The Perpetual Limited (ASX: PPT) share price is slipping lower in morning trade on Thursday. This comes after the global financial services company released its full-year results for FY21 today.

At the time of writing, the Perpetual share price is down 0.58%, trading at $39.24.

Perpetual share price dips despite ‘transformational’ year

• Operating revenue increased 31% to $640.6 million
• Underlying profit after tax up 26% to $124.1 million with the inclusion of Trillium and Barrow Hanley acquisitions
• Total assets under management (AUM) reached $98.3 billion
• Net profit after tax fell 9% to $74.9 million due to significant one-off costs
• Fully franked final dividend declared of 96 cents per share, bringing total dividends for FY21 to $1.80 per share — an increase of 16% on FY20.

What happened in FY21 for Perpetual?

While the share price movement may have you thinking otherwise today, Perpetual has generated respectable growth across its various financial businesses in FY21.

For those less familiar, Perpetual operates four separate divisions known as Perpetual Asset Management International (PAMI), Perpetual Asset Management Australia (PAMA), Perpetual Corporate Trust (PCT), and Perpetual Private (PP).

Pleasingly for shareholders, the company’s assets under management grew 246% year-over-year to $98.3 billion. Of those funds, a significant amount outperformed their respective benchmarks over the year. Notably, 100% of its PAMI funds outperformed their relative benchmarks. This is crucial for Perpetual’s client satisfaction, retaining, and growing funds — and inevitably the Perpetual share price.

Additionally, with AUM more than tripling, the firm managed to increase operating revenue by 31% to $640.6 million. This was reflective of Perpetual’s successful acquisitions of Trillium and Barrow Hanley.

Investors might be focusing on the firm’s fall in statutory profits. While net profit after tax declined 9% to $74.9 million, this was mostly a result of one-off costs involved with the acquisitions during the financial year.

What did management say?

Commenting on the result, Perpetual CEO and managing director Rob Adams said:

We delivered solid results in FY21, with a strong uplift in earnings. The year was truly transformational for Perpetual and saw our continued evolution from a largely Australian-focused business with A$28.4 billion in AUM, to now managing close to A$100 billion in AUM, with a global footprint, a global client base and a strong forward-looking growth profile.

Furthermore, regarding the company looking forward, Adams said:

At 30 June, the group maintained its strong balance sheet which positions us to drive organic growth and take advantage of inorganic opportunities to add further depth and breadth of capability to our offerings globally.

What’s next for Perpetual?

According to the release, Perpetual will focus on three main priorities in FY22. These are client first, future fit, and new horizons. The new horizons priority involves the continued leveraging and expansion of Jacaranda Financial Planning. In addition, the company will continue to build out further investment capabilities for Trillium and Barrow Hanley.

In terms of guidance, Perpetual shared its expectation of total expenses to be between $549.2 million to $568 million in FY22. This would indicate an increase of 17% at a minimum compared to FY21’s total expenses. The company noted significant integration costs and amortisation of acquired intangibles during the year ahead.

Perpetual share price recap

The Perpetual share price has returned shareholders a solid return of 27.4% over the past 12 months. For comparison, those who simply invested in an index fund tracking the S&P/ASX 200 Index (ASX: XJO) made a 20.9% gain.

Finally, based on the current share price, Perpetual is trading on a price-to-earnings (P/E) ratio of 33.5.

The post Perpetual (ASX:PPT) share price falters after reporting 9% profit fall appeared first on The Motley Fool Australia.

More reading

• How did the Perpetual (ASX:PPT) share price respond last earnings season?
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• Perpetual (ASX:PPT) share price struggles despite ‘strong performance’

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

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The South32 Ltd (ASX: S32) share price is in reverse on Thursday morning following the mining outfit’s full-year FY21 results. It may come as a surprise the company reported a relatively strong result, yet delivered a mammoth net loss after tax.

At the time of writing, South32’s shares are fetching for $2.85 apiece, down 1.38%.

South32 share price stutters

The South32 share price fell wayside after the company delivered its result for the 12 months ending 30 June 2021. Here are some of the key highlights:

• Total revenue improved to US$6,337 million, up 4% on the prior year (FY20 US$6,075 million);
• Underlying earnings before interest and tax (EBIT) jumped to US$844 million, up 89% on the prior year (FY20 US$446 million);
• Net loss after tax came to US$195 million, (FY20 net loss after tax US$65 million);
• Underlying earnings per share (EPS) rocketed to US 10.3 cents, up 164% on the prior year (FY20 US 3.9 cents per share); and
• Full-year dividend (ordinary and special) lifted to US 6.9 cents per share, up 82% on the prior year (FY20 US 3.2 cents per share).

