The Immutep Ltd (ASX: IMM) share price has been a strong performer again on Thursday.

In morning trade, the biotechnology company’s shares are storming 10% higher to 48.5 cents.

Why is the Immutep share price storming higher?

Investors have been buying Immutep’s shares following the release of its second announcement in as many days.

On this occasion, the company has provided an update on its lead product candidate, eftilagimod alpha.

According to the release, the soluble LAG-3 protein, which is better known as efti or IMP321, has received Fast Track designation in first line recurrent or metastatic head and neck squamous cell carcinoma (HNSCC) from the United States Food and Drug Administration (FDA).

The company notes that it was granted Fast Track designation due to its potential to address an unmet medical need, as evidenced by encouraging data indicating a positive risk benefit ratio.

The data package evaluated by the FDA included the promising results from Part C of Immutep’s Phase II TACTI-002 trial. The Overall Response Rate (ORR) from the trial was approximately 36% (approximately 44% in evaluable patients) for 28 patients receiving efti in combination with KEYTRUDA.

What does Fast Track designation mean?

FDA Fast Track designation is awarded to help important new therapies reach patients earlier.

It is designed to facilitate the development and speed up the review of drug candidates to treat serious conditions and fill an unmet medical need.

The company notes that, importantly, it will now have access to more frequent meetings and communications with the FDA. It could potentially even receive Rolling Review of its Biologic License Application (once submitted) and may be eligible for Accelerated Approval and Priority Review, if relevant criteria are met.

Overall, a very promising development, making the Immutep share price one to watch over the rest of the year.

More reading

• Here’s why the Immutep (ASX:IMM) share price is climbing today
• Why Immutep, Inghams, REA Group, & Synlait shares are sinking
• Why the Immutep (ASX:IMM) share price is rocketing 39% higher today
• Why the Immutep (ASX:IMM) share price is up 6% today
• Why the Immutep (ASX:IMM) share price will be in focus today

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. 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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US President Joe Biden is pitching his US$2.25 trillion infrastructure plan as integral for his country to keep ahead of China – a rivalry that ASX share investors should warmly embrace.

The president warned that China is trying “to own the future” as he pushes US lawmakers to get behind his ambitious plan, reported Bloomberg.

The new economic arms race will have implications for a range of ASX miners and could reach well beyond the obvious names.

US-China rivalry is good for ASX iron ore miners

It’s easy to see how iron ore demand will get a boost as steel is needed to build infrastructure. But I don’t believe that the increase in US demand is factored into the earnings forecasts of the ASX iron ore majors.

These include the Rio Tinto Ltd (ASX: RIO) share price, Fortescue Metals Group Limited (ASX: FMG) share price and BHP Group Ltd (ASX: BHP) share price.

Some analysts have recently warned that the iron ore price is set for a sharp pull-back as Chinese demand for the mineral can’t maintain its fervent pace.

Earnings upside for these ASX shares

That may be true, but there’s no mention about what’s happening in the US. If Biden gets his way, the ramp up in infrastructure construction activity could roughly coincide with the predicted slowdown in China.

This means that the iron ore price, while it may not break new record highs, might not fall as far as some experts are forecasting.

Other ASX shares to benefit from US infrastructure stimulus

But there is a wide range of other ASX miners that could get a Biden boost too. The president made it clear that his massive infrastructure stimulus isn’t just about road and rail.

“Do you think China is waiting around to invest in its digital infrastructure or in research and development?” Biden was quoted as saying by Bloomberg.

“I promise you, they are not waiting. But they’re counting on American democracy to be too slow, too limited and too divided to keep pace.”

Biden wants to use part of the $3 trillion to spend on water pipes, charging stations for electric vehicles and technology.

The move could add further support to copper, lithium and rare earth prices.

Foolish takeaway

Some ASX shares that are synonymous with these minerals include the OZ Minerals Limited (ASX: OZL) share price, Lynas Rare Earths Ltd (ASX: LYC) share price, Galaxy Resources Limited (ASX: GXY) share price and Orocobre Limited (ASX: ORE) share price.

