At lunch on Tuesday, the S&P/ASX 200 Index (ASX: XJO) is on course to start the month on a disappointing note. The benchmark index is currently down 0.5% to 7,127.5 points.

Here’s what is happening on the market today:

A2 Milk share price rises

The A2 Milk Company Ltd (ASX: A2M) share price is pushing higher on Tuesday amid potentially positive news out of China. According to China’s official news agency Xinhua, the government will support couples who wish to have a third child. This compares to a limit of two previously. The government made the move in response to the country’s ageing population. The new policy is aimed at raising China’s fertility rate, which bodes well for infant formula demand.

Mining giants rise

Mining giants BHP Group Ltd (ASX: BHP), Fortescue Metals Group Limited (ASX: FMG), and Rio Tinto Limited (ASX: RIO) are trying the best to lift the ASX 200 on Tuesday. All three miners are pushing higher at lunch. This appears to have been driven by a rise in the iron ore price overnight. According to Metal Bulletin, the spot iron ore price climbed 4.4% to US$198.83 a tonne following a rise in Chinese steel prices.

Woolworths completes Quantium investment

The Woolworths Group Ltd (ASX: WOW) share price is trading lower despite announcing the successful completion of its Quantium transaction. According to the release, this transaction has strengthened its partnership with the data science and advanced analytics business, increasing its shareholding from 47% to 75%. Woolworths paid $223 million for the additional stake. CEO Brad Banducci commented: “Through this transaction, we aspire to bring together Quantium’s advanced analytics capability and Woolworths Group’s retail capabilities to unlock value across our entire retail ecosystem.”

Best and worst ASX 200 performers

The best performer on the ASX 200 on Tuesday has been the a2 Milk share price with a gain of 3%. This follows changes to China’s two-child policy. The worst performer has been the Pointsbet Holdings Ltd (ASX: PBH) share price with a 4% decline. This is despite there being no news out of the sports betting company.

More reading

• Falling from record highs, why the BHP (ASX:BHP) share price couldn’t keep it together in May
• Woolworths (ASX:WOW) share price lower despite investment update
• Expected spike in Aussie dollar to >US80 cents spells trouble for these ASX shares
• These were the best performing ASX 200 shares in May
• Why the a2 Milk (ASX:A2M) share price crashed 23% in May

The post ASX 200 down 0.5%: A2 Milk rises, Woolworths completes Quantium transaction appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/2TlH5F9

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

There are many things that can keep you from becoming a millionaire, like not having enough disposable income or an adequate amount of time. But if you have money that you can spare, the right time horizon, and the risk tolerance for stocks, it can be done — and with less money than you probably think you need every year.

In your quest, just make sure you avoid these three things. 

Not having a plan 

Making a plan can help you become a millionaire and it starts with actually setting the goal of accumulating $1 million. Then you can evaluate where you are now, and make a roadmap for how you will reach your goal. This will include things like how much you will save each year, the rate of return that you will receive, and for how long you will do it. For example, if you plan on saving your money for retirement in 30 years and can invest $5,000 each year, you will need a rate of return on average of 10.72% each year. And you could’ve reached it by investing in the S&P 500 between January 1991 and December 2020.

If you could invest more every year, you could reach your goal in less time or with a more conservative rate of return. If you can invest $7,000 a year for 27 years, you could reach $1 million at this same rate of return. Or if you invested $7,500 annually, you would only need an 8.5% rate of return on average — which you could’ve gotten by taking a lot less risk with a portfolio of 50% stocks and 50% bonds. 

Lack of consistency

Part of growing your accounts to $1 million involves consistency. Some things you can’t do anything about, like market conditions. But you can control how consistently you stay invested. And missing just one of the best years of stock market performance could drag your average rate of return down. If instead of beginning in January 1991, you had invested in the S&P 500 from January 1992 until the end of December 2020, your average rate of return would’ve been 10.1% because you would’ve missed a positive return of 31% in 1991. And this difference in your average rate of return would’ve resulted in $125,000 less over 30 years.

