The timing for the reopening of the global economy post COVID-19 remains highly uncertain, but this isn’t stopping brokers from picking ASX shares to buy now.

Travel-related ASX shares are the posterchild for the recovery trade and that explains why the Qantas Airways Limited (ASX: QAN) share price, Flight Centre Travel Group Ltd (ASX: FLT) share price and Sydney Airport Holdings Pty Ltd (ASX: SYD) share price have bounced as COVID fears receded.

However, one ASX travel share that stands out is the Corporate Travel Management Ltd (ASX: CTD) share price. Morgans calls the business travel agent its “key pick” in the sector.

First to return to profits

This is particularly so following Corporate Travel’s trading update yesterday. The group has reach breakeven at the earnings before interest, tax, depreciation and amortisation (EBITDA) level in March.

“CTD expects to be EBITDA positive in the 4Q21, lead [sic] by ANZ and UK/Europe,” said Morgans.

“CTD is now EBITDA positive. It is the first travel stock under coverage to be profitable which highlights its greater exposure to essential services customers, domestic travel, large pipeline of new client wins and low cost base.”

Other reasons this ASX share is a favourite COVID reopening trade buy

These aren’t the only reasons what Morgans thinks the stock is ahead of the pack. Corporate Travel’s balance sheet has no debt, when all its peers do. This means the group has the strongest balance sheet in the ASX travel sector.

Morgans has an “add” recommendation on the Corporate Travel share price with a price target of $21.75 a share.

US and EU key to more earnings upgrades

But Morgans isn’t alone in recommending the Corporate Travel share price as a “buy”. UBS reiterated its bullish rating on the shares as it noted the group’s leverage to the US and EU markets.

“The vaccine roll-out is well-advanced in the US/UK and remains the key catalyst for travel to materially lift,” said UBS.

“CDC US guidelines state fully vaccinated citizens can travel domestically & internationally without quarantining after travel.

“Meanwhile, international travel in the UK could potentially resume on 17 May with ‘green countries’.”

More room for the Corporate Travel share price to climb

The US accounts for around 45% of Corporate Travel’s proforma EBITDA while Europe makes up around 20%.

UBS’ 12-month price target is $22 a share, but it could upgrade this if there are more tangible signs of a travel recovery in the US and Europe.

More reading

• ASX 200 dips, Corporate Travel flies, Nuix sinks
• Why Corp Travel Management, Imugene, MoneyMe, & Syrah are pushing higher
• Why the Corporate Travel Management (ASX:CTD) share price is soaring today
• 5 things to watch on the ASX 200 on Wednesday
• Why Altium, Challenger, Lynas, & Sydney Airport shares are sinking

Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Brokers favourite ASX share for the COVID-19 reopening trade appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3nblOJ3

The Zip Co Ltd (ASX: Z1P) share price is rising today after the company announced an agreement with Adobe (NASDAQ: ADBE) to become an Accelerate partner in the Adobe Exchange Partner Program.

At the time of writing, the Zip share price is up 4.11% to $9.11.

Zip Pay is Australia’s second-largest buy now, pay later (BNPL) fintech company. It’s a financial technology company that operates across Australia and New Zealand, offering point-of-sale credit and digital payment services to consumers and merchants.

Zip first listed on the ASX in 2009 and is headquartered in Sydney. Currently, the company has around 10,000 retail partners and 1,200,000 customers in Australia.

What does the Zip, Adobe partnership mean?

Zip is now set to become the buy now, pay later provider of choice for Adobe’s e-commerce software, Magento.

Magento is a digital commerce platform that blends digital commerce, order management, and predictive intelligence. This enables online shopping across a wide array of industries and business models (B2C, B2B, and hybrid).

Adobe offers an enterprise-level, cloud-hosted application, Magento Commerce, as well as a free e-commerce solution, Magento Open Source.

Zip’s Accelerate partner agreement with Adobe will be mutually beneficial for Zip. Furthermore, allowing Zip to benefit from a range of technological and programmatic support from the US tech giants. 

Zip says the agreement will mean its BNPL services are marketed to thousands of new retail customers across the world. 

