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

The genius of Square Inc (NYSE: SQ) is the simplicity of its systems. On the back end, this fintech company is incredibly complex, but for users, it maintains an interface that is quick and easy. That’s what initially attracted me to the share, along with seeing the growing number of merchants who used its Seller ecosystem and sang its praises. What’s kept me in Square shares is seeing the company’s continued innovations, especially those involving its Cash App.

The Square share price is up more than 196% over the past year. That’s a dizzying climb, but one that’s backed by the company’s revenue and profit-margin improvements.

Crunching the numbers

In the third quarter, Square’s gross profit was a reported $794 million, a rise of 59% year over year. Its net revenue, listed at $3.3 billion, was up 140% over the same period in 2019 and its adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of $181 billion was up 49% year over year.

The biggest growth in revenue has been in the company’s Cash App, which management said generated $2.07 billion in Q3 or roughly 68% of the company’s revenue. In the quarter, Square had gross profit growth of 212% year over year.

Square keeps adding to what Cash App does, and that’s why it was one of the most downloaded financial apps in 2020. Users can store money, make payments to merchants or friends, manage credit cards, invest in stocks, and buy Bitcoin (CRYPTO: BTC) with the app. In November, after Square bought Credit Karma Tax for $50 million, it began offering its tax-prep software on the app for free.

Areas of concern

With the growth Square is seeing, it’s not surprising that others will rise up to try to snatch market share. PayPal Holdings Inc (NASDAQ: PYPL) is a huge competitor to Square. In October, it launched a service in its PayPal digital wallet that, like Square’s Cash App, allowed users to trade or purchase items in cryptocurrencies. While Square has the head start in the area, PayPal’s a much larger company with $5.46 billion in revenue in Q3, so it has the size and resources to try to cut into Square’s market share.

Some traders may also worry that Square shares have become overpriced, with a price-to-earnings (P/E) ratio of 390 and a forward price-to-earnings-to-growth (PEG) ratio of 5.30. That’s less concerning, however, because Square is a classic growth stock with an early-to-market advantage. It is more concerned at this point with adding users than with making a profit. Through nine months, it said it spent $628 million on product development, up 26% year over year, and $781 million on sales, an increase of 78% over the same period in 2019.

The third thing to watch for is how Square shares fare when the coronavirus pandemic winds down. Square’s business was helped last year because e-commerce ruled during the pandemic, driving more digital payments. More businesses also needed to use contactless payment to limit the spread of COVID-19.

However, I don’t see Square solely as a pandemic play, but as one whose fundamental business model was just adopted more quickly because of the pandemic. Once merchants and users are in the Square system, there isn’t that much churn because of the usefulness of its various platforms. 

SQ data by YCHARTS

Plenty of growth ahead

Cash App is growing because it also has share trading features that younger investors like, such as allowing the purchase of stocks in fractional shares and zero commission trades. It may also benefit from Robinhood’s recent stumble regarding the GameStop Corp (NYSE: GME) trading controversy.

Cash App was already growing quickly before the controversy. According to the Business of Apps, an app industry website, Cash App surpassed PayPal’s Venmo in new downloads in 2019 and was downloaded 90 million times last year.

Cash App went from 24 million daily active users in December 2019 to 30 million active users in December 2020. It’s the No. 2 downloaded finance app after Robinhood, and on 29 January 2021, the day after Robinhood halted trades in AMC Entertainment Holdings Inc (NYSE: AMC) and GameStop, searches for Cash App hit their highest point this year, according to Google Trends.

While Cash App has been getting most of the attention, look for the company’s Seller ecosystem to expand in the next few years.

The ecosystem has gone from being a niche service for mobile businesses, such as farmer’s market vendors, to increasingly servicing larger sellers. There’s obviously plenty of opportunity in both ecosystems. The company said it feels it has reached only 2% of a $60 billion opportunity in its Cash App and just 3% of a $100 billion market with its Seller ecosystem.

When the pandemic ends, Square’s Seller ecosystem should start growing at a greater clip as people attend more outdoor events and go back to eating in restaurants, two areas where Square has a good foothold.

