ASX dividend shares don’t generally garner the same media headlines as growth shares.

The reason is simple human nature.

If a company sees its share price rocket by 50% in a matter of months, the greed factor kicks in. By that I mean we all want to reap those kinds of stellar returns from our investments. And we tend to tune in to stories about huge share price growth to see how it was achieved.

On the other hand, an ASX dividend share that reliably returns a 5% annual yield to investors isn’t nearly as exciting. Even if it does manage some capital growth along the way.

But as long-term investors that’s okay. More than okay, in fact.

As a veteran buy-and-hold investor once told me, “If you want exciting, go to the casino.”

Real interest rates are already negative

The Reserve Bank of Australia (RBA) is adamant that the official cash rate will remain at a rock bottom 0.10% until 2024.

That in turn is keeping the lid on any kind of returns you can get from your cash savings.

Even a 24-month term deposit is unlikely to pay more than 1% interest. Factor in inflation, and any cash you have in a deposit account will be worth less in 2 years than it is today.

That means investors looking for positive real (inflation-adjusted) income streams need to look elsewhere.

Which brings us back to ASX dividend shares.

Robert Francis is the Australian managing director of online trading and brokerage company eToro.

When asked why investors should include dividend shares in their equity portfolio, Francis told The Motley Fool:

Dividend-paying stocks provide a reliable income and are known for being safer, reliable investments, especially compared to growth stocks or other investments that don’t pay dividends… As markets can be quite volatile, dividend-paying stocks allow investors to weather the storm, because the dividend provides returns regardless of a dip in the share price.

These stocks also have the potential to deliver substantial capital gains when held for a long period of time.

However, you can’t (generally) get something for nothing.

When it comes to dividend payments, Francis said, “The major disadvantage of paying dividends is the cash paid out to investors cannot be used to grow the business.”

Not all ASX dividend shares are created equal

Of course, that doesn’t mean you should go out and buy just any old dividend paying shares.

As with any investment, it’s important to do your research first. Look into the company’s historic and current dividend yields and its share price performance over time atop your other due diligence.

If you find what you think is a decent income paying share, see how it stacks up to its competitors. As Francis explains, that’s important because, “If a company’s dividend yield is significantly higher or lower than that of similar companies, it could be a red flag.”

Next, check out the payout ratio. According to Francis:

Investors should look at the stock’s payout ratio, which tells them how much of the company’s income is going toward dividends. 

A payout ratio that is too high, generally above 80%, means the company is putting a large percentage of its income into paying dividends. In some cases, dividend payout ratios can top 100%, suggesting the company may be going into debt to pay out dividends.

Common investing mistakes

Francis told us there are a few common mistakes investors in ASX dividend shares should avoid.

Namely:

• Investing in a particular stock, based entirely on hype instead of doing their own research into the company.
• Expecting to buy and sell shares just for the dividend.
• Focusing purely on high yield, high-risk strategies. And,
• Focusing on current, instead of future yields.

We also wanted to get Francis’ take on whether it’s better to buy shares before or after they go ex-dividend. He said:

While a stock’s dividend history plays into its popularity amongst investors, the announcement and payment cut-off dates also have an effect on its price.

The announcement date is important because a change in the expected dividend or distribution payment can cause the stock to quickly rise or fall, as investors respond to new expectations.

If you want in on the next dividend payments, you’ll want to buy shares before the ex-dividend date. Just be aware that shares tend to fall in value by roughly the amount of the upcoming payment on the day they go ex-dividend.

Two leading ASX dividend shares

One of the chief advantages of ASX dividend shares over most other international exchanges is that many offer franking credits. In a nutshell that means that you can deduct the corporate income taxes the company has already paid (generally 30%) from your own tax burden.

Dividends may be unfranked, partly franked, or wholly franked.

With that out of the way, there are a number of quality ASX dividend shares for you to consider adding to your portfolio.

We’ll look at 2 of those today.

First, Adairs Ltd (ASX: ADH).