What happened in FY21 for South32?

On the production front, South32 came in strongly. The company achieved record production at Worsley Alumina and Brazil Alumina with both refineries benefitting from higher plant availability. In addition, the company’s attained its best ever output at Australia Manganese, exceeding previous earnings guidance.

Sales volumes increased and realised prices for aluminium, silver, zinc and nickel all improved. Higher base metals prices were partially offset by lower realised prices for South32’s bulk commodities, with metallurgical coal and manganese ore prices declining.

The strong operating result and higher prices translated into an improved group operating margin of 26%. South32’s cost base remained relatively unchanged despite higher power costs, the inflationary impact of global freight rates and stronger producer currencies.

The company’s response to the pandemic continued throughout FY21 whilst controls remained in place across its operations. It noted that some of the COVID-19 local cases are in areas where it currently operates.

However, affecting the South32 share price is the company’s sizeable loss on the bottom line. South32’s statutory profit after tax declined by US$130 million to a loss of US$195 million following the recognition of impairment charges totalling US$728 million (US$510 million post-tax).

This is in relation to Illawarra Metallurgical Coal and a loss on sale of US$159 million following the company’s divestment of South Africa Energy Coal.

What did management say?

South32 CEO Graham Kerr touched on the company’s performance, saying:

During the year, we made substantial progress reshaping our portfolio, completing the divestments of South Africa Energy Coal, the TEMCO manganese alloy smelter, and a portfolio of non-core precious metals royalties. This simplifies our business, reduces capital intensity and will improve our underlying operating margin.

At Hermosa we continue to progress studies for the Taylor and Clark deposits. We have also commenced the summer field season drilling program at the Ambler Metals Joint Venture in Alaska.

What’s next for South32?

Looking ahead, South32 expects to see robust volumes at its base metals operations following investment projects to increase aluminium and nickel production. This is in relation to the company’s Mozal Aluminium, Cerro Matoso and Cannington sites.

While remaining subject to further potential impacts from COVID-19, FY22 guidance is unchanged. This is, however, with the exception of the company’s non-operated Brazil Alumina and underground base metals operation at Cannington.

The post South32 (ASX:S32) share price drops on US$195 million net loss after tax appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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 IPH Ltd (ASX: IPH) share price is gaining in intraday trade, up 2.7% to $8.49 per share.

This comes following the release of the intellectual property services company’s results for the full 2021 financial year.

The IPH share price gains on results

• Revenue of $363.5 million, down 2% from $370.1 million in FY20.
• Earnings before interest, taxes, depreciation and amortisation (EBITDA) of $113.3 million, equal to FY20 EBITDA.
• Net profit after taxes (NPAT) of $53.6 million, down 2% year-on-year from $54.8 million.
• Final dividend increased 3% from FY20 to 15.5 cents per share, 40% franked.

What happened in FY21 for IPH

IPH reported that it was able to deliver consistent underlying EBITDA ($124.3 million compared to $126.0 million in FY20) despite an 11% increase in the average Aussie dollar to US dollar exchange rate over the course of the financial year, as well as due to the continuing market disruptions from the ongoing global pandemic.

Diluted earnings per share (EPS) were came in about 4% lower than the prior year, at 24.7 cents compared to 25.8 cents in FY20.

What did management say?

Commenting on the results, IPH CEO Andrew Blattman said:

Like-for-like revenue declined by 2%, including the market disruption caused by COVID-19. However, our success in our ongoing strategy to integrate acquisitions and capture synergies to deliver margin accretion, together with another solid performance from Asia, resulted in Group Underlying like-for-like EBITDA increasing by 10%. Group Underlying like-for-like EBITDA margin increased by 12%…

IPH remains the market leader in Australia with combined group patent market share (including Baldwins IP on a proforma basis and excluding innovation patents) of 36.2% for the year to 30 June 2021.

What’s next for IPH?

Looking ahead, Blattman said the company’s focus is on “organic growth, consolidating acquisitions, and pursuing growth step-out opportunities”.

He said IPH’s strong financial position with low gearing and stable cash generation “enables us to continue to assess further growth options, including potential international acquisition opportunities in core secondary IP markets”.

