The Plenti Group Ltd (ASX: PLT) share price is on watch today after the company released its trading update for the fourth-quarter of FY21.

The Plenti share price is $1 per share at the time of writing.

Plenti is a technology-led consumer lending and investment company that focuses on specific industries. The company offers loan products under three verticals, or revenue streams.

First it provides automotive lending for the hire or purchase of new vehicles. Second, it provides renewable energy lending for the purchase and installation of renewable energy products such as solar panels and batteries.

Finally, it also focuses on personal lending, providing fixed-term, unsecured, interest-bearing loans used for a wide variety of purposes.

Plenti’s strong fourth-quarter results

Plenti posted record quarterly loan originations of $172.4 million, 120% above prior corresponding period and 32% above its results from the prior quarter. 

It posted record quarterly loan originations in each lending vertical, across automotive, renewable energy and personal loans. Its total loan portfolio increased to $615 million, 61% above the prior corresponding period.

Funding increased through upsizing of Plenti’s automotive loan warehouse facility to $350 million. In interesting news for buy now, pay later (BNPL) investors, it also successfully launched BNPL finance for renewable energy customers.

This was one of what the company calls a series of “significant product and technology advancements”, including progress on the company’s next generation credit decisioning and pricing models.

Its prime loan portfolio also continues to demonstrate strong credit performance, with low levels of losses and 90-plus day arrears declining to 0.31%.

What Plenti management said

Commenting on the trading update, Daniel Foggo, Plenti’s CEO, said:

Plenti’s exceptional growth during the quarter was underpinned by our relentless focus on delivering faster, fairer loans, with originations for the quarter up more than 100% on the same quarter last year. Our ambition is to be Australia’s best lender. This quarter validated our ongoing investment in technology while continuing to deliver exceptional customer experiences uncompromised by our rapid growth.

With strong momentum across each part of our business, we are powering towards our one billion dollar loan book milestone.

Plenti share price snapshot

The Plenti share price has lost 17% in 2021 so far and 23% over the past 12 months. It’s down 67% against the financial services sector and 52% against the S&P/ASX 200 Index (ASX: XJO).

More reading

• Airtasker (ASX:ART) share price cools after explosive IPO

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 Plenti (ASX:PLT) share price on watch after ‘exceptional growth’, BNPL launch appeared first on The Motley Fool Australia.

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

The Galaxy Resources Limited (ASX: GXY) share price is one to watch this morning after a quarterly update from the Aussie lithium miner.

Why is the Galaxy Resources share price on watch?

Galaxy this morning provided a quarterly results update for the quarter ended 31 March 2021 (Q1 2021). Shares in the lithium miner could be on the move following the brief update, ahead of its March 2021 quarterly activities report release on 21 April.

Galaxy’s Mt Cattlin site has successfully ramped back up to nameplate capacity during Q1 2021. Mt Cattlin achieved quarterly production of 46,588 dry metric tonnes of lithium concentrate during the period. That represents a 39.7% increase on Q4 2020 at an improved recovery of 60%.

The Galaxy Resources share price is one to watch as investors digest the latest numbers. Galaxy reported product quality of 5.8% lithium oxide in line with customer requirements.

The Aussie mining group shipped 29,917 dry metric tonnes of lithium concentrate during Q1 2021. Galaxy delayed a second shipment of 15,000 dry metric tonnes until early April due to the late arrival of a vessel.

Galaxy reported its contracting arrangements for this quarter are progressing well with pricing “well in excess” of US$600 per dry metric tonne.

It will be interesting to see how the Galaxy Resources share price performs in early trade following the update. Further information is likely to follow in the quarterly activities report on 21 April and the investor conference call at 10 am AEST on the same day.

What are the latest performance numbers for Galaxy?

Shares in the Aussie lithium producer jumped 2.8% on Friday to close at $2.98 per share. That means the Galaxy Resources share price is now up 263.4% in the last 12 months. Fellow lithium miners Orocobre Limited (ASX: ORE) and Pilbara Minerals Ltd (ASX: PLS) have also seen strong gains as lithium prices have soared.