The home furnishings retailer has more than 160 stores across Australia and New Zealand. And it has a lengthy track record of making both annual dividend payments, even in 2020 when many companies were forced to suspend payments.

At the current price of $4.18 per share, Adairs pays a dividend yield of 5.8%, 100% franked.

Adairs shareholders have also enjoyed some outsized capital growth. The Adairs share price is up 179% over the past 12 months. The ASX retailer has continued to perform well in 2021, with shares up 23% year-to-date.

The second ASX dividend share you may wish to add to your portfolio is Accent Group Ltd (ASX: AX1).

The sports and fashion retailer also has a long track record of paying out 2 annual dividends.

At the current price of $2.65 per share, Accent pays an annual dividend yield of 4.5%, fully franked. And like Adairs, Accent has also outperformed the market, with shares up 124% over the past 12 months. Year-to-date the Accent share price is up 12%.

More reading

• Got money to invest for dividends? Here are 2 ASX shares
• Down 9% today, why the Redbubble (ASX:RBL) share price continues to tumble
• 2 highly rated ASX dividend shares with generous fully franked yields
• Got money to invest? Here are 2 ASX shares to buy
• 2 compelling ASX shares to buy in May 2021

Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends ADAIRS FPO. The Motley Fool Australia has recommended Accent Group and ADAIRS FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why these 2 ASX dividend shares may be just what your portfolio needs appeared first on The Motley Fool Australia.

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The Deep Yellow Limited (ASX: DYL) share price is in reverse today despite announcing the appointment of a highly-experience executive.

At the time of writing, the uranium miner’s shares are trading at 84 cents, down 4.5%.

Deep Yellow sets eyes for next phase of growth

Investors are selling Deep Yellow shares following the company’s change on its board.

According to its release, Deep Yellow advised that it has selected Mr Chris Salisbury as the new chair of the board. This will see Mr Rudolf Brunovs depart, but retain his title as non-executive director and chair of the Audit Committee.

Mr Salisbury brings a wealth of knowledge to the company, having served more than 30 years in the mining industry. His experience spans over strategy and operations, particularly in the uranium sector.

Having worked in both Australia and Namibia, Mr Salisbury held several senior roles for Rio Tinto Limited (ASX: RIO). This included managing director and head of country for Rio Tinto’s Rossing Mine, located in Namibia.

However, his most important role was chief executive iron ore for Rio Tinto from 2016 to 2020. During this period, Mr Salisbury led the strategy for developing and implementing a climate change program and improving operational performance. His team consisted of roughly 20,000 employees and contractors across 16 mines, 4 ports and a railway system.

The reshaping of the board comes as the company begins embarking on the next phase of its growth strategy. Deep Yellow plans to establish a multi-platform, low-cost, tier 1 uranium producer.

Management commentary

Deep Yellow managing director and CEO, John Borshoff welcomed the inclusion of Mr Salisbury, saying:

The strengthening of our Board through the appointment of Chris as Chairman is an excellent outcome for Deep Yellow, as we continue to advance our dual-pillar growth strategy to establish the Company as a tier-one, multi- platform uranium producer.

To attract someone of Chris’ calibre is a strong reflection of where we are heading as a Company and the progress of our strategy over the past 12 months.

Deep Yellow is in its strongest position ever as a Company, underpinned by an exciting and advanced project portfolio and a strong cash balance. We see Chris playing an important role assisting the management team in executing our growth strategy, moving towards production and advancing key M&A objectives.

About the Deep Yellow share price

Over the last 12 months, Deep Yellow shares have surged more than 220%, with year-to-date gains of close to 80%. It’s worth noting, the company’s shares reached a multi-year high of 9.7 cents on Monday.

Based on today’s prices, Deep Yellow commands a market capitalisation of roughly $269 million, with 325 million shares on issue.

More reading

• These ASX uranium shares are surging this year. Here’s why

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.

The post What’s with the Deep Yellow (ASX:DYL) share price today? appeared first on The Motley Fool Australia.

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The Federal Budget has been on the lips of most Australians today, and the top dogs of Australia’s Big Four banks, along with The Motley Fool‘s own Scott Phillips, have been no different.