The record date for investors wanting to claim the final dividend is 25 August. Payment is scheduled for 17 September.

The IPH share price is up 0.5% over the past full year.

The post The IPH (ASX:IPH) share price charging higher following dividend boost appeared first on The Motley Fool Australia.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended IPH Ltd. The Motley Fool Australia has recommended IPH 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 Neometals Ltd (ASX: NMT) share price has stepped into the red this morning.

The Neometals share price initially jumped 1.2% from the open to 81.5 cents, but at the time of writing it has dropped to 78.5 cents, a fall of 2.48% from yesterday’s closing price.

Neometals shares are on the move after the minerals explorer gave an announcement regarding its battery recycling plant.

Let’s investigate further.

What did Neometals announce?

Recall that the Primobius plant is a 50:50 joint venture (JV) between Neometals and SMS Group GmbH. Neometals recently announced it had completed stage 1 commissioning at the plant on 12 August.

In the announcement made earlier today, Neometals explained that “in response to customer interest”, it would fund its Primobius JV “to fast-track commercial operations” at the plant. SMS Group will also fund the JV with Neometals, as per the release

As a result of Neometal’s decision, “recycling services (will be) offered in Q1 2022”, and Primobius will modify its existing plant to “process up to 10 tonnes per day”.

This will “provide disposal services” to European automakers and cell makers, according to the company.

In addition, Neometals outlined the process which the plant intends to use in its operations. According to the release, Primobius will “shred batteries, physically separate battery components”, after which it will “sell mixed cathode and anode” with the label “Black Mass”.

In fact, Neometals explains the “shredder plant 1” will derive its “early revenue” almost exclusively from the sale of black mass.

What did management say?

Speaking on the release, Neometals’ managing director Chris Reed said:

We are excited to herald the entry of Primobius into the commercial European battery recycling landscape. The funding approval is an agile response by the JV shareholders to strong demand for the safe disposal of growing volumes of lithium-ion batteries arising from warranty returns and at end-of-life. 10tpd Shredding Plant 1 represents the maximum commitment we can make to meet demand having regard to regulatory permitting timeline constraints.

In addition, when touching on future scale, Reed said:

As well as being a showcase for potential customers and partners, the facility will provide a valuable training ground for the operations team and will support continuous process improvement ahead of the next scale up to a 50tpd operation. The scale and speed of the electrification of transport and renewable energy storage is phenomenal, the volumes and momentum of global investment funds available to support enablers of decarbonisation steel our resolve for Primobius to become the pre-eminent recycler in the western world.

Neometals share price snapshot

The Neometals share price has posted a year-to-date return of 187%. It has also gained 327% in the past 12 months.

In addition, Neometals’ shares have climbed 37% over the past month.

These gains have outpaced the S&P/ASX 200 Index (ASX: XJO)’s return of around 25% over the past year.

The post Neometals (ASX:NMT) share price falls on battery update appeared first on The Motley Fool Australia.

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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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Bapcor Ltd (ASX: BAP) was one of the ASX companies that reported its FY2021 earnings numbers to the markets yesterday.

The Bapcor share price didn’t exactly react the way investors might have hoped, with the auto parts company’s shares falling 4.56% by yesterday’s close. Today, the selling has continued, with Bapcor shares down another 1.36% at the time of writing to $7.595 a share.

There were many interesting tidbits in yesterday’s earnings, which my Fool colleague James covered yesterday. In summary, Bapcor delivered a revenue increase of 20.4% to $1.76 billion, a 28.8% bump in pro forma earnings before interest, tax, depreciation and amortisation (EBITDA), and a 46.5% rise in pro forma net profit after tax to $130.1 million.

The company also increased its final dividend to 11 cents per share, fully franked. That means Bapcor will pay a total dividend of 20 cents per share for the full year, which is up 14.3% year on year.

Bapcor’s dividend puts company on a good path

This latest dividend continues the path Bapcor has been on for a few years now. This company has now managed to raise its annual dividend every single year since 2015. Back then, Bapcor paid out an interim dividend of 4 cents per share in April, as well as a final dividend of 4.7 cents per share in September.

In contrast, 2021 has seen Bapcor pay an interim dividend of 9 cents per share in March already. And we now know that investors will receive their second 2021 dividend of 11 cents per share on 14 September.

That dividend growth rate represents a compounded annual growth rate of 14.88% since 2015 for Bapcor.

