for shareholders, one leading broker believes the PointsBet share price can bounce back strongly from its 2021 weakness.

In fact, the broker sees potential for the company’s shares to be trading close to $15.00 in the near future.

According to a note out of Goldman Sachs this morning, its analysts have retained their buy rating and $14.75 price target on its shares.

Based on the current PointsBet share price, this implies potential upside of ~47% for investors.

What did the broker say?

The note reveals that Goldman Sachs attended the G2E conference in Las Vegas. It also hosted meetings with the management teams of PointsBet and a number of other gaming companies.

The broker spoke positively about its meeting with Pointsbet’s US CEO Johnny Aitken and his team.

Goldman said: “Management believes their tech stack, purpose-built in the mid 2010s for the US, will be a key source of differentiation as it can roll out better products, more rapidly than competitors. Furthermore, the company highlighted their trading team, which has a presence in Europe, Australia and North America, will allow them to make markets rather than taking lines, providing a competitive advantage (ie. better same-game parlays).”

The broker also notes that management is confident that it can carve out a decent market share in the United States even in an intensely promotional environment.

The broker explained: “Management took a different view on consolidation, pointing to Australia where consumers went from 1-2 apps in the early 2010s to 4-6 now. They believe that in an environment with multiple apps on device, the ability to compete on tech, leverage their NBC partnership through all parts of the funnel, and drive retention through engagement will enable them to carve out mid single-digit market share even in an intensely promotional environment.”

This could bode well for the future performance of the PointsBet share price.

Positive outlook

After taking into account all its meetings, Goldman concluded: “While the promotional environment is a risk, we came away more confident in the demand backdrop and adoption trends online and found comments about one-time marketing spend to be a sign of a more rational competitive environment on the horizon.”

All in all, the broker appears to believe there’s potential for the PointsBet share price to be trading within sight of $15.00 by the end of the year.

The post Could the PointsBet (ASX:PBH) share price hit $15 by the end of 2021? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• 3 fantastic ASX growth shares to buy
• Why the PointsBet (ASX:PBH) share price has jumped 10% in a week
• 3 exciting ASX growth shares analysts love
• 3 fantastic ASX shares for buy and hold investors

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 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.

from The Motley Fool Australia https://ift.tt/3oTuRBp

The Strike Energy Ltd (ASX: STX) share price is falling hard in early trade.

Below, we take a look at the ASX energy share’s gas reserve update.

What gas reserve update did Strike announce?

Strike Energy’s share price is tumbling despite the company reporting it had delivered its maiden Perth Basin Gas Reserve. This comes just 2 years after Strike launched its initial exploration operation in the area.

The Gas Reserve was certified by subsurface consultancy Netherland, Sewell & Associates, Inc. (NSAI).

According to the release, NSAI certified 300 petajoule (PJ) 2P and up to 372 PJ 3P gross gas Reserves at the West Erregulla gas field in the Kingia Sandstone.

(Note, 2P equates to the total proved and probable reserves, while 3P equates to proved, probable and possible reserves.)

The Strike Energy share price failed to get a boost despite the company reporting that NSAI identified “considerable upside” with an additional 128 PJ of gross 2C Resources and 198 PJ of gross 2U Resources in the West Erregulla gas field.

Commenting on the progress, Strike’s CEO, Stuart Nicholls said:

Delivering our maiden Perth Basin reserve is an important step on the journey towards delivering Strike’s Mid-West vision of becoming a Net Zero 2030 integrated energy, fertiliser and renewable power producer, predicted to be the first of its kind for Australia.

These initial reserves are the beginning of a value staircase with a clear plan to increase the recoverable resources in the Erregulla complex and come at a time when gas availability is shortening and its value in the energy system is rising.

With an eye on further potential within the company’s Perth Basin holdings, Nicholls added, “These NSAI certified resources are bounded by significant upside and potential in Strike’s 100% owned acreage, where gas resources have been booked to the very southern edge of the permit boundary, where Strike’s acreage continues.”

