Shares in Advanced Human Imaging Ltd (ASX: AHI) are trading modestly today despite news the company’s DermaScan AI has received European medical device approval. In earlier trade, the Advanced Human Imaging share price jumped more than 6% but has since retreated. At the time of writing, the company’s shares are fetching $1.495, up 0.34%.

Today’s news means the company’s DermaScan AI device can now be used in 27 European Union (EU) countries.

Advanced Human Imaging developed the smartphone-based skin scanner in partnership with Canadian company Triage Technology Inc. It uses Triage’s artificial intelligence (AI) technology to identify 588 skin conditions. The company claims the program is, on average, more effective than dermatologists.

Advanced Human Imaging also announced Triage has signed a distribution agreement with SkinHealth Canada. The agreement will see more than 2,000 Canadian healthcare professionals use the program.

Let’s take a closer look at the news.

DermaScan AI approval

Having received EU approval, DermaScan AI will be available to more than 20,000 clinicians and dermatologists in Europe. It’s already used by more than 20,000 medical professionals worldwide.

Advanced Human Imaging expects the technology will also receive US Food and Drug Administration approval later this year.  

The company plans to release DermaScan AI as a part of its smartphone-based CompleteScan platform in the third quarter of this year.

CompleteScan is a group of programs that use images from smartphone cameras to analyse a person’s risk of health conditions and monitor existing health conditions.

Currently, the CompleteScan platform includes BodyScan and FaceScan. BodyScan analyses a person’s body composition and chronic disease risk, while FaceScan analyses a person’s vital signs, such as blood pressure, heart rate, and respiratory rate.

Once DermaScan AI is incorporated into CompleteScan, it will be available in 200 countries worldwide.

Commentary from management

Advanced Human Imaging CEO Vlado Bosanac commented on DermaScan AI’s EU approval, saying:

This opens up the market significantly for AHI and Triage… More importantly it validates the Derma AI as credible, allowing medical practitioners access to the technology in their day-to-day practices… We are combining the Derma AI into the CompleteScan platform, which will allow our partner’s users an ability to perform an extensive number of health checks via the CompleteScan platform.

Advanced Human Imaging share price snapshot

Advanced Human Imaging shares are having a strong year so far on the ASX.

Currently, the Advanced Human Imaging share price is sitting around 24% higher than it was at the end of 2020. It’s also gained a whopping 740% since this time last year.

The company has a market capitalisation of around $204 million, with approximately 136 million shares outstanding.

More reading

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• Advanced Human Imaging (ASX:AHI) share price is sinking, but why?
• Advanced Human Imaging (ASX:AHI) share price sinks despite positive update

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The Reserve Bank of Australia (RBA) has made it clear what it expects the monetary policy framework to look like in Australia for the next several years.

Ever since the COVID-19 pandemic shuddered the global economy last year, the RBA has insisted interest rates will stay at the record-low level of 0.1%. It says this will remain as long as it takes to get the economy running hot again. 

Just this month, the RBA’s minutes revealed it sees no reason to change its predictions, despite the strengthening economy, and signs of substantial inflationary pressures over in the United States.

Here’s some of what the RBA said in a statement on 7 May:

The board is committed to maintaining highly supportive monetary conditions to support a return to full employment in Australia and inflation consistent with the target.

It will not increase the cash rate until actual inflation is sustainably within the 2 to 3 percent target range.

For this to occur, the labour market will need to be tight enough to generate wages growth that is materially higher than it is currently. This is unlikely to be until 2024 at the earliest.

Will interest rates stay low forever?

Case closed, then? Well, perhaps not.

If economic changes force its hand, the bank could have no choice but to hike rates earlier than it had flagged.

Another big factor at play is what the rest of the world is doing. One of the reasons rates are at record lows is because they are also at record lows across most other advanced economies.

Europe, the United Kingdom, the United States and Japan all have an official interest rate that looks similar to ours.

And that includes New Zealand, which has an interest rate of 0.25%.

But our brothers and sisters across the ditch may be the first country to move on interest rates. 

According to a report in the Australian Financial Review (AFR) this week, the Reserve Bank of New Zealand (RBNZ) has signalled it might start raising New Zealand interest rates far sooner than the RBA.

Rate hike across the ditch?

The statement the RBNZ released yesterday stated the following:

The Committee agreed to maintain its current stimulatory monetary settings until it is confident that consumer price inflation will be sustained near the 2 percent per annum target midpoint, and that employment is at its maximum sustainable level. Meeting these requirements will necessitate considerable time and patience.

