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.

What a wild ride it’s been for Big Tech. After decades of Washington applying a relatively soft-touch regulatory approach to the sector’s leaders, there’s been a sharp turn toward much fiercer rhetoric over the last two years. The sentiment that it’s time to rein in those companies is widespread. Big Tech has drawn the ire of congresspeople on both sides of the aisle, and it is increasingly taking heat from officials at the state level as well.

However, one mega-cap tech company has been noticeably absent from the list of those that are earning lawmakers’ ire: Microsoft (NASDAQ: MSFT).

Lawsuits and regulatory pushback

Facebook (NASDAQ: FB) has been the most visible target of governmental scrutiny and pressure of late. President Trump has been aggressive in his efforts to overturn social-media friendly Section 230 of the Communications Decency Act, first by issuing an executive order in May and then threatening to veto the annual National Defense Authorization Act if the provision’s repeal is not included in it.

However, the executive order has been challenged in court on legal and constitutional grounds. Meanwhile, the bill Trump was threatening has passed both houses of Congress with veto-proof majorities.

An antitrust lawsuit originating at the state level with 46 state attorneys general and the FTC challenging Facebook’s earlier acquisitions of Instagram and WhatsApp appears to be the bigger risk to the company at the moment.

Apple‘s (NASDAQ: AAPL) biggest legal challenges relate to its App Store marketplace’s policies. The first is a lawsuit from Fortnite creator Epic Games, which does not want to keep paying Apple a 30% cut of the revenue that the popular title generates through in-app transactions.

More recently, Cydia has sued Apple. Similarly to the Epic suit, it alleges that the iOS App Store model is an illegal monopoly. In a federal court filing, Cydia claims its own (unauthorized) iPhone app store existed before Apple’s, and that due to Apple’s anticompetitive conduct, it has essentially been shut out of the iOS distribution market. 

Amazon is facing a similar marketplace-related class-action lawsuit. Plaintiffs allege it uses its monopoly power to essentially dictate prices on third-party products. Finally, in October, the U.S. Justice Department and 11 state attorneys general filed a lawsuit alleging Alphabet‘s search business constitutes an illegal monopoly. A recent report from The Wall Street Journal suggests there are additional lawsuits in the works against the search giant.

How does this help Microsoft?

There are a few ways that keeping out of the courtroom benefits Microsoft. The first is that legal problems are a bandwidth issue. The more time C-suite occupants spend responding to government inquires and ensuring that their company is complying with injunctions, the less time they have to think about high-level strategy. The second is that court cases carry the possibility of monetary penalties. Ultimately, both of these tend to be minor concerns for the largest tech companies, but they are risks nonetheless.

The biggest risk appears to be that the results of court cases could force changes to some Big Tech business models, most notably on the mergers-and-acquisitions front. The multistate lawsuit against Facebook is interesting in that it seeks to revisit acquisitions that were sealed five or more years ago. While this may portend a more hostile environment toward all acquisitions in tech, Microsoft has been aggressively snapping up businesses recently with no pushback from regulators.

The company spent $9 billion on 20 acquisitions in its fiscal 2019 — though most of that sum went toward its $7.5 billion acquisition of GitHub — and tacked on another dozen acquisitions in its fiscal 2020 (which ended June 30). It’s likely that fiscal 2021’s M&A outlays will exceed 2019’s, as Microsoft announced in September that it was spending $7.5 billion to buy ZeniMax Media.

What should you do if you own these companies?

Investors generally employ one of two approaches when evaluating legal and regulatory risk, and both tend to be overreactions. The first is to quickly sell stocks at the prospect of a legal or regulatory challenge without knowing its full ramifications. The second — which has admittedly been an effective strategy over the last decade — is to haphazardly wave off any concern without applying proper due diligence.