Strike Energy share price snapshot

The Strike Energy share price has been on a bit or a rollercoaster in 2021. With today’s moves factored in, Strike’s shares are down 15% year-to-date. That compares to a 9% gain posted by the All Ordinaries Index (ASX: XAO) so far this year.

Over the past month, Strike Energy’s share price is down more than 13%.

The post Why the Strike Energy (ASX:STX) share price is down 10% this morning appeared first on The Motley Fool Australia.

More reading

• Strike (ASX:STX) share price climbs on green hydrogen announcement

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.

from The Motley Fool Australia https://ift.tt/3v1eyDJ

The Australian share market is home to a good number of dividend shares with generous yields.

However, as dividend yields are usually reported on a trailing basis, investors need to be careful that they don’t buy shares on the expectation that the last dividend is indicative of what will be paid over the next 12 months.

For example, the three ASX shares listed below show up on many websites as offering 20%+ yields. Is this really the case?

Fortescue Metals Group Limited (ASX: FMG)

On Google, Fortescue shows up with a fully franked 25% dividend yield. While this is accurate based on its FY 2021 dividends, analysts are tipping the iron ore giant to pay a significantly reduced dividend in FY 2022. This is due to a sizeable pullback in the iron ore price and the weaker outlook for the low grade iron ore that Fortescue mines. Goldman Sachs is expecting fully franked dividends per share of US$1.02 in FY 2022 and 61 US cents in FY 2023. This will mean yields of 9.7% and 5.8%, respectively, over the next two financial years. Great yields, but nowhere near the 25% some investors may have been hoping for.

iShares S&P 500 AUD Hedged ETF (ASX: IHVV)

This index-tracking exchange traded fund apparently offers investors a 21% yield at current prices. However, this is even more misleading than the previous example. As my colleague explains in detail here, this ETF periodically rebalances its holdings. This is achieved by selling the shares that have increased outside their index allocations and by buying the shares that go under. This left the iShares S&P 500 AUD Hedged ETF with surplus cash, which is then returned to existing unit holders in the form of dividend distributions. The actual dividend yield provided by this ETF is closer to 1.3%.

Regal Investment Fund (ASX: RF1)

Finally, Regal Investment Fund’s shares show up as offering a 25% yield at current prices. However, it is worth noting that this dividend yield is the result of a profit surge in FY 2021 after the fund delivered a whopping return of 62.75% net of fees. This allowed the company to make a significant increase to its full year dividend. However, it is impossible to know if Regal Investment Fund will be able to come close to replicating its success again in FY 2022. As a result, if its dividend were to drop back down to the FY 2020 level of ~23 cents per share, it would mean a yield of 6.8% rather than a 25% yield.

The post Do these ASX dividend shares really have 20%+ yields? appeared first on The Motley Fool Australia.

More reading

• 2 ASX shares that could be worth researching this weekend
• Here’s why the Rio Tinto (ASX:RIO), BHP and Fortescue share prices are surging today
• Why Clinuvel, EML, Regal, & Whitehaven Coal shares are sinking
• Is the Fortescue (ASX:FMG) dividend yield really 25%?
• US warns Evergrande crisis could affect ‘entire world’

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.

from The Motley Fool Australia https://ift.tt/2YH8N2f

The Betashares Nasdaq 100 ETF (ASX: NDQ) has plateaued in recent weeks, down 4.8% from its 31 August all-time high of $34.17.

What’s weighing on NDQ ASX?

US 10-year Treasury yields surge to 4-month highs

Investors have become fixated on yields, a major driver for how tech shares are valued.

Benchmark US 10-year Treasury yields have surged in recent weeks, rallying from 1.3% in late September to 1.62% last Friday.

Bond yields have climbed higher on the back of higher and more persistent levels of inflation and the expectation that the US Federal Reserve will begin increasing interest rates in 2022.

The Fed initially described elevated levels of inflation as ‘transitory’, as the economy cycles through higher prices from the COVID-19 induced year of 2020.

However, the recent jump in oil prices, rising transport costs and the impact of supply shortfalls is seeing a more persistent rise in near-term inflation.