It shouldn’t be lost on investors that the benefits from the US stimulus will go beyond ASX share prices.

Biden’s bold plan has the potential to lower Australia’s dependency on China – and that’s something all Aussies would welcome.

More reading

• Why the Rio Tinto (ASX:RIO) share price is in focus
• Why the Orocobre (ASX:ORE) share price is surging
• ASX 200 rises, EML jumps, Zip falls
• Why ASX copper shares are cheering for Joe Biden
• Alliance (ASX:AQZ) share price tumbles despite material BHP deal

Motley Fool contributor Brendon Lau owns shares of BHP Billiton Limited, Galaxy Resources Limited, Lynas Limited, Orocobre Limited, OZ Minerals Limited, and Rio Tinto Ltd. Connect with me on Twitter @brenlau.

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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When mentioning Westpac Banking Corp (ASX: WBC), it probably doesn’t conjure up images of Bitcoin (CRYPTO: BTC) trading. Westpac is Australia’s oldest bank after all.

Yet Westpac looks set to benefit from Bitcoin and other cryptocurrencies very soon. Perhaps to the tune of $500 million, no less.

How? Well, it’s complicated (and no, Westpac isn’t about to sell bitcoins itself).

Westpac is one of the largest backers of a venture capital fund by the name of Reinventure – “Westpac’s $150m venture capital fund committed to early stage ventures”.  The two businesses are heavily intertwined, with Westpac telling us that:

“[By] working with Reinventure, Westpac gains deep insight into technologies and business models that may drive new customer experiences and disrupt traditional financial services. The Reinventure portfolio companies gain access not just to Westpac capital, but may strategically benefit from Westpac resources and expertise to enable the company to scale more rapidly

One of Reinventure’s early investments was a US company called Coinbase. Coinbase is now one of the largest cryptocurrency exchanges in the world. Coinbase tells us that Reinventure made an investment into Coinbase in 2015 during a Series C funding round. Well, it might be time to reap for Westpac.

Westpac set for a Bitcoin payday

According to Coinbase, the company is set to list on the US Nasdaq exchange. The listing will occur on April 14. Clearly, Coinbase doesn’t believe in superstition because that’s the same day the Titanic hit its iceberg. Its ticker code will be COIN for its Class A shares. As seems to be the norm these days, its Class B shares (which allow 20 votes per share) will not be publically traded and will remain with company insiders.

Coinbase has been chumming up the waters too. Just this morning, it released an earnings report for the 2021 calendar year. In this report, Coinbase reported 56 million verified users, trading volume of US$225 billion, revenue of US$1.8 billion and adjusted earnings before interest, tax, depreciation and amortisation (EBITA) of US$1.1 billion.

We don’t yet know the listing price that COIN shares will go for. But according to a report in the Australian Financial Review (AFR), that will be released next Wednesday. The report estimates that Coinbase will be valued at between US$70-100 billion when it does go public. If that were the case, Reinventure would be looking at a profit of roughly $450 million on its original $50 million investment.

No doubt Westpac will be very pleased with its efforts if that does come to pass.

More reading

• Westpac (ASX:WBC) share price on watch after ASIC launches civil proceedings
• Will China’s great emissions wall crash the Bitcoin price?
• 3 reasons Bitcoin could double your money (and more)
• ASX 200 up 0.25%: EML surges on acquisition news, Westpac’s APRA update
• Westpac (ASX:WBC) share price lower on APRA update

Sebastian Bowen owns shares of Bitcoin. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Bitcoin. 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) has been range-bound for the past few months, bouncing between 6,600 and 6950.

The index managed to push into a six-week high on Wednesday, attempting to break out of its trading range. Here are the ASX 200 shares riding the strength of the broader market and making record highs. 

ASX 200 shares making 52-week highs 

Brickworks Ltd (ASX: BKW)

The Brickworks share price has pushed into record territory riding the tailwinds of better than expected half-year results. Its shares briefly hit an all-time record high of $21.29 on Wednesday.  

