There are some compelling ASX tech shares that could be worth looking into.

Some technology businesses have the potential to grow quickly and support high gross profit margins because software is so easily and cheaply replicated for new clients and users.

Here are some compelling ASX tech shares that could be worth looking into:

Redbubble Ltd (ASX: RBL)

Redbubble operates two leading global artist product marketplaces, Redbubble.com and TeePublic.com The company says that the artists sell uncommon designs on high-quality, everyday products such as apparel, stationery, housewares, bags, wall art and so on.

The company is slowly but steadily adding more product lines onto its site. One recent example is face masks due to the COVID-19 pandemic. This one category has made many millions of dollars of revenue for the company.

There was a large shift to online shopping during the first half of the 2020 calendar year, but the growth that Redbubble is experiencing has continued.

In the first quarter of FY21, Redbubble reported that its normalised revenue (excluding a change in delivery times) grew 98% to $139.3 million, its normalised gross profit increased by 118% to $59.6 million and it generated normalised earnings before interest and tax (EBIT) of $17.2 million.

Over the long-term the company is aiming for $1 billion of marketplace revenue.

At the time of the FY21 first quarter update, Redbubble CEO Martin Hosking said: “The strategic priority for the group now is to ensure we extend the market leadership we have established. We intend to invest in the customer experience to improve loyalty and retention and ensure long-term higher levels of growth. The company has the resources to undertake the anticipated investments and margin structure to ensure it can do so while remaining profitable.”

Altium Limited (ASX: ALU)

Altium is an electronic PCB software business that offers various software for different engineering outfits to design the products, services and vehicles of the future.

The ASX tech share has a number of high quality clients like Tesla, Space X, Google, Amazon, Apple, Microsoft, Disney, NASA, Cochlear Limited (ASX: COH) and ResMed Inc (ASX: RMD).

Over the long-term Altium is aiming to become the clear market leader in the industry in the same way that Microsoft dominated the office software space. To do that, it’s trying to reach 100,000 Altium Designer subscribers.

The company is currently going through a transition phase. Not only is it suffering from COVID-19 impacts, but it also focusing on a shift to the cloud with its Altium 365 product. This provides the opportunity for direct monetisation. It can generate transaction fees on manufacturing (like an Airbnb model) and it can also offer premium services (like an Amazon Prime model).

According to Commsec, the Altium share price is valued at 44x FY23’s estimated earnings.

Betashares Nasdaq 100 ETF (ASX: NDQ)

This ASX tech share actually gives exposure to many of the world’s biggest technology businesses.

The biggest positions in the portfolio include Apple, Microsoft, Amazon, Tesla, Facebook, Alphabet, Nvidia, PayPal and Netflix.

There are a number of other interesting businesses in the ETF portfolio like Adobe, Broadcom, Qualcomm, Texas Instruments, Advanced Micro Devices, MercadoLibre, Intuitive Surgical, Activision Blizzard and Zoom.

In terms of the management costs, it has an annual fee of 0.48% per annum.

The net return of Betashares Nasdaq 100 ETF over the last year has been 25.8% and it has produced average returns per annum of 21.25% since inception in May 2015.

More reading

• 2 fantastic ASX shares to buy this month
• 2 outstanding ETFs for ASX investors to buy in February
• 2 top ETFs to buy for February 2021
• 2 great ASX growth shares to buy
• 2 quality SaaS ASX shares to buy in February 2021

Tristan Harrison owns shares of Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Altium. The Motley Fool Australia owns shares of and has recommended BETANASDAQ ETF UNITS. The Motley Fool Australia owns shares of Altium. The Motley Fool Australia has recommended Cochlear Ltd. and ResMed Inc. 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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With so many growth shares to choose from on the Australian share market, it can be hard to decide which ones to buy.

Two that could be worth considering are listed below. Here’s why they have been tipped as buys:

Bigtincan Holdings Ltd (ASX: BTH)

The first ASX growth share to look at is Bigtincan. This artificial intelligence-powered sales enablement automation platform provider has been growing strongly in recent years and this has continued in FY 2021.

Last week the company released its second quarter update and revealed further impressive recurring revenue growth.

Bigtincan reported annualised recurring revenue (ARR) of $48.4 million at the end of the period. This represents growth of 50% on the prior corresponding period and was driven predominantly by organic growth. Organic ARR came in at $40 million (up 42.9%) and ARR from acquisitions was $8.4 million.