This has weighed on the performance of NDQ constituents as higher interest rates make the future cash flows of fast growing tech shares less appealing in the present.

Market almost-certain on a rate hike next year

According to Reuters, futures on the federal funds rate, which track short-term interest rate expectations, has priced in a quarter-point hike by the Fed in either November or December next year.

“The fed funds market showed a more than 94% chance of a rate hike by November 2022, fully pricing that scenario in December next year,” the report said.

The recent volatility of NDQ reflects factors such as a rotation back towards more cyclical sectors and a re-rate for tech shares to reflect rising interest rates.

Supply chain woes

The global shortage of semiconductor chips has delayed the production of products ranging from cars and mobile phones to kitchen appliances.

Semiconductor shortages and supply-chain bottlenecks could weigh on the near-term revenues for NDQ constituents such as Microsoft, Amazon, Tesla and Nvidia.

The post Why is the Betashares Nasdaq 100 (ASX:NDQ) ETF share price struggling lately? appeared first on The Motley Fool Australia.

More reading

• 2 top ETFs that might be buys in October 2021
• 2 top tech ETFs for ASX investors in October
• What were the biggest movers on the Nasdaq 100 (ASX:NDQ) overnight?
• 2 very high quality ASX shares to own
• 2 top ASX ETFs that give investors access to Wall Street’s best tech shares

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. 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. owns shares of and has recommended Amazon, BETANASDAQ ETF UNITS, Microsoft, Nvidia, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool Australia owns shares of and has recommended BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended Amazon and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/2YzwJ7S

The ASX is a stock exchange well known for its strong dividend chops. Perhaps due to our unique system of franking in Australia, most ASX companies on the share market tend to pay out relatively regular dividend payments, with a few exceptions of course.

But you can’t have a dividend payment without a company trading ex-dividend first. So let’s check out some of the ASX shares that will be going ex-dividend this week.

5 ASX 200 dividend shares going ex-dividend this week

WAM LICs trade ex-dividend today

Wilson Asset Management (WAM) is one of the largest fund managers on the ASX and has developed a reputation as an income stalwart on the share market with its Listed Investment Companies (LICs). Four of WAM’s LICs are trading ex-dividend this week, today in fact.

They are WAM Alternative Assets Ltd (ASX: WMA), WAM Research Ltd (ASX: WAX), WAM Microcap Ltd (ASX: WMI) and the Future Generation Global Investment Co Ltd (ASX: FGG). 

All four of these LICs will pay out their dividends on 22 October. WAM Alternative Assets will be forking out 2 cents per share. WAM Research is putting up 5 cents, while WAM Microcap is sending 8 cents per share out the door. Future Generation will be paying out 8 cents per share. As is typical with WAM dividends, all of these payouts will be fully franked.

Reece Ltd (ASX: REH)

Plumbing supplies company Reece is also trading ex-dividend this week for its final dividend for FY21. This company will be paying out 12 cents per share, fully franked, on 27 October, with Reece going ex-dividend for this payment on Tuesday. 

At Reece’s last share price of $17.86, the company had a dividend yield of 1.01%.

Duxton Water Ltd (ASX: D2O)

Water rights owner Duxton is another share that is trading ex-dividend, this one on Thursday. It will be shelling out a fully franked interim dividend of 3.1 cents per share on 29 October. At Duxton’s last share price of $1.44, it was offering a yield of 4.24%.

Harvey Norman Holdings Limited (ASX: HVN)

Our final share to look at today is none other than the ASX retailing giant Harvey Norman. Harvey Norman is scheduled to trade ex-dividend on Friday this week. It will be doling out its final dividend of 15 cents per share, fully franked, on 15 November (so still a while to wait for shareholders).

At this company’s last share price of $4.99, Harvey Norman had a dividend yield of 7.01%.

The post These 7 ASX shares are going ex-dividend this week appeared first on The Motley Fool Australia.