The better long-term approach is to critically evaluate these risks in their proper perspective. Ironically, we can draw from Microsoft’s history for some context about how stronger regulation might impact today’s tech powerhouses. In 2000, a federal judge initially ruled that Microsoft’s tactics in bundling Internet Explorer with its Windows operating system had violated antitrust laws. He ordered the company to be broken up.

On appeal, the breakup order was rescinded. That led the Department of Justice to settle its case in exchange for a host of concessions from Microsoft, including an agreement to share its APIs with third-party developers. Use of the Internet Explorer browser plunged and — for a host of reasons not all related to the legal loss — a “lost decade” followed for Microsoft investors. I don’t expect such an aggressive result for the current targets of governmental ire, but some in Washington are looking to make a statement to Big Tech. Microsoft, though, is clearly out of their crosshairs.

While legal and regulatory risks have been minimal for this sector in recent years, investors now need to be more alert to them when doing their due diligence. Ultimately, your investment decisions should not be dictated by these concerns, but they are definitely worth keeping an eye on.

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

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• World’s 10 biggest companies are now worth 12% of Earth’s GDP
• Is it time for Facebook to do the unthinkable?
• ACCC hauls Facebook to court for ‘deceptive’ conduct

Jamal Carnette, CFA owns shares of Amazon. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Facebook, and Microsoft and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Apple, and Facebook. 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 Bapcor Ltd (ASX: BAP) share price has steadily grinded higher this year, currently up 20% year to date. While the COVID-19 pandemic and resulting government imposed restrictions in Australia, New Zealand and Thailand had an adverse impact on its financial performance in FY20, the business expects to bounce back strongly in FY21. 

Resilient FY20 performance 

Despite the circumstances, Bapcor delivered a resilient FY20 performance with proforma earnings before interest, taxes, depreciation and amortisation (EBITDA) down 4.1% and proforma net profit after tax 5.5% below the record earnings achieved in FY19. 

Looking ahead, the company believes the fundamentals of the vehicle aftermarket are as strong as ever. COVID-19 has resulted in record sales of second hand vehicles as travellers sought social distancing and moved away from public transport. According to Bapcor, there is also the likely flow-on effect of more people spending their holidays domestically utilising their vehicles. 

FY21 trading update 

Last week, Bapcor provided a pleasing first quarter FY21 trading update in which revenue for the first five months to the end of November was up 26% on the prior corresponding period (pcp).

For the first half of FY21, the company anticipates it will achieve revenue growth of at least 25% over the prior corresponding period. It also expects net profit after tax to increase by at least 50% over the pcp which was $45.6 million. 

In the update, Bapcor also reported that the construction of its new Victorian Distribution Centre is progressing well. The building is expected to be handed over in February 2021, and an automated picking system operational in the following six months. 

This update was well received as the Bapcor share price jumped as high as 10% on the day of the announcement. However, Bapcor shares were unable to hold onto all of the day’s gains and closed just 3% higher. 

Upgraded Bapcor share price after trading update

Citi has raised its Bapcor share price target from $8.80 to $8.85 and retains its buy rating. The broker was pleased with the company’s trading update to the end of November but expects group sales to slow to 23% growth in Q2 compared to 27% in Q1. It rates Bapcor as a top pick in the automotive sector. 

Macquarie Group Ltd (ASX: MQG) has raised its Bapcor price target from $8.50 to $8.75 and retains an outperform rating. It notes strong trading across all business segments and expects solid growth to continue. 

Morgan Stanley has raised its price target for Bapcor from $8.45 to $9.00 with an overweight rating. The broker says that further upgrades may follow as trends in auto spending continue. 

UBS Group retained its buy rating with a price target of $8.55. The broker upgraded its expected FY21 NPAT to $120 million, above Bapcor’s own guidance range. 

Credit Suisse was the only broker to lower its Bapcor share price target from $8.75 to $8.60 despite retaining its outperform rating. Its commentary was also positive, saying sales growth as reported in November was better than expected.  