However, the AFR report notes that forecasts released alongside this statement show the bank is pencilling in a cash rate of 0.67% by December 2022. And one close to 1.5% by December 2023.

Now that’s a whole lot different from what the RBA is saying.

So if New Zealand does indeed hike its interest rates along these lines, it could well signal some pressure on the RBA’s own timeline.

All investors should be watching these developments closely since interest rates have a very real effect on asset valuations like ASX shares.

The general rule is higher rates equal lower share prices. That’s something we all might have to deal with if the RBA ends up following the RBNZ.

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The Life360 Inc (ASX: 360) share price has been a very strong performer in 2021.

Since the start of the year, the technology company’s shares have stormed 49% higher.

What is Life360?

Life360 is a San Francisco-based technology company. The company’s core offering is the Life360 mobile app. It is a market leading app for families providing features such as communications, driving safety, and location sharing. At the end of March, it had more than 28 million monthly active users globally.

Despite facing tough trading conditions during COVID-19 (lockdowns, lower mobility), Life360 still delivered a 39% increase in normalised revenue to US$81.6 million during the 12 months ending 31 December.

Positively, with COVID-19 headwinds starting to ease, management is confident that its growth will continue in FY 2021. It is targeting Annualised Monthly Revenue in the range of US$110 million to US$120 million, which will be a 23% to 34% increase year on year.

Is the Life360 share price in the buy zone?

Although the Life360 share price has been on fire this year, Bell Potter remains bullish. The broker currently has a buy rating and $7.00 price target on its shares.

Based on the latest Life360 share price, this implies potential upside of 20% over the next 12 months.

It was pleased with its recent acquisition of Jiobit and believes it has a long runway for growth. Bell Potter also suspects that more acquisitions could be coming.

The broker explained: “When Life360 announced the proposed acquisition of Jiobit in late April it also said “the company will continue to evaluate both strategic and financial opportunities” and “this includes larger acquisitions … with a focus on companies in the insurance vertical”. We therefore believe another acquisition is likely in the coming months in the insurance space but it is unclear exactly what type of company this will be (i.e. an insurance carrier, a managing general agent (MGA), an insurance agent?).”

“Our view is the most logical acquisition for Life360 in the insurance vertical is a digital insurance agent in the US given this is consistent with where the insurance market is heading (i.e. online sales) and is in the tech space. It is also compelling given the large and very engaged user base of Life360 in the US which serves to significantly lower the typically high customer acquisition cost for an insurance agent.”

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The post Up 49% in 2021: Can the Life360 (ASX:360) share price keep climbing? appeared first on The Motley Fool Australia.

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The Recce Pharmaceuticals Ltd (ASX: RCE) share price has been a strong performer on Thursday.

In afternoon trade, the biotechnology company’s shares are up 8.5% to $1.13.

Why is the Recce share price surging higher?

Investors have been bidding the Recce share price higher today following the release of a promising update.

According to the release, the company has announced positive results from a pre-clinical study investigating the Mechanism of Action (MoA) of its lead compound RECCE 327 (R327).

The company notes that R327 is a broad-spectrum synthetic anti-infective that has the potential to address the urgent global health threat posed by antibiotic resistant superbugs and emerging viral pathogens.

Recce advised that the study was performed by independent, world leaders in bacterial MOA analysis and antibiotic profiling.

What were the results?

The release explains that R327’s MoA was “unlike that of any antibiotic seen before” with multiple mechanisms identified in the study. These will be presented at an upcoming World Microbe Forum in June.

In addition, the study showed that R327 was rapidly and irreversibly bactericidal against Gram-negative Escherichia coli (E. coli) bacteria, in both active and stationary phase cells. Positively, it outperformed the best in class commercial antibiotics.

Management notes that current antibiotics rarely retain bactericidal activities against non-dividing bacterial cells. However, R327 shows significant activity against both slow-growing bacteria and actively dividing cells, thereby enabling continuous treatment of infections throughout the bacterial cell life cycle.

Recce’s Executive Director & Chief Scientific Officer, Michele Dilizia, commented: “The data from this study further supports the potential of RECCE 327 to provide a novel and universal way to treat harmful infections. We are excited about these highly encouraging results as they provide important insights regarding how RECCE 327 is able to work repeatedly against the same strain of bacteria and their superbug forms.”

