The AMP Ltd (ASX: AMP) share price has been a very poor performer so far in 2021.

Since the start of the year, the financial services company’s shares are down 27%.

This means the AMP share price has now lost 78% of its value over the last five years.

Why is the AMP share price under pressure?

There have been a number of catalysts for the weakness in the AMP share price in 2021.

One of those was the company’s poor performance in FY 2020. For the 12 months ended 31 December, AMP reported a 32.8% decline in underlying profit to $295 million. This was driven by earnings declines across all four of its business units.

In addition to this, AMP Australia’s wealth management business reported an 8% reduction in assets under management following outflows of $8.3 billion. It then revealed further net cash outflows of $1.5 billion during the first quarter of FY 2021.

Also weighing on the AMP share price was an update in April that revealed that talks with Ares Management in respect to a takeover of the AMP Capital private markets business ended without a deal.

Is this a buying opportunity?

Since then, the company has announced a new CEO and plans to pursue a demerger of AMP Capital’s private markets investment management business.

However, despite how promising these developments are, brokers remain largely lukewarm on the prospects of the AMP share price. Citi, for example, has a neutral rating and $1.25 price target on its shares.

It commented: “Given the failed negotiations with Ares, AMP’s plan to demerge its AMP Capital Private Markets business is probably the only realistic option left. Although it could be a potential route to value realisation, we worry how much of the business will be left by the time the demerger is scheduled to take place in 1H22, with rivals such as Dexus trying to pick off funds in the interim.”

“We also note key deal makers are leaving and the business will need a new CEO [now appointed]. There are also question marks over scale and distribution capabilities. We reverse the Ares transaction in our forecasts, leading to an EPS uplift but lower valuation,” Citi concluded.

The post The AMP (ASX:AMP) share price is down 27% in 2021 appeared first on The Motley Fool Australia.

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• The AMP (ASX:AMP) share price is rising today
• 5 reasons interest rate hikes won’t smash your ASX shares
• Sell Nuix, AMP, Pushpay before EOFY? Expert weighs in
• Here are the 3 most active ASX 200 shares trading 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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The A2 Milk Company Ltd (ASX: A2M) share price will be on watch on the ASX 200 on Monday.

This follows the release of an announcement relating to a major acquisition.

What did a2 Milk announce?

This morning a2 Milk announced that the New Zealand Overseas Investment Office has issued its consent to the company’s proposed acquisition of a 75% interest in Mataura Valley Milk.

As a result of this development, completion of the transaction is now to set to occur with effect from the end of July.

Current majority shareholder, China Animal Husbandry Group (CAHG), will retain a 25% interest in Mataura Valley Milk. CAHG is a wholly owned subsidiary of China National Agriculture Development Group, which is also the parent company of a2 Milk’s strategic logistics and distribution partner in China.

What is Mataura Valley Milk?

Mataura Valley Milk is a dairy nutrition business located in Southland, New Zealand.

Management expects the acquisition to provide the opportunity for a2 Milk to participate in nutritional products manufacturing, provides supplier and geographic diversification, and strengthens its relationship with key partners in China.

It also notes that it is an opportunity to acquire a recently constructed and operational, world-class nutritional products manufacturing facility in New Zealand and the ability to capture manufacturing margin.

Last year the two parties agreed a total consideration of NZ$268.5 million for the 75% interest, based on an enterprise value of ~NZ$385 million. The acquisition will be undertaken on a debt-free cash-free basis and funded from existing cash reserves.

At the time, then-CEO, Geoff Babidge, commented: “As previously announced, due to the increasing scale of our infant nutrition business, we have been assessing participation in manufacturing capacity and capability.”

“The potential investment in Mataura Valley Milk’s recently commissioned facility, alongside China Animal Husbandry Group, aligns with this strategic objective as we look to complement and build upon our current strategic relationships with Synlait Milk and Fonterra Co-operative Group, which remain in place. Our intention would be to invest further to establish blending and canning capacity at Mataura’s facility to support the establishment of a fully integrated manufacturing plant for infant nutrition,” he added.

The a2 Milk share price is down 44% since the start of the year. Shareholders will no doubt be hoping this acquisition is the catalyst to getting its shares heading in the right direction again.

The post A2 Milk (ASX:A2M) share price on watch after acquisition update appeared first on The Motley Fool Australia.