More reading

• Top brokers name 3 ASX shares to buy next week
• Why Bapcor, Fortescue, Nufarm, & Saracen shares are pushing higher
• 2 ASX growth shares to buy that keep delivering wins
• ASX 200 rises on Thursday
• Citigroup picks the best ASX retail stocks to own for 2021

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

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The Suncorp Group Ltd (ASX: SUN) share price will be on watch on Monday after the release of an update on its business interruption insurance.

What did Suncorp announce?

This morning Suncorp announced that the Federal Court of Australia made its ruling on Friday in relation to a COVID-19 business interruption insurance claim from a customer in Victoria.

The customer commenced proceedings following the decline of a claim under its business interruption policy for COVID-19 pandemic related losses. A discrete question concerning the proper construction of the exclusion clause was referred to the Federal Court.

The exclusion clause in the particular Suncorp policy excluded cover for “any claim that is directly or indirectly caused by or arises from, or is in consequence of or contributed by highly pathogenic Avian influenza or any biosecurity emergency or human biosecurity emergency declared under the Biosecurity Act 2015 (Cth), its subsequent amendments or successor, irrespective of whether discovered at the premises of the breakout or elsewhere.”

What happened in the Federal Court?

According to the release, the Court’s interpretation is consistent with Suncorp’s position that cover for loss arising from a pandemic is a high risk for an insurer which would normally be excluded.

It found that the exclusion clause will operate where a human biosecurity emergency has been declared to exist, and a business has been shut down by government order as a response to that emergency, whether Federal, State or Local.

The Court also held the exclusion would apply even where the connection between the emergency and the claim was remote and was only a cause of the claim.

In light of this favourable outcome, the insurance giant believes that its overall reserving continues to be adequate.

Though, it notes that valuations do not take into account the potential for further COVID-19 lockdowns, as well as any unexpected outcomes from future litigation including any industry test cases.

Suncorp’s CEO, Steve Johnston, commented: “Suncorp is committed to working with Government, industry and the broader community to explore alternative frameworks to addressing pandemic risks.”

“We recognise these are challenging times for small business and we have put in place a range of measures to support them through this period. Unfortunately, pandemics are an uninsurable risk and premiums have not been paid to cover an event of the scale of COVID-19,” he concluded.

More reading

• The ASX bank with the best dividend yield under APRA’s new guidelines
• Macquarie’s model portfolio of ASX stocks to hold in the post-COVID recovery

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 S&P/ASX 200 Index (ASX: XJO) has done it again, banking yet another week in the green to turn its 6-week winning streak into 7. The gains also helped the ASX 200 hit its highest level since the March share market crash. All of this was despite a nasty fall on Friday as the extent of the Sydney coronavirus cluster became clear.

So, it was a rather dramatic week on the share market last week. Friday saw the ASX 200 hit 6,756.7 points upon market open, a new post-March high watermark for the index. At that level, the ASX 200 was up 1% year to date, and up almost 47% since the March lows.

But that wasn’t the only high we saw last week. We also saw the Aussie dollar climb to a new 2½-year level last week when it reached as high as 76.4 US cents on Thursday night. Additionally, the cryptocurrency bitcoin also broke its all-time high, that was set back in 2017, last week. Highs all round, it seems.

Lockdowns and crushed dreams

In other news, we had some blockbuster moves on the markets last week. Perhaps most spectacular was the A2 Milk Company Ltd (ASX: A2M), shares in which plunged 23.64% on Friday to close the week at just $10.14 a share. The A2 Milk share price fell as low as $9.82 during the trading day as well. You have to go back to 2018 to find the last time A2 hit those levels (and that includes the March crash). The catalyst? An announcement the company released to the markets which updated A2’s guidance for FY2021. Apparently, the company has experienced a more severe than expected disruption in its ‘daigou’ product channels than previously anticipated.

We also had another dramatic move for Mesoblast Limited (ASX: MSB), shares of which crashed a colossal 36.07% on Friday. It was a disappointing update from its remestemcel-L product trial for treating COVID-19 that set investors off on that one. Unlike A2 though, as of Friday the Mesoblast share price is still well above its 52-week low of $1.02 we saw back in March.