At face value, Brickworks’ half-year results were relatively flat with revenue falling 4% to $432 million and underlying net profit after tax down 10% to $90 million. However, from a broker perspective, these results beat expectations with the company’s property portfolio delivering a far stronger performance. 

Codan Ltd (ASX: CDA) 

The Codan share price is the gift that keeps on giving. The metal detector and communication electronics company has announced a stream of positive news in the past few months.

This includes a profit upgrade back in December 2020, the acquisition of Domo Tactical Communications in February 2021, an outstanding half-year results announcement during the February reporting season and another acquisition this month. Its acquisitions are both earnings accretive for FY21 and complement Codan’s core business segments. 

EML Payments Ltd (ASX: EML) 

Things seem to have just clicked for the EML share price in 2021. Its shares spent most of 2020 below their pre-COVID highs, chopping back and forth as shopping centre closures across Europe and the United States affected its core gift cards business. 

Its shares are on the comeback as revenues pivot into general-purpose reloadables such as gaming payouts, salary packaging and commission payouts. The company’s half-year results highlight its versatility despite challenging business conditions for gift cards. Its interim results highlighted a solid 61% increase in revenue to $95.3 million and a $30% increase in net profit after tax and amortisation to $13.2 million. 

On Wednesday, the EML share price surged to record all-time highs after the announcement of its acquisition of Sentenial Limited. Its shares briefly touched $5.80, briefly surpassing its pre-COVID high for the first time. 

Premier Investments Ltd (ASX: PMV) 

Soaring profits have pushed the Premier Investments share price to new highs. The company reported a 7.2% increase in global sales to $784.6 million and an 88.9% surge in net profit after tax to $188.2 million for the period of 27 weeks ended 30 January 2021.

This was driven by record sales from its boutique sleepwear business, Peter Alexander, and an uplift in margins. 

Reece Ltd (ASX: REH) 

Reece is another ASX 200 share that’s pushing into record territory after a solid set of half-year results. The leading supplier of bathroom and plumbing products delivered a 4% increase in sales revenue to $3,074 million while stronger margins saw its net profit after tax increase 17% to $123 million.

The Reece share price surged 4.83% on Wednesday, closing at an all-time record high of $18.88. 

More reading

• 2 ASX 200 shares to buy for growth
• EML Payments (ASX:EML) and these ASX shares just hit new highs
• ASX 200 rises, EML jumps, Zip falls
• ASX 200 up 0.25%: EML surges on acquisition news, Westpac’s APRA update
• Why EML, NextDC, Qantas, & Recce shares are racing higher

Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends EML Payments. The Motley Fool Australia owns shares of and has recommended Brickworks and Premier Investments Limited. The Motley Fool Australia 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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Some ASX dividend shares have very big dividend yields thanks to their big payout ratios and the growth generated in recent times.

But, not only do the businesses below have large yields, but the businesses are also increasing the dividends per share too.

JB Hi-Fi Limited (ASX: JBH)

JB Hi-Fi is one of the largest Australian retailers of appliances and electronic devices. It has experienced a high level of demand over the last 12 months and this was shown in the latest FY21 half-year result.

It saw total sales go up 23.7% to $4.9 billion, earnings before interest and tax (EBIT) grew 76% to $462.8 million and net profit after tax (NPAT) grew 86.2% to $317.7 million. One area of particularly strong growth was an online sales increase of 161.7% to $678.8 million.

Both The Good Guys and JB Hi-Fi Australia saw large growth of its EBIT margin thanks to cost control. JB Hi-Fi Australia’s EBIT margin increased 214 basis points to 9.8% and The Good Guys’ EBIT margin went up 417 basis points to 8.7%.

The ASX dividend share’s board decided to increase the interim dividend by 81.8% to $1.80 per share – this represented 65% of net profit. It currently has a trailing grossed-up dividend yield of 7.4%.

