The PointsBet Holdings Ltd (ASX: PBH) share price has been a positive performer on Tuesday.

In afternoon trade, the sports betting company’s shares are up 5% to $13.24.

This latest gain means the PointsBet share price has now more than doubled in value since this time last year.

Can the PointsBet share price go higher?

According to a recent note out of Goldman Sachs, there still could be plenty of upside left in the PointsBet share price.

Its analysts currently have a buy rating and $17.20 price target on the company’s shares.

Based on the latest PointsBet share price, this implies potential upside of 30% over the next 12 months.

Why is Goldman Sachs bullish?

Goldman Sachs believes that PointsBet is well-placed for growth in the coming years thanks to its strong position in a rapidly growing United States market.

It commented: “We forecast a US$39 bn sports betting TAM at maturity, implying a 40% CAGR out to 2033. As such, we believe PBH is well positioned to benefit from this multi-year high growth opportunity ahead as more US states begin to allow online sports betting, and see a path for it to achieve ~10% share overtime. Further, we believe the staged state by state opening derisks the US rollout story while we also believe there is upside risk from other adjacent revenue streams such as media/ads and iGaming which we believe is not reflected in market valuations.”

The broker also sees scope for scalability benefits.

Its analysts explained: “We see scalability benefits ahead, particularly in the US, given i) full ramp-up of its exclusive NBC partnership, the US’s largest sports broadcaster (>184 mn viewers), ii) driving marketing efficiencies, iii) scale benefits as it continues to roll out in more US states, and iv) iGaming and cross-selling opportunities ahead.”

And finally, although its valuation may look stretched using traditional metrics, Goldman actually sees a lot of value in the PointsBet share price.

It commented: “While PBH is currently trading on ~6x forward EV/sales (below the recent avg), we believe this does not accurately reflect the significant long runway of growth ahead for the business. Over the next three years, we forecast a revenue CAGR of 97%, which compares favourably against a large basket of peers (25% ex Aus peers) and US SB/iGaming peers of 35%, trading on >11x EV/Sales. Notwithstanding different business models/scale, we believe PBH’s multiple gap to US operator DraftKings (DKNG) should converge closer over time.”

The post Why the PointsBet (ASX:PBH) share price could be in the buy zone appeared first on The Motley Fool Australia.

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James Mickleboro does not own any shares 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.

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When it comes to ASX dividend shares, finding a share that will consistently give you a high yield is a popular goal. And finding one that can keep delivering dividend increases might be the Holy Grail.

But dividend investors also have to be ever-watchful for the dreaded ‘dividend trap’. This describes the situation where an investor buys an ASX dividend share under the pretext of assuming that its trailing dividend yield will be consistent going forward, only to have the company cut its dividend afterwards. This not only results in a loss of potential dividend income but can also come with a capital loss as investors re-rate the shares’ valuation accordingly.

So here are 2 ASX dividend shares that according to CommSec broker Goldman Sachs, might treat investors to such a situation.

2 ASX shares that could be dividend traps

AGL Energy Limited (ASX: AGL)

AGL shares have not had much of a fun time lately. The AGL share price is currently trading at $9.04, down 25% year to date and almost 50% over the past 12 months. Falling earnings, a difficult national electricity market and the declining value of some of AGL’s energy generation assets (mainly coal-fired power plants) are most likely behind this. This decline has given AGL shares a seemingly attractive trailing dividend yield of 9.07%.

But Goldman reckons that the 98 cents per share in dividends that AGL paid out to investors in FY2020 will fall to 74 cents for FY2021, 72 cents for  FY2022 and 56 cents for FY2023. I’m sure shareholders will be hoping that doesn’t play out.

Fortescue Metals Group Limited (ASX: FMG)

Fortescue has been a top S&P/ASX 200 Index (ASX: XJO) performer over the past year, with Fortescue shares up 51.5%. They are also up a staggering 600% in the past 5 years. And those number’s aren’t even including the hefty dividends the iron ore giant has paid out either. These lofty gains are likely the result of a rampaging iron ore price, which has spent much of 2021 at historically high prices above US$200 a tonne.