ASX bank investors, however, were cheering last week. On Tuesday it was announced that the financial regulator APRA would be removing the cap on banks’ dividend payout ratios, which was previously restricted to 50% of earnings. That means the ASX banks should be able to increase their dividend payments in 2021 if all goes well.

Finally, it’s worth mentioning that the coronavirus news out of Sydney on Friday hit cyclical shares hard, especially (and somewhat predictably) those in the travel sector. Qantas Airways Limited (ASX: QAN) shares were down 3.53% on Friday, whilst Sydney Airport Holdings Pty Ltd (ASX: SYD) shares were hit 2.88%.

How did the markets end the week?

The ASX 200 had a bumpy, but overall positive week last week. Monday saw a healthy 0.6% gain, whilst Tuesday saw that reversed with a 0.8% loss. Wednesday turned back to the green with another 0.9% gain, backed up on Thursday with another 1% on top. Friday saw a nasty drop of 1.2%, but it wasn’t enough to stop the ASX 200 making it 7 for 7. Since the index started the week at 6,642.6 points and finished up at 6,675.5 points, it ended up being a week-to-week gain of 0.5% overall.

Meanwhile, the All Ordinaries Index (ASX: XAO) started the week at 6,886.4 points and finished up at 6,924.1 points for a week-to-week gain of 0.55%.

Which ASX 200 shares were the biggest winners and losers?

Time now for some Foolish hot coffee whilst we salaciously dissect last week’s biggest winners and losers. As always, we’ll start with the worst-performing ASX 200 shares:

More reading

• Synlait Milk (ASX:SM1) share price on watch after halving guidance due to a2 Milk (ASX:A2M) update
• 2 top ASX dividend shares to buy today
• 5 things to watch on the ASX 200 on Monday
• Buy these ASX blue chip shares for your retirement portfolio
• 2 ASX dividend shares with 4%+ yields

Sebastian Bowen owns shares of 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 EML Payments and MEGAPORT FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Avita Medical Limited and CSL Ltd. The Motley Fool Australia owns shares of and has recommended A2 Milk, 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 Australia has recommended Avita Medical Limited, EML Payments, MEGAPORT FPO, and Service Stream Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Synlait Milk Ltd (ASX: SM1) share price will be on watch today after it released an update on its guidance.

This follows a disappointing update by its largest customer, A2 Milk Company Ltd (ASX: A2M), on Friday.

That update revealed that A2 Milk Company has experienced a more significant and protracted disruption in the daigou channel than expected. As a result, it downgraded its sales and earnings guidance materially for FY 2021.

What did Synlait announce?

This morning the dairy processor updated its FY 2021 guidance to reflect a revised demand forecast received from the infant formula company following its guidance update.

According to the release, the updated forecast from a2 Milk Company has resulted in Synlait forecasting total consumer-packaged infant formula volumes to be approximately 35% lower than FY 2020.

As a result of this change, based on initial estimates and currently available information, management expects its FY 2021 net profit after tax to be approximately half that of its FY 2020 profit result.

The company intends to provide investors with a further update on its FY 2021 profit expectations with its half year results in March.

What now?

The dairy processor’s board and management team revealed that they are continuing to actively pursue opportunities to mitigate the impact of this development. This includes focusing on the execution of its diversification strategy, asset optimisation, and prudently managing costs.

It also advised that there has been no disruption to manufacturing or demand for Synlait’s ingredient, lactoferrin, or consumer-goods businesses, and remains confident that it can deliver on its medium to long term objectives.

However, the company warned that its guidance remains subject to the ongoing effects of COVID-19, with consumer behaviour, channel dynamics, and supply chain disruptions all subject to change.