Nick Scali Limited (ASX: NCK)

Nick Scali is another ASX retail share that is experiencing high levels of growth. HY21 sales went up 24.4% to $171.1 million. Sales order growth in January 2021 was up 47%, with the sales order bank at the end of the month being the highest of all time.

HY21 underlying EBIT grew 100.3% and the EBIT margin rose 1,270 basis points to 33.6%. Underlying earnings per share (EPS) also doubled, which allowed the board to grow the interim dividend by 60% to $0.40 per share.

The ASX dividend share continues to add new stores to its network. It’s expecting to open two further stores in the second half of FY21.

Nick Scali currently has a trailing grossed-up dividend yield of 8.7%.

Charter Hall Long WALE REIT (ASX: CLW)

This is a real estate investment trust (REIT) operated by Charter Hall Group (ASX: CHC) with the aim of generating rental income from tenants with a high quality property portfolio and long weighted average lease expiry (WALE). The properties are spread across different sectors including telecommunications exchanges, agri-logistics, industrials and logistics, office and long WALE retail.

The WALE was 14.1 years at 31 December 2020 at the ASX dividend share and the weighted average rental review (WARR) increase was 2.2%.

Charter Hall Long WALE REIT reaffirmed its FY21 operating EPS guidance of no less than 29.1 cents per security, representing growth of at least 2.8%. The target distribution payout ratio remains at 100% of operating earnings, representing a FY21 yield of at least 6%.

More reading

• How are these ASX 200 retail shares tracking after JobKeeper’s end?
• Will the Kogan (ASX:KGN) share price making a comeback in April?
• 2 major ASX retail shares trading near record highs
• These are the 10 most shorted shares on the ASX
• Top brokers name 3 ASX shares to sell next week

Motley Fool contributor Tristan Harrison 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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There are some really good S&P/ASX 200 Index (ASX: XJO) shares that could be good options to own for potential growth.

Some businesses have already reached a size where long-term compound growth is limited. However, there are a few ASX 200 shares that have very interesting growth prospects over the next year and beyond:

Sonic Healthcare Ltd (ASX: SHL)

Sonic Healthcare is one of the largest healthcare ASX 200 shares, with a market capitalisation of almost $17 billion according to the ASX.

The business is generating strong operating leverage in its laboratory division. The huge level of COVID-19 testing has been enabled by historical investments in people and infrastructure (expertise, equipment, facilities, IT, supply chain and so on). The business has conducted more than 18 million COVID-19 PCR tests performed in around 60 Sonic laboratories globally.

Thanks to the high level of COVID-19 testing, half-year revenue grew 33% to $4.4 billion and net profit after tax (NPAT) rose 166% to $678 million.

The USA and Germany in-particular saw high levels of growth. The US division generated 39% organic revenue growth, despite base revenue (excluding COVID testing) being down 8%. The second wave impact was significantly less than the first. Germany saw organic revenue growth of 58% – Sonic is the largest provider of COVID-19 PCR tests in Germany, in 30 laboratories nationwide.

Even the Australia division saw 26% organic revenue growth, despite Australia’s COVID-19 situation being much more controlled than in the northern hemisphere. Base business revenue growth was 5%.

The ASX 200 share said that it’s in a strong position for future growth, with demand for COVID-19 PCR testing to continue into the foreseeable future. Management said that the underlying strong healthcare growth drivers are unchanged. Sonic has leading market positions in Australia, Germany, USA, UK and Switzerland.

At the current Sonic Healthcare share price it’s valued at 14x FY21’s estimated earnings according to CommSec.

Brickworks Limited (ASX: BKW)

The diversified property and building products business is seeing a recovery for its business and continued growth for its property trust.

Brickworks said that the pandemic has resulted in increased consumer demand for lower density living and this is resulting in a shift towards detached housing from multi-residential alternatives. This is favourable for Austral Bricks and Bristle Roofing, due to the relatively high usage of bricks and roof tiles in detached houses.

