The comeback of the S&P/ASX 200 Index (ASX: XJO) from the record breaking COVID-19 market meltdown last February and March has been nothing short of stellar.

Since the March 2020 lows, the ASX 200 has soared 42%. If you’ve never witnessed anything like it, don’t worry. No one has.

ASX 200 shares sprinted to record gains

While most shares gained strongly during the rebound, it was the ASX 200 growth shares that led the charge. Think of companies like ASX buy now, pay later (BNPL) darling, and Afterpay Ltd (ASX: APT).

Although down 34% since its 10 February 2021 highs, the Afterpay share price is still up 740% since 20 March 2020.

Other ASX 200 shares have underperformed the index and far underperformed growth shares like Afterpay.

With international and even most domestic air travel locked down for much of the past 12 months, the Sydney Airport Holdings Pty Ltd (ASX: SYD) share price has only gained 28% since 20 March 2020. While that may not sound like a small gain (and it’s not), the Sydney Airport share price is still down 32% since 27 December 2019.

With these kinds of figures in mind, investors are increasingly wondering about the outlook for value shares.

For that answer, we turn to the experts.

Why these investment experts disagree on the outlook for value shares

If you were hoping for a unified answer, those months appear behind us.

As Bloomberg reports:

Societe Generale SA and JPMorgan Chase & Co. say value shares will keep outperforming at this stage of the market cycle. Prudential Financial Inc. and AlphaOmega Advisors LLC say the sector is due for a pullback.

Solomon Tadesse is Societe Generale’s head of North American equity quant research in New York. According to Tadesse:

Value (and more generally cyclicals) still command significant valuation advantage to the rest of the market. Distressed out-of-favour assets tend to gain from potential multiple expansion at this point of the market cycle.

And JPMorgan Chase strategists led by Dubravko Lakos-Bujas write that:

Value remains an outsized beneficiary of reopening, which is still in its early stages… [W]hile we believe value and reopening trade still has room for upside, we would emphasize focusing on higher quality companies with greater staying power, for example retail and energy.

On the other side of the value share debate is Peter Cecchini, founder and chief strategist of AlphaOmega Advisors. According to Cecchini:

It’s time to take money off the table now. Perhaps the latest round of stimulus will keep the cyclicals trade alive a bit longer, but I just don’t see the cycle turning for good as we might expect after a normal recession. Staying tactical and nimble seems prudent.

As for Prudential Financial, as Bloomberg reports, Quincy Krosby, chief market strategist says, “The reflation trade is ‘frothy’ and ‘waiting for a pullback is prudent’.”

Krosby believes investors have been too optimistic about the massive new infrastructure cash splash proposed by United States President Joe Biden. She said that if investors sense issues within Congress that could delay or derail the package, shares could sell-off. Which, she says, could be the right time to buy the dip.

Foolish takeaway

So what’s an ASX 200 investor to do?

I believe Peter Cecchini, quoted above, has it right. “Staying tactical and nimble seems prudent.”

Happy investing.

More reading

• Why the Telstra (ASX:TLS) share price rose 11% in March
• ASX 200 boom as Joe Biden unveils massive infrastructure, tax package?
• Why the Afterpay (ASX:APT) share price fell 20% in March
• ASX 200 up 0.25%: AMP names new CEO, Boral’s buyback, Webjet sinks
• Why the South32 (ASX:S32) share price is climbing

Motley Fool contributor Bernd Struben 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 Fluence Corporation (ASX: FLC) share price is up today after it shared 3 pieces of positive news.

Fluence announced it has received 2 separate orders from large state-owned enterprises in China and a US$2.4 million contract to supply 3 NIROBOX water treatment units in Taiwan. All up, the orders are worth US$4.6 million, with the supplier of wastewater and reuse treatment products predicting follow-on business.

At the time of writing, the Fluence share price is up by 11.9%, trading at 23.5 cents.

Let’s take a closer look at Fluence’s announcements.

What’s driving the Fluence share price today?

First volume order from Three Gorges

Fluence has received its first volume contract for the Yangtze River Great Protection Program, managed by China Three Gorges Group Corporation, worth a total of US$2.2 million.

The order consists of 29 of Fluence’s Aspiral MABR wastewater treatment products, to be implemented in 14 townships in the Hunan province.

China Rail Order

Fluence has also been awarded another contract by Beijing China Railway Science New Technology Co Ltd, a subsidiary of China Academy of Railway Sciences Cooperation Limited, known as China Rail.