What both companies’ management said

Zip CEO Peter Gray said the Adobe partnership was a milestone in global expansion for the Australian company:

Adobe is a global leader in digital commerce and this collaboration will help us reach thousands of merchants and their customers with our better way to pay. With partners like Adobe, we are well on our way to making Zip the first payment choice, everywhere and every day.

Adobe vice president, Jason Woosley, said BNPL services were a value addition for Magento.

While brands are looking for ways to engage customers with new, exceptional experiences, the realities of COVID-19 have catapulted digital commerce technologies to the forefront of the market

Consumers love installment payment solutions because they’re fast, fair and interest-free. Zip enables Magento merchants globally to implement these capabilities effortlessly at checkout, improving cash flow, increasing order value, and keeping customers coming back again and again.

Zip share price snapshot

The Zip share price is down more than 5% this week. However, it has gained nearly 10% this month and is up over 350% over the past 12 months. 

More reading

• BrainChip and Zip were among the most traded ASX shares last week
• Why Accent, Bank of Queensland, Freelancer, & Zip shares are pushing higher
• This major US bank has bought 6% of Zip (ASX:Z1P) shares
• Why GPT, Mayne Pharma, Talga, & Zip shares are tumbling lower
• Top broker picks ASX shares next in line for a profit upgrade

Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. 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 Zip Pay (ASX:Z1P) share price rising after ‘global leader’ agreement appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3sFW6hc

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

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

Square (NYSE: SQ) came back from an underwhelming first half of 2020 with big increases in revenue and gross payment volume in the fourth quarter. But the bigger story is that the fintech company’s long-term potential became more apparent as the year went on, and the market rewarded shareholders with roughly 350% gains over the course of the year. ARK Invest chief Cathie Wood, whose investment decisions are watched by growth investors everywhere, has made Square one of her largest holdings. Is it the right long-term stock for you?

The cashless society is coming

Square operates two ecosystems: one for sellers, which caters to the small and medium-sized business clients that use its fintech solutions, and Cash App, which individuals use to send payments and related functions. In many ways, it’s similar to fintech leader PayPal, which offers similar products and services. 

As would be expected, the seller division was mixed during the pandemic. Physical small businesses suffered during lockdowns, but many with digital capabilities flourished. Square sees a $100 billion addressable market, of which it has less than 3%.

Cash App, though, was a high performer during the pandemic as people stayed home and relied on mobile wallets to send and receive money. The company also expanded features for Cash App, such as stock and Bitcoin trading, as well as Cash Card and a rewards program. More than a million Cash App users bought Bitcoin for the first time in Q4, and the cryptocurrency was traded two and a half times more than in Q4 2019. Square itself bought $230 million of Bitcoin recently as it steers itself toward an expanded digital payment ecosystem. 

CashApp users increased 50% over the prior year in the fourth quarter to 36 million, and Cash App revenue increased more than 500%. A little bit of context is necessary here: Square records Bitcoin volume as revenue, and Bitcoin accounted for 80% of Cash App revenue in the fourth quarter and more than half of total revenue. Without Bitcoin, though, Cash App still grew 137%.

According to a McKinsey survey, digital penetration reached 78% in 2020, and that includes 93% for ages 13-34. People using more than one type of digital payment increased to 58%. More than half of survey respondents said they shifted to online shopping during the pandemic, and more than a third said they would increase that. The pandemic accelerated what was already a shift to digital payments, and that’s good news for Square.

The power of the mobile wallet

Square is poised to benefit from the move to digital wallets, and that means increased revenue from a growing and engaged user base. A Cash App account is simpler to use than a bank account, and the “ecosystem” aspect of Cash App as a peer-to-peer payments account and trading account is a very attractive feature. As we become more cashless, Square’s investments in its platform are likely to yield more customers, higher engagement, and increased revenue.

Cash App is also becoming more profitable, with gross profit per user up 70% year over year in Q4. Square became profitable for the first time in 2018, and it’s been posting more consistent profits over the past two years. Q4 earnings of $294 million were a 24% decrease year over year, but as the seller business gets back up to speed, that should increase. 