The ASX 200 share has been pro-active throughout the pandemic to accelerate several initiatives and ensure the business emerges stronger. All of Brickworks’ major Australian divisions saw growth of its earnings before interest and tax (EBIT). It continues to invest in its manufacturing plants to ensure market leadership.

In America, Brickworks has made strong progress on key strategic priorities. Significant ‘plant rationalisation’ activities were also accelerated through the pandemic, with a total of 16 manufacturing plants transitioning to 10. There has been higher demand for single family housing across the country. There was a strong recovery of demand during March, with improved weather and increased optimism of a stimulus-led, post-pandemic recovery. The daily order intake is now at pre-pandemic levels. Long-term growth is anticipated, once conditions normalise.

There’s a lot of potential with its property trust, with development activity going on at an unprecedented scale. Completion of pre-committed facilities over the next two years will result in a significant uplift of rental income and asset value, according to Brickworks. The trend towards online shopping and demand for more sophisticated facilities will help drive growth.

At the current Brickworks share price, it offers a grossed-up dividend yield of 4.1%.

More reading

• Why the Orocobre (ASX:ORE) share price is surging
• The National Storage (ASX:NSR) share price is at a 52-week high. Here’s why
• Should income investors buy Sonic Healthcare (ASX:SHL) shares?
• ASX 200 rises, EML jumps, Zip falls
• Why the Bubs (ASX:BUB) share price is up 5% today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Brickworks. The Motley Fool Australia has recommended Sonic Healthcare 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 Western Areas Ltd (ASX: WSA) share price is on watch this morning following a preliminary production update. At yesterday’s market wrap, the nickel producer’s shares closed the day $2.13.

Let’s take a closer look and see how Western Areas performed for the stated period.

How did Western Areas perform?

Western Areas share price could be on the move today after the company delivered a robust performance for the March quarter.

In its announcement, Western Areas reported a significant improvement in both mine and milled physicals at its Forrestania operations in Western Australia. The company mined 4,236 Ni tonnes, resulting in strong nickel (Ni) in concentrate production. This reflected an increase of up to 20% quarter-on-quarter.

Western Areas achieved a grade of 3.6% Ni in total of the mined ore, representing a gain of up to 27% quarter-on-quarter.

Nickel produced in concentrate of 4,267 Ni tonnes, lifting 21% quarter-on-quarter due to higher mined grades and mill recoveries.

Words from the management

Western Areas managing director Dan Lougher commented:

As previously flagged to the market, we re-entered the higher-grade areas of the Flying Fox mine this quarter, and saw improved mined nickel grades from Spotted Quoll.

This result was setup by the significant development and rehabilitation of existing ore drives achieved during the previous December quarter, which allowed access to and mining of higher-grade ore tonnes in the March quarter.

The company stated that it remained focused on continuing the positive momentum into the final quarter of FY21. It expects that the development and rehabilitation work already undertaken will help contribute to attaining that goal.

Western Areas share price snapshot

The Western Areas share price is marginally higher, around 4%, over the past 12 months. However, the company’s shares have fallen close to 20% year-to-date, notably treading lower since the beginning of last month.

Based on current valuations, Western Areas commands a market capitalisation of roughly $670.2 million, with 314.6 million shares outstanding.

More reading

• These are the 10 most shorted shares on the ASX
• Why Accent, Fortescue, Western Areas, & Zip shares are tumbling lower
• Is this a better way to buy into the ASX mining supercycle?
• Here’s why the Western Areas (ASX:WSA) share price is sinking today
• Why the Western Areas (ASX:WSA) share price is in a trading halt

Motley Fool contributor Aaron Teboneras 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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Since listing in 1994, CSL Limited (ASX: CSL) has become a household name among Australian investors.  

The biotech giant has had a strong track record of performing consistently well, regardless of market conditions.

However, following an initial surge during the height of the COVID-19 pandemic, the CSL share price has struggled. This, despite the overall Australian share market enjoying a strong recovery.

How has CSL performed?