This is the first wastewater reuse project in China for the company. It’s worth US$28,000 and includes 2 Aspiral Micro wastewater treatment units. The Aspiral Micro units were chosen for their ability to treat wastewater to irrigation quality.

The company states that wastewater reuse is a key part of China’s current five-year plan.  

NIROBOX order in Taiwan

Finally, the company announced it has received a US$2.4 million contract to supply 3 NIROBOX units to drought-stricken Taiwan.

The contract is expected to begin in May. Fluence’s units will be placed to convert seawater into drinking water for 30,000 people in central Taiwan.

According to the company, it was awarded the contract because it was able to provide a proven product with a quick turnaround.

Fluence stated its partner, ADE Corporation, facilitated the order from Taiwan’s Water Resources Agency.

What did management have to say?

Fluence CEO Richard Irving welcomed the news, saying:

Reuse is a major strategic target for Fluence given MABR’s competitiveness in meeting the required standards to reuse treated wastewater. Importantly, China’s latest five-year plan (2020-2025) for the first time specifies wastewater reuse targets ranging from 25%–35% in water-stressed regions which is anticipated to require significant deployment of new and upgraded treatment.

Based on China Ministry of Housing Data, this represents a US$4 billion market opportunity over the next 4 years assuming new or upgraded treatment is needed to achieve these targets.

Mr Irving went on to discuss the order for Taiwan, saying the company was pleased to continue working with long-term partner ADE Corporation to secure the order.

We anticipate that local drought conditions, combined with increased demand for smart, automated, decentralized solutions, will lead to further business in Taiwan and the region.

Fluence share price snapshot

Today’s news comes at a perfect time for the Fluence share price, which is having a poor year on the ASX. While it is up by 6.82% year to date, it’s down 24.19% over the last 12 months.

Fluence has a market capitalisation of around $131 million, with approximately 624 million shares outstanding.

More reading

• The Zimplats (ASX:ZIM) share price is up nearly 93% since January. What’s going on?
• Here’s why the Fortescue (ASX:FMG) share price sank 17% in March
• Zoono (ASX:ZNO) share price soars 40% on Microsoft deal
• Why the Telstra (ASX:TLS) share price rose 11% in March
• Deliveroo shares flop on market debut

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.

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The Zimplats Holdings Ltd (ASX: ZIM) share price has surged since the beginning of this year.

The platinum miner’s share price opened the year at $13.15 and is now trading for $25.30, which is up 92.4% in just under 3 months. Just today, it opened 11% higher before retreating to be up 1.2%. For comparison, the S&P/ASX 200 Index (ASX: XJO) is up 0.47% today and 2.07% year-to-date.

The Zimplats share price has been breaking its own all-time record almost once a week. So, what’s driving these gains?

Zimplats share price surging alongside platinum prices

When the Zimplats share price first broke its all-time record at the beginning of March, Motley Fool Australia reported the movement was highly correlated with the price of rhodium.

Rhodium is one of the elements Zimplats specialises in – along with platinum and palladium, as well as iridium, ruthenium, and osmium. Rhodium is the rarest non-radioactive element on Earth. It has many uses, but its most important one is in car exhausts. The element is used as a catalyst in cars to reduce the amount of nitrogen oxide (an air pollutant) in exhaust fumes. 

Car manufacturers are increasingly demanding rhodium as nations around the world increase environmental regulations, according to website Trading Economics.

Supply has also diminished due to COVID-19 work stoppages. As a result of increasing demand and decreasing supply, rhodium’s price is surging.

At the time of writing, rhodium was trading in the commodities market for US$26,200 a troy ounce (t oz). While it’s down from its all-time high of US$29,800t oz, it is still up 54.12% since the beginning of this year.

What about platinum and palladium?

Rhodium isn’t the only element with a surging commodity price. Both palladium and platinum’s price have been a boon for the Zimplats share price.

Since the beginning of the year, the price of palladium has increased 6.95% ($2,617.78t oz) and platinum by 10.89% ($1182.50t oz).

Both platinum and palladium, like rhodium, are used as catalysts for car exhausts to reduce emissions. While not as rare as rhodium both metals are seeing increased demand, nevertheless.

Platinum is also used in oil refinery and as jewellery. Palladium’s other uses include electronics, dentistry, medicine, and hydrogen purification. Palladium’s price is at an all time high, after hitting a 5-year high in February this year.

Zimplats share price snapshot

Most of the Zimplats share price growth has occurred in 2021. Over the last 12 months, the company’s value has increased 166.6%.