Galaxy currently boasts a market capitalisation of $1.5 billion prior to Monday’s open when the S&P/ASX 300 Index (ASX: XKO) is tipped to edge higher.

More reading

• ASX lithium shares are surging across the board. Here’s why
• The new race between US and China is good news for these ASX shares
• Why ASX lithium shares are shooting higher in April
• Brokers name 3 ASX shares to buy right now
• Why the Wesfarmers (ASX:WES) share price is up today

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post The Galaxy Resources (ASX:GXY) share price is on watch. Here’s why appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3a34vVc

The Summerset Group Holdings Ltd (ASX: SNZ) share price is on watch this morning after a quarterly trading update from the Kiwi retirement village operator.

Why is the Summerset share price on watch?

Summerset this morning provided a sales update for the quarter ended 31 March 2021 (Q1 2021). The company reported 275 sales for the quarter including 148 new sales and 127 resales.

Summerset’s business model relies on selling occupation rights for its retirement and care villages. These rights are sold to temporary residents, with either new village sales or the resale to a new tenant.

The Summerset share price is on watch after CEO Scott Scoullar said the waitlist is up 24% from one year ago. That figure is also up 8% on the previous quarter as demand continues to grow despite the coronavirus pandemic.

Mr Scoullar also said there is a good pipeline of new builds to come. This includes a $170 million village in Prebbleton, New Zealand, which was granted resource consent in March. The new facility would comprise more than 290 independent homes and include a state-of-the-art memory care centre for residents with dementia.

The leading retirement village operator and developer has 33 villages completed or in development across New Zealand. Summerset also has three properties in Victoria, Australia among others that brings its total sites to 43.

Foolish takeaway

The Summerset share price is on watch today following the company’s latest update. Shares in the retirement village operator managed to soar in 2021 as New Zealand effectively contained COVID-19. 

In fact, the Summerset share price has rocketed 85.6% higher in the last twelve months after plummeting to a 52-week low of $5.33 in the March 2020 bear market. Summerset currently boasts a market capitalisation of $2.5 billion on the ASX.

The S&P/ASX 200 Index (ASX: XJO) is tipped to rise this morning with the latest SPI futures pointing to a 0.1% gain at the open

More reading

• ASX 200 Weekly Wrap: ASX sees 7,000 points once more
• Delorean (ASX:DEL) debuts on ASX, already posting profits
• Synlait (ASX:SM1) share price on watch after sudden CEO exit
• 2 quality small cap ASX shares rated as buys
• 2 blue chip ASX dividend shares to buy

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why the Summerset (ASX:SNZ) share price is in focus appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3259SPp

The S&P/ASX 200 Index (ASX: XJO) has continued its form over April so far. Last week the index crossed its highest threshold since the start of the coronavirus pandemic more than a year ago after rising 2.4% from Tuesday to Friday. Not a bad return considering most of us (including the ASX) had Monday off.

On Thursday morning, the ASX 200 crossed 7,000 points for the first time since January 2020 and climbed as high as 7,012 points during intra-day trading. Whilst that milestone is completely rudimentary, it still represents a significant psychological milestone. It also means the ASX 200 is getting closer to its pre-COVID high of 7,162 points that we saw back on 20 February 2020.

Even though the week saw the ASX 200 ended back below 7,000 points, it was only just, given the index finished up at 6,995 on Friday afternoon.

ASX tech hits gold

In a departure from recent norms, it was the ASX tech sector that shone last week, helped along by gold miners. ASX tech shares spent last week bouncing back from the bond-driven sell-off we saw over February and March. Afterpay Ltd (ASX: APT) was a strong performer, gaining close to 15% over the week. As was Zip Co Ltd (ASX: Z1P) and Xero Limited (ASX: XRO)  with gains of 7.5% and 5.9% respectively.

This was assisted by a cracker of a week over on the US markets. The tech-heavy Nasdaq Composite (NASDAQ: .IXIC) rose more than 3% last week, whilst the S&P 500 Index (SP: .INX) and the Dow Jones Industrial Average Index (DJX: .DJI) continued to push into new all-time high territory.

