The Virgin Money UK (ASX: VUK) share price was one the highest movers on the ASX today, rising by almost 15% to $2.40. Meanwhile the ASX has also gained across most sectors, still fuelled by the news that a vaccine for COVID-19 is imminent. The Virgin Money share price was the highest gainer of all the mid cap stocks today, with all major bank shares also moving in the same direction. 

Why did Virgin Money UK rise today?

As mentioned, the big jump in the Virgin Money share price today was mainly driven by optimism around the availability of a vaccine. The share price was also buoyed by the news that consumer confidence in Australia is at a seven-year high. Meanwhile in London, where Virgin Money operates, the FTSE 100 Index (FTSE: UKX) has risen for two consecutive days, with a total gain of 6.46%. Yesterday’s FTSE closing level is the highest since 23 June. The market euphoria is continuing despite the United Kingdom showing a jump in its unemployment level from 4.5% to 4.8% in the September quarter, according to official data released yesterday. 

Why is the UK economy important for Virgin Money?

Virgin Money derives all of its income from the UK. The history of Virgin Money dates back to 2016, when National Australia Bank Ltd. (ASX: NAB) demerged its UK operations in Clydesdale Bank and Yorkshire Bank (known collectively as CYBG). The combined entity of CYBG and Virgin Money was renamed Virgin Money UK PLC in 2019.

Virgin Money is a mid-sized bank, and its market share is dwarfed by the UK’s big five banking entities. Around 80% of Virgin Money’s loan book is in mortgages, with 30% of this concentrated in London’s property market alone. Virgin Money UK will be renamed to Virgin Money in 2021.

How has the Virgin Money share price performed in 2020?

In its quarterly trading update to 30 June 2020, Virgin Money announced that it had not seen any significant provisions or credit losses due to the COVID-19 pandemic, mainly due to government support. The Virgin Money share price had lost around 40% on a year-to-date basis before today’s 15% jump. With today’s gains, the Virgin Money share price is now 32% lower year to date and has a market capitalisation of $2 billion. 

More reading

• ASX 200 up 1.3%: CBA Q1 update, tech shares rebound, JB Hi-Fi sinks
• These were the best performing shares on the ASX 200 in October
• ASX 200 Weekly Wrap: Budget, US election sparks 5% surge in ASX shares

Motley Fool contributor Eddy Sunarto 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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The S&P/ASX 50 index is home to 50 of the largest listed companies on the Australian share market.

This means the index is home to many of the highest quality and most well-known companies that the ANZ region has to offer.

Two ASX 50 shares that are highly rated are listed below:

a2 Milk Company Ltd (ASX: A2M)

A2 Milk Company is a New Zealand-based infant formula and fresh milk company. It has been growing its earnings at a quick rate over the last few years thanks to strong demand for its infant formula. This has particularly been the case in China and through the daigou channel. And while the latter has been impacted by the pandemic due to a reduction in tourism and international student numbers, management is confident this is a short term headwind.

Analysts at UBS believe that investors should look through the short term volatility and focus on its long term growth potential. It expects this to be driven by market share gains in China as its roll out in mother and baby stores increases and free trade zones are expanded. UBS has a buy rating and NZ$20.50 (A$19.22) price target on its shares.

Aristocrat Leisure Limited (ASX: ALL)

Aristocrat Leisure is one of the world’s leading gaming technology companies. It is responsible for some of the most popular poker machines in play today and also has a growing number of digital and social games that are generating significant recurring revenues from their millions of daily active users.

Last month analysts at Ord Minnett put an accumulate rating and $38.60 price target on the company’s shares. It was pleased with the way the company’s businesses are recovering from the pandemic and the performance of its new releases. This compares to the current Aristocrat Leisure share price of $33.04.

More reading

• The A2 Milk (ASX:A2M) share price is up 4% today. Here’s why.
• How you could have turned $20,000 into $250,000 in 10 years with ASX shares
• 2 must-buy ASX growth shares to buy in November
• 4 outstanding ASX 200 shares to buy with $4,000
• I plan to invest heavily in ASX shares next week

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. 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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The market is extending its rally following the US presidential elections, but brokers have downgraded some ASX stocks to the naughty list.