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

More reading

• GameStop lessons for ASX investors
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• Here’s what low interest rates really means for your cash
• Forget Bitcoin, buy PayPal and Square instead
• How I knew GameStop would collapse

Jim Halley owns shares of Square. Suzanne Frey, an executive at Alphabet, 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), PayPal Holdings, and Square and recommends the following options: long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), and PayPal Holdings. The Motley Fool has no position in any cryptocurrencies mentioned. The Motley Fool Australia has no position in any cryptocurrencies 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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Each and every hour, we make decisions.

Fortunately, most of those don’t have long-term consequences, so a poor choice won’t wreck your life.

For example, selecting which flavour of ice cream to have.

“The cost of a poor decision in ice-cream decision making is non-substantial, and so, most people don’t give it more than a second thought,” Collins St Value Fund managing director Michael Goldberg posted on Livewire.

“In fact, most choices that people make on a day to day basis don’t have a high cost, and so many people get comfortable with ‘going with their gut’.”

However, this approach could have dire consequences for investments.

The role of emotion in investments

According to Goldberg, each decision in our lives is decided with a combination of emotion, intellect and circumstance.

This is not to say you should force yourself to completely eliminate emotion when making decisions about buying, holding or selling shares.

“Recognise that emotions play a part in decision making, and use them to your benefit,” he said.

“We can’t expect to disconnect ourselves entirely from the impact of emotions when making investment decisions, but we can put in place a process that ensures that we are not driven by them.”

Goldberg recommended four steps to take in order to achieve the right balance between emotion, intellect and circumstance when making investment decisions:

1. Decide the value of the company

It might seem obvious, but in a bull market, an investor can lose sight of a company’s “intrinsic value” said Goldberg.

“In a world (market) so dominated by emotion, fads, and talking heads, the only factor we can truly control is the price we are prepared to pay or sell at. To establish those points, the starting point must always be ‘what’s it actually worth’.”

There is currently much talk about growth vs value, momentum vs fundamentals, quantitative vs qualitative analysis. 

According to Goldberg, all that is unnecessary noise and the only two questions that matter for a particular share are: What are the company’s earnings and what am I prepared to pay for those earnings.

“Ignoring either of those fundamental questions leads to some interesting, and often scary situations.”

The enthusiasm for technology companies that have never made a profit is the classic symptom of ignoring these basic questions, said Goldberg.

“Even with companies like Xero Limited (ASX: XRO) and Afterpay Ltd (ASX: APT), which may at some point become worth the market cap they now demand, investors really need to ask themselves if they are investing in the businesses or speculating on the share price.

“Understanding the difference between the two and being able to identify which you are doing is absolutely essential for long term peace of mind (and fortunes).”

2. Talk to someone

Goldberg recommended having a friend to talk to who won’t be afraid to slap you in the face when you’re about to act against your own interests.

“Being able to avoid the trappings of falling in love with an idea, a company, or a way of thinking is absolutely essential to long term results,” he said.

“If you aren’t constantly and independently challenging your assumptions, chances are you’ve already fallen into the trap of group think or bias.”

3. Ignore the market

This is somewhat related to the first step of not listening to “the noise”.

According to Goldberg, too much value is placed on the movements of the indices such as S&P/ASX 200 Index (ASX: XJO).

“It is simply the whim of some 5 million investors, each of whom are making decisions on individual companies based on how they felt when they woke up that morning,” he said.

“The magnitude of the misplaced value ascribed to the ‘all powerful’, ‘all knowing’ market is highlighted by the significant differences of the companies that make up the indices.”

Goldberg prefers to think of the ASX as “a market of stocks” rather than the “stock market”.

“To suggest that [companies] like Telstra Corporation Ltd (ASX: TLS), Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd (ASX: BHP) are somehow intrinsically connected is patently silly,” he said.

“Each is driven by distinctly different factors, and very few (if any) intersect. Yet, when we quote ‘the market’, we do so as if it were a singularity, connecting each of the companies that make up the index as if they were all driven in the same direction by the same drivers.”