More reading

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• 3 ASX 200 shares moving on the market today
• Why a2 Milk, Chalice Mining, IDP Education, & Imugene are charging higher
• Top broker tips A2 Milk (ASX:A2M) share price to jump 37%
• The 5 worst performing shares of the ASX 200 in FY21 revealed

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 recommended A2 Milk. 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 that time of the year when professional investors sell off their winners and look for the next bargains.

One ASX share that Wilson Asset Management portfolio managers Matthew Haupt, Catriona Burns and Oscar Oberg are excited about for the new financial year is Fletcher Building Limited (ASX: FBU).

The New Zealand company plays in the not-so-glamorous construction materials supply business. Think along the lines of concrete and flooring.

The Wilson trio revealed that both WAM Capital Limited (ASX: WAM) and WAM Research Limited (ASX: WAX) funds now hold the stock.

“Its share price finished the financial year up 104%,” they wrote in a memo to clients.

“Fletcher Building is in a strong financial position, announcing that it expects earnings before interest and tax (EBIT) for FY2021 to be between $650 million to $665 million — towards the upper end of the previous guidance range.”

Fletcher Building just gave heaps of money back to investors

The excellent numbers gave Fletcher Building enough confidence to reward its shareholders handsomely last month.

“The company began returning capital to shareholders in the form of a NZ$300 million ($280 million) on-market share buyback in June,” read the Wilson memo.

Fletcher chief executive Ross Taylor said in May that “leverage [is] expected to remain below our target range in the medium term”. 

“This position provides us with capacity to recommence capital management and distribute up to NZ$300 million to shareholders.”

Fletcher’s ASX shares were up 0.93% on Friday, to trade at $7.02 in the afternoon.

Future looking bright for Fletcher

The Wilson portfolio managers don’t believe the party has ended with the June buybacks.

Fletcher Building will continue to be a post-COVID recovery winner, they reckon.

“We believe Fletcher Building is well positioned to take advantage of market tailwinds, including a pick-up in construction activity and the low interest rate environment,” their memo read.

“Additionally, the company continues to benefit from federal government stimulus, such as the Home Builder scheme in Australia and infrastructure stimulus in New Zealand.”

Fletcher now has a market capitalisation of $5.74 billion. The company is dual-listed in its country of origin as Fletcher Building Limited (NZE: FBU).

The post This ASX share is up 104% and just gave $280m to shareholders appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo 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 S&P/ASX 200 Index (ASX: XJO) finished the 2021 financial year on a high last week, and managed to also shake off some early market jitters to finish (barely) the week in the green.

The financial year ended on Wednesday afternoon for ASX shares. And what a financial year it was. As we covered extensively here on the Fool, the ASX 200 managed its best performance for a financial year ever, with the index gaining a record 24% over FY21.

The All Ordinaries Index (ASX: XAO), which has been around for far longer than the ASX 200, managed its best financial year performance since the 1980s, with a gain of 26.5%.

Moving on from the indexes, and we saw some interesting moves from ASX shares last week.

To start things off, most of the major ASX banks had a good week. The glaring exception was Westpac Banking Corp (ASX: WBC), which ended the week almost 1% lower following the revelation that the ASX bank might be exposed to an alleged $200 million fraud case.

The big miners in BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) also all had a strong week, perhaps buoyed by rising oil prices and a still-robust iron ore market.

Last week’s ASX 200 trash is this week’s treasure

Some of the other top performers last week were ASX shares that have seemingly been shunned by investors in recent weeks.

Travel shares like Qantas Airways Ltd (ASX: QAN), Flight Centre Travel Group Ltd (ASX: FLT), Webjet Ltd (ASX: WEB) and Corporate Travel Management Ltd (ASX: CTD) all rose between 2% and 5%, despite the ongoing coronavirus lockdown happening in NSW.

Other ASX shares that seemed to experience something of a rebound last week include A2 Milk Company Ltd (ASX: A2M) and Nuix Ltd (ASX: NXL). Saying that, Afterpay Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P) both had nasty weeks, falling 7.5% and 8.3% respectively.

How did the markets end the week?

It was actually a pretty flat week on the ASX 200 last week.