In response to the update, analysts at Morgan Stanley initiated coverage on the company’s shares with an overweight rating and $1.40 price target. It believes the company is in a strong position for growth thanks to its leadership position in a growing industry.

Kogan.com Ltd (ASX: KGN)

Kogan is one of Australia’s leading ecommerce companies and the country’s answer to Amazon. It has been growing at a very strong rate in recent years and particularly in FY 2021 thanks to the acceleration of the shift to online shopping.

In fact, the company has just released its half year update, which revealed explosive sales and profit growth. For the six months ended 31 December, Kogan’s gross sales (including the Mighty Ape acquisition) increased 96% over the prior corresponding period.

And thanks to margin expansion, its gross profit grew over 120% and its earnings before interest, tax, depreciation and amortisation (EBITDA) jumped over 140%.

Analysts at Credit Suisse were pleased with its update. In response to it, the broker put an outperform rating and $21.08 price target on its shares. This compares to the current Kogan share price of $17.45. It believes Kogan is well-placed to benefit from the shift to online shopping.

More reading

• 2 compelling ASX shares to buy in February 2021
• Leading brokers name 3 ASX shares to buy today
• ASX 200 Weekly Wrap: Reality (and GameStop) finally hits ASX
• 3 ASX tech shares to buy in February 2021
• 3 very impressive ASX quarterly updates from last week

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends BIGTINCAN FPO. The Motley Fool Australia owns shares of and has recommended BIGTINCAN FPO and Kogan.com 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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Are you looking to boost your portfolio with a few dividend shares? Then you might want to take a look at the ones listed below.

Here’s why these ASX dividend shares could be among the best on offer on the Australian share market:

Coles Group Ltd (ASX: COL)

The first ASX dividend share to look at is Coles. This supermarket giant has been a particularly strong performer over the last 12 months thanks to its defensive qualities and a favourable redirection in consumer spending.

Pleasingly, this strong form has continued in FY 2021, with Coles reporting solid growth across its business so far in the financial year. This appears to have positioned the company to deliver another strong full year result in August.

Looking further ahead, the company’s refreshed strategy appears to be positioning it for growth over the long term. This strategy is aiming to cut costs, boost automation, and make Coles an own brand powerhouse.

Analysts at Citi are positive on the company and have a buy rating and $21.20 price target on its shares. Its analysts are forecasting a 63.5 cents per share fully franked dividend in FY 2021. Which, based on the latest Coles share price, represents a fully franked 3.45% dividend yield.

Sonic Healthcare Limited (ASX: SHL)

Another ASX dividend share to look at is Sonic Healthcare. It is a leading medical diagnostics company with operations across the world.

Like Coles, Sonic has been a very impressive performer during the pandemic. For example, in October the company released its first quarter update and revealed a 29% increase in revenue to $2,144 million and a massive 71% lift in EBITDA to $580 million. This is being driven by strong demand for COVID-19 testing services and decent performances across the rest of the business.

Morgan Stanley is very positive on the company. Earlier this week, it put an overweight rating and $40.10 price target on its shares.

The broker expects a big dividend this year of ~$2.13 per share, which represents a 5.9% dividend yield. Though, it is worth noting that it is forecasting this dividend to reduce back to more normal levels of ~$1.23 per share in FY 2022. Based on the current Sonic share price, this will be a 3.4% yield.

More reading

• Got cash to invest? Here are 3 ASX shares to buy
• 2 COVID-19 amplified ASX shares to buy
• 3 ASX 200 shares that keep growing their dividends
• Top ASX shares to buy in February 2021
• ASX 200 Weekly Wrap: Reality (and GameStop) finally hits ASX

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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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Exchange-traded funds (ETFs) have the ability to give us exposure to a large group of businesses from a particular location or sector. Some ETFs have delivered a lot of growth.

Here are two that have outperformed the S&P/ASX 200 Index (ASX: XJO) over the past few years.

Betashares Asia Technology Tigers ETF (ASX: ASIA)

The US isn’t the only place to find technology giants with big addressable markets.

This ETF is about giving investors exposure to the 50 largest Asian technology companies outside of Japan through a single investment.

BetaShares says that due to its younger, tech-savvy population, Asia is surpassing the West in terms of technological adoption and the sector is anticipated to remain a growth sector. The ETF provider also says that technology is under-represented in the Australian share market and it can complement investors’ US tech exposure.