If you’re an investor and not a speculator, there is no need to play the mug’s game of guessing whether markets will rise or fall.

“Our job as investors is to simply understand the businesses we are considering, identify if they are cheap or expensive, and on that basis buy or sell,” said Goldberg.

“Everything else is a distraction.” 

4. Pull the trigger

You’ve done all the research about what the company is earning and how much you’re willing to pay.

But sometimes actually converting all that hard work into real action is the most difficult step.

“This is especially so in times of extreme conditions,” said Goldberg.

“Extreme conditions create the most attractive investing opportunities, with some 90% of market returns being earned over just 5% of trading days.”

Goldberg quoted US motivational speaker Eric Thomas: “Everyone wants to be a beast until it’s time to do what beasts do.”

Feeling uncomfortable is part of the investment process.

“It’s precisely during those times that all those around you think you are crazy, when even your ‘gut’ insists that you’re making a mistake that true long term profits are established,” he said.

“It’s in recognising that discomfort and realising that therein lies the opportunities that the greatest investors make the most spectacular returns.”

More reading

• Telstra (ASX:TLS) share price on watch after maintaining half year dividend
• 5 things to watch on the ASX 200 on Thursday
• 2 ASX 200 shares to buy for growth
• ASX 200 rises 0.5%, CBA reports, Crown deemed unsuitable for Sydney
• Nasdaq at record high! Here’s what it means for the ASX 200

Motley Fool contributor Tony Yoo owns shares of AFTERPAY T FPO and Xero. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO and Xero. 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 will be one to watch on Thursday.

This follows the release of the telco giant’s half year results this morning.

How did Telstra perform in the first half?

For the six months ended 31 December, Telstra reported a 10.4% decline in total income to $12 billion. This was driven largely by an 11% decline in consumer and small business revenue to $6.35 billion and an 8.1% decline in enterprise revenue to $3.47 billion.

Telstra’s underlying earnings before interest, tax, depreciation and amortisation (EBITDA) fell 14.2% to $3.3 billion. This was due largely to an estimated in-year NBN headwind of $370 million and an estimated $170 million impact from COVID-19. Excluding these impacts, Telstra’s underlying EBITDA would have been broadly flat compared with the prior corresponding period.

On the bottom line, the company revealed a 2.2% decline in net profit after tax compared to the same period last year to $1.1 billion.

Finally, the company reported cashflow after operating lease payments of $1.9 billion.

The Telstra dividend

One thing that has been weighing on the Telstra share price over the last 12 months has been concerns that it may cut its dividend.

Pleasingly, this morning the company has declared a fully franked 8 cents per share interim dividend, which is flat on the same period last year. This sees the company return approximately $950 million to shareholders.

Even better, though, is that the Telstra board confirmed that it also expects to pay a fully franked final dividend of 8 cents per share, bringing its total dividend for FY 2021 to 16 cents per share. This is in line with FY 2020’s dividend.

What else could impact the Telstra share price today?

There were a few more positives in the announcement that could give the Telstra share price a lift today.

One was that the company has increased its T22 cost reduction target to $2.7 billion by FY 2022.

CEO Andy Penn commented: “Telstra continued to make progress on its productivity target, reducing underlying fixed costs by a further $201 million, or 7 per cent, during the half and increased its productivity targets to $450 million in FY21 and from $2.5 billion to $2.7 billion by the end of FY22. Around $2.0 billion has already been delivered under the program.”

Mr Penn also provided an update on the establishment and proposed monetisation of InfraCo Towers, as well as the broader legal restructuring of the company.

“We plan to commence the process for external strategic investment into InfraCo Towers early in the first quarter of FY22, with binding offers to be submitted by the second quarter of FY22. We are undertaking significant verification and due diligence on our towers and property, appointed key members of the management team and advisors, and preparation work is well advanced to meet our timetable.”