And since the company told us yesterday that it earned 38.3 cents in pro forma earnings per share (EPS) for FY21, we can place this dividend at an earnings payout ratio of 52.2%.

Since Bapcor managed to grow its EPS by 26.8%, but its full-year dividends by ‘only’ 14.3%, this means that Bapcor has managed to raise its dividend and lower its payout ratio at the same time. That’s often good news for future dividend payments.

About the company’s share price

Bapcor shares are, on today’s pricing, up a solid 10.36% over the past 12 months. However, year to date, the story is a little different. Bapcor remains down 2.62% in 2021 so far, vastly underperforming the broader S&P/ASX 200 Index (ASX: XJO), which is up 11.3% over the same period.

Over the past 5 years, Bapcor shares have appreciated by 19.54%, against the ASX 200’s 34.6%.

At the current Bapcor share price, the company has a market capitalisation of $2.59 billion, and a price-to-earnings (P/E) ratio of 24.55. Bapcor’s trailing dividend yield presently stands at 2.43%.

The post The Bapcor (ASX:BAP) dividend bumps up 14% 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 no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Bapcor. 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 NRW Holdings Limited (ASX: NWH) share price is soaring after the company released its results for the financial year 2021 (FY21).

Right now, the NRW Holdings share price is trading at $1.88, 13.3% higher than its closing price yesterday.

NRW share price jumps on $2.3 billion revenue

Here’s how the diversified contracting service provider performed during FY21:

• $2.3 billion in revenue – 11.5% more than in FY20
• Earnings before interest, tax, depreciation, and amortisation (EBITDA) of $266.7 million. That’s 6.7% higher than the prior comparable period
• 5-cent fully franked final dividend.

Of the company’s approximately $2.3 billion of revenue, its civil works segment brought in $726.5 million, mining brought in around $1.177 billion, and minerals, energy, and technologies earned $426.9 million.

NRW’s operating earnings before interest and tax came in at $120.6 million. That’s lower than it was in FY20, mainly due to high staff turnover, labour rate increases, and skill shortages in Western Australia’s Pilbara region.

NRW ended the period with $163.9 million of cash and $196.7 million of debt.

What happened in FY21 for NRW Holdings?

It was a busy financial year for NRW Holdings and its share price.

The company acquired Primero Group Ltd in March.

It also developed and installed pit crushing and conveying solutions to reduce its carbon emissions by at least 75% when compared to traditional mining and haul solutions.

Unfortunately, COVID-19 impacted the company’s staff retention, with staff turnover reaching record highs.  

Border restrictions still mean interstate worker numbers are far below pre-pandemic levels. NRW historically sees 30% of its workforce coming from Australia’s east coast.

What did management say?

NRW Holdings’ managing director and CEO Jules Pemberton commented on the results, saying:

The COVID-19 pandemic has had a significant impact on the business throughout the financial year…

Resource availability and labour cost pressures impacted WA Pilbara project completion costs and schedules. Both these issues were attributed to COVID-19 measures including border closures which limited the available workforce.

Most of those projects however were complete at 30 June 2021, other than resolution of claims and contract variations. Whilst these projects have had the most impact on our financial performance, it is important to note that large parts of our business have performed to expectations.

What’s next for NRW Holdings?

Here’s what may drive the NRW Holdings share price in FY22.

The company is forecasting its revenue for FY22 will be between $2.4 billion and $2.5 billion. $2 billion of its expected revenue is already either in NRW’s order book, supported by a letter of intent, or is expected to be reoccurring.

NRW anticipates its operating EBIT for FY22 will be between $145 million and $155 million.

Additionally, the company’s order book is expected to grow by $1 billion to $4.4 billion in FY22 after NRW received a letter of intent for the extension of mining services at Curragh.

Additionally, NRW is preparing its first sustainability report. It will be published in September.

NRW Holdings share price snapshot

The NRW share price has slipped 37% year to date. It is also 9% lower than it was this time last year.

The post NRW Holdings (ASX:NWH) share price soars 13% on FY21 earnings appeared first on The Motley Fool Australia.

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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.

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The ASX Ltd (ASX: ASX) share price has eked out a small gain of 0.54% to $82.08 following the release of the company’s full year FY21 results.