More reading

• These were the worst performing ASX 200 shares last week
• Why did the Synlait (ASX:SM1) share price drop 2% then enter a trading halt today?
• ASX 200 falls 1.2% on Friday
• Why the a2 Milk Company (ASX:A2M) share price crashed 26% lower today
• 5 things to watch on the ASX 200 on Friday

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.

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Do you have some cash to invest? ASX shares might be the way to go.

There are plenty of businesses to look at on the stock exchange, these are two that could be worth a look:

Pushpay Holdings Ltd (ASX: PPH)

Pushpay is an electronic payments business which facilitates donations from people to charitable organisations, particularly large and medium churches in the US. For those churches, it offers a livestreaming service to connect with the congregation even during this period of COVID-19 and social distancing.

One fan of Pushpay is fund manager Ben Griffiths from Eley Griffiths who said: “Over the last 12 months it has become clear Pushpay is at an inflection point for both cashflow and earnings. Under the stewardship of CEO Bruce Gordon, Pushpay has transitioned from a founder-led investment phase into an optimize/monetization phase. What is more surprising is the very conservative nature of the accounts (a rarity in small cap tech, outside Iress Ltd (ASX:IRE). We believe the next few years for Pushpay will be rewarding and that COVID-19 will accelerate the already entrenched trend to digital giving/engagement from cash.”

The ASX share believes that it can continue to deliver significant operating leverage as revenue grows whilst keeping costs under control. In the FY21 interim result it increased its gross profit margin from 65% to 68% and the earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) margin went up from 17% to 31%.

Pushpay is aiming for US$1 billion of annual revenue over the long term, it made US$85.6 million of operating revenue in the FY21 interim result, which indicates that there is room for more growth.

In FY21 it’s expecting to more than double its EBITDAF to a range of US$54 million to US$58 million.

At the current Pushpay share price it’s valued at 25x FY23’s estimated earnings.

Pacific Current Group Ltd (ASX: PAC)

Pacific Current is an ASX share that invests into fund managers. Nearly all of its approximately 15 investments are based overseas, with a majority based in the US.

One key fund manager within its portfolio is GQG which has five long-only investment strategies: US shares, global shares, concentrated global shares, international shares and emerging markets shares.

GQG’s strategies have beaten their benchmarks over the longer-term, this is growing and attracting new funds under management (FUM).

In FY20 Pacific Current grew FUM by 62% from AU$57 billion to AU$93 billion, with GQG being the biggest contributor to growth.

In the quarterly update for the three months to 30 September 2020, FUM grew by 14% to AU$106.4 million. Again, the vast majority of the growth during the period came from GQG.

At its annual general meeting, Pacific Current said that its pipeline of attractive investments is strong, with the company expecting to make at least two investments in FY21. It also said it’s expecting an acceleration of new commitments to its investments over the next 18 months.

Pacific Current also said that it’s exploring new revenue sources because it has the ability to deploy far more capital than it can access, so it’s considering raising a private fund to invest alongside Pacific Current. In that arrangement, the company would receive management fee revenue from the fund and co-investment rights.

In FY20 it grew its underlying earnings per share (EPS) by 18% to 51 cents and the dividend increased by 40% to $0.35 per share.

At the current Pacific Current share price it offers a grossed-up dividend yield of 8.3% and it’s valued at 9x FY23’s estimated earnings.

More reading

• 3 top ASX shares to buy for 2021
• 4 leading ASX growth shares to buy for 2021
• Why Mesoblast, Pilbara Minerals, Pushpay, & Retail Food Group shares are dropping lower
• Why the Pushpay (ASX:PPH) share price is tumbling lower today
• 3 exciting ASX tech shares to buy in 2021

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of PUSHPAY FPO NZX. The Motley Fool Australia has recommended PUSHPAY FPO NZX. 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 Hipages Group Holdings Ltd (ASX: HPG) share price has been a disappointing performer since listing on the Australian share market in November.

The online platform and software as a service (SaaS) provider’s shares ended the week at $2.13. Which means they are down 13% from their listing price of $2.45.