More reading

• Why the Recce Pharmaceuticals (ASX:REE) share price is storming higher today

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My portfolio went up 2% on Tuesday.

If you think that’s impressive, then no, I’m not boasting.

If you think that’s unimpressive, I’m tipping you’ve spent too long trading cryptocurrencies!

2% is, in the context of a single day’s market trade, unusually good.

Better, considering the market was only up 1% the same day.

But still, I’m not boasting.

See, the ASX gains an average of something like 10% per year, inclusive of dividends.

Let’s assume dividends are around 4% per annum (a reasonable guess, given an ASX 200 ETF is paying out 2.84%, but the banks are yet to get back to pre-COVID dividend levels), and the Year 1 maths says that the average share price gain is around 6%.

That means I got a full one-third of the average yearly gain in a day.

The market went up by one-sixth of the same benchmark.

No. Still not boasting.

Exactly the opposite.

Because when we talk about the ASX’s average yearly gain, that hides a helluva lot of volatility.

So yes, it was nice to make 2% on Tuesday.

But some of those winners — including companies I own like Kogan.com Ltd (ASX: KGN) and Corporate Travel Management Ltd (ASX: CTD) — have had a helluva last 6, 12 and 18 months.

In the last 12 months, CTM has been as low as $8 and as high as $22.

Kogan has been as high as $25 and as low as $8.70.

Kinda makes that 2% rise, though welcome, look a little anaemic, doesn’t it?

(And Kogan fell 6% yesterday. Did I mention the ASX can be volatile?)

Don’t get me wrong: I reckon you should take the wins when you get ‘em.

But remember there’ll be bad days, too.

And that the number of ‘up’ days is often not that many more than the ‘down’ days… but the net result of all of those ups and downs tends to be up, over time.

It’s why paying attention to short term movements is usually counterproductive.

You can’t just have the good days.

You can’t avoid the bad days.

You’ve gotta take the bad with the good.

I wish I could make it different, but I can’t.

So yep, I really enjoyed Tuesday.

Yesterday? Not so much.

But better than both is getting to a point where you realise that neither is important in the overall scheme of things.

You need to learn to enjoy the good days a little less… because that also helps the bad days hurt less.

And, in the long run, that helps you avoid acting out of fear, greed, pain or pleasure.

It puts your rational brain back in charge of your emotions.

Hard, but worthwhile.

And, in all probability, much more profitable.

See you tomorrow at our Live Facebook Q&A!

Fool on!

More reading

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• Got money to invest? Here are 2 ASX shares that could be buys
• 2 ASX 200 blue chip shares that might be the best to buy

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Until now, Magellan Financial Group Ltd (ASX: MFG) was mostly known for its suite of listed managed funds. Or Listed Investment Trusts (LITs) if you want to get technical.

Over the past decade or so, these funds have become some of the most popular managed investments on the ASX.

Take the Magellan Global Fund (ASX: MGF). It’s a globally focused fund that holds companies such as Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) and Netflix Inc (NASDAQ: NFLX).

It targets both capital preservation and strong compounding returns. As of 30 April, it was worth a staggering $3.18 billion.

Historically, Magellan has been famous for this kind of fund. As far back as 2019, Magellan was flagging a retirement-focused product for its massive base of retail investors.

Until today, it had been very coy on what exactly this might be, only ruling out that it would be an annuity-style product.

But that could be about to change after Magellan finally revealed some details about its new retirement-focused product. An ASX release this morning sheds some light on this new offering.

A retirement fund?

According to the release, the new product will be known as ‘FuturePay’.

Magellan didn’t offer too much detail, instead spruiking that more information will be available at the product’s official launch on 1 June.

But here’s what Magellan CEO Brett Cains did say about the “upcoming retirement income-focused solution”:

We are pleased to announce the launch of Magellan FuturePay. We believe it will help address the challenges faced by many investors and their advisers, particularly those dealing with the problem of establishing a retirement income.

This is an important topic and I look forward to discussing our approach in further detail at our upcoming launch event.

However, a report in the Australian Financial Review (AFR) this morning has some more details.

The AFR says the fund will target an initial yield of 4.3% per annum. This will be paid monthly to investors, which Magellan aims to adjust for inflation and grow over time.

Like most of Magellan’s other funds, FuturePay will focus mostly on global equities. It will be able to divert profits in times of outperformance into a trust.

The fund will also reportedly be backed up with capital, and a loan facility capped at 2% of the fund’s value, from Magellan’s own balance sheet.