The S&P/ASX 200 Index (Index:^AXJO) jumped a further 1.6% as we head into the close with every sector trading in the black.

But one stock that’s heading in the opposite direction is the Ramsay Health Care Limited Fully Paid Ord. Shrs (ASX: RHC) share price.

Second wave prompts downgrade of ASX stocks

Shares in the hospital operator tanked 2.9% to $67.48 at the time of writing after Credit Suisse downgraded the stock to “neutral” from “outperform”.

You can blame COVID‐19 for the underperformance, even though the pandemic should be less of a concern with a potential vaccine just around the corner.

“While we continue to believe that RHC will be a beneficiary of a volume tailwind post COVID‐19, there remains significant near‐ term earnings pressure for RHC’s offshore divisions with rising COVID‐19 cases in Europe,” warned Credit Suisse.

Increased hospital admission rates for COVID cases will hamper Ramsay’s ability to undertake more profitable elective surgeries.

It looks as though Ramsay’s facilities in France and the UK will take a hit due to a significant second wave of the disease.

Credit Suisse’s price target on the Ramsay share price is $70 a share.

Longer than expected recovery from pandemic

Meanwhile, the CSL Limited (ASX: CSL) share price was also downgraded, although that didn’t stop it from rising 0.8% to $307.06 in late trade.

Citigroup cut its rating on the blood treatment company to “neutral” from “buy” as it believes that COVID-19 is impacting on its operations.

“In the last few weeks, we had quarterly results from key competitors and suppliers including Takeda, Grifols, and Haemonetics,” said Citi.

“All noted the plasma product demand remains unchanged, however collections have been impacted by COVID-19.”

The broker believes that plasma collection will only return to normal levels in Jan 2021 compared to its earlier prediction of October 2020.

Citi’s 12-mopnth price target on the CSL share price is $320 a share.

New tech casualty from COVID rotation

News of the possible COVID vaccine triggered a large sell-off in tech stocks. It also gave Bell Potter a reason to chop its recommendation on the Macquarie Telecom Group Ltd. (ASX: MAQ) share price to “hold” from “buy”.

“With its focus on Data Centres (DCs) and the cloud, MAQ too has seen a large share price rise over the past year,” said the broker.

“While we view MAQ’s rise as justified on account of its long-term DC and cloud growth outlook, with an anticipated rotation towards more cyclical names as a US and Australian re-opening gains greater focus and COVID fear subsidies, MAQ’s shares may see some near-term selling pressure.”

Bell Potter’s 12-month price target on the stock is $52.40 a share.

More reading

• The irresistible urge that costs retail investors 3% a year
• Macquarie Telecom (ASX:MAQ) share price surges on contract win
• ASX 200 up 1.3%: CBA Q1 update, tech shares rebound, JB Hi-Fi sinks
• 5 things to watch on the ASX 200 on Wednesday
• Enjoying your ASX 200 gains? Here’s why you should watch out for January

BrenLau owns shares of CSL don Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia has recommended Ramsay Health Care Limited. 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 looking to overcome low interest rates by investing in the share market, then these highly rated growth shares might be the ones for you. 

Two top growth shares that have been given buy ratings by brokers are listed below. Here’s what you need to know about them:

Altium Limited (ASX: ALU)

Altium is a leading printed circuit board (PCB) design software provider. It has been growing at a very strong rate over the last few years thanks to its leading software and its exposure to the booming artificial intelligence and Internet of Things markets. The good news for investors is that management is confident its growth can continue and is targeting revenue of US$500 million and 100,000 subscribers by 2025-26.

This will be a 150% increase on FY 2020’s revenue and almost double its current subscriber numbers. One broker that appears confident it will get there is Morgan Stanley. It has an overweight rating and $40 price target on Altium’s shares. The Altium share price is currently changing hands for $37.26.