Square sees a more than $60 billion addressable market for Cash App, of which it has less than 2%. In the near term, it’s planning to gain market share by expanding the Cash App product line and improving customer service. But it has strong tailwinds that will continue to accelerate digital payment adoption as we move away from the pandemic.

If you’re looking for a growth stock that offers potential in the short and long term, Square is a candidate for you. Square stock has gained more than 1,500% over the past five years, but there is much more opportunity ahead, and the company is making moves to harness its potential.

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

More reading

• Aussie fintech lets ANYONE receive salary in Bitcoin (CRYPTO:BTC)
• ASX 200 Weekly Wrap: ASX 200 hits new post-COVID high
• Forget the Bitcoin price, the Dogecoin price is on fire!
• Do you think the Bitcoin price is a bubble? Read this
• Why Cryptocurrency stocks like Marathon Digital and Riot Blockchain crashed Today

Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Bitcoin, PayPal Holdings, and Square and recommends the following options: long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia has recommended PayPal Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Is Square the long-term stock for you? appeared first on The Motley Fool Australia.

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

from The Motley Fool Australia https://ift.tt/32CjeCE

The Australian Bureau of Statistics (ABS) released its ‘Household Financial Resources‘ data on Wednesday, illustrating the importance of the Australian Government’s JobSeeker and JobKeeper programs to Australian household income from September 2019 to September 2020.

The data shows that Australian household income and wealth were stable throughout the worst of the pandemic. The ABS’ reporting period finished after the peak of Victoria’s COVID-19 crisis, where the state was plunged into one of the world’s harshest and longest lockdowns. 

The ABS reported that, despite the Australian economy shrinking by 2.5% during the COVID recession, Australia’s average private household income remained stable at $2,117 per week compared to September 2019.

Income from government payments was a significant contributor to this stability. JobSeeker and JobKeeper spearheaded an average increase in government payments of 30% – or $89 per week – to $300 per week. 

The survey also provided insights into how those accessing the controversial early superannuation withdrawal scheme used their funds. The data showed that the majority of people accessing the scheme used their withdrawals for mortgage or rent payments (29%) or household bills (27%). Another 15% of people used the funds to pay down credit card or personal debt, while around one in eight people (13%) added to their savings. 

The ABS tracks Australia’s household income and subsequent spending capability on a quarterly basis, in order to inform government spending and drill deeper into the various impacts slow wage growth or rising inequality has on the broader Australian economy.

Government spending key to broader household stability

As mentioned, the ABS data showed that government spending helped maintain Australian household incomes at similar levels to those seen before the pandemic. It stated that, despite increased government pensions and allowances, total average household income remained stable in the September 2020 quarter.

This illustrates that household income would have fallen were it not for the increases in government payments. By how much, however, is speculative given that job losses generally affected lower-income households to a greater extent than their higher-income counterparts during the recession.

Meanwhile, families appeared to benefit most from the increases in government spending.

Average government pensions and allowances increased for most family types between September 2019 and September 2020. These increased by 82% for couple families with dependent children, the largest proportional increase by household composition.

The data also showed that JobKeeper was particularly important for middle-class families with mortgages. Of those households including an individual collecting JobKeeper, half owned their dwelling with a mortgage. Nearly half (47%) of all households with a member collecting JobKeeper were couple families with dependent children.

Household wealth more resilient than the ASX

While the ABS data didn’t track share market value, a look at the ASX’s major indexes over the same period shows that, despite household income remaining resilient, Australian listed businesses fared far worse. The S&P/ASX 200 Index (ASX: XJO) fell by nearly 1,000 points over September 2019 to September 2020. Meanwhile, the All Ordinaries Index (ASX: XAO) tumbled by around 800 points.

It wasn’t until January this year that the Australian markets returned to roughly similar levels as those seen in February 2020, before the onset of the pandemic. However, of particular interest, the S&P/ASX All Technology Index (ASX: XTX) largely rose steadily throughout the entire period of the pandemic, aside from an initial fall in March, coinciding with the bottom of the bear market.