More reading

• Top broker upgrades the Super Retail (ASX:SUL) share price to buy
• 2 ASX dividend shares with fully franked yields of more than 5% today
• Woolworths (ASX:WOW) and Coles (ASX:COL) could face a margin shock
• Harvey Norman (ASX:HVN) share price rises on broker upgrade
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor Sebastian Bowen owns shares of WAM Research Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Harvey Norman Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3iO54XI

The Woodside Petroleum Limited (ASX: WPL) share price performed well over the first quarter of financial year 2022 (FY22) thanks to a last-minute rally.

In fact, the oil and gas producer’s share price hit its lowest point of the quarter on 10 September.

So, how did it ultimately boast a 7.5% gain for the 3-month period ended 30 September 2021? Let’s take a look.

Woodside Petroleum share price in FY22’s first quarter

The Woodside Petroleum share price started the recent quarter trading at $22.21 and finished it at $23.88.

That’s despite it falling 13% between the quarter’s start and 10 September.

Even though the company released plenty of news, Woodside’s stock spent most of the quarter in the red.

What did Woodside announce in the first quarter?

Over the 3-months just been, Woodside released news of its acquisition of a joint venture, its results for FY21’s fourth quarter, and cost estimates for its Scarborough project.

But the biggest news from Woodside for the quarter was released alongside its half-year earnings on 18 August.

Then, Woodside announced its plans to merge with BHP Group Ltd‘s (ASX: BHP) petroleum division. The merger will see Woodside’s value surging to around $35 billion.

The company also permanently instated its acting CEO, Meg O’Neill, as its leader and announced a return to profit.

Woodside posted $317 million of net profit after tax and a 14% increase to its dividend for the half year ended 30 June 2021.

Despite all the seemingly good news, the Woodside share price fell 2% on 18 August.

What else drove Woodside’s stock last quarter?

The Woodside share price struggled over much of the quarter just been before gaining 23.9% in its last 10 days. The rollercoaster may have been instigated by turbulent oil prices.

The first quarter of FY22 was a big one for oil prices.

It started with the Organization of the Petroleum Exporting Countries and Russia (OPEC+) disagreeing on supply levels.

While the squabbles drove oil prices downwards, the disagreement didn’t last long.

The OPEC+ soon decided to increase production by 400,000 barrels a day each month from August, eventually bolstering oil supply back to pre-pandemic levels.

However, Hurricane Ida hit the Gulf of Mexico in late August and early September, devastating the region’s oil production and boosting the price of oil once more.

Come the end of the quarter, oil prices were surging to multiyear highs and the Woodside share price was surging alongside them.

The post Here’s what happened to the Woodside Petroleum (ASX:WPL) share price in the FY22 first quarter appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 on Friday
• ASX 200 energy shares pull back as oil prices take a breather
• Top broker sees 16% upside for the Woodside (ASX:WPL) share price
• 5 things to watch on the ASX 200 on Thursday

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned.

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

from The Motley Fool Australia https://ift.tt/3lrPWkg

Could the Zip Co Ltd (ASX: Z1P) share price fall to just $5.50 by Christmas?

Some brokers have had their say on the prospects of the buy now, pay later business.

For shareholders that have been investors in Zip for several months already, it has been a pretty volatile ride.

Since the middle of February 2021, the Zip share price has fallen by around half.

In three months it has fallen around 16%.

Looking over the 2021 time period, the payments business has actually been reporting a significant amount of operational growth, particularly in the FY21 result and with its acquisitions. The numbers that Zip reports can have an effect on the Zip share price.

Zip FY21 result

In the latest financial year, Zip revealed triple digit growth.

It said that revenue increased 150% year on year to $403.2 million, with a 176% increase of transaction volume to $5.8 billion.

The number of customers increased by 248% to 7.3 million, whilst merchants on Zip’s network went up 109% to 51,300.

It also said that growth continued to accelerate in FY22, with FY22 year to date transaction volume up 58% year on year in Australia and 240% year on year in the US.

Zip also revealed that it was maintaining “strong unit economics” while investing for, and delivering, “strong growth” with a cash transaction margin of 3.5%.

The buy now, pay later business also said that it delivered a “strong” credit performance in light of COVID-19, driven by repeat customer usage and investments in its decisioning capabilities. Net bad debts as a percentage of transaction volume was 1.28%.