Bigtincan Holdings Ltd (ASX: BTH)

Bigtincan is a growing provider of enterprise mobility software. This software allows sales and service organisations to increase their sales win rates, reduce expenditures, and improve customer satisfaction by pairing functionality with a highly-intuitive user interface. This provides users with an advanced content management system, document automation, internal communications, and fully integrated modern LMS. Bigtincan has experienced strong demand for its platform over the last few years, which has led to stellar recurring revenue growth.

Pleasingly, management remains confident in its long term outlook and notes that the sales engagement platform will be worth $6 billion a year by 2021. It also recently announced the acquisition of Agnitio, a Danish-based company that is a pioneer in sales enablement for the Life Sciences sector. This went down well with Canaccord Genuity, which has slapped a buy rating and $1.40 price target on its shares. The Bigtincan share price is trading at $1.22 this afternoon.

More reading

• ASX 200 up 1.3%: CBA Q1 update, tech shares rebound, JB Hi-Fi sinks
• 3 great ASX tech shares to buy
• 3 ASX shares targeting huge growth in the 2020s
• Bigtincan (ASX:BTH) share price on watch after new contract win
• 3 rules that helped me 10x my money with Altium (ASX:ALU) shares

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 Altium and BIGTINCAN FPO. The Motley Fool Australia has recommended BIGTINCAN FPO. 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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The Xero Limited (ASX: XRO) share price has been one of the best performers on the S&P/ASX 200 Index (ASX: XJO) on Wednesday.

At one stage today the cloud-based business and accounting platform provider’s shares were up over 13% to a record high of $130.50.

The Xero share price has since pulled back a touch but is still up a decent 6.5% at the time of writing.

Why is the Xero share price zooming higher today?

Investors have been buying Xero shares on Wednesday for a couple of reasons.

The first is the impending release of its half year update tomorrow morning.

It appears as though some investors are expecting the company to deliver a strong result despite the negative impact that COVID-19 is having on small businesses.

What else is driving the Xero share price higher?

Also giving Xero’s shares a boost today is its inclusion in the illustrious MSCI Global Standard index this morning following its quarterly review.

Xero was the only ANZ based company out of 141 new additions to the index this morning. Thankfully for local investors, no Australian companies were among the 135 companies that were deleted from the index.

Given that the MSCI Global Standard index is one that fund managers and index funds track, the buy side has been a lot firmer than usual today and helped drive its shares higher.

What is the MSCI Global Standard index?

The MSCI Global Standard index is MSCI’s flagship global equity index. It is designed to represent the performance of the full opportunity set of large and mid-cap stocks across 23 developed and 26 emerging markets.

According to MSCI, as of December 2019, the index covered more than 3,000 constituents across 11 sectors and approximately 85% of the free float-adjusted market capitalisation in each market.

It has been built using MSCI’s Global Investable Market Index (GIMI) methodology, which is designed to take into account variations reflecting conditions across regions, market cap sizes, sectors, style segments, and combinations.

More reading

• ASX 200 up 1.3%: CBA Q1 update, tech shares rebound, JB Hi-Fi sinks
• Why CBA, Straker, Woodside, & Xero shares are surging higher
• 3 great ASX tech shares to buy
• Why ASX 200 technology shares are again racing higher
• How did the WAAAX shares perform in the last quarter?

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 Xero. 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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A natural human need for “emotional comfort” costs retail investors 3% in lost returns each year.

However, United Kingdom behavioural finance firm, Oxford Risk, warned this week that losses in the year of the COVID-19 pandemic would be even higher.

This is because emotions take over even more in times of volatility.

“During a crisis, investors are likely to focus too much on the present and on the detail, feeling compelled to do something even when sitting tight is the best solution,” stated the company.

“They can gravitate towards the familiar – often leading to underinvestment, selling low, or decreased diversification.”

These behaviours are common to many investors, even experienced ones.

Oxford Risk Chief Executive, Dr Marcus Quierin, said such acts devastatingly result in turning theoretical losses into actual ones.

“If they don’t need to withdraw money for immediate expenses, then the losses are only virtual… until they panic and make them real,” he said. 

“The investments in the news are not your investments. Retail investors should avoid watching the markets day-to-day as this will only increase anxiety to no useful end, and make you feel like you should be doing something, without any useful guidance to what that should be.”