What is Hipages?

Hipages is a leading Australian-based online platform and software as a service (SaaS) provider that connects tradies with residential and commercial consumers. It currently has 36,000 tradies subscribed to the platform.

Based on the number of jobs posted, it is the leader in the on-demand tradie economy. The company notes that to date, over three million Australians have changed the way they find, hire, and manage trusted tradies with Hipages.

Approximately $40 million in gross proceeds was raised through its initial public offer (IPO). These funds will be used to drive future growth through investment in its brand and technology platform, as well as its expansion into new channels and adjacent opportunities.

Is the Hipages share price in the buy zone?

According to analysts at Goldman Sachs, the recent weakness in the Hipages share price has dragged its shares down to an attractive level.

This morning it initiated coverage on the company with a buy rating and $2.90 price target. This price target implies potential upside of 36% from its last close price.

Goldman Sachs is a fan of the company due to its belief that in can grow its revenue and particularly its operating earnings strongly over the coming years.

It commented: “We forecast a FY20-FY23E revenue CAGR of 12%, broadly in line with market growth. However, we forecast a materially stronger EBITDA CAGR of 36% as HPG drives improving returns on its sales and marketing spend (brand investment) and further refinements in marketplace efficiencies (balance between the number of tradies on its platform and higher quality job listings).”

“We value HPG based on a 50:50 weighting of EV/EBITDA (FY21 EBITDA Multiple of 25.7x benchmarked to peers, applied to FY22E EBITDA) and a 10-year DCF (WACC 8.9%, TGR 2.5%, revenue CAGR 11.4% and a terminal year EBITDA margin of 39%). This derives our A$2.90 12m target price,” it concluded.

More reading

• Synlait Milk (ASX:SM1) share price on watch after halving guidance due to a2 Milk (ASX:A2M) update
• Got cash to invest? Here are 2 ASX shares to buy
• 2 top ASX dividend shares to buy today
• 5 things to watch on the ASX 200 on Monday
• Buy these ASX blue chip shares for your retirement portfolio

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you’re on the lookout for some dividend shares to add to your portfolio, then you might want to take a closer look at the ones listed below.

Here’s why they are being rated as shares to buy right now:

Bravura Solutions Ltd (ASX: BVS)

Although this leading wealth management and transfer agency software solution provider isn’t normally regarded as a dividend share, a significant decline in its share price means it has become one. That decline has been driven by concerns over its performance in FY 2021 due to COVID and Brexit headwinds. Management has warned that the majority of its earnings will be generated in the second half.

One broker that remains very positive on the company’s future and sees this share price weakness as a buying opportunity is Goldman Sachs. It recently put a buy rating and $4.50 price target on its shares. The broker is also forecasting a 10.6 cents per share dividend in FY 2021. Based on the current Bravura share price, this represents a 3.1% dividend yield.

Coles Group Ltd (ASX: COL)

Unlike Bravura, this supermarket operator has been performing very positively this year and has seen its share price surge higher. The company delivered a 6.9% increase in sales to $37.4 billion in FY 2020 and has followed this up with further strong growth in the first quarter of FY 2021. During the three months that ended 30 September, Coles reported an impressive 10.5% increase in total sales over the prior corresponding period to $9.6 billion.

Goldman Sachs is also very positive on Coles and was pleased with its performance in the first quarter. In light of its positive form, the broker is forecasting a fully franked 64 cents per share dividend in FY 2021. Based on the current Coles share price, this equates to a 3.5% dividend yield. Goldman has a buy rating and $20.50 price target on its shares.

More reading

• How useful is the P/E ratio in assessing ASX shares?
• 4 rock-solid ASX dividend shares to buy for 2021
• 2 blue chip ASX dividend shares to buy next week
• Woolworths (ASX:WOW) buyout makes ACCC anxious
• Why the Afterpay (ASX:APT) share price is not the only rising star this year

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Bravura Solutions Ltd. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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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On Friday the S&P/ASX 200 Index (ASX: XJO) finished a positive week on a disappointing note. The benchmark index tumbled 1.2% to 6,675.5 points.