Not saving as much or missing years of saving could also impact your overall growth. If you’d only saved for 25 years instead of 30, your investment would’ve grown by $400,000 less. And if you could’ve only invested $4,000 a year for the 30 years you would’ve ended up with almost $200,000 less.

Not tracking progress 

As much as you hope that your plan will go off without a hitch, it’s possible that not everything will go the way you want it to. Maybe you miss a year of saving or can’t save as much as you intended. Or maybe you sold out of your investments in a panic and the rate of return that you received on average was a lot lower than expected. 

You can’t go back in time and change these actions, and obsessing over it won’t help you reach your endpoint any faster. Instead, regularly tracking your progress along the way can help you course-correct. If you discover that the original plan you put in place will no longer get you where you want, it’s possible that you won’t reach your goal. But if you catch it soon enough, small adjustments like saving more or increasing your time horizon may help you get back on track. 

There are a lot of things that can get in the way of you becoming a millionaire. But there are also some things that you can control, like having a plan, being consistent, and reviewing your plan along the way. And even if you don’t make it to millionaire status, developing these investing habits can still help you grow your wealth considerably.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• Why the MetalsTech (ASX:MTC) share price is rocketing 81% higher
• The Nine (ASX:NEC) share price is up on deals with Google and Facebook
• The PayGroup (ASX:PYG) share price jumps 6% on record FY21 results
• Immutep (ASX:IMM) share price bounces on new supply deal
• Brokers think these 2 top ASX shares are buys in June 2021

The post 3 things holding you back from millionaire status appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

from The Motley Fool Australia https://ift.tt/3c56F7O

The Blackstone Minerals Ltd (ASX: BSX) share price is down 5.33% in morning trade.

Below we take a look at the latest drill results from the ASX resource explorer.

What drill results did Blackstone report?

Blackstone Minerals’ share price is moving lower today. This negative movement comes despite the company reporting positive results from its latest assays. The results come from an ongoing resource extension drilling campaign at its King Snake Massive Sulfide Vein (MSV) prospect.

King Snake is situated within Blackstone Minerals’ Ta Khoa project in Northern Vietnam. In particular, the project is focused on nickel, copper, and platinum group elements (PGE).

New intersections from the latest drilling, combined with historic results, have defined a strike length of roughly 900 metres at King Snake. The company said this includes “MSV, semi-massive sulphide vein (SMSV) and disseminated sulfides (DSS)”.

Furthermore, Blackstone Minerals in-house geophysics crew will now perform Downhole Electro-magnetic (DHEM) surveys at King Snake. These surveys have the potential to identify new sulphide targets at depth. Additionally, they will also “inform infill drilling” at its King Snake prospect.

Commenting on the latest results, Blackstone Minerals’ managing director Scott Williamson said:

King Snake is our most exciting active MSV drill target and we are pleased that it continues to deliver excellent results. The latest drill results have extended strike at the King Snake prospect and we look forward to assessing the outcomes of DHEM currently being performed by our in-house geophysics team.

Copper prices remain at near-record highs, with copper currently trading for US$10,258 (AU$13,322) per tonne. That’s up 142% from the US$4,790 per tonne that copper was trading for on 27 March 2020.

The price rise has largely been driven by supply shortages just as demand has grown. Copper is also in strong demand with massive new global infrastructure plans. Additionally, this demand is due to its prevalence in electric vehicles (EVs). EVs contain around 4 times as much copper as combustion engine vehicles.

Blackstone Minerals share price snapshot

Although the Blackstone Minerals share price is down 5.33% today, shares remain up 108% over the past 12 months. That handily outpaces the 24% gains posted by the All Ordinaries Index (ASX: XAO).

Year-to-date the Blackstone Minerals share price is down 9%.

More reading

• Why the MetalsTech (ASX:MTC) share price is rocketing 81% higher
• The Nine (ASX:NEC) share price is up on deals with Google and Facebook
• The PayGroup (ASX:PYG) share price jumps 6% on record FY21 results
• Immutep (ASX:IMM) share price bounces on new supply deal
• Brokers think these 2 top ASX shares are buys in June 2021

The post Why ASX resource explorer Blackstone Minerals (ASX:BSX) share price is tumbling today appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/2SFiRFE

The MetalsTech Ltd (ASX: MTC) share price has started the month in incredible form.