“Since we updated the market in November 2020, we have appointed external advisors and progressed consultations with stakeholders to obtain approvals and support for the restructure. This includes discussions with the ACCC, the ACMA and relevant Government Departments to ensure that Telstra’s regulatory obligations will continue to apply as intended. We have also had constructive engagement with NBN Co on the restructure,” he added.

Another development announced today is Telstra’s plan to transition to full ownership for all of its branded retail stores across Australia.

This will be bad news for Vita Group Limited (ASX: VTG), which currently operates 104 of its stores. Telstra advised that Vita Group and individual licensees are being notified of the plan with discussions and transition arrangements expected to progress over the coming months.

Outlook

Possibly holding back the Telstra share price a touch today is news that it has downgraded its guidance for FY 2021. Telstra is now expecting total income to come in at between $22.6 billion and $23.2 billion for the full year.

This is down from $23.2 billion to $25.1 billion previously. Management advised that this was due to low-margin hardware and other equipment sales.

The company has also narrowed its guidance range for underlying EBITDA. It now expects its operating earnings to be in the range of $6.6 billion to $6.9 billion (from $6.5 billion to $7 billion).

Positively, its guidance range for free cashflow after operating lease payments has increased by $450 million at the mid point to the range of $3.3 billion to $3.7 billion. This is due to working capital management and the impact of lower hardware revenue.

Telstra also expects to be at the low-end of the net NBN one-offs range due to factors including NBN Co’s decision to pause HFC-based connections of new customers. Guidance for capital expenditure remains unchanged.

Looking further ahead, Mr Penn appears confident that the company is positioned to return to growth in FY 2022.

He said: “I am confident the many initiatives we have taken under our T22 program, particularly in simplifying the business and the digitisation program, will further improve customer experience.”

“To get the real benefits from all the effort we’ve already made, Telstra needs to be bold. I’ve set an aspiration for mid to high single-digit growth in underlying EBITDA in FY22 and $7.5 to $8.5 billion of underlying EBITDA in FY23. I am confident we can deliver this if we remain focused,” he added.

More reading

• 5 things to watch on the ASX 200 on Thursday
• ASX 200 Weekly Wrap: RBA unleashes ASX’s inner animal
• 2 high quality ASX dividend shares you can buy right now
• 5 things to watch on the ASX 200 next week
• Brokers name 2 ASX blue chips to buy

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

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GUD Holdings Limited (ASX: GUD) shares will be on watch this morning following the company’s update regarding its acquisition of several businesses.

At market close yesterday, the GUD share price finished the day 0.16% lower at $12.78.

What did GUD announce?

In yesterday’s announcement, GUD advised it has entered into an agreement to acquire Australian Clutch Services and its subsidiaries, XCLUTCH USA Inc and ACS NZ Pty Limited. The total value of the takeover is $32 million, subject to customary price adjustments.

GUD noted that ACS alone recorded normalised earnings before interest and tax (EBIT) of $5.7 million in FY20.

It will be interesting to see how the GUD share price performs today after the company advised it anticipates all three businesses positively impacting the group’s earnings. The earnings per share (EPS) metric is also forecast to increase as a result.

The company will fund the acquisition using its undrawn debt facilities. Completion of the deal is expected to be finalised on 1 March 2021.

What did management say?

GUD managing director and CEO Mr Graeme Whickman touched on the company’s latest takeover, saying:

This is a strategic acquisition of a strongly performing business which complements GUD’s automotive portfolio. This acquisition, at a compelling multiple of 5.6 times follows in close succession to GUD’s acquisition of companies formerly comprising AMA’s ACAD business, is further demonstration of GUD’s growth strategy.

Commenting on local business ACS, Mr Whickman went on to add:

ACS has a diverse customer base and is a leader in the traditional manual clutch, and the growing higher value dual clutch transmission replacement/repair markets. The business is an excellent complement to Disc Brakes Australia (DBA). ACS and DBA together will form GUD’s Friction-based businesses, to be led by Mr Gideon Segal, currently Executive General Manager of DBA.

How has the GUD share price been performing?