They were all generally supportive of the Budget, despite acknowledging it was far more stimulatory than many Australians expected.

Some complimented the Government on its approach to supporting businesses, while others were looking forward to the return of migration in 2022.

Here’s what they had to say.

Australia and New Zealand Banking Group Ltd (ASX: ANZ)

ANZ CEO Shayne Elliott said the Federal Government’s 2021 Budget would be a driver of Australia’s economic recovery.

This is the right budget for these economic times and is good news for Australian industries, households and social services.

While it is more stimulatory than many would have anticipated, this reflects the reality that the pandemic still poses risks to our health and economic prosperity and once again shows the government’s flexibility in dealing with the ongoing impacts.

Westpac Banking Group (ASX: WBC)

Westpac CEO Peter King commented that he appreciated the Budget was focused on job creation and economic growth.

The additional spending on infrastructure will be a key economic and employment driver and the banking sector will play a vital part in facilitating these projects.

It’s particularly pleasing to see ongoing support for the tourism sector, and for business more broadly, the extension of temporary full expensing and loss carry-back rules into 2023 will provide welcome relief for the vast majority of businesses that will benefit.

National Australia Bank Ltd (ASX: NAB)

NAB CEO Ross McEwan said the Federal Budget worked to continue the momentum of the economies business-led recovery.

The most recent NAB Monthly Business Survey shows business conditions and confidence at record-highs and confirms that for most of the economy, we have shifted from recovery to growth.

This Budget builds on that momentum and will help deliver an increase in business investment and job creation.

A plan for the gradual return of skilled migrants from mid-2022 is an important ambition as it will help address the need for labour that I’ve seen recently when I’ve visited areas like the Northern Territory and Far North Queensland.

Australia’s economic recovery and future growth is a shared responsibility and NAB will continue to play its role in helping our customers and the economy prosper.

Commonwealth Bank of Australia (ASX: CBA)

CBA CEO Matt Comyn also welcomed the Federal Budget, saying:

We welcome what is a very comprehensive and broad-based series of initiatives which we believe will have a positive effect on the economy and help underpin the recent increases in consumer and business confidence…

The extension of temporary tax relief initiatives for companies looking to invest will help around 98 per cent of Australian companies – small, medium and large – that we know are the lifeblood of the country’s economy…

This can only be good news for businesses, their people and the wider workforce in general given the stimulatory effect in creating more and new jobs right across the economy…

The additional spending announced on aged care, childcare, women’s health and safety, the NDIS and support for single parents in the housing market are all welcome.

More reading

• Which ASX bank share is the cheapest after earnings?
• ASX 200 down 1%: CBA Q3 update, tech shares rise, Qantas update
• Commonwealth Bank (ASX:CBA) share price in focus following Q3 results
• Does the NAB (ASX:NAB) share price offer a 7% dividend yield?
• 2 excellent ASX dividend shares to buy

Motley Fool contributor Brooke Cooper 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.

The post What do the CEOs of the Big Four banks think of the Federal Budget? appeared first on The Motley Fool Australia.

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The ASX banks have been in the news a lot over the past couple of weeks. Like a lot. For starters, the S&P/ASX 200 Index (ASX: XJO) made a new all-time high this week. And seeing as the big four ASX banks dominate the largest weighted shares in the ASX 200, this has drawn interest (pardon the pun).

But perhaps the biggest reason why all eyes have been on the banks is good old fashioned earnings. Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking GrpLtd (ASX: ANZ) and National Australia Bank Ltd. (ASX: NAB) have all reported half-year earnings in the past fortnight. And just today, Commonwealth Bank of Australia (ASX: CBA) has delivered a quarterly update.

Since this was a chance to see how the banks are all bouncing back from the turmoil of last year, it was something of a watershed moment for the big four. And overall, investors seem to be impressed. That’s going off how bank share price appreciation was a large driver of the ASX 200 reaching its new record high.