This structure will allow Magellan to smooth out its distribution payments over time, balancing out market gyrations.

It’s also estimated the new FuturePay fund will list on Wednesday 2 June, just after the official launch. It will reportedly list on the Chi-X exchange under the ticker code ‘FPAY’.

The fund will charge a management fee of 1% per annum.

About the Magellan share price

The Magellan share price has risen slightly on the back of this news.

Magellan Financial Group shares are up 0.48% at the time of writing, to $47.74. That’s largely in line with the S&P/ASX 200 Index (ASX: XJO).

This share price gives Magellan a market capitalisation of $8.74 billion, a price-to-earnings (P/E) ratio of 21.56 and a trailing dividend yield of 4.61%.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) has overcome a soft start and is pushing higher. At the time of writing, the benchmark index is up 0.25% to 7,109.8 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are falling:

ALS Ltd (ASX: ALQ)

The ALS share price is down 1.5% to $12.08. This decline appears to have been driven by a broker note out of Morgans this morning. According to the note, the broker has downgraded the testing services company’s shares to a hold rating with an $11.56 price target. This was made largely on valuation grounds after a strong rise.

Costa Group Holdings Ltd (ASX: CGC)

The Costa share price has crashed 22% to $3.48 following the release of its annual general meeting update. The horticulture company revealed that it is only expecting its first half performance to be marginally ahead of the prior corresponding period. This is being driven by weakness in its domestic operations and currency headwinds.

Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)

The Fisher & Paykel Healthcare share price has fallen 5.5% to $28.04. Investors have been selling the medical device company’s shares following the release of its full year results. Although the company reported a 56% increase in operating revenue to NZ$1.97 billion and an 82% jump in net profit after tax to NZ$524 million, its outlook appears to have spooked investors. Management warned that things were too uncertain to provide guidance.

Ramsay Health Care Limited (ASX: RHC)

The Ramsay Health Care share price is down 2.5% to $62.81. Investors have been selling the private hospital operator’s shares following the announcement of plans to acquire UK-based Spire Healthcare for approximately 1 billion pounds (A$1,822 million). Management expects the acquisition to be transformational for its UK business. Citi has responded by holding firm with its neutral rating and $67.00 price target. The broker appears uncertain whether it will achieve the synergies it is targeting.

More reading

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Sure, Fortescue Metals Group Ltd (ASX: FMG) and BHP Group Ltd (ASX: BHP) are leveraging sky-high iron ore prices and making a lot of money. But Champion Iron Ltd (ASX: CIA) just delivered an extraordinary jump in profits after announcing its FY21 results.

The market was quick to pick up on its success, with the Champion Iron share price jumping 7.4% to an intraday high of $7.06. Its shares have since pulled back, currently trading 4.26% higher at $6.86.

Champion Iron is an iron ore exploration and development company with a number of projects in Canada’s Québec region.

Champion Iron share price jumps on profit surge

Champion Iron announced its operational and financial results for the fourth quarter and fiscal year ended March 31, 2021.

The company delivered revenues of CA$1,281.8 million (A$1,366.8 million) in FY21, representing a 63% increase on FY20 figures. This translated into record FY21 net profits of CA$464 million (A$495 million), a 419% increase on the prior corresponding period.

During this period, Champion Iron produced 8,001,200 wmt of high-grade 66.4 Fe concentrate, compared to the 7,903,700 wmt for the same period in 2020.

The announcement highlighted a number of growth accomplishments in FY21 including the approval and decision to complete its Phase II expansion project. This move will double the production of its flagship Bloom Lake project to 15 Mtpa by mid-2022. In April 2021, the company also completed the acquisition of the Kami Project, a high-grade iron ore project located a few kilometres away from Bloom Lake.

Not only did Champion Iron deliver an outstanding financial and operational result, but the company has made a conscious effort to improve its environmental performance. The exceptional purity and quality of its iron ore significantly contributes to the reduction of greenhouse gas emissions in the steelmaking industry.

Why its been a volatile ride for iron ore miners

ASX iron ore miners have been all over the place as investors juggling sky-high iron ore prices of more than US$200/tonne against a steady stream of negative news from China.

China has made a number of announcements that could have significant ramifications for iron ore prices in the near term. This includes plans to increase its own domestic production, moves to strengthen its domestic management of commodities to fight against “unreasonable prices” and urging domestic players to safeguard price stability.