Over the last 12 months, the GUD share price has delivered modest gains of 2.16%.

The company’s shares hit a multi-year low of $7.12 in March, before rebounding in the following months. GUD shares reached a 52-week high of $13.66 in October 2020.

Based on the current GUD share price, the company commands a market capitalisation of close to $1.2 billion.

More reading

• Got money to invest for dividends? Here are 3 ASX shares
• Here’s why all eyes will be on the Cimic (ASX:CIM) share price today
• 2 exciting ASX tech shares to buy today
• 3 reliable ASX blue chip shares to own
• 2 outstanding ASX growth shares that could be strong buys

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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If you have money ready to deploy to try to find dividends from ASX shares then there are some contenders to think about.

Here are three to consider:

Pacific Current Group Ltd (ASX: PAC)

This company is a business which invests in fund managers across the world. It then helps those fund managers grow with capital and/or Pacific’s expertise.

Dean Fremder of Perpetual Limited (ASX: PPT) said when Pacific Current shares were around this level: “The stock’s really cheap. It is on nine times earnings. It’s growing earnings at double digits, so more than 10% a year. It’s paying a 6.5% fully franked yield. And most excitingly, we think they can pay out a much larger portion of their earnings as dividends. We see no reason, given the surplus franking credits they have on the balance sheet, they can’t be paying a 10 or 11% fully franked yield in the next 12 months. So, really excited about that one.”

In FY20 the ASX dividend share grew its dividend by 40% to $0.35 per share. This was supported by an 18% increase in underlying earnings per share (EPS) with funds under management (FUM) growing by 62% to $93 billion.

Pacific’s quarterly update for the three months to 31 December 2020 showed FUM had grown to AU$112.8 billion. It would have been even higher if the Australian dollar hadn’t strengthened significantly against the US dollar. Most of the growth was delivered by key investment manager GQG, which grew FUM by more than US$35 billion during the 2020 calendar year.

At the current Pacific Current share price it has a grossed-up dividend yield of 8.2%.

Brickworks Limited (ASX: BKW)

Brickworks is an ASX dividend share with one of the longest records on the ASX – it hasn’t cut its dividend for over four decades.

The dividend has been supported over the decades by its large holding of Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) shares. Brickworks currently owns around 40% of the business after selling some shares to fund its US acquisitions.

Soul Patts is an investment conglomerate that has been paying a dividend every year since it listed in 1903. It has a diversified portfolio across various industries including telecommunications, resources, pharmacies, building products, agriculture and financial services.

Over the last decade or two the Brickworks dividend has also been supported by its property earnings. It owns a 50% stake in an industrial property trust along with Goodman Group (ASX: GMG). Properties are built on excess Brickworks land. As more properties are completed, it increases the value of the trust and grows the rental profit distributions.

At the current Brickworks share price it has a grossed-up dividend yield of 4.3%.

Charter Hall Long WALE REIT (ASX: CLW)

This ASX dividend share is a real estate investment trust (REIT). It is liked by a few different brokers including Citi.

Charter Hall Long WALE REIT currently is guiding that its operating EPS and distribution will be at least 29.1 cents per unit, which meant that guidance was left unchanged from previous guidance.

The REIT reported its FY21 half-year result this week which showed that operating EPS and the distribution were up 3.6% to 14.5 cents per unit.

Citi thinks that considering the FY21 half-year result was slightly better than the broker was expecting, there is upside considering Charter Hall Long WALE REIT bought around $700 million of new assets during the period.

The ASX dividend share has a weighted average lease expiry (WALE) of 14.1 years, which is one of the longest in the REIT sector.

It has a number of major, stable tenants including Telstra Corporation Ltd (ASX: TLS), Australian government entities, BP and Woolworths Group Ltd (ASX: WOW).

At the current Charter Hall Long WALE REIT share price, it has a distribution yield of at least 6% for FY21.