ASX share price tips higher on mixed results

ASX delivered a mixed result in light of record levels of retail trading from last year and the effects of the RBA’s current policy settings. Key highlights include:

• Operating revenue of $951.5 million, up 1.4% on FY20
• Underlying net profit after tax (NPAT) of $480.9 million, down 6.4%
• Total expenses of $310.3 million, up 8.4%
• Underlying earnings per share of 248.4 cents, down 6.4%
• Final dividend per share of 111.2 cents per share, down 9.2%

What happened in FY21 for ASX?

The ASX’s listings and issuer services made a strong contribution to growth, with revenue increasing 8.9% to $258.2 million. The company was pleased to highlight 176 new listings with a combined market cap of new listings of $40.6 billion, up a respective 112% and 50.5% against the prior corresponding period. Although, the market for secondary capital raisings was down 11.8% to $61.9 billion given the comparative strength of 2H20 activity.

The strong result from listings and issuer services was offset by a weaker performance from the company’s derivatives and OTC markets segment. This segment experienced a 10.4% decline in revenue to $284.6 million, reflecting a decline in futures volume and low-interest rates.

ASX’s trading services delivered a solid result in light of record trading volumes in 2H20. The “solid performance in retail activity” translated to a 3.4% increase in revenue to $265 million.

Finally, the company’s equity post-trade services experienced a 12.8% increase in revenue to $143.7 million, driven by strong growth in trading and settlement activity.

It appears that the market is relatively pleased with the mixed result, with the ASX share price pushing 1.04% higher to $82.49.

A slight concern could be the 8.4% increase in expenses. However, the company advised that this increase reflects the growth in full-time employees as a result of the timing of FY20 hires and new roles to support the company’s growth initiatives.

The ASX elected to pay a final dividend of 112.4 cents per share, reflecting a payout ratio of 90% of underlying profit. This brings the company’s FY21 dividend to 223.6 cents per share or a yield of 2.7% at today’s prices.

Management commentary

ASX managing director and CEO Dominic Stevens commented on the result, saying:

ASX has delivered a resilient result overall in FY21, with operating revenue growing 1.4% to $951.5 million, up $13.1 million, following a very robust FY20. Strong listings and equity market activity, due in part to an ongoing surge in retail trading, were tempered by the effects of the RBA’s current policy settings on both short-end futures volumes and interest income. This led to a 3.6% fall in statutory profit to $480.9 million – down $17.7 million

Looking ahead at FY22, Stevens said:

FY22 has continued where FY21 left off. Equities trading remains robust given ongoing uncertainty
generated by COVID and the listings pipeline looks healthy. While futures volumes remain linked to the
RBA’s policy settings, market support for our suite of energy derivatives and for Austraclear activity looks
positive.

What’s next for ASX?

The typically slow moving ASX share price has had a solid performance in 2021, up 13% year-to-date.

The company provided solid outlook commentary citing equities trading is likely to remain robust due to COVID-19 related uncertainty and geopolitical issues. In addition to a well-supported pipeline of listings and settlements to benefit from fiscal stimulus and strong mortgage issuance.

ASX expects FY22 expenses to increase 5-7% alongside capital expenditure guidance between $105 million to $115 million.

The post ASX (ASX:ASX) share price edges higher on mixed FY21 results appeared first on The Motley Fool Australia.

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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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On Wednesday the S&P/ASX 200 Index (ASX: XJO) was out of form again and edged lower. The benchmark index fell 0.1% to 7,502.1points.

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

ASX 200 expected to fall

The Australian share market looks set to fall on Thursday. According to the latest SPI futures, the ASX 200 is expected to open the day 51 points or 0.7% lower this morning. This follows a disappointing night of trade on Wall Street which saw the Dow Jones drop 1.1%, the S&P 500 fall 1.1%, and the Nasdaq tumble 0.9% lower. US markets tumbled after the latest US Federal Reserve meeting minutes gave an insight into its tapering plans.

Treasury Wine full year results

The Treasury Wine Estates Ltd (ASX: TWE) share price will be on watch today when it releases its full year results. This will be the first annual result since the wine company was effectively shut out of China. According to a note out of Goldman Sachs, its analysts expect Treasury Wine to post EBITS of $508.2 million. This compares to its guidance of $495 million to $515 million.

Oil prices sink

Energy producers such as Oil Search Ltd (ASX: OSH) and Woodside Petroleum Limited (ASX: WPL) could have a difficult day after oil prices sank overnight. According to Bloomberg, the WTI crude oil price is down 2.9% to US$64.63 a barrel and the Brent crude oil price has fallen 2.2% to US$67.49 a barrel. Rising COVID-19 cases globally is weighing on the demand outlook.