On the current Fortescue share price, the company has a whopping 10.96% trailing dividend yield. Goldman expects Fortescue to pay out US$2.37 ($3.06) in dividends in FY2021, up substantially from the US$1.18 ($1.52) it paid out in FY2020. However, it also is expecting these dividends to fall to US$1.26 ($1.63) per share in FY2022 and 81 US cents ($1.05) by FY2023. That would be a substantial income haircut if Goldman’s expectations translate to reality.

The post 2 ASX shares that brokers reckon might be dividend traps 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 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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Vitalharvest Freehold Trust (ASX: VTH) shareholders have received yet another takeover offer for their shares.

The offer from Roc Partners is the ninth from Roc — if you’re keeping count. It comes as a counteroffer to Macquarie Group Ltd (ASX: MQG) subsidiary Macquarie Agricultural Funds Management’s (MAFM) latest takeover offer on 1 June — also MAFM’s ninth.

Vitalharvest, a real estate investment trust (REIT) focused on Aussie agricultural property assets, has been hotly contested between the 2 investment groups. Roc has indicated it’s likely to beat any MAFM offer by 1 cent per share.

And so far, Roc looks to be doing just that.

What is Roc’s latest takeover offer?

Vitalharvest reported Roc’s new offer is for $1.33 per share, or $357.35 million under the Asset Sale alternative, which it says would result in a maximum return of $1.31 per share.

The latest offer is 2 cents per share higher than Roc’s previous bid for the ASX agricultural trust. It contains other differences as well, including lowering the maximum payment to the manager under the facilitation deed to $4.5 million, down from $8 million.

Roc gave a deadline of 15 June to accept its ninth bid. However, the Vitalharvest board said the deadline would need to be pushed out “in view of the matching right timing in the MAFM Scheme Implementation Deed”.

The board said it’s “reasonably likely” Roc’s latest offer was superior to MAFM’s ninth offer of $1.295 per unit, which would be equivalent under the asset sale alternative. However, the board highlighted it has not yet made any concrete determination.

If the board accepts Roc’s latest offer, MAFM will have 5 business days to make its own new counter offer. (Yes, that will make 10).

Vitalharvest said shareholders don’t need to take any action at this time, and it will keep the market informed of any developments. The company has postponed its 10 June shareholders’ meeting.

Vitalharvest share price snapshot

The Vitalharvest share price has gained 70% over the past 12 months, handily outpacing the 20% gains posted by the All Ordinaries Index (ASX: XAO).

Year-to-date, Vitalharvest shares continue to outperform, up 35%. The current share price of $1.325 sits just above Roc’s latest offer.

The post The battle for Vitalharvest (ASX:VTH) shares isn’t over yet! appeared first on The Motley Fool Australia.

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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 Macquarie Group 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 Mad Paws Holdings Ltd (ASX: MPA) share price is surging higher today after the pet services marketplace announced it is acquiring Waggly Club.

At the time of writing, the Mad Paws share price is trading hands at 19 cents, up 11.8%.

What’s lifting the Mad Paws share price?

Investors have been scrambling to buy shares in the pet services company today following its announcement this morning.

According to the release, Mad Paws has entered into a binding agreement to acquire Waggly Club. The company being acquired is described as “one of Australia’s largest dog treats and toys subscription businesses”

Waggly was launched by founder Kate Herbert in 2016, providing dog owners with an assortment of treats and toys monthly. These subscription boxes range in value from $45 to $52 per month and are tailor-made based on the dog’s age, chewing needs and size.

Waggly’s founder and CEO, Kate Herbert stated:

As we look to our next horizon, my aim is to scale Waggly and reach more and more dogs and their fur parents each month. To this end, I feel Mad Paws and Waggly are a perfect match.

The details

Mad Paws has agreed to acquire 100% of Waggly Club through a combination of cash and shares. Total cash consideration of $2 million will be paid upon completion of the acquisition, along with $1 million worth of Mad Paw shares. The issuing Mad Paws share price will be at 25 cents per share.

Furthermore, another $0.5 million will be payable dependent on Waggly Club achieving agreed revenue-based performance hurdles up until 31 December 2022.