More reading

• 3 ASX shares rated as strong buys by brokers
• 3 top ASX dividend shares to buy
• 3 ASX dividend shares with higher yields
• 2 ASX dividend shares rated strong buys by brokers
• ASX 200 rises 0.6%, Vocus jumps on takeover offer, Afterpay hits new record

Motley Fool contributor Tristan Harrison owns shares of PACCURRENT FPO and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Brickworks, Telstra Limited, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of Woolworths Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Cimic Group Ltd (ASX: CIM) shares will be watched closely by investors once the market opens this morning. This comes after the company announced yesterday it has secured several contract extensions in the power industry. 

The Cimic share price finished Wednesday’s session 17% lower at $21.56 due to its disappointing full-year results.

What was announced?

The Cimic share price could be on the rebound today following a positive update to the market after Wednesday’s session.

According to its release, Cimic advised its subsidiary, UGL, has won several power contract extensions involving maintenance and outage works.

The engineering company will deliver services across Western Australia, South Australia, and New South Wales.

It’s estimated that the entire value of the contracts secured will generate around $110 million in revenue for the company.

Furthermore, Cimic noted that all of the contracts signed are effective from early 2021.

Management commentary

Cimic group executive chair and CEO Juan Santamaria touched on its services specialist business UGL, saying:

UGL has a history of delivering value to the Australian energy industry and we’re proud to continue to do so by offering maintenance and shutdown services to these long-standing clients.

Commenting on Mr Santamaria’s speech, UGL managing director Doug Moss went on to add:

These contract extensions are a testament to the adaptability and trust we share with our clients. We are proud of our ability to provide a safe and reliable service and we look forward to building on our relationships in 2021 and beyond.

Cimic share price snapshot

The Cimic share price has been on a bit of a rollercoaster since the beginning of last year. A major catalyst for its wild share price swings has been the severe impact of COVID-19 on the construction industry.

Shares in the engineering company reached a 52-week high of $28.72 last February. Soon after, Cimic shares took an extreme dip to a low of $11.87 during the March crash. While the company’s shares rebounded to around the mid-$20’s mark over the past few months, yesterday’s full-year results release shook investor expectations.

Based on the current Cimic share price, the company commands a market capitalisation of roughly $6.7 billion.

More reading

• Why CIMIC, Crown, Domino’s, & Praemium shares are tumbling lower today
• ASX 200 up 0.35%: CBA half year update, IAG impresses, Zip shoots higher
• Why the Cimic (ASX:CIM) share price is plunging 16%
• Goldman Sachs says sell Premier Investments (ASX:PMV) shares into today’s big rally

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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If you’re currently searching for a couple of tech shares to add to your portfolio, then you might want to check out the ones listed below.

Here’s why these ASX tech shares come highly rated right now:

Adore Beauty Group Limited (ASX: ABY)

The first ASX tech share to look at is Adore Beauty. It is Australia’s number one pureplay online beauty retailer. Its aims to deliver users an empowering and engaging beauty shopping experience personalised to their needs.

Management notes that education and entertainment are core elements of Adore Beauty’s offering. As a result, its platform is a destination for beauty consumers even when they are not seeking to purchase items.

The company’s aspiration is to transform the beauty shopping experience and drive online penetration in order to own the beauty category in Australia and New Zealand. Furthermore, it wants to be the pre-eminent online destination for a broad selection of premium beauty, wellness, personal care products across skin, hair, make up, accessories and close adjacencies.

It certainly is going the right way about this. At the last count, the company had almost 600,000 active customers and was expecting to generate revenue of $158.2 million from them in calendar year 2020.

Morgan Stanley is a fan of the company and has an overweight rating and $8.35 price target on its shares.

Life360 Inc (ASX: 360)

Another ASX tech share to look at is app maker Life360. The San Francisco-based company provides families with a market leading app with a wide range of features.

These include real-time location sharing and notifications and driving safety features like Crash Detection and Roadside Assistance. Ultimately, the company aims to create tools that remove uncertainty from modern life, so families can feel free, together.

At the last count, the company had more than 25 million monthly active users (MAU) across 195 countries.