If your original strategy was to invest for the long haul, Quierin said, then any market volatility should be viewed through long-term lenses.

Focus on what you can control

The Oxford Risk study found that many retail investors have increased their proportion of cash this year because of the volatility.

But this reluctance to invest would cost them 4% to 5% per year over the long term.

Losses due to timing — selling low and buying high — was calculated at an average of 1.5% to 2% per year.

Quierin said trying to time the market is a mug’s game.

“Investors should focus on what they can control. It’s the most ancient advice there is, and still the most important,” he said.

“You can’t move the market or predict when it’s at the ‘bottom’ or the ‘top’. You can postpone discretionary spending and use tumultuous times as an opportunity to take stock of your long-term financial plans. And you can control the opportunity to benefit from the ‘risk premium’ – the long-term reward for owning shares that has eventually weathered every short-term storm yet.”

The volatility of 2020 is perfectly demonstrated in the wild ride that the S&P/ASX 200 Index (ASX: XJO) has had. 

When the market crashed in March during the first coronavirus lockdown, the index lost 36%. Then from that trough, it has gained more than 40% as at 11 November.

Oxford Risk develops software that assists financial advisers and institutional investors to overcome behavioural biases.

“There is too much guesswork and not enough technology. This means that assessment of client emotional proclivities is noisy, biased and prone to error… it is too subjective,” said Oxford Risk behavioural finance head, Dr Greg B Davies.

“This is not to advocate removing humans from the process… Human conversations are vital, particularly in a crisis, but advisers need to be assisted by better diagnostic tools enabling accurate assessment of the client’s personality and likely behavioural tendencies.”

More reading

• ASX 200 up 1.3%: CBA Q1 update, tech shares rebound, JB Hi-Fi sinks
• 5 things to watch on the ASX 200 on Wednesday
• Enjoying your ASX 200 gains? Here’s why you should watch out for January
• Vaccine hopes cause ASX 200 to rise on Tuesday
• Why the JB Hi-Fi (ASX:JBH) share price is down 7% today

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. 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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The JB Hi-Fi Limited (ASX: JBH) share price is out of form again on Wednesday and is sinking lower.

In afternoon trade the retailer’s shares are down 5% to $44.20.

This means the JB Hi-Fi share price is now down almost 17% from the all-time high it reached just three weeks ago.

Why is the JB Hi-Fi share price sinking lower?

Investors have been selling the retailer’s shares this week amid news that there could soon be an effective COVID-19 vaccine rolled out globally.

As backwards as it might sound, this is being seen as bad news for companies like JB Hi-Fi.

This is because it has been a big winner during the pandemic as investors redirect their spending away from travelling onto entertainment and homewares.

It was for this reason this morning that equity analysts at Macquarie Group Ltd (ASX: MQG) downgraded the company’s shares to a neutral rating and cut the price target on them by almost 10% to $49.50.

According to the note, if the vaccine is a success, the broker expects that consumer behaviour will return to normal in 2021. This is likely to result in a slowdown in its growth as consumers start traveling again.

What about other retailers?

Analysts at Morgans also expect this to be the case and have been adjusting their recommendations today.

It has reduced the multiples for shares that it believes are likely to be impacted by a redirection in spending as the world returns to normal.

Two retailers that have been impacted are Accent Group Ltd (ASX: AX1) and Super Retail Group Ltd (ASX: SUL).

The broker has downgraded Accent’s shares to a hold rating with a reduced price target of $1.67. As for Super Retail, its shares have been downgraded by Morgans to a hold rating with a reduced price target of $11.78.

More reading

• Why Bingo, Evolution, JB Hi-Fi, & Super Retail shares are dropping lower
• ASX 200 up 1.3%: CBA Q1 update, tech shares rebound, JB Hi-Fi sinks
• Why the JB Hi-Fi (ASX:JBH) share price is down 7% today
• What big brokers are thinking about the Macquarie (ASX: MQG) share price after its interim results
• 2 ASX dividend shares with above-average yields

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited and Super Retail Group Limited. The Motley Fool Australia has recommended Accent Group. 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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The Botanix Pharmaceuticals Ltd (ASX: BOT) share price is surging higher today after a positive announcement.