Regarding Waggly’s financial performance, the company currently serves roughly 2,000 orders per month. Around 70% of the company’s revenue is subscription-based. From Fy20 to FY21, Waggly nearly doubled its revenue to $1.5 million.

The Waggly Club acquisition is not subject to conditions and is expected to be completed today, 8 June 2021.

The post Mad Paws (ASX:MPA) share price wagging its tail on acquisition news appeared first on The Motley Fool Australia.

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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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COVID-19 has arguably brought forward years of digital change in the way companies do business. According to McKinsey, the restriction of movement due to lockdowns has fast-tracked the adoption of digital platforms by consumers and businesses by five years in just a matter of months.

A report last week from the Australian Bureau of Statistics (ABS) revealed just how far Australian businesses have come with cloud computing. Let’s take a closer look at the rise of cloud computing, as well as a couple of the high-profile S&P/ASX 200 Index (ASX: XJO) shares operating in the space.

Paid cloud computing on the rise

The ABS reported that just over half (55%) of Australian businesses were using paid cloud computing services in 2019-20. This compares to the 42% reported in 2017-18 and 31% between 2015-16.

The report observed that the use of paid cloud computing increased relative to the employment size of the company.

Four in five businesses (81%) with 200 or more employees reported using cloud services. Meanwhile, smaller businesses, such as those employing 0 to 4 persons and 5 to 19 persons reported respective 49% and 65% use of cloud services.

2 ASX 200 shares focused on cloud computing

NextDC Ltd (ASX: NXT)

NextDC delivers data centre solutions that provide businesses with direct access to leading public cloud platforms, such as Amazon Web Services (AWS) and Microsoft Azure, networks and IT services infrastructure.

The accelerated shift to cloud and hybrid cloud services has led to a sharp increase in demand for capacity at NextDC data centres. To meet the uplift in demand, the company has focused on the expansion of existing facility capacity and the construction of new data centres.

These tailwinds could be among the driving forces underpinning NextDC’s upgraded FY21 guidance, in which underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA) was forecast to be between $130 million and $133 million (previously $125 million to $130 million).

The NextDC share price has slid by around 9% year to date, broadly consistent with the ~9.35% fall in the S&P/ASX 200 Info Tech (ASX: XIJ). At the time of writing, NextDC shares are trading 2.85% higher at $11.18.

Megaport Ltd (ASX: MP1)

Megaport operates a similar business model to NextDC, providing customers with connectivity to leading cloud, network and managed service providers through its software-defined network (SDN) of over 700 enabled data centres.

In contrast to the NextDC share price and Info Tech Index, the Megaport share price is up by almost 10% year to date. The company’s upbeat third-quarter update on 22 April helped drive its share price up by around 14% within two days from $11.70 to $13.51. Its shares have since drifted higher and are currently fetching $15.63 at the time of writing.

The post 2 ASX 200 shares with exposure to cloud computing appeared first on The Motley Fool Australia.

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Motley Fool contributor Kerry Sun owns shares in NextDC. 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. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Amazon, MEGAPORT FPO, and Microsoft. 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 has recommended Amazon and MEGAPORT FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Immutep Ltd (ASX: IMM) share price jumped by more than 5% in morning trade to 69 cents following an update on the company’s preclinical development of a tablet to treat cancer.

The Immutep share price has since pulled back slightly and is trading for 68 cents at the time of writing.

The ASX biotech develops LAG-3-related immunotherapy treatments for cancer and autoimmune diseases.

What update did Immutep provide?

Immutep reported “some exciting early results” in its ongoing preclinical trials. 

The company said it has advanced its program to develop a new generation of small molecule anti-LAG-3 therapies. Immutep has been collaborating on the project with Cardiff University since 2019, with the goal of developing an oral treatment for cancer patients.

Immutep also hopes to be able to deliver its treatment at a lower cost than today’s anti-LAG-3 antibodies.