In morning trade, the gold explorer’s shares were up as much as 81% to a 52-week high of 34.5 cents.

The MetalsTech share price has since dropped back a touch but currently remains up 52% at 29 cents.

Why is the MetalsTech share price rocketing higher?

Investors have been driving the MetalsTech share price higher today following the release of an update on drilling activities at its flagship Sturec Gold Mine in Slovakia.

According to the release, the company has completed sixteen diamond drill holes as part of the company’s maiden underground drilling program from within the Andrej Adit. This signals the end of its phase 1 drilling program, with all assay results now received and analysed.

The good news is that the phase 1 drilling program has been a big success, with the company recording hit after hit of visible gold.

“Outstanding”

MetalsTech Chairman, Russell Moran, explained: “Our first diamond drilling campaign at Sturec has been nothing short of outstanding. We have hit visible gold in 9 out of 16 holes with bonanza hits in 11 out of 16 holes.”

“We continue to hit thick high grade gold intersections as we step out from the existing 1Moz+ resource. We are eagerly awaiting what we hope will be a significant upgrade to the resource model over the next few weeks and look forward to updating stakeholders on this.”

Mr Moran also added further drilling will soon commence and be funded by its recent deal with Lithium Royalty Corp.

He said: “Our recent $18 million deal signed with Lithium Royalty Corp, including a $6m cash payment to MetalsTech provides us with an opportunity to be more aggressive with our resource expansion drilling, which we will restart later this month.”

“We could not as for a better macro environment for the gold sector and we believe the timing for our planned scoping study later this year will be perfect. Your company is at the start of an exciting journey in 2021,” Mr Moran conclude.

The MetalsTech share price has now more than doubled in value since this time last week.

More reading

• The Nine (ASX:NEC) share price is up on deals with Google and Facebook
• The PayGroup (ASX:PYG) share price jumps 6% on record FY21 results
• Immutep (ASX:IMM) share price bounces on new supply deal
• Brokers think these 2 top ASX shares are buys in June 2021
• Here’s how Moderna plans to beat the biggest threat to its vaccine

The post Why the MetalsTech (ASX:MTC) share price is rocketing 81% higher appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3g2rcv9

Shares in Nine Entertainment Co Holdings Ltd (ASX: NEC) are gaining today after the company announced it has officially signed agreements with Facebook Inc (NASDAQ: FB) and Alphabet Inc‘s Google (NASDAQ: GOOGL) (NASDAQ: GOOG) following Australia’s News Media Bargaining Code.

At the time of writing, the Nine share price is $3.03, 2% higher than yesterday’s close.

The media company owns news outlets including 9 television, The Age, The Sydney Morning Herald, and the Australian Financial Review.

Nine’s deal is the result of a battle over the Australian Government’s proposed media code earlier this year that saw Facebook remove all Australian news from its platform.

Days after the stand-off between Facebook and Australian news media, the News Media Bargaining Code passed through Parliament. The code encourages news media companies to undertake commercial agreements outside of the code.

News Corporation (ASX: NWS) and Seven West Media Ltd (ASX: SWM) have already signed agreements with Google and Facebook.

Let’s take a look at the agreements driving the Nine Entertainment share price today.

Nine’s new deals

Nine Entertainment announced this morning that the media company has officially signed agreements with Facebook and Google.

While Nine hasn’t announced what it will be charging the tech giants, it expects revenue from the deals will boost its news media assets considerably.

According to Nine’s release, it expects its publishing division’s earnings before interest, tax, depreciation, and amortisation (EBITDA) to grow by $30 million to $40 million as a result of its deals with Facebook and Google.

Nine states the growth will be due to the fees charged to Facebook and Google, the end of an earlier agreement on Google’s advertising sales revenue, and increased customer subscriptions.

According to anonymous sources quoted by The Age, Nine is charging Google around $45 million annually to use its news content. That’s about double what it’s said to be charging Facebook.

The deal between Nine and Facebook will see Nine’s news video clips and articles posted on the social media platform. It has a minimum amount payable and a 3-year term.