Will the market be able to bounce back from this on Monday? Here are five things to watch:

ASX futures pointing lower.

The Australian share market looks set to start the week in a cautious manner after an underwhelming finish to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the week 10 points or 0.15% lower this morning. On Friday night on the United States, the Dow Jones fell 0.4%, the S&P 500 dropped 0.35%, and the Nasdaq edged 0.1% lower.

BINGO a takeover target?

The BINGO Industries Ltd (ASX: BIN) share price will be on watch this morning after rumours swirled that it could be a takeover target. According to the AFR, the waste management company is being pitched to funds as “contracted industrial infrastructure.” Infrastructure funds are believed to kicking a few tyres to test the reliability of its revenue and earnings.

Oil prices jump.

Energy producers including Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could start the week strongly after oil prices finished the week higher. According to Bloomberg, the WTI crude oil price rose 1.5% to US$49.10 a barrel and the Brent crude oil price climbed 1.5% to US$52.26 a barrel. This led to oil prices recording their seventh successive weekly gain.

Gold price softens.

Gold miners such as Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) will be on watch today after the spot gold price softened on Friday. According to CNBC, the spot gold price fell 0.2% to US$1,886.80 an ounce. A firmer U.S. dollar led to weakness in the price of the precious metal.

QBE share price given conviction buy rating.

The QBE Insurance Group Ltd (ASX: QBE) share price crashed 12% lower on Friday after the release of a trading update. One broker that sees this as a buying opportunity is Goldman Sachs. Its analysts have put a conviction buy rating and $10.67 price target on the insurance giant’s shares. This compares to the current QBE share price of $8.71. Goldman commented: “At 12x our FY21 earnings we continue to think QBE looks attractive relative to growth we forecast and remain broadly comfortable with our thesis.”

More reading

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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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If you’re approaching retirement, then now could be the time to shift away from growth shares and start focusing more on capital preservation and income.

But which shares should you buy to accomplish this? The two blue chip ASX shares listed below could be worth a closer look:

Goodman Group (ASX: GMG)

Goodman Group is an integrated commercial and industrial property group. It owns, develops, and manages industrial real estate in 17 countries. Goodman has been growing at a solid rate over the last decade thanks to the diversity of its operations and its exposure to quick growing markets such as ecommerce. Pleasingly, the latter market has resulted in strong demand from blue chip customers such as Amazon, Coles Group Ltd (ASX: COL) and Walmart. This appears to have positioned Goodman for sustainable growth over the 2020s.

One broker that certainly believes this to be the case is Morgan Stanley. It was pleased with its development work, sky high occupancy rates, and the yields it is commanding. In light of this, it put an overweight rating and $20.90 price target on its shares. It is also expecting a 30 cents per share distribution this year. Based on the current Goodman share price, this represents a 1.6% yield.

Woolworths Limited (ASX: WOW)

This retail conglomerate is another popular option for retirement portfolios. This is due to Woolworths’ strong brands, entrenched customer base, and defensive qualities. Combined, they have allowed the company to deliver robust earnings and dividend growth over the last decade.

Analysts at Citi are positive on the future and recently reiterated their buy rating and $44.50 price target on Woolworths shares. They were pleased with the company’s strong performance in the first quarter and lifted their earnings forecasts to reflect this. Citi is forecasting a $1.16 per share fully franked dividend in FY 2021. Based on the latest Woolworths share price, this equates to a 2.9% yield.

More reading

• How useful is the P/E ratio in assessing ASX shares?
• These are the 5 best ASX real estate shares of 2020
• Citigroup picks the best ASX retail stocks to own for 2021
• 2 blue chip ASX dividend shares to buy today
• Woolworths (ASX:WOW) buyout makes ACCC anxious

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

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