But this gives us a good chance to take stock of the banks today. ASX shares, especially blue chip shares like the banks, are usually valued by the price-to-earnings (P/E) ratio metric. The P/E ratio is especially useful in comparing businesses that compete in the same sector too. And the banks have given us new ‘Es’ with their recent earnings reports. As such, it’s a good time to check out these new valuations. Before we start, it’s worth mentioning that the iShares Core S&P/ASX 200 ETF (ASX: IOZ) has the average P/E ratio of ASX 200 shares at 23.87 right now.

ASX bank shares get new P/Es

So, let’s begin with Commonwealth Bank. CBA currently has a P/E ratio of 21.08 with a share price (at the time of writing) of $94.79.

Westpac is sitting on 21.93 with a share price of $25.63.

ANZ is on a P/E of 16.22 at a price of $26.78.

And NAB is offering a P/E ratio of 20.28 at a share price of $26.43.

Ok, so on a pure earnings basis, Westpac is the most expensive bank, followed closely by CBA. Then we have NAB, and ANZ in last place by quite a distance. This tells us that the market is viewing ANZ in a less favourable light than the other banks, all other things being equal.

But that also means that ANZ is currently offering the largest dividend yield of the big four today, with 3.92% on the table at the current share price. I’ll leave you with that.

More reading

• What do the CEOs of the Big Four banks think of the Federal Budget?
• ASX 200 down 1%: CBA Q3 update, tech shares rise, Qantas update
• Commonwealth Bank (ASX:CBA) share price in focus following Q3 results
• Does the NAB (ASX:NAB) share price offer a 7% dividend yield?
• 2 excellent ASX dividend shares to buy

Motley Fool contributor Sebastian Bowen owns shares of National Australia Bank Limited. 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 illustrious S&P/ASX 200 Index (ASX: XJO) is home to a good number of shares with true blue chip status. So many, it can be hard to decide which ones to include in your portfolio.

In order to narrow things down, I have picked out two blue chip ASX 200 shares which are highly rated right now. They are as follows:

ResMed Inc. (ASX: RMD)

The first blue chip ASX 200 share to look at is ResMed. It is a sleep treatment focused medical device company with a portfolio of world class products.

But it certainly isn’t resting on its laurels. Later this year the company will be releasing its AirSense 11 CPAP device. This device has been tipped as the catalyst for a new upgrade cycle and is expected to be a key driver of growth in the coming years.

In addition to this, the company’s increased investment in its out-of-hospital platforms leaves it uniquely placed to benefit from the pandemic-driven shift to home healthcare.

It is partly for these reasons that analysts at Credit Suisse are so positive on the company. A recent note reveals that its analysts have put an outperform rating and $29.00 price target on the company’s shares. This compares favourably to the current ResMed share price of $24.65.

SEEK Limited (ASX: SEK)

Another blue chip ASX 200 share to consider is SEEK. It is the leading job listings company in the ANZ region and has a number of growing businesses around the globe.

SEEK looks well-placed to benefit greatly from Australia’s economic recovery from the pandemic. Particularly given its domination of the local jobs market.

At the end of December, SEEK ANZ had 16 million candidate profiles, 35 million monthly visits, and 160,000 active hirers. This led to the company having almost a third of all placements in the region, which is five times greater than its nearest competitor.

UBS is a fan of the company and believes it is well-placed for growth. Last week it put a buy rating and $34.50 price target on its shares. This compares to the latest SEEK share price of $29.48.

More reading

• 2 top ASX shares rated as buys this week
• Leading brokers name 3 ASX shares to buy today
• 2 fantastic blue chip ASX 200 shares rated as buys
• Is the SEEK (ASX:SEK) share price in the buy zone?
• ASX 200 rises, Flight Centre drops, Super Retail grows

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ResMed Inc. and SEEK 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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Alicanto Minerals Ltd (ASX: AQI) shares are rocketing today after the company revealed new high-grade copper assays. At the time of writing, the Alicanto share price is up 7.69% to 14 cents, sneaking ever closer to a 100% yearly return.