You may be wondering about some of the Asian tech giants that make up this ETF’s portfolio holdings. The biggest five positions are: Taiwan Semiconductor Manufacturing, Samsung Electronics, Meituan, Tencent and Alibaba. These positions alone account for 47.5% of the portfolio. The next five are: Pinduoduo, JD.com, Netease, Sea and Infosys.

In terms of geographical diversification, just over half of the portfolio is made up of Chinese businesses. There’s another 20.7% based in Taiwan, 19.2% from South Korea and 5.1% from India.

It has an annual management fee of 0.67% per annum. Whilst that’s higher than many other index-based ETFs, it hasn’t harmed the returns too much. At 29 January 2021, it had produced a net return of 71.5% over the last year and an average return per annum of 37.2% since inception in September 2018.

Betashares Global Cybersecurity ETF (ASX: HACK)

This is another ETF provided by BetaShares. With this one, it provides a focus on a particular industry: cybersecurity.

There have been plenty of high profile cyber attacks over the past decade. BetaShares says that with cybercrime on the rise, the demand for cybersecurity services is expected to grow strongly for the foreseeable future.

At the moment there are around 40 positions in the portfolio, represented by both global giants and smaller niche emerging players.

Its biggest holdings include: Crowdstrike, Zscaler, Cisco Systems, Accenture, Splunk, Fireeye, Palo Alto Networks, Proofpoint, Fortinet and Sailpoint Technologies.

Whilst over half of the Betashares Global Cybersecurity ETF portfolio is classified as ‘systems software’, there are other categories like IT consulting and other services, communications equipment, internet services and infrastructure, application software and aerospace and defence.

Almost 90% of the portfolio is invested in businesses listed in the US, though many of them generate earnings from multiple countries. Other countries with a weighting in the portfolio of more than 1% include the UK, Israel, Japan and France.

This ETF also has an annual management fee of 0.67% per annum. Its net returns have also been better than the ASX in recent years. Over the last year the net return from Betashares Global Cybersecurity ETF was 25.2%, over the last three years the ETF has made an average return per annum of 25.1% and since inception in August 2016 the ETF has made average returns per annum of 20.9%.

More reading

• 5 things to watch on the ASX 200 on Thursday
• ASX 200 up 0.9%, Afterpay drops, CBA rises
• RBA relief! Why the ASX 200 is set for a bumper year… or 3
• ASX 200 up 1.1%: Amcor jumps, South32 sinks, Virgin Money UK rockets
• ASX coal stocks increasingly isolated with rise of start-ups like MGA Thermal

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended BetaShares Asia Technology Tigers ETF. The Motley Fool Australia owns shares of BETA CYBER ETF UNITS. 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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Due to favourable long term industry tailwinds, many investors are positive on the healthcare industry.

But with so many top shares to choose from in the industry, it can be difficult to decide which ones to buy.

To narrow things down, I have picked out an ASX healthcare share that could be fantastic long term option for investors.

ResMed Inc. (ASX: RMD)

ResMed is a medical device company aiming to change lives by developing, manufacturing and distributing innovative medical devices and cloud-based software solutions that better diagnose, treat, and manage sleep-disordered breathing, chronic obstructive pulmonary disease (COPD), and other key chronic diseases.

Over the last decade, it has developed a portfolio of world class products and become a leader in its field. This has underpinned very strong sales and earnings growth over the period ang generated impressive returns for investors.

The good news is that its strong form has continued in FY 2021. ResMed recently released its second quarter update and revealed a 9% increase in quarterly revenue to US$800 million and a 17% increase in net profit to US$206.4 million.

Looking ahead, ResMed still has a huge and growing market opportunity due to the increased education around sleep disorders and the growing prevalence of sleep apnoea. It also has a massive digital health ecosystem with millions of connected devices generating valuable patient data.

The latter is expected to play a role in helping the company achieve its goal of improving 250 million lives in out-of-hospital healthcare in 2025.

One broker that is particularly positive on the company is Morgans. Last week the broker put an add rating and $30.09 price target on the company’s shares.

It notes that ResMed delivered a result ahead of its expectations. The broker also believes its outlook is positive thanks to new sleep patient diagnoses, strong mask resupply, and the favourable pricing environment.

This compares to the latest ResMed share price of $26.69.