After a 600 point decline between February and March 2020, the index then rose until February this year, more than doubling in value.

Foolish takeaway

More reading

• Why the Santos (ASX:STO) share price is in focus
• 5 things to watch on the ASX 200 on Thursday
• ASX 200 dips, Corporate Travel flies, Nuix sinks
• What’s with the Advanced Human Imaging (ASX:AHI) share price today?
• ASX stock of the day: Freelancer (ASX:FLN) shares shoot higher

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 ABS data shows Australians maintained wealth during COVID appeared first on The Motley Fool Australia.

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

The Oz Minerals Limited (ASX: OZL) share price is slipping after the company announced a solid first-quarter update for the 2021 calendar year today.

At the time of writing, the Oz Minerals share price has fallen 1.1%, trading at $24.35. 

However, shares in the copper and gold producer are up almost 26% year-to-date thanks to copper surging to an 11-year high of US$4.2/lb. 

What’s driving the Oz Minerals share price today?

In its update for the three months ending 31 March, the company highlighted strong operational performance and advised it was on track to meet its FY21 production guidance.

The company’s first-quarter production came in at 26,842 tonnes of copper and 55,150 ounces of gold, ticking the boxes to meet annual guidance. 

Despite well-controlled cost performance over the quarter, the strengthening Australian dollar and weaker gold prices are expected to negatively impact comparative all-in sustaining costs and unit costs over the year. As a result, the company has modified its 2021 cost guidance. 

A soaring copper price has helped counter rising costs and support robust operating cash flows. Furthermore, gold prices appear to have hit a short-term bottom in the past few weeks, bouncing from US$1,680/oz in late March to US$1,795/oz this week. 

Advancing pipeline projects to drive growth

Oz Minerals continues to advance its growth pipeline projects, demonstrating the quality of organic growth options available. The company highlighted key drilling programs underway at Prominent Hill, West Musgrave and Santa Lucia. These projects are all progressing to support key milestones and decision points later this year.  

Broker Macquarie had previously highlighted Oz Minerals as its preferred exposure to copper with several key organic catalysts headlined by its Prominent Hill expansion update later this year.

The broker rated its shares as outperform with a $30.00 target price on 16 March. Oz Minerals expects to complete a shaft expansion study in 3Q21 at Prominent Hill to enable 6Mtpa of production from 2025. 

More reading

• ASX miners in focus as the copper price looks poised to crack above 10-year highs
• Why ASX mining shares are likely to jump this morning
• Why the BHP (ASX:BHP) share price is surging today
• The new race between US and China is good news for these ASX shares
• Why ASX copper shares are cheering for Joe Biden

Motley Fool contributor Kerry Sun 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 Oz Minerals (ASX:OZL) share price slips despite solid update appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/2Pf71ki

ASX mining shares could soon rediscover the meaning of having too much of a good thing as talk of a super profits tax returns.

Former prime minister Keven Rudd is rattling the cage on introducing the extra levy on our largest iron ore producers, reported Peter Ker of the Australian Financial Review.

Super profit tax on ASX miners back from the grave

Rudd is accusing the major ASX miners of ripping off Australians as the iron ore price looks poised to break new highs.

The ex-PM tried to introduce a similar tax during the last commodity boom in 2010. This contributed in no small part to his downfall.

Extra cash would be handy right now for the country

An extra tax on cashed-up miners could certainly be handy in paying down the record federal government deficit. The Morrison government will release the budget on the second Tuesday in May.  

As highlighted yesterday, the BHP Group Ltd (ASX: BHP) share price and Rio Tinto Limited (ASX: RIO) share price are likely facing profit upgrades in the near-term due to the expectation-defying iron ore price.

This same tailwind also bodes well for the Fortescue Metals Group Limited (ASX: FMG) share price.

Iron ore likely to set new record soon

A growing number of experts are warming to the idea that the iron ore price will soon crack above its previous high of US$193 a tonne set in February 2011.

But if the idea of a super profits tax gains momentum, this could dampen the party for the major miners.