Its share price has increased over 10% on four separate days this year. In fact, on Monday 29 March, the share price increased a whopping 25.7% by close of trade. At one point it reached an all-time high of $2.75.

Zimplats has a market capitalisation of $2.7 billion.

More reading

• Why the Zimplats (ASX:ZIM) share price just hit an all-time high

Motley Fool contributor Marc Sidarous 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 Fortescue Metals Group Limited (ASX: FMG) share price was uncharacteristically out of form in March.

During the month, the iron ore producer’s shares fell a disappointing 17%.

This compares to a gain of 1.8% by the the S&P/ASX 200 Index (ASX: XJO).

Why did the Fortescue share price underperform in March?

There were a couple of reasons for the underperformance of the Fortescue share price last month.

The first was the company’s shares trading ex-dividend on the very first day of the month for its huge interim dividend.

When a company’s shares go ex-dividend, they tend to drop by the amount of the upcoming dividend. This is to reflect the fact that the rights to the dividend remain with the seller and aren’t transferred to the buyer.

In the case of Fortescue, it was paying shareholders a massive $1.47 per share dividend. This is the equivalent of a 6.1% yield, which accounts for over a third of the Fortescue share price decline.

What else was weighing on the company’s shares?

However, having the biggest impact on the Fortescue share price last month was the iron ore price.

The price of the base metal came under pressure in March after Chinese authorities decided to restrict the output for some steel mills in Tangshan until the end of 2021. Regulators made the move in an attempt to combat rising pollution levels.

This led to analysts at Goldman Sachs predicting that the steel making ingredient would end up in a surplus in 2022 instead of a deficit.

According to Metal Bulletin, this news led to the benchmark 62% fines iron ore price losing ~US$10 a tonne or over 6% during the month to end it at US$165.15 a tonne.

In light of this, it will come as no surprise to learn that mining giants BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) also underperformed the market materially last month as well.

More reading

• 2 ASX dividend shares with very BIG yields
• Is the Fortescue share price ring-fenced by Twiggy and its climate targets?
• Why Macquarie thinks the BHP (ASX:BHP) share price and 2 others will outperform
• ‘Remarkable resilience’ in Aussie farmland a tailwind for ASX agriculture shares
• Why the South32 (ASX:S32) share price is outperforming today

Motley Fool contributor James Mickleboro 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 Zoono Group Ltd (ASX: ZNO) share price is flying higher today after the sanitiser producer released a company update. The announcement contained several positive pieces of information.

At the time of writing, the Zoono share price has retreated slightly but still remains a staggering 38.3% higher to 83 cents per share.

US tested and approved boosts Zoono share price

According to the release, Zoono’s Microbe Shield surface sanitiser has been tested by an independent laboratory in New Jersey, United States. The US FDA regulated facility found Zoono’s flagship sanitiser to be successful against Human Coronavirus 229E. Previously the products had only been tested against the COVID surrogate feline coronavirus.

Additionally, the product now meets the US EPA Standard ASTM E1053, which relates to the assessment of the virucidal activity of chemicals.

Following the US regulatory approval, the company has sourced new distribution partners in Norway, Luxembourg, Greece, and Poland. Reportedly initials orders are pending in each country.

Deals for days

In another win for the Zoono share price, the company has gained another two highly notable partnerships. After an extensive market evaluation, Microsoft Corporation (NASDAQ: MSFT) has offered Zoono the opportunity to be an approved supplier to the tech company’s office network.

An initial purchase of Zoono’s sanitiser products has already been received for the Redmond Campus. This location is Microsoft’s corporate headquarters in Washington, with 125 buildings and 53,500 staff across the campus. A full US rollout will be engaged once employees return to the campus in May.

Secondly, Zoono has partnered with Boeing Co (NYSE: BA) to distribute Microbe Shield to airlines globally. The flagship sanitiser meets the Boeing standard for use in aircraft interiors. As a result, Boeing has made the product available from its official online store.

Sales, production, and intellectual property

Zoono indicated that its orders shipped for Q3 FY21 are in excess of $5 million. This is despite global freight and logistic challenges. Furthermore, Fine Hygiene Group is on target to meet sales projections of US$7 million over the next 6 months. Once relevant regulatory requirements are satisfied, Fine will expand into new markets including Europe, United States, and Australia.

Lastly, the company has brought its plastic bottle production in-house. This is in an effort to avoid supply chain bottlenecks. Zoono plans to commence production in the near future. As a means of protecting the company’s specialised formulations, global patent applications have been submitted.