More reading

• 2 ASX shares rated as buys by brokers
• Leading brokers name 3 ASX shares to buy today
• Why Afterpay, ResMed, Temple & Webster, & Worley shares are dropping lower
• 3 very impressive ASX quarterly updates from last week
• ASX 200 up 0.6%: ResMed Q2 update, Kogan sinks, NAB acquires 86 400

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended ResMed Inc. 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 money to invest into ASX shares for dividends?

There are some good contenders to think about for income:

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts has the best dividend record when it comes to consecutive years of dividend increases.

The ASX dividend share has increased its income payment to shareholders every year since 2000. It has also paid a dividend every year since it listed in 1903.

Soul Patts started out as a pharmacy business. It still has an indirect investment in the Soul Pattinson Chemists business through its holding of Australian Pharmaceutical Industries Ltd (ASX: API) shares.

But that isn’t the only investment that Soul Patts owns. It now runs as an investment conglomerate, so it has a diversified portfolio across telecommunications, healthcare, property, building products, listed investment companies (LICs), resources, agriculture and financial services.

Those sectors are represented by listed businesses like TPG Telecom Ltd (ASX: TPG), Apex Healthcare, Brickworks Limited (ASX: BKW), Bki Investment Co Ltd (ASX: BKI), Milton Corporation Limited (ASX: MLT), Round Oak Minerals and Pengana Capital Group Ltd (ASX: PCG). Those investments pay dividends to Soul Patts, which it can then pay on to shareholders. 

Bapcor Ltd (ASX: BAP)

Bapcor currently has a grossed-up dividend yield of 3.1%. It was one of the few S&P/ASX 200 Index (ASX: XJO) shares that increased its dividend in FY20. Bapcor has increased its dividend consecutively for the last several years.

The company’s trading conditions have been elevated in recent months after everything that has happened with COVID-19 and the related impacts.

The ASX dividend share is expecting to report a “strong” FY21 first half result. For the first five months of FY21 to November 2020, revenue was up 26% with the net profit after tax (NPAT) achieving operating leverage from lower expenses in areas such as travel and other areas of discretionary expenditure, as well as lower interest rates and the contribution from Truckline which was not included in the prior corresponding period.

For the first half of FY21, Bapcor anticipates that it will achieve revenue growth of at least 25% over FY20, and a net profit after tax increase of at least 50%.

Over the next few months, Bapcor is expecting its automated picking system to become operational at its Victorian distribution centre that will deliver significant operational benefits.

Charter Hall Long WALE REIT (ASX: CLW)

This ASX dividend share is one of the few real estate investment trusts (REITs) that increased its distribution in FY20. Another increase is expected in FY21.

What is Charter Hall Long WALE REIT? It’s a commercial property trust with long rental leases which is operated by Charter Hall Group (ASX: CHC). It’s liked by brokers such as Morgan Stanley which like the high quality tenant base and the access to the Charter Hall platform. 

Some of the tenants that are leasing the properties include Telstra Corporation Ltd (ASX: TLS), Australian government entities, BP, Woolworths Group Ltd (ASX: WOW), Inghams Group Ltd (ASX: ING), Coles Group Ltd (ASX: COL), Metcash Limited (ASX: MTS) and Arnott’s Group.

The REIT is steadily adding to its portfolio. Recent acquisitions include the flagship David Jones store in Sydney and a portfolio of BP service stations.

There is rental growth built into the contracts and it has a weighted average lease expiry (WALE) of 14.2 years, which is among the longest in the sector.

FY21 it’s expecting to generate at least 29.1 cents per unit, which equates to a distribution yield of 6.1% for the ASX dividend share.

More reading

• 3 highest yielding ASX dividend shares
• 2 ASX dividend shares for steady income in retirement
• 3 ASX 200 shares that keep growing their dividends
• 2 ASX dividend shares rated as strong buys by brokers
• 3 ASX dividend shares with yields above 5%

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Bapcor, Brickworks, and Washington H. Soul Pattinson and Company Limited. 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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On Wednesday the S&P/ASX 200 Index (ASX: XJO) was on form for a third day in a row. The benchmark index jumped 0.9% higher to 6,824.6 points.

Will the market be able to build on this on Thursday? Here are five things to watch:

ASX 200 futures pointing lower

The Australian share market looks set to end its winning streak on Thursday. According to the latest SPI futures, the ASX 200 is poised to open the day 14 points or 0.2% lower this morning. This is despite stocks on Wall Street pushing higher overnight. In late trade, the Dow Jones is up 0.25%, the S&P 500 is up 0.5%, and the Nasdaq has climbed 0.6% higher.

