Stock Pick

  • This ASX 200 share is rocketing higher after delivering more strong sales growth

    The S&P/ASX 200 Index (ASX: XJO) may be sinking lower today, but that hasn’t stopped the Breville Group Ltd (ASX: BRG) share price from rocketing higher.

    In morning trade the appliance maker’s shares have returned from their trading halt and jumped 10% higher to $20.54.

    Why was the Breville share price in a trading halt?

    Breville requested a trading halt on Wednesday while it undertook a $104 million equity raising.

    This morning the company revealed that it has successfully completed the underwritten institutional placement component of the equity raising.

    Breville has raised $94 million through the issue of approximately 5.5 million new shares to institutional investors for $17.00 per new share. This represents a discount of 9.1% to its last close price.

    It will now push ahead with its share purchase plan which aims to raise a further $10 million.

    The proceeds will be used to enhance Breville’s financial flexibility to continue to invest in the execution of its growth agenda while maintaining a strong financial position.

    Why is the Breville share price rocketing higher?

    Equity raisings rarely send share prices hurtling higher, so readers may be curious about today’s gains.

    Investors have been buying the company’s shares after it released a trading update with its equity raising announcement.

    According to the release, Breville has been performing very strongly during the second half of FY 2020, despite the pandemic and store closures.

    Between January 1 and April 30, Breville’s revenue was up 32% on the prior corresponding period. Sales grew 25% in March and 21% in April.

    Management commented: “At a segment level, Global Product has delivered 32% revenue growth, or 24% in constant currency terms, from 1 January to 30 April 2020.”

    “In constant currency terms, March delivered 14% growth which strengthened to 18% in April. This is despite retailers in key regions closing stores during government mandated lockdowns. Sell-through exceeded sell-in growth in all key regions, as demand remained strong and retailers ran down their inventory,” it added.

    Despite its sales growing strongly, the company has been quick to manage its cashflows and reduce cash expenses to minimum levels.

    These cost savings are designed to temporarily reduce salary costs but protect capability, temporarily reduce marketing and increase its return on investment, while ensuring that its product development continues.

    Pleasingly, the pandemic doesn’t look likely to stifle its expansion plans. Management revealed that it is in advanced planning for the entry into further international markets in FY 2021. The funds raised today are expected to support this growth plan.

    Missed Breville’s gains? Then you won’t want to miss out on these dirt cheap shares.

    5 cheap stocks that could be the biggest winners of the stock market crash

    Investing expert Scott Phillips has just named what he believes are the 5 cheapest and best stocks to buy right now.

    Courtesy of the crashing stock market, these 5 companies are suddenly trading at significant discounts to their recent highs… creating what could be incredible opportunities for bargain-hungry investors.

    Simply click here to scoop up your FREE copy and discover the names of all 5 cheap shares to buy now… before the next stock market rally.

    See the 5 stocks

    Returns as of 7/4/2020

    More reading

    Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

    The post This ASX 200 share is rocketing higher after delivering more strong sales growth appeared first on Motley Fool Australia.