The index started the week out at 7,308 points and ended the week at 7,308.6 points – a rather minuscule rise of 0.008%. Monday started things off with a flat day, falling 0.01%. Tuesday was also pretty flat, with the ASX 200 shedding 0.08%. Wednesday brought the first day in the green, with the ASX 200 rising 0.16%. this was followed by a 0.65% fall on Thursday, which was somewhat reversed by Friday’s 0.59% gain.

Meanwhile, the All Ordinaries Index (ASX: XAO) also had a rather lousy week. The All Ords started out at 7,578.6 points and finished up at 7,587.1 points – a slight improvement over the ASX 200 with a gain of 0.11%.

Which ASX 200 shares were the biggest winners and losers?

Time now for our Foolish gossip pages, where we look at the ASX 200’s best winners and poorest losers of the week that was. So put the kettle on as we start with the losers, as always:

Worst ASX 200 losers	% loss for the week
Collins Foods Ltd (ASX: CKF)	(13.1%)
AGL Energy Limited (ASX: AGL)	(10%)
Bega Cheese Ltd (ASX: BGA)	(9.7%)
Pointsbet Holdings Ltd (ASX: PBH)	(9.6%)

Kentucky Fried Chicken purveyor Collins Foods was the ASX 200’s wooden spooner last week, with a loss of just over 13%. A rather interesting thing happened with Collins Foods last week. The company released its full-year earnings results on Tuesday, which initially saw the company hit a record high. But Collins spent the rest of the week sharply falling away from those highs, for no obvious reason.

Embattled energy utility AGL was also out of favour at week. This ASX stalwart released an update for its upcoming plans to split its business in two on Wednesday. Investors have previously been a little unsure about these plans, but the mood seemed unambiguously hostile following this latest announcement. Its planned split is scheduled to take place in the fourth quarter of the 2022 financial year.

Next up we have dairy giant Bega Cheese. Bega fell a nasty 9.7% last week, despite there being no news or major announcements out of the company whatsoever. Bega has been on an upward trajectory ever since its acquisition of the Lion Dairy and Drinks’ portfolio late last year. Perhaps some profit taking was happening here.

And finally, we have Pointsbet Holdings. Once again, there were no major news or announcements out of this gaming company. However, this company’s share price weakness might have been related to therather dramatic IPO of another gaming company last week, that of BlueBet Holdings (ASX: BBT). Investors don’t normally like to see increased competition coming into a market, after all.

Now with the losers out of the way, let’s take a look at last week’s winning shares:

Best ASX 200 gainers	% gain for the week
IDP Education Ltd (ASX: IEL)	17.8%
Mineral Resources Ltd (ASX: MIN)	9.5%
Harvey Norman Holdings Limited (ASX: HVN)	8.1%
Clinuvel Pharmaceuticals Limited (ASX: CUV)	5.8%

The best performing ASX 200 share last week was IDP Education. IDP seemed to be in the hot zone for investors last week when the company announced a new acquisition on Friday. That would be the Indian International English Language Testing System, which IDP is buying from British Council for $240 million. Investors seemed to be approving of this move.

Mineral Resources is next up. This company, once again, did not put out any major news or announcements last week that might have catalysed a move of this nature. However, my Fool colleague Kerry Sunrecently posited that a renewed interest in lithium from ASX investors may have helped.

The hardly normal Harvey Norman was another ASX 200 share that enjoyed a solid week last week. And one that also moved for no obvious reason. The same can be said of pharma company Clinuvel Pharmaceuticals.

A wrap of the ASX 200 blue-chip shares

Before we go, here is a look at how the major ASX 200 blue-chip shares are faring as we commence yet another week in paradise:

ASX 200 company	Last share price	Trailing P/E ratio	Trailing Dividend Yield	52-week high	52-week low
CSL Limited (ASX: CSL)	$284.19	36.58	0.99%	$320.42	$242
Commonwealth Bank of Australia (ASX: CBA)	$99.49	22.13	2.49%	$106.57	$62.64
Westpac Banking Corp (ASX: WBC)	$25.64	21.94	3.47%	$27.12	$16
Australia and New Zealand Banking Group Ltd (ASX: ANZ)	$28.32	17.16	3.71%	$29.64	$16.40
National Australia Bank Ltd (ASX: NAB)	$26.23	20.13	3.43%	$27.84	$16.56
Macquarie Group Ltd (ASX: MQG)	$156.91	19.03	3%	$162.06	$117.66
Fortescue Metals Group Limited (ASX: FMG)	$23.58	8.59	10.47%	$26.40	$13.60
BHP Group Ltd (ASX: BHP)	$48.55	26.54	4.26%	$51.82	$33.73
Rio Tinto Limited (ASX: RIO)	$125.71	15.74	4.88%	$132.94	$90.04
Newcrest Mining Ltd (ASX: NCM)	$25.36	15.9	1.72%	$38.15	$23.08
Woodside Petroleum Limited (ASX: WPL)	$22.95	–	2.25%	$27.60	$16.80
Telstra Corporation Ltd (ASX: TLS)	$3.79	25.43	4.22%	$3.79	$2.66
Woolworths Group Ltd (ASX: WOW)	$37.59	33.55	2.69%	$44.06	$35.96
Wesfarmers Ltd (ASX: WES)	$59.03	35.6	2.8%	$59.60	$43.50
Coles Group Ltd (ASX: COL)	$16.72	21.26	3.62%	$19.26	$15.28
Transurban Group (ASX: TCL)	$14.29	–	2.55%	$15.64	$12.36
Sydney Airport Holdings Pty Ltd (ASX: SYD)	$5.81	–	–	$7.49	$4.99
Afterpay Ltd (ASX: APT)	$118.29	–	–	$160.05	$59.66

And finally, here is the lay of the land for some leading market indicators:

• S&P/ASX 200 Index (XJO) at 7,308.6 points.
• All Ordinaries Index (XAO) at 7,587.1 points.
• Dow Jones Industrial Average Index (DJX: .DJI) at 34,786 points after rising 0.44% on Friday night (our time).
• Bitcoin (CRYPTO: BTC) going for US$35,511 per coin.
• Gold (spot) swapping hands for US$1,787 per troy ounce.
• Iron ore asking US$212 per tonne.
• Crude oil (Brent) trading at US$76.17 per barrel.
• Australian dollar buying 75.3 US cents.
• 10-year Australian Government bonds yielding 1.47% per annum.

That’s all folks. See you next week!

The post ASX 200 Weekly Wrap: ASX finishes FY21 on a high appeared first on The Motley Fool Australia.

More reading

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• Why the Telstra (ASX:TLS) share price outlook suddenly improved last week
• 2 highly rated ASX mining shares that could be buys
• Top brokers name 3 ASX shares to buy next week
• Top brokers name 3 ASX shares to sell next week

Motley Fool contributor Sebastian Bowen owns shares of National Australia Bank Limited, Newcrest Mining Limited, A2 Milk, Bitcoin, and Telstra Corporation Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO, Bitcoin, CSL Ltd., Idp Education Pty Ltd, Pointsbet Holdings Ltd, and ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Nuix Pty Ltd. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO, COLESGROUP DEF SET, Corporate Travel Management Limited, Macquarie Group Limited, Telstra Corporation Limited, Webjet Ltd., and Wesfarmers Limited. The Motley Fool Australia has recommended A2 Milk, Collins Foods Limited, Flight Centre Travel Group Limited, and 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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If you’re trying to find a way to overcome low interest rates, then you might want to look at the Australian share market.

This is because there are a large number of shares that pay generous dividends each year. Two such shares are listed below. Here’s what you need to know about them:

BWP Trust (ASX: BWP)

The first ASX dividend share to look at is BWP Trust. It is the largest owner of Bunnings Warehouse sites in Australia with a portfolio of 68 warehouses leased to the hardware giant.

BWP has been a positive performer in 2020 and 2021 despite the pandemic. This has been driven largely by the quality of its tenancies. With Bunnings Warehouse reporting stellar sales growth, BWP has been able to collect rent as normal. It has even seen the value of its properties increase strongly during this time.

In light of this, the company is expecting to pay a full year distribution of ~18.3 cents per share in FY 2021. Based on the current BWP share price of $4.26, this equates to an attractive 4.3% dividend yield.

National Storage REIT (ASX: NSR)

Another dividend share to look at is National Storage. It is one of the ANZ region’s largest self-storage operators with a portfolio of over 200 centres.