While the Champion Iron share price has managed to stand strong in recent weeks, other iron majors such as Fortescue and BHP have both slipped around 10% since mid-May.

More reading

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• ASX miners on edge as investors ask how low can the iron ore price go?
• Broker forecasts massive dividends from Fortescue (ASX:FMG) shares

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The Electro Optic Systems Holdings Ltd (ASX: EOS) share price is climbing today. The gains come after the company announced a partnership agreement with Diehl Defence.

In early afternoon trading, the communications, defence, and space company’s shares are fetching $4.06, up 3.31%.

Electro Optic Systems teams up with Diehl Defence

Investors are watching Electro Optic Systems shares following the release of the company’s latest update.

In its announcement, EOS advised it has signed a cooperation agreement with Diehl Defence.

Founded in 2004, Diehl Defence is a German arms manufacturer that primarily produces guided missiles and ammunition for armed forces.

The collaboration between the companies will see an initial focus “on the area of advanced stabilized and remotely operated weapon systems (RWS) for the European and NATO markets.”

According to Electro Optic Systems, its RWS technology is considered among the best in the world due to its accuracy, reliability and lightweight frame. The battle-proven system allows operators to access long-range and wide-area imagery of the battlespace. In addition, the RWS can also relay information to drones to lock onto targets for direct fire.

Under the cooperation agreement, an RWS production line will be established at Diehl’s facilities in Germany. From there, the technology will be transferred and integrated with Diehl products to cater for European defence forces’ requirements.

As well, both companies will work together on space and high-power electro-magnetics technologies. Electro Optic Systems hopes the partnership can lead to lucrative revenue opportunities with European and NATO defence forces.

Management commentary

Electro Optic Systems CEO Dr Ben Greene welcomed the partnership, saying:

This Cooperation Agreement with Diehl aligns companies that not only have complimentary and non-competing cutting-edge technologies, but organisational cultures and values that are strongly aligned. EOS is excited by the prospect of being able to offer and support our land and space technologies in conjunction with great German engineering know-how for the European and NATO markets.

Diehl Foundation board member and CEO of Diehl Defence Helmut Rauch added:

At Diehl we have a tradition of more than a hundred years of moving into new, demanding fields of technology on a proven foundation. Strategic partnerships are very important to our owner-managed company. The great technologies of EOS and the extraordinarily well-fitting corporate culture of EOS offer us excellent opportunities to develop a strategic business area.

About the Electro Optic Systems share price

It has been a difficult year for Electro Optic Systems shareholders, with the company’s share price tumbling by around 30%. EOS shares reached a 52-week high of $7.30 last year before positive investor sentiment wore off.

Electro Optic Systems has a market capitalisation of roughly $618 million, ranking 375th on the ASX.

More reading

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On Wednesday I looked at three ASX shares that brokers have given buy ratings to this week.

Unfortunately, not all shares are in favour with them right now. Three ASX shares that have just been given sell ratings by brokers are listed below. Here’s why these brokers are bearish on them:

Goodman Group (ASX: GMG)

According to a note out of Goldman Sachs, its analysts have retained their sell rating but lifted their price target slightly to $13.31. Goldman bearish view is due to its belief that the integrated property company’s shares are vastly overvalued compared to peers. It notes that Goodman’s Funds Management operations are valued at 32x estimated FY 2022 segment EBITDA. This compares to an average 20x estimated FY 2022 EBITDA for other US-listed Alternative Asset Managers covered by the broker. The Goodman share price is fetching $19.26 this afternoon.

Scentre Group (ASX: SCG)

A note out of Macquarie reveals that its analysts have retained their underperform rating and $2.62 price target on this shopping centre-focused property company. According to the note, the broker points to Scentre’s Bondi Junction mall in Sydney as proof that the leasing environment has disconnected from the strength in retail sales. It believes this disconnect will lead to vacant stores and negative leasing spreads, which will place pressure on underlying cash flows. The Scentre share price is trading at $2.68 today.

Zip Co Ltd (ASX: Z1P)

Analysts at UBS have retained their sell rating and cut their price target on this buy now pay later (BNPL) provider’s shares to $5.60. UBS feels increasing competition could be a problem and weigh on Zip’s margins. Particularly in the United States, where its QuadPay business enjoys higher than normal margins. In addition, the broker feels that the market underestimates the amount of capital required to support its growth, especially if competition increases. The Zip share price is trading at $7.16 on Thursday.

More reading

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