Global growth

Not only is Zip growing in the US with Quadpay, but it has been busy with expansion into other areas.

At the time of the FY21 result, it was operating in 12 markets, across five continents, with the additions of the UK, Canada and Mexico, plus the regional market entries into Europe, the Middle East and Southeast Asia. Zip also agreed to acquire the remaining shares in the South Africa BNPL business, Payflex, which has “access to a sizeable underbanked, young and fast growing African population.”

But that’s not the only thing Zip has been doing. It recently also announced an acquisition in India. It has bought an investment in ZestMoney, another BNPL business.

Zip says that India has the potential to become one of the largest markets globally and by FY26 is forecast to have US$300 billion in BNPL payment volume. It’s attracted to the younger Indian population with the “aspirational individuals’ view of credit and how they engage with financial services”. Online shopping growth also has a long way to go.

The buy now, buy later business also recently signed an agreement with Microsoft to integrate Zip within the Microsoft Edge shopping experience.

Could the Zip share price fall to $5.50?

Price targets are for the next 12 months, not just the next two or three months, so it may not hit the below price targets by Christmas.

However, with that in mind, the broker UBS actually has a price target of $5.40. This suggests the Zip share price could drop by more than 20% over the next year. Whilst the broker acknowledges that Zip is growing strongly, this is also coming with higher expenses.

However, there are other brokers with a positive outlook on its long-term growth potential. For example, Morgans rates Zip as a buy with a price target of $8.87.

The post Could the Zip (ASX:Z1P) share price sink to $5.50 by Christmas? appeared first on The Motley Fool Australia.

More reading

• How did the Zip (ASX:Z1P) share price perform last quarter?
• Why the Zip (ASX:Z1P) share price is storming 5% higher this Thursday
• These are the 10 most shorted ASX shares
• ASX 200 (ASX:XJO) midday update: Afterpay & Zip sink, energy shares rise
• Why the Zip (ASX:Z1P) share price is down 4% today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended ZIPCOLTD FPO. 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.

from The Motley Fool Australia https://ift.tt/3BxespE

The Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price has been a strong performer in 2021.

Since the start of the year, the banking giant’s shares have risen a sizeable 21%.

Can the ANZ share price hit $35.00 by Christmas?

The good news for shareholders is that despite its strong gain so far this year, one leading broker appears to believe the ANZ share price has the potential to climb close to $35.00 by Christmas.

According to a note out of Morgans, its analysts have retained their add rating and $34.50 price target on the bank’s shares.

Based on the current ANZ share price of $27.96, this implies potential upside of 23% before dividends.

Morgans has also pencilled in a $1.65 per share fully franked dividend in FY 2022. This represents a 5.9% yield at current prices. If you add this into the equation, the total potential return stretches to 29%.

Why does Morgans like ANZ?

Morgans believes the ANZ share price is attractive. In fact, it believes it offers the most value among the major banks right now.

In addition to this, the broker is a fan of the bank’s cost reduction plans and the de-risking of its loan book.

The broker commented: “We believe ANZ is the most compelling of the major banks on a valuation basis. We expect ANZ to continue to focus on absolute cost reduction over the medium term. ANZ has de-risked its loan book over recent years – particularly its institutional loan book – such that the quality of its loan book has improved. While ANZ’s Australian home loan book has been growing below system over recent months, we expect a disciplined margin performance from ANZ.”

All in all, this could make the ANZ share price one to consider if you’re looking for exposure to the banking sector.

The post Could the ANZ (ASX:ANZ) share price reach $35 by Christmas? appeared first on The Motley Fool Australia.

More reading

• How did ASX bank shares perform in the last quarter?
• 2 ASX 200 dividend shares to buy next week
• Westpac and other ASX 200 banks face renewed shareholder pressure over climate policies
• ASX 200 (ASX:XJO) midday update: EML crashes, mining shares rise
• ANZ (ASX:ANZ) share price flat despite BNPL plans

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.

from The Motley Fool Australia https://ift.tt/3iOpbVC