Through Nine’s agreement with Google, Nine will supply news content for Google’s News Showcase and the platform’s other news products. Google will also expand its marketing on Nine’s platforms. Google will not be sharing videos from Nine’s media brands.

Nine stated the costs to Google will involve a fixed annual fee with modest growth in its early years. Nine’s deal with Google will cover a 5-year period.

Nine Entertainment share price snapshot

The Nine Entertainment share price has been performing well on the ASX lately.

Currently, it’s 30% higher than it was at the start of 2021. It’s also gained 102% since this time last year.

The media company has a market capitalisation of around $5 billion, with approximately 1.7 billion shares outstanding.

More reading

• News Corp (ASX:NWS) share price slides amid FOX Bet rumours
• Leading brokers reveal 2 ASX shares to buy right now
• Why the Nuix (ASX:NXL) share price tumbled 5% today
• This tech ETF has returned 30% for ASX investors in the past year
• Are the FAANG stocks still good buys today?

The post The Nine (ASX:NEC) share price is up on deals with Google and Facebook appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3icHDI5

The PayGroup Ltd (ASX: PYG) share price has bounced strongly off record all-time lows, reaching an intraday high of 48.5 cents this morning. The company announced a record set of FY21 results after market close on Monday.

At the time of writing, the PayGroup share price is trading at 46.5 cents, up 5.68%.

PayGroup provides payroll and cloud-based Software as a Service (SaaS) human resource solutions. The company has a turnover of more than 6 million payslips and transactions per year for clients in more than 40 countries.

Why the PayGroup share price is bouncing off record-lows

PayGroup achieved its maiden full year of positive earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $1.6 million compared to its $0.6 million loss in FY20. Factors including improved operating leverage attributable to higher revenue, strong sales momentum and disciplined management of operating costs helped drive its financial performance.

In FY21, PayGroup achieved a record exit annualised recurring revenue of $27.2 million, a 53% increase on FY20 figures. This translated to a $16 million in revenue, representing 47% growth on FY20. Its increasing top-line growth was driven by an increase in payslips processed, combined with organic growth across its human capital management modules.

The company’s strong financial performance was underpinned by record new contract wins during FY21, worth $13.7 million, representing a 149% increase on FY20 contract wins. The strong growth not only contributes to the company’s record financial performance but also reflects the growing demand for its solutions and broader demand for the digitisation of human resource functions.

The company successfully completed 4 acquisitions in FY20, significantly expanding its market opportunity and capabilities. The announcement highlighted an expansion in its human resource management offering, with 11 new high margin modules and the addition of a highly specalised franchise payroll vertical.

Despite the company’s market capitalisation of just ~$50 million, it remains “well capitalised” with $12.2 million of cash at 28 May 2021.

The PayGroup share price has taken a beating in recent months, from highs of 75 cents in January to a close of 44 cents on Monday. It’s a positive to see an upbeat FY21 performance bringing life back to its share price on Tuesday.

Management commentary

PayGroup managing director and founder Mark Samlal commented on the results, saying:

We are extremely proud of the record results we have achieved in FY21. Despite the significant disruption to economies and markets as result of the global pandemic, PayGroup has delivered its first full year of positive EBITDA alongside strong ARR and statutory revenue growth.

We are excited by the opportunities ahead in FY22 underpinned by the strong momentum of FY21 and the significant digitisation tailwinds we have observed over the past year. The scale we continued to achieve across the business provides a strong foundation for sustainable long-term growth

Outlook

Another potential driver for the PayGroup share price today is the strong momentum its carrying through to FY22.

The results highlight continued industry tailwinds that the company anticipates will present further opportunities to growth revenues, as businesses increasingly look to digitise their human resources activities.

Paygroup expects its investment into its sales team in FY21 to continue to pay dividends. Alongside plans to further drive its operating leverage through the continued monetisation of activities which is expected to improve margins.