Alicanto is a mineral exploration company, focused on the exploration and development of a portfolio of gold projects in the prospective geological provinces of Guyana. Its geographical segments are spread across the most unlikely of bedfellows: Guyana, Australia and Sweden.

Let’s take a look at what’s behind the booming Alicanto share price today.

Alicanto’s copper discoveries

Alicanto’s recent high-grade copper assays are from its first holes at Stone Lake, in the Greater Falun Project in Sweden. All of the company’s exploration activities have historically been located in Scandanavia, but now it’s also operating a little further afield.

Its Falun assays report results of up to 5.92% copper and the mineralogy suggests drilling is close to the source.

Assays from drilling at Stone Lake have returned 5.92% copper grades and 4.6 parts-per-million (ppm) of silver from 124 metres to 124.4 metres. The hole also revealed the presence of native copper.

With copper prices currently at all-time highs, it’s not surprising to see the Alicanto share price surging on the results.

Both holes drilled to date at Stone Lake intersected an intensely skarn-altered sequence of volcano-sedimentary rocks (hornfels) and interbedded limestones (marble-massive skarn) in contact with a strongly deformed granitoid.

For any geology nuts out there, skarn is very interesting as it’s a volcanically affected rock that forms out of magma from volcanic explosions. Alicanto says that the “combination of high-grade mineralisation and the significant alteration footprint” underlines the area’s prospectivity for copper-gold skarn mineralised bodies.

Follow-up geophysics, including ground magnetic surveys and down-hole electromagnetic surveys, are now underway in a bid to identify nearby copper-gold and polymetallic skarn mineralisation.

Management comments

Alicanto managing director Peter George said:

This is a highly promising result. The intersected mineralisation, together with its textbook skarn alteration, strongly indicates that we have identified another intrusion-related copper skarn system, less than 10km away from the world-class Falun deposit.

The semi-massive character of the intersected copper-skarn system, some 80m beneath historic workings with similar mineralisation, in combination with the most intense, proximal and prograde skarn alteration so far encountered at Greater Falun, highlights the potential for significant mineralisation nearby.

Alicanto share price snapshot

As a small-cap share, the Alicanto share price has shown a huge degree of volatility on the ASX. In the past two months alone, it’s dropped by as much as 30%. In the past 12 months, however, it has gained around 94%. 

More reading

• Why the Astron (ASX:ATR) share price is up 8% today
• Will the Afterpay (ASX:APT) share price go up?
• TPG Telecom (ASX:TPG) share price storms higher on insider buying news
• 2 highly rated mid cap ASX shares given buy ratings
• With the ASX sliding again today, why NOT to panic sell

Motley Fool contributor Lucas Radbourne-Pugh 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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The Astron Ltd (ASX: ATR) share price is rocketing today after the company revealed new metallurgical test work on its Donald mine and a series of zircon test results.

Astron shares are up 8% to 54 cents per share at the time of writing. 

Astron is a Hong Kong-based mineral sand mining company that evaluates and advances downstream applications for zircon and titanium. It’s also heavily involved in titanium-based materials trading. The company’s segments include the Donald Mineral Sands in rural Victoria, and in Senegal and China.

Let’s take a look at what’s driving the Astron share price today.

Astron’s Zircon tests

Astron has been testing zircon from its Donald mineral sands mine against competitor products. Zircon is a popular gemstone that people have been using for more than 2000 years. It’s even a birthstone for the month of December. 

Astron said testing of its “premium zircon” from Donald has determined that it “rates favourably in terms of whiteness – a highly desirable characteristic for the main ceramics end-use market – compared to three competitor products”. 

The company calls the extra-white zircon from the Donald mine ‘Donald Premium Zircon’ and expects this grade of gemstone will constitute 80% or approximately 95,000 tonnes per annum of its total 1 zircon production.

It may prove cheaper to mine in the long-term, as this zircon will not require acid leaching to meet customer specifications. In the next stage of its Donald project zircon mining operations, Astron says it has the ability to double total production.