As mentioned above, ASX gold miners also had a stellar week. The ASX’s largest gold miner Newcrest Mining Ltd (ASX: NCM) was up 6.54% last week, whilst Silver Lake Resources Limited (ASX: SLR) was the ASX 200’s best performer with a gain of 18.2% (more on that later). We can probably put this strength down to a rising gold price, falling bond yields and a slight recovery in the Australian dollar.

How did the markets end the week?

The ASX 200 managed three out of four days in the green last week. Tuesday kicked things off with a 1% rise, which was backed up on Wednesday and Thursday with gains of 0.3% and 1.1% respectively. Friday saw the week’s only loss, but only just, with the ASX sliding a paltry 0.05%. The complications surrounding the AstraZeneca coronavirus vaccine which the government responded to on Friday certainly put a dampener on the mood at the week’s end.

Meanwhile, the All Ordinaries Index (ASX: XAO) also had a strong week, rising from 7,061.8 points at Tuesday’s open to 7,252.3 pints on Friday afternoon, a hefty gain of 2.7%.

Which ASX 200 shares were the biggest winners and losers?

Time now for our winners and losers segment where we put the S in salacious by looking at the week’s best and worst ASX 200 shares. So put the kettle on as we start with the losers:

Worst ASX 200 losers	% loss for the week
Chorus Ltd (ASX: CNU)	(6.4%)
AMP Ltd (ASX: AMP)	(4.9%)
Incitec Pivot Ltd (ASX: IPL)	(3.8%)
Corporate Travel Management Ltd (ASX: CTD)	(3.7%)

New Zealand telco Chorus was the ASX 200 wooden spooner last week with a 6.4% slide. This appears to be a response to Chorus’s announcement last Tuesday, in which the company advised it’s expecting its maximum allowable revenue range to be lower than previously indicated at $680 to $710 million (down from the previous $715 to $755 million).

Poor old AMP was also a loser last week. This embattled wealth manager was once again being sold off in the wake of CEO Francesco de Ferrari’s resignation announced last month.

Fertiliser and chemical manufacturer Incitec Pivot was in the firing line after an update on one of its factories. The company announced on Tuesday that its Waggaman ammonia operation won’t be coming back online until mid-April. It was previously expected to be back by mid-March following some earlier mechanical failures.

Finally, travel company Corporate Travel Management was also on investors’ hit list last week. Most of the week’s 3.7% loss came on Friday following the government’s response to the AstraZeneca vaccine concerns. Any delay in ‘returning to normal’ is obviously bad news for a travel company.

Now with the losers done and dusted, let’s have a look at last week’s winners:

Best ASX 200 gainers	% gain for the week
Silver Lake Resources Limited (ASX: SLR)	18.2%
EML Payments Ltd (ASX: EML)	17.1%
Afterpay Ltd (ASX: APT)	15.1%
Ramelius Resources Ltd (ASX: RMS)	13.3%

As you can see, we had two ASX gold miners and two ASX tech shares making up the ASX 200’s best performers last week.

EML had some more good news up its sleeve though. On Wednesday, the payments company announced the acquisition of Sentinel Limited, a European banking and payments company, for 110 million euros. Investors clearly approved.

Some stellar numbers from Afterpay’s ‘Afterpay Day’ sales over in the US also gave investors another reason to chase this buy now, pay later (BNPL) company up the wall.

There was no major news out of Silver Lake, the ASX 200’s best performer. However, fellow gold miner Ramelius Resources Limited (ASX: RMS) gave the markets a quarterly update which may have helped its case.