More reading

• Immutep (ASX:IMM) share price bounces on new supply deal
• Brokers think these 2 top ASX shares are buys in June 2021
• Here’s how Moderna plans to beat the biggest threat to its vaccine
• Starpharma (ASX:SPL) share price pushes higher on COVID-19 product update
• Why the Infomedia (ASX:IFM) share price is jumping 8% today

The post The PayGroup (ASX:PYG) share price jumps 6% on record FY21 results appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3i8i0Im

The Immutep Ltd (ASX: IMM) share price is bouncing around today after the biotechnology company announced it has teamed up with a new German partner for a cancer study.

After rising and falling several times during early trade, Immutep shares are currently trading 1.43% higher at 71.5 cents.

Immutep enters collaboration for clinical trial

Immutep, which develops products to treat cancer and autoimmune diseases, has signed a new collaboration and supply agreement with Merck KGaA, Darmstadt, Germany. Judging by the rollercoaster performance of the Immutep share price so far today, it seems investors have mixed feelings about the company’s latest news.

The two companies will team up for a phase I/IIa clinical trial in patients with solid tumours. The study, titled INSIGHT-005, will evaluate the feasibility, safety and efficacy of Immutep’s lead product candidate, eftilagimod alpha (efti or IMP321) when given in combination with bintrafusp alfa (M7824).

M7824, developed jointly by Merck, Darmstadt, Germany and GlaxoSmithKline, is an investigational bifunctional fusion protein immunotherapy.

Immutep stated: “Bintrafusp alfa aims to block two immunosuppressive pathways, TGF-β and PD-L1, while efti activates antigen presenting cells, via the LAG-3 – MHC II pathway.”

In layman’s terms, efti works by controlling signalling pathways and activating T-cell function, while M7824 removes two brakes to allow the immune system to kill cancer cells.

The INSIGHT-005 trial will be conducted by the Institute of Clinical Cancer Research, at Krankenhaus Nordwest in Frankfurt, Germany. Subject to regulatory and ethics committee approval, the first patient is expected to be enrolled in mid-2021. First data is estimated to be available in early 2022.

Management commentary

Immutep CEO Marc Voigt said:

Through INSIGHT-005, we plan to explore the effect of releasing the brakes and pushing the accelerator of the body’s immune system in three different positions of the cancer immunity cycle. The new trial builds on our knowledge and the encouraging data from the INSIGHT trial of efti, also in solid tumours. We are excited about this new clinical collaboration which allows us to extend and strengthen our relationship with an existing partner in a new and exciting setting, particularly at a time when there is growing awareness and validation of the LAG-3 MHC class II interaction.

Dr Salah-Eddin Al-Batran, lead investigator of INSIGHT-005, added:

We are very pleased to be expanding our involvement with Immutep to explore efti in a new combination with bintrafusp alfa. Our experience and knowledge of efti, combined with our extensive nationwide network of more than 500 German clinical facilities, means we are well equipped to lead the INSIGHT-005 study.

How has the Immutep share price been performing?

Immutep shares have jumped by more than 250% over the past 12 months, and are up by around 70% year to date.

Based on current valuations, Immutep has a market capitalisation of about $497 million, with approximately 696 million shares on issue.

More reading

• Why the Immutep (ASX:IMM) share price rocketed 14% today

The post Immutep (ASX:IMM) share price bounces on new supply deal appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3fDvIRL

It’s the start of another month. Brokers have picked out a couple of ASX shares that could be really good opportunities to think about in June 2021.

But it’s not just one broker that likes the below businesses. There are actually a number of analysts that like the below ideas:

Australian Finance Group Ltd (ASX: AFG)

There are currently at least three brokers that like this large mortgage broking business. One of those brokers that like Australian Finance Group is Macquarie which has a price target of $3.06, which gives it a potential upside of almost 10% over the next 12 months.

Macquarie pointed out that the ASX share’s net interest margin (NIM) is doing well thanks to the lower funding costs.

In the third quarter of FY21, the business’ brokers lodged a record $20.6 billion in home loan applications. That was a 3.79% increase on the prior quarter and a 34.32% increase year on year.

Australian Finance Group said that record low interest rates, effective government stimulus packages and an improving consumer outlook have contributed to increased activity.

Quarter on quarter, NSW lodgements were up 9.37% and Victorian lodgements were up 6.6%.