And while 200 centres may sound like a lot, management still sees plenty of room to grow its footprint in the highly fragmented self-storage market in the future.

So much so, it recently raised $325 million from investors via a capital raising. These funds will be used to strengthen its balance sheet and replenish its investment capacity. If management can deploy these funds successfully, it could be supportive of further solid earnings and dividend growth in the coming years.

Analysts at Ord Minnett are expecting dividends of 8.2 cents per share in FY 2021 and then 8.6 cents per share in FY 2022. Based on the latest National Storage share price of $2.02, this equates to yields of 4% and 4.25%, respectively.

The post 2 top ASX dividend shares with big yields 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 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 Friday the S&P/ASX 200 Index (ASX: XJO) was on form and stormed higher. The benchmark index rose 0.6% to 7,308.6 points.

Will the market be able to build on this on Monday? Here are five things to watch:

ASX 200 expected to open flat

The Australian share market is expected to start the week where it ended it. According to the latest SPI futures, the ASX 200 is expected to open the day flat. This is despite a very positive end to the week on Wall Street, which saw the Dow Jones rise 0.45%, the S&P 500 climb 0.75%, and the Nasdaq storm 0.8% higher.

Oil prices mixed

Energy producers such as Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) will be on watch after a mixed end to the week for oil prices. According to Bloomberg, the WTI crude oil price fell 0.1% to US$75.16 a barrel and the Brent crude oil price rose 0.45% to US$76.17 a barrel. Traders weren’t sure whether to buy or sell oil as OPEC talks dragged on into the weekend.

Tech shares could rise

Tech shares including Afterpay Ltd (ASX: APT) and Xero Limited (ASX: XRO) could start the week on a high. This follows a solid night of trade on the Nasdaq index on Friday, which saw the tech-heavy index hit a record high after a strong US jobs report. Given that the local tech sector tends to follow the Nasdaq’s lead, this could bode well for today’s session.

Gold price rises

Gold miners including Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) could be on the rise today after the gold price pushed higher on Friday night. According to CNBC, the spot gold price rose 0.4% to US$1,783.30 an ounce. Traders were buying the precious metal despite the strong jobs report.

Magellan given sell rating

The Magellan Financial Group Ltd (ASX: MFG) share price could be overvalued according to analysts at Goldman Sachs. According to the note, the broker has retained its sell rating but lifted its price target to $49.20. The broker believes the market is underestimating potential losses relating to its Barrenjoey investment. It also believes its recent performance means the earnings risks are skewed to the downside.

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

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• 5 best ASX energy shares of the 2021 financial year revealed
• 5 best ASX 200 mining and resource shares of financial year 2021
• Here are the 5 best ASX telecom shares of the 2021 financial year
• These were the best performing ASX 200 shares last week

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 Xero. The Motley Fool Australia owns shares of and has recommended Xero. 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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There are some exchange-traded funds (ETFs) that might be good ideas to think about in July 2021.

Certain ETFs might be able to give exposure to a certain sector, stock exchange or country. They may be able to give exposure to the underlying growth of companies or trends.

Here are two to think about:

Betashares Global Cybersecurity ETF (ASX: HACK)

There are a growing number of cyberattacks and cybercrime around the world. Indeed, there was another attack in the last couple of days according to media reporting. About 200 US businesses have been hit when Kaseya was targeted and then it spread through corporate networks.

According to Statista, the global cybersecurity market is expected to grow from $137.6 billion in 2017 to $248.25 billion in 2023.

This ETF is invested in businesses that are involved in various elements of the digital world. These are the different weightings: systems software (51.4%), IT consulting and other services (15.6%), communications equipment (13.1%), internet services and infrastructure (9.1%), application software (6.8%) and aerospace and defence (4%).

It has a total of 40 holdings.  The biggest 10 positions in the portfolio are: Zscaler, Accenture, Okta, Cisco Systems, Cloudflare, Varonis Systems, Splunk, Fortinet and Verisign.

The annual management fee is 0.67%. Including the fees, the net returns have been 19.3% per annum since inception in August 2016. However, past performance is not an indicator of future performance.

Betashares Nasdaq 100 ETF (ASX: NDQ)

Instead of a sector, this ETF is about giving exposure to a particular stock exchange in the US called the NASDAQ.