Gold price flat

Gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) could have a subdued day after the gold price traded flat. According to CNBC, the spot gold price is steady at US$1,787.7 an ounce. COVID fears were offset by concerns the US Federal Reserve could reduce stimulus next year. Evolution is also due to release its results today.

Origin FY 2021 results

The Origin Energy Ltd (ASX: ORG) share price could be on the move today when it releases its full year results. Goldman Sachs expects revenue of $955 million, which will be the lower end of Origin’s guidance range of $940 million to $1,020 million. Though, it believes the main focus will be on management’s commentary. It expects management to confirm that Energy Markets have troughed and should steadily rebuild from FY 2023.

The post 5 things to watch on the ASX 200 on Thursday 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 no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Treasury Wine Estates Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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If you would like to bolster your portfolio with some blue chips, then you might want to take a look at these ASX shares.

Here’s why these two blue chip ASX shares are highly rated:

ResMed Inc. (ASX: RMD)

The first blue chip ASX share for investors to consider is ResMed. It is a medical device company with a focus on sleep disorders. It has been a real standout performer over the last decade thanks to its industry leading products and the growing awareness and prevalence of sleep disorders.

The good news is that the company still has a very long runway for growth and has recently bolstered its portfolio with the launch of its AirSense 11 product. This comes at a time when one of its main rivals is busy recalling and fixing millions of competing devices and trying to repair its reputation.

Morgans is positive on the company and currently has an add rating and $41.34 price target on its shares.

SEEK Limited (ASX: SEK)

Another blue chip share to look at is SEEK. It is the leading job listings company in the ANZ region and has a number of growing businesses around the globe.

During the first half of FY 2021, SEEK was dominating the local market and averaging 35 million monthly visits and 160,000 active hirers. This led to the company having almost a third of all placements in the region, which is five times greater than its nearest rival.

This has put the company in a great position to benefit from Australia’s recovery from the pandemic. With unemployment levels tipped to fall materially, job ad volumes look set to increase significantly once the economy opens up again.

Macquarie is very positive on SEEK and has an outperform rating and $40.00 price target on its shares.

The post 2 top blue chip ASX shares rated as buys appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro owns shares of SEEK Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended ResMed. The Motley Fool Australia has recommended ResMed Inc. and SEEK Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Pro Medicus Limited (ASX: PME) share price was the standout performer on the S&P/ASX 200 Index (ASX: XJO) on Thursday.

The healthcare technology company’s shares were up as much as 16.5% to a record high of $65.90 before finishing the day up 15.5%.

The Pro Medicus share price is now up 86% since the start of the year.

Why did the Pro Medicus share price rocket higher?

Investors were bidding the Pro Medicus share price higher following the release of an impressive full year result this morning.

For the 12 months ended 30 June, the company reported a 19.5% increase in revenue to $67.9 million and a 43% jump in earnings before interest and tax (EBIT) to $42.7 million.

This was driven by the implementation of a series of major contract wins and further operating leverage.

Also giving the Pro Medicus share price a boost were comments by management. It advised that although FY 2021 was a record year on new contracts, its pipeline remains very healthy in respect to quality and quantity.

How does this compare to expectations?

Although its revenue fell a touch short of the market’s expectation of $70 million, this was largely due to foreign exchange headwinds.

Positively, despite its revenue missing, its EBIT was ahead of the consensus estimate of $41.6 million thanks to stronger than expected margin expansion.

Goldman Sachs has commented on the result. It said: “Group revenue of $67.9m fell -3% short of consensus expectations as revenue growth for the core PACS segment of +18% (to $55.3m) fell short of our expectations of +26% (to $59.0m). However, on a constant currency basis, revenue grew +30% to $74.0m, likely explaining the majority/all of the miss.”

“Furthermore, EBIT grew +43%, coming in +3% ahead of expectations, as margins increased +1,036bps (vs. cons +690bps). Net income grew +34% to $30.9m and period-end cash grew +42% to $61.8m, and the company remains debt-free.”

Is it too late to invest?

Goldman Sachs currently has a neutral rating and $55.60 price target on its shares. This compares to the current Pro Medicus share price of $65.35.

However, it has yet to update its model to reflect this result. So, there’s a chance in the coming days it could lift its price target higher. Investors may want to stay tuned for that one.

The post Pro Medicus (ASX:PME) share price rockets 16% on earnings beat 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. owns shares of and has recommended Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus 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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