A wrap of the ASX 200 blue-chip shares

Before we go, here is a look at the major ASX 200 blue-chip shares as we start on our first five-day week for a while (sigh):

ASX 200 company	Trailing P/E ratio	Last share price	52-week high	52-week low
CSL Limited (ASX: CSL)	34.37	$263.40	$332.68	$242
Commonwealth Bank of Australia (ASX: CBA)	19.38	$87.13	$89.20	$57
Westpac Banking Corp (ASX: WBC)	39.57	$25.21	$25.30	$14.53
Australia and New Zealand Banking Group Ltd (ASX: ANZ)	23.74	$28.74	$29.55	$15.07
National Australia Bank Ltd (ASX: NAB)	24.62	$26.72	$27.10	$15
Fortescue Metals Group Limited (ASX: FMG)	7.72	$20.89	$26.40	$10.61
Woolworths Group Ltd (ASX: WOW)	36.8	$41.23	$42.05	$33.82
Wesfarmers Ltd (ASX: WES)	32.67	$54.17	$56.40	$35.58
BHP Group Ltd (ASX: BHP)	26.03	$46.67	$50.93	$28.76
Rio Tinto Limited (ASX: RIO)	14.66	$115.50	$130.30	$80.10
Coles Group Ltd (ASX: COL)	20.16	$15.85	$19.26	$14.95
Telstra Corporation Ltd (ASX: TLS)	23.02	$3.43	$3.54	$2.66
Transurban Group (ASX: TCL)	–	$13.67	$15.64	$10.73
Sydney Airport Holdings Pty Ltd (ASX: SYD)	–	$6.10	$7.49	$4.92
Newcrest Mining Ltd (ASX: NCM)	17.07	$26.70	$38.15	$23.08
Woodside Petroleum Limited (ASX: WPL)	–	$24.32	$27.60	$16.80
Macquarie Group Ltd (ASX: MQG)	23.38	$154.80	$155.94	$88.13
Afterpay Ltd (ASX: APT)	–	$121.47	$160.05	$19.67

And finally, here is the lay of the land for some leading market indicators:

• S&P/ASX 200 Index (XJO) at 6,995.2 points.
• All Ordinaries Index (XAO) at 7,252.3 points.
• Dow Jones Industrial Average Index (DJX: .DJI) at 33,800.6 points after rising 0.89% on Friday night (our time).
• Bitcoin (CRYPTO: BTC) going for US$59,707 per coin.
• Gold (spot) swapping hands for US$1,744 per troy ounce.
• Iron ore asking US$170 per tonne.
• Crude oil (Brent) trading at US$62.95 per barrel.
• Australian dollar buying 76.22 US cents.
• 10-year Australian Government bonds yielding 1.7% per annum.

That’s all folks. See you next week!

More reading

• 2 blue chip ASX dividend shares to buy
• Is the Woolworths (ASX:WOW) share price a good defensive buy?
• 5 things to watch on the ASX 200 on Monday
• 2 buy-rated ASX dividend shares with generous yields
• Is the CSL (ASX:CSL) share price too cheap to ignore?

Sebastian Bowen owns shares of Bitcoin, National Australia Bank Limited, Newcrest Mining Limited, and Telstra Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Bitcoin. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd., Xero, and ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends EML Payments. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited, EML Payments, Macquarie Group Limited, and Telstra Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO, COLESGROUP DEF SET, Transurban Group, Wesfarmers Limited, and Woolworths Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post ASX 200 Weekly Wrap: ASX sees 7,000 points once more appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3uF6veo

A company that earns revenue both from its customers and suppliers is listing on the ASX on Monday.

Delorean Corporation Limited (ASX: DEL) has raised $14 million through an initial public offering, with shares priced at 20 cents.

The IPO prospectus showed Delorean made a net profit after tax of $2.6 million in the last financial year.

Managing director and co-founder Joe OIiver told The Motley Fool that the business has already been turning a profit for 5 years.

“Our forecast is for net profit to match or better what we’ve done in financial year 2021.”

So what exactly does this Perth company do?

Turning rubbish into energy

Delorean is in the renewable energy industry, currently selling power to retail and wholesale clients under the CleanTech Energy brand.

The company aims to also become an energy producer by building its own bioenergy generation infrastructure. 

Its generators will receive organic waste that would otherwise end up in landfill, then convert it into electricity and gas.

“The capital from the IPO allows us to directly invest into shovel-ready projects in the Delorean pipeline and continue delivering on our growth strategy,” said Oliver.