“As was the case during the last resources boom, and the one before that, the super-profits earned by a handful of resource majors in this country are a giant rip-off of the Australian people,” the AFR quoted Rudd as saying.

“Furthermore, the greed of these three is unbelievable: they haven’t even bothered to establish serious, large-scale charitable foundations to benefit the Australian people at the scale that other serious global firms do. And in Rio’s case, they dynamite Indigenous heritage in the way.”

The real commodity supercycle

Also worth noting that it isn’t only the iron ore price that is reaching for the stars. A wide range of metals, including copper and lithium, are booming.

This commodities supercycle looks more enduring than the last too. Production output is up, costs are down and demand for commodities is coming from several countries, not just China.

Foolish takeaway

However, it’s too early to be pricing in a super profits tax on ASX mining shares. The federal Liberal coalition that’s in power is unlikely to back such an idea – especially one that comes from an ex-Labor prime minister.

But ASX miners will be keeping their fingers crossed that such an idea won’t find widespread popular support!

More reading

• Is the BHP (ASX:BHP) share price in the buy zone after its update?
• ASX 200 dips, Corporate Travel flies, Nuix sinks
• Why Rio Tinto (ASX:RIO) and BHP (ASX:BHP) look set for another profit upgrade
• Fortescue share price falls as Twiggy calls fossil fuels ‘most dangerous industry in the world’
• BHP (ASX:BHP) share price drops despite 10-year iron ore highs

Motley Fool contributor BrenLau owns shares of BHP Billiton Limited, Fortescue Metals Group Limited and Rio Tinto Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Super profits tax risk rising for ASX miners as commodity prices chase record highs appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3tI8dvg

The Audinate Group Ltd (ASX: AD8) share price is climbing higher today following the release of its quarterly trading update.

At the time of writing, the media networking solutions provider’s shares are swapping hands for $8.03, up 2.03%.

What did Audinate announce?

The catalyst for the rise in the Audinate shares this morning has come from its quarterly trading update.

According to its release, Audinate reported robust growth for the March quarter, achieving unaudited revenues of US$7 million. The sound performance reflects a 31% increase on the prior corresponding period.

Audinate attributed the result to its newly released Bluetooth and USB-C AVIO adapters as well as an increase in customer orders. Furthermore, the company also strived to manage supply chains disruptions caused by COVID-19.

Pleasingly though, Audinate highlighted that the chips, cards, and modules revenue have continued to grow when compared to H1 FY21. Predominately, this has derived from the entire range of AVIO adaptors and Ultimo chips.

Audinate CEO Aidan Williams provided an update on the company’s outlook, saying:

We are pleased with the ongoing revenue trajectory of the business and the initial contributions from our new AVIO adaptors. However, we are closely watching global supply chains for potential negative impacts on both our customers and Audinate, which may constrain our near-term revenue and growth.

Along with our manufacturing and OEM partners, we are working to mitigate supply chain challenges and expect this near-term uncertainty to resolve itself as CY21 progresses. We remain very confident in the long-term outlook for the business.

Leadership change

In further news, possibly boosting Audinate shares, the company restructured some of the leadership team.

Audinate co-founder, Dr. Varuni Witana will move into the role of chief technology officer, heading up R&D activities of technology architecture. Previously, Dr. Witana worked alongside Audinate CEO Aidan Williams to develop the core Dante technology at the National ICT Australia (NICTA).

In addition, John Rush will take up the position of chief marketing officer, expanding on his current responsibilities in sales. Prior to joining Audinate, Mr. Rush held the role of vice president of marketing and product at Vesta — an electronics payment solutions company.

Mr. Williams commented on the management change:

I am thrilled to have someone of Varuni’s calibre and track record in such an important role for Audinate. I’m confident she will continue to drive our long-term strategy forward through innovation and R&D. Additionally, we are pleased to further expand Josh’s role to incorporate the global sales function. His market and product knowledge combined with a strong analytical approach will bring immediate benefits to our global sales teams.

Audinate share price snapshot

Over the past 12 months, the Audinate share price has accelerated to almost 70%. Year-to-date, however, the company’s shares are flat.