Rising house prices have contributed to a fall in the loan to value (LVR) ratio. The national average LVR is down from 73.3% to 71.9%. The national average mortgage size has increased by 5.9% to $574,948.

Australian Finance Group disclosed that first home buyer activity has slowed, down from 22% to 18%, but this figure is still historically high. The ASX share commented that the state and federal government incentive schemes have done their job and likely pulled forward some demand.

Using Macquarie estimates, the Australian Finance Group is valued at 15x FY21’s estimated earnings with a grossed-up dividend yield of 6.3%.

Ramelius Resources Limited (ASX: RMS)

Ramelius Resources is one of the gold miners on the ASX, with its operations in Western Australian. It operates the Mt Magnet, Vivien, Edna May and Marda gold mines. It also has the Tampia and Penny gold projects.

It’s currently rated as a buy by at least three brokers, including Morgan Stanley which has a price target of $2.30 on the business.

The broker thinks that the gold miner can continue to generate good cashflow to pay dividends, fund growth and perhaps even find some acquisitions.

In its quarterly update for the period to 31 March 2021, it saw group gold production of 66,029 ounces, which was within its production guidance of 65,000 ounces to 70,000 ounces.

The gold miner’s all-in sustaining cost (ASIC) was AU$1,370 per ounce, though this was at the top of the guidance.

For the quarter, Ramelius said it generated A$38.7 million of underlying cash flow, after excluding the FY20 tax payment and Tampia farm and minority joint venture acquisitions.

For FY21, it’s expecting to produce between 275,000 ounces to 280,000 ounces at an ASIC of between A$1,280 to A$1,330 per ounce.

According to Morgan Stanley, the gold miner is valued at 15x FY22’s estimated earnings with a projected grossed-up FY22 dividend yield of 4.7%.

More reading

• Could it be time to give ASX gold shares another chance?
• 2 ASX shares rated as strong buys by brokers

The post Brokers think these 2 top ASX shares are buys in June 2021 appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3c7daHf

Australia and New Zealand Banking Group Ltd (ASX: ANZ) shares edged lower on opening. At the time of writing, the ANZ share price is down 0.77% to $28.49. Comparatively, the S&P/ASX 200 Index (ASX: XJO) is down 0.29% at the time of writing.

Below we look at the details of the bank’s $1 billion capital raising plans.

How will the bank raise $1 billion?

ANZ shares are edging lower after the big 4 bank announced its intention to raise $1 billion in new tier 1 capital.

The company will raise the funds via its new ANZ Capital Notes 6 (CN6), saying it has the ability to raise more or less than $1 billion.

Under a reinvestment offer, investors holding existing ANZ Capital Notes 1 (CN1) can apply to sell some or all of those holdings. Furthermore, this will then be reinvested into the new CN6 notes. The CN1 notes were issued in August 2013.

Current holders of ANZ shares who wish to participate in the new CN6 offer or the reinvestment offer are looking at a closing date of 30 June.

The company points out that, “ANZ Capital Notes 6 are complex, involve increased risks compared to other less risky and less complex bank investments such as deposits and may not be suitable for all investors.”

The bank said it expects the offer to open on 9 June. It will use the newly raised funds both for general corporate purposes and refinance CN1.

ANZ shares snapshot

ANZ shares first listed in Australia way back in 1969. These days the bank counts amongst the largest listed companies on the ASX 200. The company also has a market cap of $81.7 billion.

ANZ shares are also well known for providing a reliable dividend stream. At the current price of $28.49 per share, the bank pays an annual dividend yield of 3.68%, fully franked. 

Atop dividends, shareholders have also enjoyed some outperforming capital gains over the past year. This is due to ANZ shares being up 59% over the past 12 months. By comparison, the ASX 200 has gained 23% over that same time.

Year-to-date ANZ shares are up 25%. 