The company already has one operational power generator in Western Australia, which has been running since 2015. 

There are plants currently under construction in South Australia and New Zealand. Another two sites in South Australia and Victoria will have their construction kick-started with the new money.

This ambitious vertical integration is how the business can run in the black now, but also have growth immediate prospects.

“As we shift into asset ownership, we’ll be augmenting [the retail business] with newly based revenues… from these infrastructure assets,” Oliver said.

“Our aspiration is to move to a fast growth company… and ultimately be a payer of dividends as we roll out these infrastructure assets.” 

Revenue from both sides of supply chain

Renewable energy is expected to receive positive treatment from all levels of government in the coming years.

“We’ve got a history of success and proven our capabilities in what is a high growth market with favourable regulatory conditions as well as environmental and sustainability benefits,” said Oliver.

The new bioenergy generators also have a unique revenue model where money is coming from both suppliers and customers.

The plants will charge a “gate fee” to parties that want to offload organic waste. Then the converted energy will be sold off to wholesale and retail clients.

“We work with the logistics companies that are picking up waste. We work direct with food manufacturers, councils — the providers of organic waste,” executive chair and co-founder Hamish Jolly told The Motley Fool.

“There is a financial incentive in that there’s not a landfill levy attached to [supplying Delorean], depending on the state.”

Delorean will start its life on the ASX with a market capitalisation of $35.9 million.

More reading

• Synlait (ASX:SM1) share price on watch after sudden CEO exit
• 2 quality small cap ASX shares rated as buys
• 2 blue chip ASX dividend shares to buy
• Is the Woolworths (ASX:WOW) share price a good defensive buy?
• LIVE COVERAGE: ASX to rise; Synlait CEO resigns

Motley Fool contributor Tony Yoo 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 Delorean (ASX:DEL) debuts on ASX, already posting profits appeared first on The Motley Fool Australia.

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

The Synlait Milk Ltd (ASX: SM1) share price will be one to watch on Monday.

This follows the release of a major announcement this morning by the struggling dairy processor.

What did Synlait Milk announce?

This morning Synlait Milk announced that its board has accepted the resignation of Leon Clement from the role of Chief Executive Officer (CEO).

Mr Clement is leaving the company after a little over two and a half years in the CEO role, having joined Synlait Milk in September 2018.

During his tenure, the Synlait Milk share price has lost approximately 72% of its value, falling from $11.73 on 1 September 2018 to $3.22 today.

Nevertheless, the board has spoken positively about the impact he had at the company.

Synlait’s Chair, Graeme Milne, commented: “Leon has been an authentic and transformational leader. He has successfully repositioned Synlait’s purpose, ambition, and strategy to make us a more diversified and sustainable company. On behalf of the Board and all staff we wish Leon the very best in his future career and thank him for his energy and dedication to Synlait during his time with us.”

The outgoing CEO added: “It has been a privilege to lead Synlait. It has been an intensive period of change and growth and I am proud of our achievements. Synlait has an amazing team that is making a positive and sustainable impact in the areas we operate.”

What now?

According to the release, Mr Clement will continue in his role until the end of April.

After which, from 1 May 2021, John Penno (Synlait Co-Founder, Former CEO, and current Director), will assume the role of Interim CEO until a permanent replacement is appointed.

A search for a new permanent CEO will be initiated shortly.

What’s been happening?

Last month the Synlait share price crashed to a multi-year low following the release of a very poor half year result.

Due partly to the weakness facing infant formula customers such as A2 Milk Company Ltd (ASX: A2M), Synlait posted a 76% decline in net profit after tax to NZ$6.4 million.

Unfortunately, things are not expected to get any better in the second half, with management forecasting a breakeven full year result.

More reading

• Leading brokers name 3 ASX shares to sell today
• ASX 200 dips lower, Webjet drops, REA bids for Mortgage Choice
• Why Immutep, Inghams, REA Group, & Synlait shares are sinking
• Synlait (ASX:SM1) share price on watch after reporting huge profit decline
• Chinese factory output is up an astonishing 35%

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended A2 Milk. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Synlait (ASX:SM1) share price on watch after sudden CEO exit appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3s7ifV9

If your risk profile allows for it, having a little exposure to the small side of the market could be a good thing for a portfolio.