Audinate presides a market capitalisation of around $617 million, with more than 76 million shares outstanding.

More reading

• 2 fantastic ASX shares that brokers rate as buys
• 3 growing small cap ASX tech shares to watch
• 3 exciting small cap ASX shares for your watchlist
• 3 exciting small cap ASX shares to watch

Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AUDINATEGL FPO. The Motley Fool Australia has recommended AUDINATEGL FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Audinate (ASX:AD8) share price climbs on Q3 update appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3dDmVy1

Is the Afterpay Ltd (ASX: APT) share price a buying opportunity? The buy now, pay later business just reported another quarter of strong growth to the market.

Afterpay’s FY21 third quarter

Total underlying sales went up 104% to $5.2 billion. In constant currency terms, underlying sales went up 123%.

There was a mixed level of growth across its main operating regions. North American underlying sales soared 167% higher to $2.6 billion, it’s now the biggest segment. ANZ underlying sales grew 48% to $2.1 billion. UK underlying sales jumped 246% to $0.5 billion.

The US became the first region to record more than $1 billion of underlying sales in a single month.  

Active customer growth also saw different levels of increases. UK customers went up 134% to 1.8 million, which will help future growth. North American customers grew 112% to 9.3 million. ANZ active customers only went up 9% to 3.5 million. Total active customers grew 75% to 14.6 million.

There was strong growth with its number of active merchants. Total active merchants grew 77% to 85,800. North American active merchants rose 154% to 23,200, ANZ merchants increased 49% to 57,700 and UK active merchants went up 672% to 5,000.

The rollout of its in-store presence in the US continues, with a number of new retailers going live in the first half of FY21. ANZ in-store volumes continue to recover and are now tracking near to pre COVID-19 levels.

The buy now, pay later business said that merchant revenue margins remain in line with what was reported in the six months to December 2020.

Repeat customers are becoming even more important for the Afterpay share price

Afterpay said that the network effect of its platform continues to drive increasing customer frequency across all regions.

The top 10% of customers globally, on average, now transact 33 times per year per year. That breaks down to around 23 times per year in the US, 62 times per year in ANZ and 29 times per year in the UK.

Europe growth incoming

Afterpay revealed that merchants with over $1.5 billion of total addressable online sales are live, integrating or signed in the EU after the completion of the Pagantis acquisition and launch of Clearpay across Spain, France and Italy in March 2021.

Is the Afterpay share price an opportunity?

Brokers have mixed thoughts on Afterpay shares.

Credit Suisse thought that this quarter was better than it expected and had solid customer growth, but not quite as good as its forecast. The broker decided to slightly decrease its forecast of underlying sales for FY21. It has a price target of $145 on Afterpay.

However, UBS still has a negative outlook on the Afterpay share price with a price target of $36. The broker noted the strong northern hemisphere growth, though the UK customer growth was a bit lower than expected.

In-particular, the broker noted that ANZ saw single digit customer growth because it has reached a certain size, which is why it decided to reduce its FY21 expectations for sales. But that doesn’t impact the medium-term outlook much.

More reading

• High-flying ASX tech shares could fall another 90%: fundie
• 5 things to watch on the ASX 200 on Thursday
• Top brokers name 3 ASX shares to buy today
• Leading brokers give their verdict on the Afterpay (ASX:APT) share price
• Latitude (ASX:LFS) makes a splash on its ASX debut

Motley Fool contributor Tristan Harrison 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.

The post Is the Afterpay (ASX:APT) share price a buying opportunity right now? appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3xe1bAO

The Regis Resources Limited (ASX: RRL) share price is on the move in early trade following a pre-market announcement from the Aussie gold miner.

Why is the Regis Resources share price climbing?

There was a flurry of price sensitive announcements from Regis Resources this morning. All of those related to the Tropicana Gold Mine near Kalgoorlie, Western Australia.

IGO Ltd (ASX: IGO) announced that it has sold its 30% stake in the Tropicana Gold Mine. That sale comes after the satisfaction of a key condition precedent for the proposed transaction.