More reading

• ASX 200 Weekly Wrap: ASX record highs tumble like… Costa shares
• ANZ and BHP among ASX 200 shares aiming for 40% female leadership
• Mosaic Brands (ASX:MOZ) share price rockets 21% on business update
• Is the ANZ (ASX:ANZ) share price a buy for June 2021?
• 2 blue chip ASX dividend shares analysts are tipping as buys

The post ANZ (ASX:ANZ) shares in focus on $1 billion raising announcement appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3fXdZ6D

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Moderna‘s (NASDAQ: MRNA) vaccine is successfully helping people avoid the coronavirus. The billion-dollar product has demonstrated more than 90% efficacy in adults. And new data show it’s 100% effective in teens. But Moderna faces one big challenge that could wreak havoc on how well its vaccine protects the population. And that’s the rapid emergence of variants.

The vaccine has handled them so far. Moderna even says one of its booster candidates may be ready by fall. One of the candidates specifically targets the South African variant. But the biotech company realizes it can’t constantly chase the next variant. It has to stay a step ahead. Let’s take a closer look at how Moderna plans to do that — and what it means for investors.

Investing “intensively”

Moderna gave us a hint a few weeks ago. During the company’s earnings call, CEO Stephane Bancel emphasized Moderna’s commitment to artificial intelligence (AI). He said the company planned on investing “intensively” in AI, automation, and digital over the coming five to 10 years.

Fast forward a few weeks to the company’s annual Science Day. Here, Moderna said one major way to stay ahead of variants involves AI and machine learning. They help predict strains that may “escape” protection provided by current vaccines. Based on this, Moderna will be able to create next-generation vaccines and boosters before need becomes critical.

Researchers worldwide have made available on a database more than one million genome sequences of SARS-CoV-2 since the virus emerged. Moderna uses a special app to quickly review sequences as soon as they appear. The company then selects variants to explore in-depth.

From here, Moderna examines the situation from various angles and using various tools. Researchers look at the prevalence of particular variants over time by location. They use structural mapping of neutralizing antibody contact sites to determine where “escape” from protection is likely to happen. And they perform deep mutational scanning on a library of mutations. This helps scientists understand the possible mutations available to a virus so that it may continue to progress and infect. Moderna also examines sequencing information from coronavirus infections that may occur in its clinical trials or out in the real world.

Tomorrow’s coronavirus

All of this is key for one big reason: The coronavirus we’re fighting today may not be the same as the one we’ll fight a year from now. We’ve seen a steady emergence in variants over the past several months. It’s possible that will continue. To maintain leadership, companies must be able to address new variants before they gain ground.

Moderna is a leader now. The company is set to generate $19.2 billion in product revenue this year according to advance purchase agreements. And the potential availability of a booster this fall may get the ball rolling when it comes to handling variants. But what makes me even more confident about Moderna’s prospects in the coronavirus space are the efforts to stay ahead of the variants rather than chase them.

Of course, rivals are working to handle variants too. Pfizer is testing a variant-specific vaccine and expects to report data this summer. Smaller rival Inovio Pharmaceuticals is investigating a “pan-COVID” vaccine to handle all variants — the company expects to start a clinical trial this year.

But here are two reasons why that shouldn’t worry Moderna investors. First, considering the worldwide need for vaccination, there is room for more than one player to generate billions annually in this space. And second, from a timeline and technology perspective, Moderna seems to be ahead of the pack right now. So, Moderna has a good chance of becoming a leader when it comes to handling variants.

All of this means Moderna’s nearly 180% share price gain over the past year isn’t the end of the story. It’s probably just the beginning. It’s important to remember that the stock is trading at only seven times forward earnings estimates. And it’s trading at 26 times sales.

MRNA PE Ratio (Forward) data by YCharts

Considering these numbers and the points I mention above, Moderna shares aren’t expensive at these levels. The good news for Moderna investors and potential investors? It’s not too late to get in on shares of this biotech company — and reap rewards over the long term.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• CSL (ASX:CSL) share price backtracks despite renewed optimism
• Australia eyes Moderna (NASDAQ:MRNA) COVID-19 vaccine delivery
• What the Federal Budget could mean for CSL (ASX:CSL) shares
• Should you worry about this threat to Moderna’s vaccine?
• Moderna just made the Pfizer vaccine’s biggest weakness an even bigger one

The post Here’s how Moderna plans to beat the biggest threat to its vaccine appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

from The Motley Fool Australia https://ift.tt/3i6z3un