Zoono share price rejuvenation

The update is a sight for sore eyes, after a year of disappointing share price performance for Zoono shareholders. Even with the inclusion of today’s gain, the share price is down 53% in the past 12 months.

However, this seemingly positive update has brought a renewed interest to Zoono. In fact, the traded volume is in excess of 5.8 million shares — more than 17 times the shares monthly average volume.

The company’s share price remains volatile due to its small market capitalisation of $135 million.

More reading

• Why AMP, Boral, Rhipe, & Zoono shares are pushing higher
• Here are the US shares ASX investors have been buying
• 2 top ASX ETFs to buy right now
• Why is there no ASX All Ordinaries ETF?
• How to counter the ASX 200’s Achilles heel

Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Mitchell Lawler 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 Microsoft. 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 Telstra Corporation Ltd (ASX: TLS) share price is having a decent start to April today. At the time of writing, Telstra shares are up 0.44% to $3.42 a share. But we’re not here to talk about April, we’re here to talk about the Telstra share price in March.

And March was an unusually good month for the ASX’s largest telco. The Telstra share price started March at $3.08 a share (the closing price on 26 February). Telstra shares closed at $3.42 yesterday. That means Telstra shares were up 11.04% in March overall. And that’s not even including the 8 cents per share fully franked dividend Telstra shareholders received last week.

An 11% rise is a very decent move, especially for an old blue chip share like Telstra.

And it’s fairly obvious why this company had such a good month if we dig in. So let’s do it.

March madness for Telstra shares

So the first thing to note is that the S&P/ASX 200 Index (ASX: XJO) experienced something of a ‘rotation’ over March. A rotation is a rather horrible Wall Street term for when large fund managers move together in shifting money out of one sector into another. In this case, it was growth shares into value shares, to put it a little too simply.

Rising bond yields over February and March sparked a distaste for high flying growth shares. That’s why we saw blue chips like Telstra and the big banks do well over the month, while growth shares like Afterpay Ltd (ASX: APT) got walloped. That supported Telstra from the get-go.

But Telstra also excited the market with some details regarding its planned structural separation. On 22 March, Telstra outlined how it intended to split its core operations into four divisions: InfraCo Fixed, InfraCo Towers, ServeCo and Telstra International. This split will still see Telstra remain one company on paper (under the name ‘Telstra Group’). But these divisions will be legally and regulatorily separate. The company is planning on completing this split by the end of the year.

This was evidently well-received by Telstra investors. It seems the consensus is that a move like this will unlock significant value in the telco’s assets. This view was supported by a well-known broker. As my Fool colleague James Mickleboro reported at the time, Morgans upgraded its price target for Telstra shares from $3 a share to $4 following the announcement.

More reading

• ASX 200 boom as Joe Biden unveils massive infrastructure, tax package?
• Why the Afterpay (ASX:APT) share price fell 20% in March
• ASX 200 up 0.25%: AMP names new CEO, Boral’s buyback, Webjet sinks
• Why the South32 (ASX:S32) share price is climbing
• The Zip (ASX:Z1P) share price crashed 29% lower in March

Motley Fool contributor Sebastian Bowen owns shares of Telstra Limited. The Motley Fool Australia owns shares of and has recommended Telstra Limited. 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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In a sign of how much market sentiment has turned against growth and technology stocks, Deliveroo Holdings PLC (LON: ROO) shares crashed on the first day of listing.

The UK food delivery giant’s initial public offering (IPO) was much anticipated as one of Europe’s biggest this year, with shares snapped up for £3.90.

But when they started trading on the London exchange overnight, they immediately fell 30%.

The stock recovered slightly to end a wild first day on £2.87, which is still more than 26% down on the IPO price.

Investors boycotted Deliveroo’s IPO 

Food delivery cyclists with the familiar aqua warmer bag on their backs have become ubiquitous in both the UK and Australia. 

But recent concerns over labour relations scared away some investors during Deliveroo’s IPO, despite its famous brand name.

“Several influential institutional investors declined to participate in this IPO. They included Aviva, Legal & General, and Aberdeen Standard. They expressed concern over Deliveroo’s employment practices,” said The Motley Fool UK’s Cliff D’Arcy.

“They also disliked dual-class shares that hand extra votes to co-founder Will Shu for a further three years. Hence, they declined to invest in the eight-year-old business.”

Deliveroo did not reply to The Motley Fool’s request for comment.