One broker that is very positive on Life360 is Bell Potter. In fact, it was the broker’s top pick in the tech sector for 2021. Its analysts currently have a buy rating and $7.70 price target on its shares.

Bell Potter notes that the company is carving out a significant global footprint with its family app at the core. The broker also believes it will benefit greatly once the pandemic passes and people are on the move again.

More reading

• ASX retail shares show strong signs of resurgence 
• 3 outstanding ASX shares growing rapidly
• 5 of the best ASX shares to buy in February
• 2 exciting mid cap ASX shares to buy and hold
• 2 quality ASX tech shares you can buy 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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Some ASX blue chip shares are demonstrating reliable performance during these uncertain times.

Here are three to consider:

Macquarie Group Ltd (ASX: MQG)

The global investment bank recently released its profit update for the third quarter of its FY21. It said that trading conditions have improved across the company.

Macquarie’s ‘annuity-style businesses’, called Macquarie Asset Management (MAM) and banking and financial services (BFS), experienced a profit increase in the third quarter compared to the prior corresponding period.

These defensive businesses reported that net profit for the nine months from MAM and BFS was largely flat with the prior corresponding period because of base and performance fees being in line with last year, partially offset by BFS margin pressure, increased credit impairment charges and higher costs to support clients through COVID-19.

Meanwhile, the market-facing businesses of commodities and global markets (CGM) and Macquarie capital experienced a significant increase in net profit in the third quarter. The profit for the nine months to 31 December 2020 was broadly in line with the prior corresponding period. There was stronger activity across most CGM businesses, offset by lower fee revenue and principal income in Macquarie Capital.

The ASX blue chip share is expecting FY21 net profit to be almost as high as the FY20 profit. Management are confident about medium-term growth potential.

APA Group (ASX: APA)

APA owns a large network of 15,000km of natural gas pipelines around Australia with a presence in every mainland state and the Northern Territory. It also owns or has interests in gas storage facilities, gas-fired power stations and renewable energy generation (wind and solar farms). APA owns, or manages and operates, a portfolio of assets and delivers half the nation’s natural gas usage.

In FY20 the ASX blue chip share reported that total revenue increased by 4.8% to $2.13 billion, earnings before interest, tax, depreciation and amortisation (EBITDA) grew 5.1% to $1.65 billion, operating cashflow went up 8.3% to $1.1 billion and net profit after tax (NPAT) grew by 10.1% to $317.1 million. APA decided to increase the FY20 distribution by 6.4% to 50 cents.

After announcing some recent new investments, such as a new pipeline in WA to connect to its existing network, APA decided to increase its interim FY21 distribution by 4.3% to 23 cents. The ASX share funds its annual distributions from the operating cashflow that it generates.

The new WA pipeline that I mentioned is a $460 million investment to build a 580km pipeline to connect emerging gas fields in the Perth Basin to the resource rich Goldfields region, forming an interconnected WA gas grid.

Sonic Healthcare Ltd (ASX: SHL)

Sonic is one of the world’s largest pathology businesses with operations in Europe, Australia and North America.

The ASX blue chip share is playing a key role in the fight against COVID-19 as it’s doing countless tests. The northern hemisphere, where Sonic has a major presence, is having a difficult winter with the pandemic.

The company’s base laboratory business revenue (excluding COVID-19 testing) is up on prior levels in most countries, with negative but improving growth in the USA and UK. The COVID-19 testing revenue that it’s generating is extra revenue on top of that.

Sonic Healthcare said that its revenue was up 29% in the first quarter of FY21 to $2.1 billion and its EBITDA was up 71% to $580 million.

At the annual general meeting (AGM), Sonic said that its October 2020 revenue was 33% higher than October 2019.

More reading

• Top brokers name 3 ASX shares to buy today
• ASX 200 drops 0.9%, Crown not suitable for Sydney casino, Macquarie rises
• ASX 200 down 0.4%: Macquarie impresses, Challenger disappoints, & Suncorp rises
• Why Douugh, Macquarie, Starpharma, & Suncorp shares are storming higher
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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia owns shares of APA Group. The Motley Fool Australia has recommended Sonic Healthcare 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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If you’re a growth investor, then you’re in luck. The Australian share market is home to a good number of shares that are growing at a strong rate.