    from Motley Fool Australia https://ift.tt/2LmZTN4

  • Is Roku Stock a Buy Right Now? This Is What You Need to Know

    Is Roku Stock a Buy Right Now? This Is What You Need to KnowThe market has proven itself difficult to predict at the best of times, yet the sustained rally since mid-March has left many perplexed. As the bad news on Main Street has kept piling up, Wall Street has nonchalantly marched on, seemingly oblivious to the pandemic’s destructive effect and buoyed by the stimulus measures.But perplexing market moves are nothing new. Which brings us to Roku (ROKU). The OTT leader delivered a solid quarterly report last week, and promptly tanked in the market, as shares dropped by 8% in Friday’s session.At first glance, this may seem odd. Roku reported revenue of $321 million, up by 55.3% year-over-year and beating the estimates by $11.77million. Q1 GAAP EPS of -$0.45 met Street expectations, while active accounts increased year-over-year by 36.8% to 39.8 million. Unsurprisingly, in these stay at home times, engagement soared to 13.2 billion hours, up by 49% compared to the same period last year.So where was the problem? Maybe problem is the wrong word. But you could argue the good news was already priced in, as Roku announced preliminary results in mid-April, and therefore Wall Street knew what was coming. Secondly, it should be noted Roku stock has exploded since the mid-March lows. The majority of the market has surged too, but not many increased by 115% since then, so, it is possible some trading profits were locked in.Another explanation for the sell-off might be down to Roku’s assertion that ad spend – a major ARPU (average revenue per user) growth driver – is expected to be slashed amid the economic uncertainty. The trend was already in place in the quarter as ad cancellations came in fast and furious during late March through mid-April.Nevertheless, the pullback hasn’t dampened Rosenblatt analyst Mark Zgutowicz’s views on Roku’s prospects. As it happens, following the earnings report, the 5-star analyst reiterated a Buy and increased the price target from $110 to $145. Expect upside of 23%, should the target be met in the months ahead. (To watch Zgutowicz’s track record, click here)Zgutowicz commented, “While macro and subsequent ad market uncertainties look to be with us for some time, we remain focused on long-term potential silver linings to pandemic disruptions, including ecommerce and OTT video. Roku’s dominant US brand/household positioning in OTT, and early innings globally, make it hard to bet against, even with acknowledged less than perfect financial model transparencies. OTT video streaming and importantly Roku’s market position, should come out the other end of this stronger.”All in all, the Street keeps a positive, though more measured view. 7 Buys, 4 Holds and 2 Sells coalesce to a Moderate Buy consensus rating. The average price target is $128.33 and implies miniscule upside of 9%. (See Roku stock analysis on TipRanks)Read more: * 3 Top Stock Picks From Wall Street’s 5-Star Analyst * Morgan Stanley: 2 Stocks That Could Surge Over 25% * 3 Stocks Millennials Are Betting Big on Right Now More recent articles from Smarter Analyst: * Walt Disney Raises $11 Billion From Bond Sale to Bolster Finances * Twilio Partners With Zocdoc For Telehealth Video Consultations * CyberArk Software Shares Sink 6% on Weak Sales Outlook * Uber Announces $750M Notes Offering, As GrubHub Takeover Reports Swirl

    from Yahoo Finance https://ift.tt/2WSFftz

  • 3 top ASX shares to buy now and hold for 10 years

    Upward Trending Data Image

    If you’re looking to invest in shares following the recent market crash, then the three listed below could be good options.

    I believe all three have the potential to provide investors with strong returns over the next decade. Here’s why I would buy them:

    a2 Milk Company Ltd (ASX: A2M)

    I’m a big fan of a2 Milk Company due to its long track record of earnings growth, strong and unique brand, massive market opportunity, and sizeable cash balance. Combined, I believe these have positioned a2 Milk Company to continue its strong form for many more years to come. This certainly is expected be the case this year. Management recently upgraded its guidance for the full year thanks to stronger than expected infant formula demand. The top end of its guidance range implies year on year revenue growth of 34.1% and EBITDA growth of 35.4%.

    BetaShares Asia Technology Tigers ETF (ASX: ASIA)

    If you’re interested in investing outside Australia then the BetaShares Asia Technology Tigers ETF could be a good option. This exchange traded fund gives investors exposure to many of the biggest and brightest tech companies in the Asian market. These companies are revolutionising the lives of billions of people in the region and look well-positioned for strong growth over the next decade. The fund includes ecommerce giant Alibaba, search engine company Baidu, and Afterpay Ltd (ASX: APT) shareholder and WeChat owner, Tencent.

    Freedom Foods Group Ltd (ASX: FNP)

    I think this diversified food company could be a good option for investors. Over the last couple of years it has been investing heavily in its future growth. This investment period has now come to an end, leaving Freedom Foods well-placed to reap the benefits. I believe it is in a position to deliver strong earnings growth over the coming years. Especially given the increasing demand its Plant Based Beverage and Dairy Nutritionals businesses continue to experience thanks to the healthy eating trend.

    And don’t miss this recent discovery which could be the best buy on the market right now.

    One “All In” ASX Buy Alert, that could be one of our greatest discoveries

    Investing expert Scott Phillips has just named what he believes is the #1 Top “Buy Alert” after stumbling upon a little-owned opportunity he believes could be one of the greatest discoveries of his 25 years as a professional investor.

    This under-the-radar ASX recommendation is virtually unknown among individual investors, and no wonder.

    What it offers is an utterly unique strategy to position yourself to potentially profit alongside some of the world’s biggest and most powerful tech companies.

    Potential returns of 1X, 2X and even 3X are all in play. Best of all, you could hold onto this little-known equity for DECADES to come

    Simply click here to see how you can find out the name of this ‘all in’ buy alert… before the next stock market rally.

    Find out the name of Scott’s ‘All in’ Buy Alert

    Returns as of 6/5/2020

    More reading

    Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended BetaShares Asia Technology Tigers ETF. The Motley Fool Australia owns shares of A2 Milk and AFTERPAY T FPO. The Motley Fool Australia has recommended Freedom Foods Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

    The post 3 top ASX shares to buy now and hold for 10 years appeared first on Motley Fool Australia.

    from Motley Fool Australia https://ift.tt/2LDFqUB

The Latest