Astron’s rare earth results

In other metallurgical test work from the Donald mine, Astron advised it has also found significant rare earth deposits. Today, the company confirmed its ability to produce a high-quality rare earth elements concentrate from a froth flotation technique.

Using this specific extraction technique, Astron can find a total rare earth element percentage of 51.2% with low impurity levels from its mineral sands in the region. The Donald mineral sands project is located in the Wimmera region of Victoria, 60km from Horsham and near the township of Minyip.

According to the company, Donald represents “one of the largest known zircon and titanium ore bodies in the world and a potentially significant new source of global supply”.

Astron share price snapshot

The Astron share price has shot up this month, up more than 50%, and is also up considerably over the past 12 months at 208%. The company can only be bought on the ASX as chess depositary interests (CDI). CDI’s act as a ‘right to buy’ share at a certain price on another exchange.

More reading

• Alicanto (ASX:AQI) share price surges 8% on high-grade copper
• Will the Afterpay (ASX:APT) share price go up?
• TPG Telecom (ASX:TPG) share price storms higher on insider buying news
• 2 highly rated mid cap ASX shares given buy ratings
• With the ASX sliding again today, why NOT to panic sell

Motley Fool contributor Lucas Radbourne-Pugh 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.

The post Why the Astron (ASX:ATR) share price is up 8% today appeared first on The Motley Fool Australia.

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The Afterpay Ltd (ASX: APT) share price in 2021 resembles that of a rollercoaster ride.

After ascending to a peak of ~$160 by mid-February, the train tumbled some 35% to a trough of $100 on 31 March. 

Its shares were then pulled back up for a second, albeit a smaller peak of $129 by 20 April before free-falling down to $90 this week. 

With so much whip saw-like action this year, what’s next for the Afterpay share price? 

Most recent broker recommendation

Morgan Stanley (NYSE: MS) was the most recent broker to provide an update for its view on the Afterpay share price. The broker observes that Afterpay’s US app downloads in April were almost double that of a year ago. While this was not as strong as the record month of March, its April performance was still 20% higher than January and February figures. 

The continuation of strong app downloads leads Morgan Stanley to believe that Afterpay’s US segment is still maintaining a strong growth trajectory. On 6 May, the broker retained an overweight rating with a $149 target price. 

The forces dragging the Afterpay share price lower 

While Morgan Stanley’s commentary could be on the money, there are a number of recent factors that have dragged the Afterpay share price in recent weeks. 

This includes the slump in the S&P/ASX200 Info Tech (INDEXASX: XIJ) index, the Nasdaq Composite selloff, broader selling across the BNPL sector and rising concerns of higher interest rates. 

While the company from an operational and financial perspective might continue to kick goals, these factors have capped both the upside and bullishness for Afterpay shares. 

Macquarie’s assessment

On 24 March, Macquarie released a balanced assessment of what could be next for the Afterpay share price. The report painted a pain before gain narrative, saying that: 

BNPL has seen explosive growth in the past few years. As with many such trends (China Commodities in 2015, China Autos in 2018) we see short-term oversupply. We expect this to be followed by a few years of industry consolidation (i.e. pain for all players) before industry normalisation at a healthier supply/demand equilibrium. Despite the grim near term outlook case studies into other industries that have experienced this boom bust cycle typically see the industry overall emerge healthier than when entering the cycle, with the strong getting stronger and the weak losing out.

Foolish Takeaway

Afterpay continues to be a growth machine at the BNPL forefront of international expansion. But as a richly valued, loss-making company, the Afterpay share price has come under a heightened level of volatility. 

More reading

• Why Afterpay, CSR, Electro Optic Systems, & Estia Health are storming higher
• ASX 200 down 1%: CBA Q3 update, tech shares rise, Qantas update
• ASX 200 sinks, Boral rises, A2 Milk drops again
• Why a2 Milk, Afterpay, Nearmap, & REA Group shares are sinking
• Flight Centre and Zip were among the most traded ASX shares last week

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The TPG Telecom Ltd (ASX: TPG) share price has been a positive performer on Wednesday.