Oil prices rise again

It could be a good day for energy producers such as Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) after another positive night for oil prices. According to Bloomberg, the WTI crude oil price is up 1.6% to US$55.62 a barrel and the Brent crude oil price has risen 1.6% to US$58.39 a barrel. Oil prices are closing in on one-year highs after a stronger than expected inventory drawdown in the United States.

Northern Star-Saracen merger completes

The Saracen Mineral Holdings Limited (ASX: SAR) share price won’t be going anywhere today after being suspended at the close of play on Wednesday. This happened after its mega merger with fellow gold miner Northern Star Resources Ltd (ASX: NST) became effective. The transaction will create a new top-10 global gold major with immediate production of 1.6 million ounces per annum and a pathway to 2.0 million ounces.

Gold price edges higher

Gold miners including Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Ltd (ASX: NCM) will be on watch after the gold price edged higher. According to CNBC, the spot gold price is up 0.1% to US$1,835.10 an ounce. Elsewhere, the silver price rose 1.7% overnight after crashing lower a day earlier when the Reddit trade ran out of steam.

Iron ore price rises

It could be a good day for BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) shares after the iron ore price climbed higher on Thursday night. According to Metal Bulletin, the iron ore price has pushed 1.9% higher to US$152.65 a tonne.

More reading

• ASX 200 up 0.9%, Afterpay drops, CBA rises
• Why this Goldman Sachs forecast could see these 3 ASX energy shares lift off
• RBA relief! Why the ASX 200 is set for a bumper year… or 3
• Fleetwood (ASX:FWD) share price soars 10% following half-year results announcement
• Why BHP, Estia Health, HUB24, & South32 shares are dropping lower

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) went up by 0.9% to 6,825 points today.

Here are some of the highlights from the ASX:

Afterpay Ltd (ASX: APT)

The Afterpay share price fell by over 1% today after the buy now, pay later (BNPL) business gave a market announcement relating to its UK business called Clearpay.

Clearpay said that it welcomed the UK’s Woolard review proposal to bring BNPL under FCA oversight with proportionate regulation.

The UK BNPL business said that it has always supported fit for purpose regulation that recognises the diversity of the industry and desire from consumers for flexible payment options that don’t trap them in long-term debt.

Damian Kassabigi EVP of public policy at Clearpay said: “We welcome today’s recommendations and look forward to working with the FCA, the government and stakeholders to build on the consumer protections we already provide to create the applicable regulation for the sector.

“It has always been Clearpay’s view that consumers will be best served by products designed with strong safeguards and appropriate industry regulation with oversight from the FCA.”

Amcor CDI (ASX: AMC)

The Amcor share price went up by 4.5% today in reaction to the first half result of FY21.

The ASX 200 company said that its statutory net income was up 65% to $417 million, whilst statutory earnings per share (EPS) went up 71% to 26.5 cents.

Adjusted EPS went up 16% in constant currency terms to 33.3 cents whilst adjusted earnings before interest and tax (EBIT) grew by 8% to $743 million.

Amcor said that it achieved $35 million of Bemis cost synergies in the first half, it’s expecting $70 million of cost synergies of approximately $70 million in FY21.

A further $200 million of share repurchases have been approved, bringing the total announced in FY21 to $350 million. The board also decided to slightly increase the dividend to 11.75 cents per share.

Amcor CEO Ron Delia said: “Sales growth of 3% was balanced across our businesses and regions, cost performance has been strong and synergies from the Bemis acquisition are running ahead of schedule. We have built momentum in both operating segments resulting in adjusted EBIT growth of 9% in flexibles and 10% in rigid packaging in constant currency terms. That momentum translates into higher expectations for the full year with adjusted EPS growth now forecast at 10% to 14% in constant currency terms as well as an increased dividend and additional share repurchases.”

BWP Trust (ASX: BWP)

BWP also released its FY21 half-year result today. It achieved like for like rental growth of 2%, but overall revenue was flat at $76.1 million. Profit before gains on investment properties was also flat at $56.9 million.

The business reported gains in the value of its investment properties of $87 million. That helped net profit increase by 6% to $144 million and the net tangible assets (NTA) per unit increased by 5% to $3.20. Its gearing finished December 2020 at 17.8%.

BWP decided to maintain its interim distribution per unit at 9.02 cents.