This ETF, which may be worth considering in July 2021, owns 100 of the largest businesses on the NASDAQ.

Investors may have heard of many of the largest holdings in the portfolio including Apple, Microsoft, Amazon.com, Facebook, Alphabet, Tesla, Nvidia, PayPal and Adobe.

Whilst IT and communication services (which Facebook and Alphabet count as), there are other sectors represented in this portfolio as well with businesses like PepsiCo, Costco, Booking, Intuitive Surgical, Moderna and Mondelez.

Obviously all of the businesses in the portfolio are listed in the US. But the underlying earnings are globally based. Businesses like Alphabet, Facebook, Apple and Microsoft generate earnings from most countries around the world.

Past performance is no guarantee of future performance. But the past returns of this ETF have materially beaten the returns of the ASX. Since inception in May 2015, the Betashares Nasdaq 100 ETF has produced an average return per annum of almost 21%.

There are a couple of points that BetaShares makes about this ETF. The investment gives exposure to many of the businesses that are changing the way we live. It also has a heavy focus on technology, which doesn’t have much of an allocation in the Australian market.

The post 2 ETFs that could be buys in July 2021 appeared first on The Motley Fool Australia.

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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 BETA CYBER ETF UNITS and BETANASDAQ ETF UNITS. The Motley Fool Australia owns shares of and has recommended BETA CYBER ETF UNITS and BETANASDAQ ETF UNITS. 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 small end of the Australian share market is home to a number of companies with the potential to grow strongly in the future.

Two small caps that investors may want to get better acquainted with are listed below. Here’s what you need to know about them:

Mach7 Technologies Ltd (ASX: M7T)

The first small cap ASX share to watch is Mach7. It is a medical imaging data management solutions provider that allows users to create a clear and complete view of the patient. This is used to help inform diagnosis, reduce care delivery delays and costs, and improve patient outcomes.

Demand for Mach7’s offering has been growing strongly in recent years and is expected to continue doing so in the years to come. This is thanks to the quality of this software and trends such as telehealth. In respect to the latter, the company notes that COVID-19 has popularised telehealth services, which are creating a need for this type of technology.

And while it has been growing strongly, it is still only scratching at the surface of its overall market opportunity. According to management, the company’s total addressable market is estimated to be US$2.75 billion. This gives Mach7 a long runway for growth over the next decade.

Morgans currently has an add rating and $1.68 price target on its shares. This compares to the latest Mach7 share price of $1.03.

Whispir Ltd (ASX: WSP)

Another small cap share to watch is Whispir. It provides businesses with a cloud-based communications platform that brings all communications channels like email, text messaging and web chatting together in one easily accessible space. This helps businesses large and small eradicate communication inefficiencies so their staff and customers can connect in new and productive ways.

As with Mach7, demand has been increasing strongly for its offering. This has led to rapid recurring revenue growth in recent years. The good news is that Whispir’s current revenues are only a small fraction of its addressable market.

For example, at the end of the third quarter, Whispir’s annualised recurring revenue was up 20.3% to $50.3 million. This compares to its total addressable market of US$4.7 billion in the just United States market.

Ord Minnett currently has a buy rating and $4.25 price target on the company’s shares. This compares favourably to the latest Whispir share price of $2.73.

The post 2 highly rated small cap ASX shares to watch 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 MACH7 FPO and Whispir Ltd. The Motley Fool Australia has recommended MACH7 FPO and Whispir 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 outlook for the Telstra Corporation Ltd (ASX: TLS) share price is looking brighter and it isn’t only because of the $2.8 billion part-sale of its towers business.

While the transaction certainly caught the imagination of the market and prompted some analysts to upgrade their price target on the Telstra share price, there’s another reason to be bullish on Australia’s largest telco.

Its competitor Vodafone removed all promotional discounts on its SIM-only plans last week, according to Goldman Sachs.

Telstra share price the biggest winner

Shareholders liked the news. The TPG Telecom Ltd (ASX: TPG) share price jumped 1.1% last week to $6.22 (TPG merged with Vodafone).

That’s ahead of the 0.3% gain by the S&P/ASX 200 Index (Index:^AXJO), although the Telstra share price is the big winner with a 5.4% surge.

But as I mentioned, Telstra’s surge was partly driven by its large divestment and promise of a $1 billion plus capital return.