In afternoon trade, the telco giant’s shares are up almost 4% to $5.28.

Despite this gain, the TPG share price is still down a disappointing 25% since the start of the year.

This compares to a 15% gain by arch-rival Telstra Corporation Ltd (ASX: TLS) and a 5% gain by the S&P/ASX 200 Index (ASX: XJO).

Why is the TPG share price underperforming?

The main catalyst for the weakness in the TPG share price this year was the shock news that its Founder and Chairman, David Teoh, resigned from the company with immediate effect in March.

Mr Teoh revealed that he felt that now was the right time to step aside and pursue other interests.

Also putting pressure on the TPG share price was recent news that Stephen Banfield will be stepping down as Chief Financial Officer after 20 years with the company.

Though, he will remain in the role until November 2021 or until a replacement is appointed.

Why are its shares bouncing back today?

The TPG share price was given a boost today by the release of a second change of director’s interest notice in as many days.

On Tuesday, a notice revealed that the company’s Non-Executive Director, Robert Millner, picked up 100,000 shares via an on-market trade on Friday. Mr Millner paid a total consideration of $544,050, which equates to $5.44 per share.

This afternoon, a second notice reveals that the company’s Chief Executive Officer, Iñaki Berroeta, has snapped up 116,000 shares through an on-market trade today. Mr Berroeta paid a total of $599,580 for the shares, which equates to an average of $5.17 per share.

Judging by their purchases, these two executives appear to believe the TPG share price has been oversold in 2021.

One broker that is likely to agree is Morgans. Last week the broker put an add rating and $7.17 price target on its shares. This followed the release of a trading update which revealed that its performance in FY 2021 is tracking to internal expectations.

More reading

• This broker thinks you should buy the TPG (ASX:TPG) share price dip
• TPG (ASX:TPG) share price tumbles 6% as CFO resigns
• Why the Telstra (ASX:TLS) share price could be heading higher from here
• Is the Telstra (ASX:TLS) share price better value than the TPG (ASX:TPG) share price?
• What’s with the Telstra (ASX:TLS) share price and other telcos today?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post TPG Telecom (ASX:TPG) share price storms higher on insider buying news appeared first on The Motley Fool Australia.

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If small caps are a little too risky for your liking, then maybe mid cap ASX shares would be more suitable. These are often well-established companies that still have significant runways for growth ahead of them.

With that in mind, I have picked out two mid cap ASX shares that are rated highly. Here’s what you need to know about them:

Life360 Inc (ASX: 360)

Life360 is a San Francisco-based technology company. The company’s core offering, the Life360 mobile app, is a market leading app for families. Its features range from communications to 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. This strong form has continued during the first quarter of FY 2021.

Positively, with COVID-19 headwinds starting to ease, management is confident that this trend will continue. 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.

Bell Potter is a fan of the company. The broker currently has a buy rating and $6.00 price target on its shares.

Bravura Solutions Ltd (ASX: BVS)

Another mid cap ASX share to look at is Bravura. It is a leading provider of software solutions for the wealth management and funds administration industries.

Bravura has a portfolio of solutions that are both high quality and have significant market opportunities. This is particularly the case for the Sonata wealth management platform, which is used by a number of large financial institutions.

After a couple of years of significant headwinds from Brexit and COVID-19, Bravura looks to be back on the right path again.

It recently reaffirmed its guidance for FY 2021 net profit after tax of $32 million to $35 million and second half revenue growth of 10% half on half.

Goldman Sachs is a fan of the company. Last week it retained its buy rating and lifted its price target on the company’s shares to $3.90. The broker believes it has a massive growth opportunity in the UK and ANZ markets.

More reading

• 2 beaten down ASX shares rated as buys
• 3 quality mid cap ASX shares rated as buys
• Broker tips Bravura (ASX:BVS) share price to storm 20% higher
• 2 exciting ASX tech shares that have been tipped as buys
• Brokers name 3 ASX shares to buy now

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Bravura Solutions Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Life360, Inc. The Motley Fool Australia has recommended Bravura Solutions 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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