Commenting on the progress, Immutep’s CEO Marc Voigt said:

“Never has there been a more exciting time to explore new ideas to control the interaction between LAG-3 and MHC class II molecules, following the recent validation of LAG-3 by the pharma industry. We are excited to progress this project with the world leading scientists at Cardiff University and continue our work to develop novel LAG-3 therapeutics, especially as there are already some exciting early results from our joint efforts.”

Professor Andrew Godkin of Cardiff University noted that the small molecule anti-LAG-3 treatment they are working to develop “could offer the convenience of a tablet or capsule, at a fraction of the cost of existing anti-LAG-3 candidates”.

Professor Andrea Brancale of Cardiff University added, “We think this cross-functional expertise in chemistry, biology and drug development positions the team very well for a successful collaboration.”

Immutep and Cardiff University will jointly own all intellectual property (IP) relating to products and their derivatives developed under their agreement.

Immutep share price snapshot

The past 12 months have been good for Immutep shareholders, with the ASX biotech share up 283% since this time last year. By comparison, the All Ordinaries Index (ASX: XAO) is up 20% in that same time period.

Year-to-date, the Immutep share price has continued to strongly outperform, up 64% so far in 2021.

The post Why the Immutep (ASX:IMM) share price is marching higher today appeared first on The Motley Fool Australia.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. Bernd Struben 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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In afternoon trade the S&P/ASX 200 Index (ASX: XJO) is on course to record a small decline. At the time of writing, the benchmark index is down 0.15% to 7,270.7 points.

Four ASX shares that are not letting that hold them back today are listed below. Here’s why they are pushing higher:

CogState Limited (ASX: CGS)

The CogState share price is up a massive 58% to $1.46. Investors have been buying the neuroscience technology company’s shares following news that Eisai and Biogen have gained Accelerated Approval from the US FDA for aducanumab for the treatment of Alzheimer’s disease. Cogstate believes its digital cognitive assessment technology could play an important role in supporting the types of large-scale cognitive assessment that will be necessary in the launch of disease modifying therapies like aducanumab. It has a global deal with Eisai.

Contact Energy Limited (ASX: CEN)

The Contact Energy share price is up 5% to $7.62. This follows the release of a business update by the energy company this morning. That update revealed improvements in its overall performance and pricing.

EML Payments Ltd (ASX: EML)

The EML Payments share price is up 5% to $3.65. Investors have been buying the payments company’s shares after broker responded positively to its trading update from yesterday afternoon. One of those was UBS, which responded by retaining its buy rating and $5.30 price target. Based on its update, it expects EML Payments to deliver a result at the top end of its guidance in FY 2021.

OM Holdings Limited (ASX: OMH)

The OM Holdings share price is up 2.5% to 78.5 cents. This morning the manganese and silicon company announced that it has obtained the approval of the Securities Commission Malaysia and Bursa Malaysia Securities Berhad to proceed with its secondary listing. The company notes that it is known by many in Southeast Asia through its smelter operations in Sarawak.

The post Why Cogstate, Contact Energy, EML, & OM Holdings are pushing higher appeared first on The Motley Fool Australia.

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James Mickleboro does not own any shares mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended EML Payments. The Motley Fool Australia owns shares of and has recommended EML Payments. 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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Ratings agency S&P Global has been busy looking over the Australian banking sector this week and has given its verdict.

S&P is positive on the banking sector and has raised its outlooks to stable from negative on the long-term issuer credit ratings on the four major banks and Macquarie Group Ltd (ASX: MQG).

It commented: “We believe that the Australian banking system’s funding profile has improved in the past 10 years on the back of growing customer deposits and falling offshore borrowings.”

The ratings agency notes that its issuer credit ratings are two notches above the bank’s standalone credit profiles. This reflects its view that, if needed, the systemically important banks are likely to receive timely financial support from the Australian government.

How does S&P Global rate the banks?

This morning Australia and New Zealand Banking GrpLtd (ASX: ANZ), National Australia Bank Ltd (ASX: NAB), and Westpac Banking Corp (ASX: WBC) all confirmed that S&P has revised the outlook for their long-term issuer credit ratings to stable from negative.

The ratings agency also affirmed their long-term issuer credit ratings at AA- and A-1+ for the short term.