In mid-February, CSL reported a strong set of results for the 6 months ended 31 December. The company reported a 16.9% increase in revenue of US$5,739 million and 44% growth in net profit after tax (NPAT).

CSL noted that the COVID-19 pandemic had influenced the performance of its Behring and Seqirus arms. For the first half of FY21, CSL Behring reported a 9% increase in revenue whilst Seqirus reported a 38% surge in revenue.

The company’s Seqirus arm is one of the largest influenza vaccine companies in the world. Growth in the Seqirus business was fueled by a surge in demand for flu vaccinations from consumers.

On the other hand, CSL’s Behring business which encompasses plasma collection delivered slower growth for the first 6 months. Despite issues with plasma collections, CSL managed to keep costs low and beat market expectations for the first half.

So what’s holding the CSL share price back?

Despite demonstrating earnings growth for the first half, investors have failed to jump on the CSL share price. Shares in CSL are currently trading more than 23% lower than their all-time high of $341.00. The fall in investor interest saw the CSL share price hit a new 52-week low last month of $242.00.

Could the fact that CSL did not change its full-year guidance be putting some investors off? Despite a strong first half, CSL forecast FY21 NPAT to be in the range of approximately US$2,170 million to US$2,265 million at constant currency. The implication that CSL could have a weaker second half has been compounded by fears of lower plasma collection volumes.

Pre-COVID, CSL operated one of the largest and most efficient networks of plasma collection centres. But with donors in the US deterred from visiting plasma collection centres, there has been a seismic decline in volumes.  

However, vaccine rollouts in the US and Australia may offer some light at the end of the tunnel. CSL’s Seqirus arm could be a natural offset by pumping out vaccines, thereby making people more comfortable to attend collection centres.

More reading

• CSL (ASX:CSL) share price remains near 52-week low on COVID-19 vaccine delays
• 2 quality ASX healthcare shares to buy and hold
• Leading brokers name 3 ASX shares to buy today
• Top broker picks the best ASX shares to buy for the new quarter
• 5 of the best ASX shares to buy after the Easter break

Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. 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 Rio Tinto Limited (ASX: RIO) share price is on watch today after an update from its majority-owned entity, Energy Resources of Australia Ltd (ASX: ERA).

Energy Resources provided a quarterly update on production and rehabilitation efforts at its Ranger Mine in the Northern Territory. Rio Tinto owns an 86.3% stake in the ASX-listed Energy Resources.

Why is the Rio Tinto share price in focus?

Investors will be watching shares in both Rio Tinto and Energy Resources, Australia’s longest continually operating uranium oxide producer.

Energy Resources produced 34 tonnes of uranium oxide in the March 2021 quarter, down 96% from the 390 tonnes recorded in the December 2020 quarter. The mining group halted production on 8 January 2021 in line with the Ranger Authority.

The Energy Resources share price fell 21.9% lower in the space of a week between January 7 and January 14. The Aussie miner needed to cease mining and processing activities in the Ranger Project Area by January 2021. January 2026 is the deadline for final rehabilitation efforts under the Ranger Authority.

The Rio Tinto share price has edged lower in 2021 but the world’s second-largest metals and mining group still has a $167.2 billion market capitalisation.

The January shutdown now concludes 40 years of operation at the Ranger Mine, having produced over 132,000 tonnes of drummed uranium. Ranger rehabilitation efforts are continuing at the site, according to today’s release.

Energy Resources didn’t spend on evaluation or exploration during the quarter. Energy Resources expects to complete sales into its existing sales contracts through 2021. The average realised selling price is expected to be US$50 to US$55 per pound.

The Rio Tinto share price will be one to watch following the quarterly update from Energy Resources. Yesterday’s quarterly release also provided an update on its Ranger 3 Deeps resource discovered in 2009.

Energy Resources said, “Given the current uranium market environment, the Ranger 3 Deeps project faces material barriers to development”. Ranger 3 Deeps decline and decommissioning will continue with plant decommissioning due to be completed in Q3 2021.