Price rises and expanding margins

The move by Vodafone means an effective price increase for Vodafone customers of between $5 and $15 a month, or 13% to 25%.

“These changes have driven Vodafone (and industry) entry level pricing up to A$40 [a month],” said the broker.

“We are pleased with this development, which continues to support our high conviction on quantum of mobile market repair in Australia.”

Conducive competitive environment

The return of a more rational competitive environment is good news for Telstra’s margins. Vodafone is the last of the big three mobile operators to lift prices after Optus implemented price rises of a similar magnitude in May.

Telstra was the first to move and for a while, it looked like the odd one out. It was a calculated gamble that paid off as it could have lost market share if competitors kept their prices low.

Goldman noted that Telstra’s pricing plans offered at JB Hi-Fi Limited (ASX: JBH) was unchanged. This is good news as the broker believes that this was previously seen as a key inhibitor to Vodafone raising pricing.

Telstra share price could be cum-upgrade again

What it also means is that Telstra sees the earnings benefit of higher average revenue per user (ARPU) outweighed the potential lost subscribers.

“These changes support our view that Telstra is set to grow ARPU meaningfully ahead of consensus expectations across FY21-23E,” said Goldman.

“And [Telstra] will also likely introduce further price rises in FY22E (given its premium is now +20% vs. its +35% 3Y average, despite expanding 5G lead).”

The broker is recommending Telstra as a “buy” with a 12-month price target of $4.20 a share. It rates the TPG share price as “neutral” with a 12-month price target of $5.90 a share.

The post Why the Telstra (ASX:TLS) share price outlook suddenly improved last week appeared first on The Motley Fool Australia.

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• Here are the 5 best ASX telecom shares of the 2021 financial year

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If you’re looking to diversify your portfolio, then you might want to look at adding a little exposure to the resources sector.

But which shares should you consider? Two that could be worth considering are listed below. Here’s why they are highly rated:

Mineral Resources Limited (ASX: MIN)

Mineral Resources is a mining and mining services company with a world class portfolio of operations across lithium and iron ore. These are two of the hottest commodities around at the moment and are experiencing very strong demand from electric vehicle and steel making markets, respectively.

In respect to lithium, Mineral Resources owns the Wodgina operation. It is one of the largest known hard rock lithium deposits in the world with a production life of over 30 years. The company also has the Mt Marion Lithium project in its portfolio. This project is operated by Mineral Resources under a life-of-mine mining services contract and is jointly owned by it and Jiangxi Ganfeng Lithium.

As for iron ore, the company’s portfolio includes the Iron Valley Iron Ore project and the Koolyanobbing Iron Ore project in Western Australia.

Analysts at Macquarie are very positive on the company. So much so, they have an outperform rating and lofty $73.00 price target on its shares. This compares to the latest Mineral Resources share price of $55.54. Macquarie is also forecasting big dividends in the near term and estimates yields greater than 5% over the next two years.

Orocobre Limited (ASX: ORE)

Another mining share to consider is Orocobre. It is a lithium miner with operations in Argentina. This includes the Olaroz Lithium Project in the Jujuy Province of northern Argentina and Borax Argentina in the Salta-Jujuy region.

But perhaps best of all, is that Orocobre is potentially weeks away from merging with Galaxy Resources Limited (ASX: GXY). The latter’s shareholders will be voting on the merger next month.

If everything goes to plan, management believes the combined entity will be a new force in the global lithium sector. It will also be the world’s fifth largest lithium chemicals company with a diversified production base and exciting growth platform. Positively, management sees scope to unlock significant synergies in the future.

One broker that is particularly positive on Orocobre is Citi. It recently put a buy rating and $7.60 price target on the company’s shares.

The post 2 highly rated ASX mining shares that could be buys appeared first on The Motley Fool Australia.

More reading

• 5 best ASX 200 mining and resource shares of financial year 2021
• These were the best performing ASX 200 shares last week
• Galaxy (ASX:GXY) and Orocobre (ASX:ORE) shares rise on merger update
• The Mineral Resources (ASX:MIN) share price rose 16% in June. Here’s why
• Meet the best performing ASX 200 shares of FY21. Are yours on the list?

Motley Fool contributor James Mickleboro owns shares of Galaxy Resources 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 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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