That was the waiver or non-exercise of a right of last refusal (ROLR) by AngloGold Ashanti Australia Limited. AngloGold Ashanti holds the remaining 70% interest in the mine but looks set to partner with Regis Resources.

Given AngloGold Ashanti has waived its ROLR, that paves the way for Regis Resources to snap up the 30% stake. The transaction will complete on or before 31 May 2021 and the Regis Resources share price has jumped higher accordingly.

Regis has entered a conditional binding agreement for the Tropicana stake for cash consideration of A$903 million. The acquisition remains conditional on the approval from the Minister for Mines and Petroleum to the “transfer of certain tenements”.

Regis Managing Director and CEO Jim Beyer said, “We are very pleased this critical condition has been satisfied and look forward to working closely with our new JV partner, AngloGold”.

“This acquisition provides significant strategic benefits to Regis and when combined with our existing assets, provides a larger-scale, longer-term financial and operating platform to pursue internal and external growth opportunities”, he added.

The Regis Resources share price jumped higher on the news with investors reacting well to the latest acquisition. At the time of writing, Regis shares were up 0.9% to $2.77 per share to start the day.

More reading

• ASX 200 Weekly Wrap: ASX 200 hits new post-COVID high
• These were the worst performing ASX 200 shares last week
• Brokers name 3 ASX shares to buy now
• Why BrainChip, Regis Resources, Whitehaven, & Zip shares are tumbling lower
• ASX 200 flat: Zip raises $400m, Bank of Queensland results, Regis crashes

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 Regis Resources (ASX:RRL) share price is climbing appeared first on The Motley Fool Australia.

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

The Lynas Rare Earths Ltd (ASX: LYC) share price has come under immense selling pressure after the company revealed that Chinese producers were planning to increase production.

Among them, Northern Rare Earth will be doubling production within three years. This accounts for some 60% of China’s total rare earth production. 

This news sent the Lynas share price into free fall, shedding 13% in value in the last two trading sessions.

China has a near-global monopoly in rare earths production. This accounts for more than 55% of total global output. Between 2011 and 2017, fierce domestic competition and ignoring environmental protocols sent rare earth prices plummeting. Furthermore, placing Lynas on the brink of collapse.  

While China’s planned increase in production is met with a different set of circumstances today, it might be worth taking a trip down memory lane. 

The boom and bust for rare earth prices 

Rare earth oxides (REO) were fetching for as much as US$200/kg at their peak in 2011. However, as soon as China began to purge the market with supply, much of which was produced illegally, prices began to crash lower and lower. 

Lynas’ most recent quarterly update observes a steady improvement in REO prices. But the complete opposite was happening just a few years back. In its FY16 quarterly, REO prices went from A$17.2/kg in 1Q16 to as low as A$14.7/kg in 4Q16. The company was burning through cash and on the verge of collapse. 

Between the boom and bust of rare earth prices, the Lynas share price went from as high as $26.70 in April 2011. Prior to falling as low as 30 cents in October 2015. 

This could be why the Lynas share price is facing heavy selling pressure. Due to a significant amount of rare earths production is expected to hit the market in the medium term. 

However, it is also important to acknowledge that the supply increase is met under a different set of circumstances given the global multi-decade commitment to decarbonisation and electrification of vehicles. 

Lynas share price slumps for a third straight session

The Lynas share price dipped as much as 5.50% on open to $5.25. Its shares quickly bounced off lows and are currently trading 2.53% lower to $5.40. 

Its shares are caught in a tug-of-war. Caught between the potential impact that China might have on rare earth prices and the clear long-term demand for rare earths and renewable technology. 

More reading

• Why is the Lynas (ASX:LYC) share price down 14% this week?
• ASX 200 drops, Challenger plummets, Lynas falls
• Why Altium, Challenger, Lynas, & Sydney Airport shares are sinking
• Lynas (ASX:LYC) share price down 7% despite ‘strong’ quarterly update
• These top 2 ASX 200 shares have thumped the index’s 2021 returns

Motley Fool contributor Kerry Sun 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 How the Lynas share price (ASX:LYC) sunk 90% last time this happened  appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3emCf1h