Foolish takeaway

The Rio Tinto share price will be one to watch following a quarterly report from its majority-owned Energy Resources. Shares in the iron ore giant have climbed 27.1% in the last 12 months to $113.44 at yesterday’s close.

More reading

• UBS is calling time on the ASX iron ore supercycle
• ASX 200 boom as Joe Biden unveils massive infrastructure, tax package?
• Is the Fortescue share price ring-fenced by Twiggy and its climate targets?
• Why Macquarie thinks the BHP (ASX:BHP) share price and 2 others will outperform
• Why the South32 (ASX:S32) share price is outperforming today

Motley Fool contributor Ken Hall 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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One stock expert has admitted he got it wrong last year but said that this means that right now, there are some massive buying opportunities.

Forager Funds chief investment officer Steve Johnson said that when the COVID-19 market crash happened 13 months ago, his predictions proved to be “woeful”.

“The way different sectors were impacted by COVID surprised me. A lot,” he posted on the company blog.

“Home furnishings boom? Nope. Motorbike retailer has best year ever? Nope. Funeral homes have their worst year ever? Definitely didn’t see that coming.”

The biggest surprise was the enterprise software subsector.

Johnson, as well as many other experts, expected that this group of tech companies would be relatively shielded from COVID losses.

“Unlike software sold to individuals or small businesses, where the user simply buys the product and starts using it, most enterprise software is heavily integrated into a company’s operations and customised for each client,” he said.

“They are almost impossible to remove, making for sticky revenues and attractive long-term investments.”

But a horrible league table of ASX-listed enterprise software makers shows their shares all currently trading significantly below their pre-pandemic prices.

“It turns out that this prediction wasn’t right either,” Johnson said.

“Apparently, some of the revenue isn’t as recurring or reliable as investors had come to believe.”

Enterprise software company	Share price change from 1 Jan 2020 to 21 Mar 2021
Gentrack Group Ltd (ASX: GTK)	(62%)
Bravura Solutions Ltd (ASX: BVS)	(48%)
Integrated Research Limited (ASX: IRI)	(32%)
Livetiles Ltd (ASX: LVT)	(28%)
Infomedia Limited (ASX: IFM)	(24%)
Iress Ltd (ASX: IRE)	(24%)
Altium Limited (ASX: ALU)	(21%)
Appen Ltd (ASX: APX)	(20%)
ELMO Software Ltd (ASX: ELO)	(19%)
Nearmap Ltd (ASX: NEA)	(17%)
Readytech Holdings Ltd (ASX: RDY)	(6%)
Source: Forager Funds, table created by author

Why are enterprise tech companies so cheap now?

Johnson attributed this group’s misfortune to the way revenues are received from clients.

“Most enterprise software companies earn significant amounts of upfront implementation revenue. That depends on winning new clients. And some of the ‘recurring’ revenue is related to clients requesting changes or introducing new features,” he said.

“With employees working from home and much bigger problems to deal with, most corporates have moved IT system upgrades down their lists of priorities.”

But he believes this now presents a golden opportunity to buy up these companies. Because they will come roaring back.

“The problems are real, but the share price reactions look overdone,” Johnson said.

“The timing of a recovery is uncertain. But the deals will return, and investor optimism will likely come back alongside them.”

The executive attributed both Forager funds’ outperformance in the past 12 months to “capitalising on widespread over-reactions, and being willing to change our minds as the evidence came to hand”.

“In the enterprise software sector, we’re doing both.”

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Tony Yoo owns shares of Altium, Appen Ltd, Elmo Software, and Nearmap Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Altium and Elmo Software. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Appen Ltd, Bravura Solutions Ltd, Infomedia, Integrated Research Limited, LIVETILES FPO, Nearmap Ltd., and Readytech Holdings Ltd. The Motley Fool Australia has recommended Bravura Solutions Ltd, Elmo Software, Infomedia, IRESS Limited, LIVETILES FPO, Nearmap Ltd., and Readytech 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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