However, it is worth noting that the rating outlook for both Westpac New Zealand Limited and for Westpac Life-NZ Ltd was unchanged at negative. This reflects the potential for reduced support as Westpac is considering alternative ownership structures.

Australia given thumbs up

Today’s action follows news that S&P has revised its overall outlook on its long-term ratings on Australia to stable from negative.

S&P explained: “The government’s swift and decisive fiscal and health response to contain the pandemic and limit long-term economic scarring has seen the economy recover quicker and stronger than we previously expected.”

“The stable outlook reflects our expectations that the general government fiscal deficits will narrow in line with our forecasts. We expect the budget to be supported by steady revenue growth, aided by robust commodity prices and expenditure restraint. We believe Australia’s external accounts are likely to remain stronger than in the past and be resilient during potential crises,” it concluded.

The post S&P Global gives ASX bank shares the thumbs up appeared first on The Motley Fool Australia.

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James Mickleboro owns Westpac shares. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group 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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Motley Fool Australia Chief Investment Officer Scott Phillips joined Weekend Sunrise on Sunday to discuss the booming mining industry’s contribution to the economy — and the budget — and gave his verdict on iron ore miners’ share prices.

The post The mining boom is digging us out of recession, but where to for the BHP share price? appeared first on The Motley Fool Australia.

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Motley Fool contributor Scott Phillips 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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El Salvador President Nayib Bukele has declared he intends to make Bitcoin (CRYPTO: BTC) legal tender in the Central American nation.

The move would make El Salvador the first country in the world to accept the cryptocurrency as legal tender. Let’s take a closer look at the news.

Bitcoin to be legal tender

In a video broadcast at the Bitcoin 2021 conference on Sunday morning (AEST), President Bukele said he planned to submit a legislature bill to El Salvador’s legislative assembly that would make Bitcoin legal tender.

Welcome to the future #Bitcoin pic.twitter.com/j30vcZVXvJ

— Nayib Bukele (@nayibbukele) June 5, 2021

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According to President Bukele, the move would give El Salvador’s citizens more financial freedom.

In a Twitter Inc. (NYSE: TWTR) thread, the president stated that 70% of El Salvador’s population did not have bank accounts – making the ability to transfer Bitcoin outside of banks a major upside to the use of crypto as official currency.

He added that US$6 billion worth of remittances were sent to Salvadoran families each year – a large percentage of which was taken in fees.

President Bukele tweeted:

By using [Bitcoin], the amount received by more than a million low income families will increase in the equivalent of billions of dollars every year.

President Bukele also stated if 1% of Bitcoin was invested into El Salvador, the country’s GDP would increase by 25%.

The president went on to sell El Salvador to potential residents – offering permanent residency in the nation to cryptocurrency entrepreneurs.

1. Great weather, world class surfing beaches, beach front properties for sale.
2. One of the few countries in the world with no property tax.
3. No capital gains tax for #Bitcoin, since it will be a legal currency.
4. Immediate permanent residence for crypto entrepreneurs. https://t.co/j3eugJQCMd

— Nayib Bukele (@nayibbukele) June 6, 2021

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El Salvador’s financial troubles

According to reporting by Forbes, El Salvadore’s use of the US dollar as its major currency has recently caused issues for the country.

In 2001, El Salvador replaced its own currency with the US dollar to stabilise the nation’s financial system.

Then, in an effort to minimise the economic impacts of the coronavirus pandemic, the US Federal Reserve increased the amount of available US dollars.

Forbes reported the move by the US Federal Reserve caused El Salvador to lose purchasing power due to inflation.

Unlike the US dollar, the amount of Bitcoin available is capped – meaning it’s more resistant to inflation.

About the Bitcoin price

The Bitcoin price has fallen 8% since President Bukele’s announcement on Sunday, with a single Bitcoin trading at $42.227 at the time of writing. This continues a significant drop in the Bitcoin price over the past month, down 43.8% since 8 May.

The post Could this be the first country to adopt Bitcoin as legal tender? 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. owns shares of and has recommended Bitcoin and Twitter. 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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