In the minutes after market open, shares in the synthetic cannabinoid company jumped as high as 11.5 cents. The Botanix share price has retreated slightly during the day to 11 cents, up 15.79% at the time of writing.

What does Botanix do?

Botanix is a synthetic cannabinoid pharmaceutical company that focuses on dermatology and antimicrobial products.

Based in Perth, Australia and in Philadelphia, United States, the company has a pipeline of product candidates undergoing clinical trials. Botanix aims to address patients who have serious skin diseases, as well as prevent surgical site infections.

Pre-IND meeting completed

Botanix advised that it successfully completed a pre-Investigational New Drug (IND) meeting. The appointment took place with the United States Food and Drug Administration’s (FDA) office of Infectious Diseases for its lead antimicrobial program, BTX 1801.

The pre-IND meeting provided Botanix an opportunity to seek advice and clarification from the FDA on what’s required to initiate clinical studies. In addition, the company received feedback on the drug development plan for BTX 1801 to fast-track its FDA process. In April, Botanix was granted Qualified Infectious Disease Product status, giving the company priority FDA review and faster two-way communication.

Before the meeting had occurred, Botanix submitted data outlining the successful results from its pre-clinical studies. In addition, the company also provided the FDA with future manufacturing and clinical development plans.

The FDA stated that the data and development package was sufficient to begin clinical trials in the US. Should the study become a success, an IND application will follow.

Currently, Botanix is in a Phase 2a trial for BTX1801 in Western Australia. The study is fully enrolled and expected to be finished at the end of the calendar year. Data from the antimicrobial trial will be available shortly after completion, and provided to investors in due course.

What did management say?

Botanix president and executive chair Vince Ippolito commented on the achievement, saying:

We are very pleased with the excellent outcomes from the Pre-IND meeting. Botanix is now well placed to initiate clinical development of BTX 1801 in the US under an accelerated development path with the FDA.

About the Botanix share price

The Botanix share price has been on a wild run of late, jumping from 4.9 cents at the start of September to 10.5 cents today. This represents a gain of more than 114% in the space of less than 3 months.

Reaching a 52-week high in October of 12.5 cents, Botanix is just shy of regaining that feat again.

The company is still considered as a small-cap share with a market capitalisation of $102.1 million.

More reading

• The Botanix (ASX:BOT) share price is soaring 15% higher today. Here’s why.

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. 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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The Synlait Milk Ltd (ASX: SM1) share price came out of a trading halt today, dropping 9.75% to $5.00 before recovering to $5.25 at the time of writing. The drop in Synlait Milk’s share price came after an announcement that the company would conduct a capital raising.

How will Synlait Milk raise capital?

Synlait Milk announced yesterday that it will raise approximately NZ$200 million. This will consist of a placement to raise NZ$180 million and an underwritten share purchase plan to raise NZ$20 million.

The placement will be conducted at a share price of NZ$5.10, representing a discount of 14% to the company’s trading price before the capital raising was announced. Synlait Milk announced today that the placement was fully subscribed.

The company’s share purchase plan will allow existing shareholders to purchase up to NZ$50,000 worth of Synlait Milk shares. The price of the share purchase plan will be the lower of NZ$2.10 per share or the 5-day volume weighted average price of Synlait Milk shares trading on the New Zealand Stock Exchange in the last 5 days of the SPP offer period. The record date for the share purchase plan was 9 November 2020 and an offer booklet will be sent out to shareholders on 13 November 2020.

According to Synlait Milk, the proceeds of the capital raising will be used to start manufacturing new product lines as part of a recent agreement with a global category leader and to strengthen the company’s balance sheet.

Synlait Milk guidance for FY21

Synlait Milk also released the following guidance for the 2021 financial year:

• Volumes for consumer packaged infant formulas expected to be lower in FY2021 than FY2020
• Net profit after tax (NPAT) in the first half of FY2021 to be significantly lower than it was in the first half of FY2020
• NPAT for the full 2021 financial year expected to be slightly lower than FY2020

About the Synlait Milk share price

Synlait Milk is a New Zealand dairy processor that produces products for infant nutrition and adult nutrition along with everyday dairy and dairy-based products. Synlait Milk has been listed on the ASX since 2016.