This is because the potential returns on offer here are significant if you can find a small cap on a pathway to becoming a mid cap or even a large cap.

With that in mind, I have picked out two small caps that are highly rated. They are as follows:

Bigtincan Holdings Ltd (ASX: BTH)

The first small cap ASX to look at is Bigtincan. It is an artificial intelligence-powered sales enablement automation platform provider. 

Bigtincan has been growing very quickly in recent years and looks well-placed to continue this trend in FY 2021 following a very strong half year result in February. At the end of the half, its annualised recurring revenue (ARR) stood at $48.4 million. This was a 50% increase over the prior corresponding period.

Driving this strong growth was acquisitions and new customer wins. In respect to the latter, among the growing number of blue chips using its platform are 7 of the top 10 companies on the Fortune 500.

Analysts at Ord Minnett are positive on its prospects. They currently have a buy rating and $1.08 price target on its shares.

Doctor Care Anywhere Ltd (ASX: DOC)

Another small cap ASX share to look at is Doctor Care Anywhere. It is a growing UK-based telehealth company that is aiming to deliver high-quality, effective, and efficient care to its patients, while reducing the overall cost of providing clinical services.

It has also been growing strongly this year. For example, in January it released its fourth quarter update and revealed a 151% increase in revenue to 3.8 million pounds. This was driven by the increasing popularity of telehealth services during the pandemic.

Bell Potter is positive on the company’s long term outlook. It has a buy rating and $1.95 price target on the company’s shares.

More reading

• Looking for the next Afterpay and Zip? Try these small cap ASX shares
• These ASX tech shares are all trading near their lowest prices in months
• 2 excellent ASX mid cap shares to buy
• 2 explosive ASX growth shares to buy right now
• 2 rapidly growing ASX tech shares to buy in April

The post 2 quality small cap ASX shares rated as buys appeared first on The Motley Fool Australia.

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

If you’re wanting to add some ASX dividend shares to your portfolio, then you might want to look at the ones listed below.

Here’s what income investors need to know about them:

Aventus Group (ASX: AVN)

The first dividend share to look at is Aventus. It is Australia’s largest fully-integrated owner, manager, and developer of large format retail centres.

Aventus has been a positive performer during the pandemic. This has been thanks largely to the quality of its tenancies and its exposure to everyday needs and national retailers. This has allowed the company to collect rent largely as normal, which led to Aventus reporting both revenue and profit growth during the first half of FY 2021.

One broker that is positive on the company is Goldman Sachs. It currently has a buy rating and $3.04 price target on its shares.

Goldman is also forecasting a ~16.6 cents per share distribution this year. Based on the current Aventus share price, this represents a 5.6% yield.

Wesfarmers Ltd (ASX: WES)

Another dividend share to look at is Wesfarmers. It is the conglomerate behind several of Australia’s leading retailers and a collection of industrial businesses. Among the former are Kmart, Officeworks, Target, Catch, and Bunnings.

It is the latter business which has been the star performer over the last 12 months. Strong demand in the home improvement market led to Bunnings reporting stellar sales and profit growth during the first half. This ultimately underpinned a 16.6% increase in group revenue to $17,774 million and a 25.5% increase in net profit after tax to $1,414 million.

Goldman Sachs is a fan of Wesfarmers as well. It currently has a buy rating and $59.70 price target on its shares. In respect to dividends, the broker is forecasting a fully franked FY 2021 dividend of $1.88 per share. Based on the latest Wesfarmers share price, this equates to a 3.5% yield.

More reading

• 2 ASX dividend shares with generous yields to buy now
• How are these ASX 200 retail shares tracking after JobKeeper’s end?
• 2 great ASX 200 blue chip shares for dividends
• 2 COVID-19 ASX shares to buy
• Why the Wesfarmers (ASX:WES) share price is up today

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

The post 2 blue chip ASX dividend shares to buy appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3simKg1

At the current Woolworths Group Ltd (ASX: WOW) share price, is it an attractive buy as a defensive ASX share?