Even at the IPO price of £3.90, some experts already thought Deliveroo was overvalued for a business that’s still incurring huge losses.

Hargreaves Lansdown analyst Sophie Lund-Yates compared Deliveroo’s valuation to the owner of Menulog, Just Eat Takeaway.com NV.

“A market cap of £7.6 billion means the company’s worth 6.4 times last year’s revenue, which is some way above rival Just Eat’s 4.8 times.”

‘Terrible economics’: why Deliveroo is not a tech company

Both D’Arcy and Royston Wild of The Motley Fool UK recommended staying away from Deliveroo shares.

That’s despite Wild’s bullish outlook on the British takeaway food sector.

“I fear that the Deliveroo share price still looks too expensive despite today’s fall,” he said.

“The firm operates in a highly-competitive area, and one in which the issue over workers rights is becoming an ever-hotter potato, which makes this particular UK share too risky in my opinion.”

D’Arcy, as a value investor, disagrees with Deliveroo’s self-characterisation as a technology business.

“I see an intermediary or distributor in an ultra-competitive market. It may have a snazzy app and website, but the hard work is done by roughly 100,000 ‘independent contractors’,” he said.

“If Deliveroo had to pay the minimum wage to those delivery drivers as employees, I struggle to see how it would overcome the terrible unit economics of home delivery.”

More reading

• ASX 200 boom as Joe Biden unveils massive infrastructure, tax package?
• Here’s why the Identitii (ASX:ID8) share price is surging today
• Why the CSL (ASX:CSL) share price is going around in circles
• Why the SG Fleet (ASX:SGF) share price is one to watch next week
• Amazon is doubling down on this multibillion-dollar opportunity

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.

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US President Joe Biden has unveiled plans for a massive infrastructure program for the United States.

It’s only been a few weeks since President Biden’s Democratic Party ushered in a mammoth coronavirus stimulus package. This package, which included direct cheques and support for vaccination programs, cost US$1.9 trillion.

New infrastructure bill on the table

But now that that law has been passed, the Biden administration is now turning its attention to infrastructure. According to the White House, President Biden stated that the ‘American Jobs Plan’ will be the largest American jobs investment since World War Two and “will create millions of jobs”.

Biden’s proposal is set to cost approximately US$2 trillion, but that cost will be spread over 8 years. Here are some of the details from the President’s address:

The American Jobs Plan will build new rail corridors and transit lines, easing congestion, cutting pollution, slashing commute times, and opening up investment in communities that can be connected to the cities, and cities to the outskirts, where a lot of jobs are these days. It’ll reduce the bottlenecks of commerce at our ports and our airports… modernize 20,000 miles of highways, roads, and main streets that are in difficult, difficult shape right now. It’ll fix the nation’s 10 most economically significant bridges in America that require replacement.

It will also reportedly include funding for more modern infrastructure, such as internet connections and electric vehicle charging stations.

This package will not be entirely funded with debt, like the stimulus package was. President Biden is proposing a raft of changes to the American tax code to help come up with the extra cash.

This most prominently includes raising the US corporate tax rate to 28%, from the current level of 21%. It also includes various tax loophole closures and plans for a “global minimum tax rate” for companies.

What does this proposal mean for ASX shares?

Any large stimulatory program in the United States, the world’s largest economy, is likely to have positive flow-on effects for the global economy, which of course includes Australia. As such, this package is likely to be a piece of good news for S&P/ASX 200 Index (ASX: XJO) companies.

Infrastructure requires a lot of raw commodities, such as copper and iron ore for steel. As such, this plan could be beneficial for ASX mining companies in particular, such as BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO).

Of course, this plan is only a plan at this stage. Biden will need to wrangle it through the US Congress, where his party only holds slim majorities in both houses. This could result in significant changes to the measures we’ve discussed. Particularly around the tax plans.

But this space is certainly one to watch for any ASX investor.

More reading

• ASX 200 up 0.25%: AMP names new CEO, Boral’s buyback, Webjet sinks
• Why the South32 (ASX:S32) share price is climbing
• Why the BHP (ASX:BHP) share price fell 9.5% in March 
• These were the best performing ASX 200 shares in March
• These were the worst performing ASX 200 shares in March

Motley Fool contributor Sebastian Bowen 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 Identitii Ltd (ASX: ID8) share price is surging in early-afternoon trade following a contract renewal. At the time of writing, the financial technology company’s shares are swapping hands for 14 cents, up 8%.

What’s moving the Identitii share price higher?

Investors are buying Identitii’s shares after the company released a positive update to the market this morning.