Two exciting ASX growth shares to consider buying are listed below. Here’s what you need to know about them:

ELMO Software Ltd (ASX: ELO)

ELMO is a cloud-based human resources and payroll software company. It provides innovative human resources, payroll, and rostering technology to over 1,400 businesses across the APAC region.

Management notes that its solutions are at the forefront of a disruptive technology industry, driven by the transition of organisations towards online systems which automate processes and aggregate information in new and intelligent ways.

The company has also been strengthening its offering (and cross-selling opportunities) through the acquisition of complementary business. This includes through the acquisitions of Webexpenses for 13 million pounds and Breathe for $32 million.

Morgan Stanley is a fan of the company and currently has an overweight rating and $9.70 price target on its shares.

Nuix Limited (ASX: NXL)

Nuix is a leading provider of investigative analytics and intelligence software. It specialises in transforming massive amounts of messy data from emails, social media, communications, and other human-generated content into actionable intelligence.

The company’s investigative analytics and intelligence software can help users understand the context and connections across billions of items of data. They can search it, filter it, visualise it, analyse it, and find the truth it holds.

Its software has been used in a number of important investigations. This includes the Panama Papers and the Banking Royal Commission.

Demand has been strong for its services and led to Nuix reporting a 25.9% increase in total revenue to $175.9 million in FY 2020. This revenue is largely from subscriptions, with subscription revenues now accounting for 88.7% of its total revenue.

Analysts at Morgan Stanley are also very positive on Nuix. They currently have an overweight rating and $11.00 price target on the company’s shares.

More reading

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• Brace for an IPO resurgence as new floats beat the ASX 200 by ~50%

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Elmo Software. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Nuix Pty Ltd. The Motley Fool Australia has recommended Elmo Software and Nuix Pty Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Fortunately for income investors in this low interest rate environment, there are a good number of dividend shares on the Australian share market with attractive yields.

Two ASX dividend shares to consider buying are listed below. Here’s what you need to know about them:

Fortescue Metals Group Limited (ASX: FMG)

At present, the spot iron ore price is trading around the US$160 per tonne mark. As a comparison, Fortescue’s C1 costs are approximately US$12.74 per wet metric tonne.

It doesn’t take a rocket scientist to see that this is leading to material free cash flow generation by the mining giant. And with the company’s balance sheet is such good health, the majority of this free cash flow is likely to be returned to shareholders through dividends.

One broker that is forecasting bumper dividends from Fortescue is Macquarie. It expects the company to reward shareholders with a fully franked interim dividend of $1.37 per share. Based on the current Fortescue share price, this interim dividend alone represents a yield of 5.8%.

For the full year, the broker estimates that its shares offer an 8.6% yield. They also see upside for its shares and have an outperform rating and $26.50 price target on them.

Wesfarmers Ltd (ASX: WES)

This conglomerate has been a very positive performer over the last 12 months. This has been driven partly by its key Bunnings business, which has been experiencing strong sales growth during the pandemic. The hardware giant has been benefiting from government stimulus and consumers redirecting their spending from holidays to home improvements.

The good news is that Bunnings continues to perform well and recently reported stellar sales growth. This was supported by strong growth across other businesses such as Kmart, Target, and Catch.

Macquarie is positive on Wesfarmers as well and recently upgraded its shares to an outperform rating with a $60.00 price target. Its analysts are forecasting a 150.3 cents per share fully franked dividend in FY 2021. Based on the current Wesfarmers share price, this represents a 2.7% yield.

More reading

• How big will the ASX bank dividends be in 2021 and beyond?
• Top brokers name 3 ASX shares to buy today
• ASX 200 Weekly Wrap: RBA unleashes ASX’s inner animal
• 2 super ASX 200 shares to buy for your retirement portfolio
• Why ASX miners will get a double tailwind from Biden’s US$1.9tn stimulus

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

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