Over the last month the Woolworths share price has risen by around 5.5%. It hasn’t moved much over the last 12 months, but its sales and earnings have been marching higher.

Recent FY21 half-year result

In the first half of its FY21, Woolworths saw continuing double digit growth.

Group sales went up 10.6% to $35.8 billion, with e-commerce sales increasing 78% to $2.94 billion. Online sales made up 8.2% of total sales, up from 5.1% in the first half of FY20.

The business saw group earnings before interest and tax (EBIT) grow by a similar rate, increasing by 10.5%.

However, group net profit after tax (NPAT) increased by 15.9% to $1.1 billion. Woolworths said that its operations continues to be impacted by COVID-19, with elevated sales and higher costs as the company worked to maintain a COVID-19-safe environment.

Looking at Woolworths’ different divisions, there was growth across most of them over the first six months of FY21. Australian food sales rose 10.6%, New Zealand food sales increased 2.9%, Big W sales went up 20.1% to $2.58 billion and Endeavour Drinks (including Dan Murphy’s) sales rose 19% to $5.68 billion. Hotels was the sales decline by 27.5% to $667 million.

EBIT growth was at a similar pace for most divisions, but Big W EBIT grew 165.7% to $133 million and hotels EBIT fell 45.4% to $122 million. Big W saw such a big EBIT increase because of strong sales growth, gross profit margin improvements and cost control, despite higher COVID-19-related costs. It also saw online sales increase by 120%.

The defensive ASX share pointed out that whilst sales slowed during the half – second quarter sales increased by 8.3% – it was still high single digits.

Woolworths has managed to keep growing, despite all of the disruptions it has faced since early 2020.

Outlook

The Woolworths share price is driven by profit and growth expectations.

In the first seven weeks of the second half of FY21, it has seen continuing strong sales growth, benefiting from continued at-home consumption, Australians not travelling abroad, and a weaker prior year where sales were impacted by bushfires on the east coast of Australia. However, growth rates have continued to moderate over the period in line with the overall market. COVID-19 costs are also coming down as restrictions ease.

Australian food total sales increased by approximately 8% in the first seven weeks.

The medium-term annual net target for Woolworths is 10 to 20 new full range supermarkets in Australia, with five to 15 Metro food stores.

Looking at the Endeavour Group, Woolworths is expecting to separate this business in June 2021, most likely through a demerger.

Woolworths said the divestment will lead to a simplified business, with a greater focus on its core food and everyday needs businesses and allow Endeavour to accelerate its own growth aspirations.

Is the Woolworths share price a buy?

The broker UBS rates the Woolworths share price as a buy with a price target of $44. It likes the possible shareholder returns that may be paid after the divestment of Endeavour – it thinks it still has long-term growth potential.

According to UBS, the Woolworths share price is valued at 27x FY21’s estimated earnings.

More reading

• Is the Coles (ASX:COL) share price a buy today?
• Why Codan, Flight Centre, Magellan, & Woolworths are sinking
• Fears of new supermarket war could hit Coles (ASX:COL) and Woolworths (ASX:WOW)
• Why this top broker thinks the Woolworths (ASX:WOW) share price can break new record highs
• Lynch Group (ASX:LGL) share price falls after completing $206 million IPO

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

The post Is the Woolworths (ASX:WOW) share price a good defensive buy? appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3d6UtV1

More reading

• 5 things to watch on the ASX 200 on Monday
• 2 of the best ASX shares to buy now
• 2 buy-rated ASX dividend shares with generous yields
• 2 stellar ASX growth shares that could be strong buys
• Is the Appen (ASX:APX) share price a cheap buy?

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Kate O’Brien owns shares of Apple and Rio Tinto Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Alphabet (C shares), and Apple. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), and Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post LIVE COVERAGE: ASX to rise; Brickworks goes ex-dividend appeared first on The Motley Fool Australia.

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