The Synlait Milk share price is up 21.25% since its 52-week low of $4.33, however, it is down 39.10% since the beginning of the year. The Synlait Milk share price is down 38.16% since this time last year.

More reading

• Synlait (ASX:SM1) share price 8% higher on land covenant settlement
• Why the Synlait (SM1) share price is falling today

Motley Fool contributor Chris Chitty 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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It can be an interesting insight to know what brokers think of an ASX dividend share. The problem is that a single broker can be wrong or biased.

If you can get a consensus among brokers about which shares are best, then that may give a clue about what to buy and what to avoid.

Every so often MarketIndex collates the broker recommendations of 150 ASX shares and totals the buys, holds and sells for those shares. The higher or lower the average score the more of a strong buy, buy, hold, sell or strong sell that share is rated.

MarketIndex cautioned that a high dividend yield can indicate a falling share price or limited growth prospects.

Here are three of the ASX dividend shares rated as buys by brokers:

Charter Hall Social Infrastructure REIT (ASX CQE)

This is a real estate investment trust (REIT) which invests in social properties like early learning centres. However, it has recently expanded its investment mandate to consider other properties to add diversification.

As an example of this move, it recently announced the $122.5 million acquisition of a property that is under construction which will be the new corporate headquarters of Mater Misericordiae, Queensland’s largest Catholic not-for-profit health provider.

It had a 99.5% occupancy rate for its 395 properties with a weighted average lease expiry (WALE) of 12.7 years at 30 June 2020.

The ASX dividend share also just announced the acquisition of the South Australian Emergency Services Command Centre and multi-deck carpark which is currently under construction. It’ll be purchased for $23 million and fund the rest of the build for a total cost of $80 million. This has a 15-year lease with fixed 2.5% annual rent increases and two 5-year options.

It has previously provided distribution guidance of 15 cents per unit in FY21, which turns into a yield of 4.9% at the current Charter Hall Social Infrastructure REIT share price.

IOOF Holdings Ltd (ASX: IFL)

IOOF is now one of the largest financial advice businesses in the country after making the recent acquisitions from Australia and New Zealand Banking Group Ltd (ASX: ANZ) and MLC from National Australia Bank Ltd (ASX: NAB).

The IOOF share price is still down by 55% from the highs in January. The company recently announced its quarterly update. At 30 September 2020, its funds under management, advice and administration (FUMA) rose by around half a billion to $202.8 billion.

IOOF CEO Renato explained why IOOF is focused on financial advice: “We are at an inflection point of change for the Australian advice landscape. The value of quality financial advice has never been more apparent than it is today. Equally the need to create a professional business model has never been more apparent.”

Commsec has estimates for FY23 where IOOF has a projected grossed-up dividend yield of 10.7% and it’s trading at 9x FY23’s estimated earnings at the current IOOF share price.

Sydney Airport Holdings Pty Ltd (ASX: SYD)

Before COVID-19, Sydney Airport was paying a steadily-growing dividend from its cashflow as more passengers passed through the airport.

But COVID-19 has heavily impacted passenger numbers. In September 2020, total passenger numbers were down 96.4%. However, the company pointed out that travel restrictions between NSW and SA, between NSW and the NT, and between NSW and New Zealand are now being lifted.

Commsec has estimates for the FY22 year. Sydney Airport is projected to return to making a profit in FY22. It’s also estimated to pay dividends amounting to 20.5 cents per share, which equates to a dividend yield of 3% at the current Sydney Airport share price.

More reading

• Vaccine hopes cause ASX 200 to rise on Tuesday
• Why the Sydney Airport (ASX:SYD) share price rocketed 24% higher today
• ASX 200 up 1.6%: COVID-19 vaccine news sends Flight Centre, NAB, & Qantas surging higher
• ASX 200 Weekly Wrap: US election special
• How you could have turned $20,000 into $250,000 in 10 years with ASX shares

Motley Fool contributor Tristan Harrison 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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