In its announcement, Identitii advised it has renewed its original contract with global banking giant, HSBC.

Under the renewed contract, Identitii will continue to provide services to support HSBC’s Digital Account Receivables Tool (DART). This will see Identitii offer new features, training and maintenance, as well as support for DART’s expansion into new markets.

DART, centred around Identitii technology, is built specifically for HSBC’s Global Liquidity and Cash Management business. The platform also enables users to track invoices and receive payment information, resulting in faster business payments.

Furthermore, DART streamlines the customer experience and automates the accounts receivables process for HSBC’s corporate clients, leading to working capital efficiency.

DART first went live in India in 2018 and is now available in Indonesia. It is being slowly rolled out across Asia.

The 3-year deal is worth up to a total of $2 million in revenue for Identitii. This consists of $0.6 million in annually recurring revenue, along with up to $1.4 million in professional services and other fees.

In addition, both parties have also renewed their global Master Framework Agreement (MFA). This gives Identitii to right to licence its technology to any other business arms of HSBC globally.

Words from the CEO

Identitii CEO John Rayment welcomed the extended partnership, saying:

Renewing a contract with an existing customer is an exciting time for any business as it points to the success of the initial project and continuation of the relationship.

This announcement is particularly exciting for Identitii as HSBC was our first production customer in 2017 and since then we have delivered HSBC DART and provided ongoing development and support that has enabled them to expand the platform into new geographic markets.

The Identitii share price has fallen heavily over the past 12 months, down 55%. Year-to-date, the company’s shares are around 15% lower.

More reading

• Deliveroo shares flop on market debut
• ASX 200 boom as Joe Biden unveils massive infrastructure, tax package?
• Why the CSL (ASX:CSL) share price is going around in circles
• Why the SG Fleet (ASX:SGF) share price is one to watch next week
• Amazon is doubling down on this multibillion-dollar opportunity

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.

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The CSL Limited (ASX: CSL) share price finished March down 1.5%, largely in-line with the flat ASX 200 and 0.67% fall for the S&P/ASX Health Care (INDEXASX: XHJ). 

The CSL share price has seemingly gone nowhere since its all-time record high of $332.68 back in February 2020. Despite the lacklustre share price performance, the company has continued to lift earnings. Additionally, it has played a pivotal role in the global pandemic. 

Classic CSL growth  

CSL delivered a strong set of results for the six months ended 31 December. Its revenue increased 16.9% to US$5,739 million. This can be broken down into a 9% increase in CSL Behring revenue and 38% jump in Seqirus revenue. The company also acknowledges that the pandemic has tempered with Behring’s performance, whilst boosting the performance of Seqirus. 

Solid revenue growth was backed by higher margins. This translated to a 45% surge in net profit after tax to US$1,810 million. 

Eyes on plasma collections 

Plasma is an essential raw material for many of CSL’s therapies. Plasma collection headwinds has been a key factor that has dragged the CSL share price since the start of COVID.

The company has said that its “plasma collections have been adversely affected during the pandemic”. Furthermore, collection volumes in December 2020 represented~80% of December 2019 volumes. 

Macquarie Group Ltd (ASX: MQG) provided its view on the plasma collection environment on 26 March. The note highlights that foot traffic for CSL’s ~100 US-based plasma collection centres had fallen in recent weeks. This was also consistent trends across key states. Current foot traffic on a 7-day rolling average basis was below levels recorded over July-December 2020. 

The note acknowledges that there is a seasonal weakness across late-February to early-March. This is associated with the timing of annual tax returns. This should be followed up with a steady improvement from mid-March to June according to 2019 data. 

Macquarie has put more emphasis on the absence of improvement in recent weeks, resulting in a neutral rating for CSL shares. 

What’s next for the CSL share price? 

CSL has continued to demonstrate earnings growth despite the disruption in its supply chain. The company has forecasted FY21 net profit after tax to be in the range of approximately US$2,170 million to US$2,265 million at constant currency. This represents a 3.2% to 7.7% increase on FY20 NPAT of US$2,103 million. 

More reading

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• What’s happening with the CSL (ASX:CSL) share price?
• The A2 Milk (ASX:A2M) share price was down almost every day in March
• Over 1 in 4 Australians are investing in the ASX: report
• Here’s why the Macquarie (ASX:MQG) share price is attractive

Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of and has recommended Macquarie 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 Why the CSL (ASX:CSL) share price is going around in circles appeared first on The Motley Fool Australia.

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