In terms of the outlook, BWP said that it’s well positioned in the current COVID-19 environment with the significant majority of rental income being from Bunnings and other national large format retailers which are all trading well during this time.

Big four banks rise

After the RBA’s announcement yesterday of more quantitative easing, the big bank share prices all went higher today.

The Commonwealth Bank of Australia (ASX: CBA) share price went up 1.1%, the Westpac Banking Corp (ASX: WBC) share price climbed 1.5%, the National Australia Bank Ltd (ASX: NAB) share price went up 1.9% and the Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price grew 1.9%.

More reading

• Financials sector rallies as ASX 200 sees third day of gains
• RBA relief! Why the ASX 200 is set for a bumper year… or 3
• 2 ASX shares that humbled successful fundies
• Amcor (ASX:AMC) share price shoots up 6% as company raises FY21 outlook
• Why Amcor, Carsales, Rent.com.au, & Temple & Webster are surging higher

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

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The Zicom Group Limited (ASX: ZGL) share price has had an exceptional trading run today, closing 128% higher at 13 cents.

The Zicom share price blasted off the blocks this morning – even reaching a new 52-week high of 22 cents – off the back of a multi-million dollar deal announced yesterday.

Zicom Group is an integrated manufacturer of marine deck machinery, fluid regulating and metering stations, transit concrete mixers, foundation and geotechnical equipment and precision engineered and automation equipment. The company also provides production integration solutions and hydraulic system services. 

Why is the Zicom share price rocketing? 

Yesterday, Zicom announced a $60 million deal to design and supply LNG propulsion systems for several oil product tankers being built for a leading European oil tanker owner. The orders have been scheduled for delivery in 2022/2023.

The company cited this deal as a testament of its momentum to transform Zicom’s marine sector. Zicom advised that it has been developing technology for green energy propulsion systems for ocean-going vessels over the past 3 years.

The company believes that this strategy now enables Zicom to expand into the entire shipping industry rather than only focussing on offshore marine applications.

Zicom also noted that demand in the offshore marine sector appears to be showing some positive signs.

New shipping regulations position Zicom for growth

The International Maritime Organisation (IMO), which is part of the United Nations, regulates international shipping.

According to Zicom’s announcement, the IMO 2020 rules mandate ocean-going vessels to reduce sulphur emission from engines to 3.5%, down from 4.5%.

Meeting this mandate will require that vessels install scrubber filtration systems or use a low sulphur fuel in place of diesel. 

Each of these options will require technological updates which Zimcom believes the company can support. It therefore views the implementation of the new IMO 2020 rules as a strong growth opportunity.

Today’s gains see the Zimcom share price recover from its trading lows over the previous 12-month period. Its shares fell from 12 cents last February to a low of 4 cents in the coronavirus market meltdown of March.

More reading

• 2 ASX 200 shares to buy for growth
• 2 ASX shares rated as buys by brokers
• Financials sector rallies as ASX 200 sees third day of gains
• GameStop chaos: How Aussie fund doubled money in 2 days
• Why this Goldman Sachs forecast could see these 3 ASX energy shares lift off

Motley Fool contributor Gretchen Kennedy 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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There are some S&P/ASX 200 Index (ASX: XJO) shares that continue to generate growth despite all of the impacts from COVID-19.

Here are two of the ASX 200 shares generating growth and could be worth looking at:

Wesfarmers Ltd (ASX: WES)

Wesfarmers is largely a retail conglomerate that runs various major retailers such as Bunnings, Officeworks, Catch, Kmart and Target.

During this difficult COVID-19 pandemic period, the department store businesses have been struggling with lower foot traffic going into the stores. However, online sales across the business has been booming to help the overall picture.

The ASX 200 share gave a trading update in November to outline how it had done in the first four months of FY21 to October 2020.

It said that Bunnings total sales were up 25.2%, Kmart total sales had risen by 3.7%, Target sales had fallen by 2.2%, Catch’s gross transaction value had gone up 114.4% and Officeworks sales had climbed 23.4% higher.

In the year to date, Wesfarmers’ retail businesses had achieved total online sales growth of 166%, excluding Catch. Excluding online sales in metro Melbourne, which were significantly elevated due to government trading restrictions, online sales growth was 98%. Including Catch, total online sales across the group increased to $1.3 billion in the year to date.

Bunnings is by far the largest profit generator for Wesfarmers. Management said that the DIY hardware business had seen continued strong growth in both consumer and commercial segments. Consumer sales were particularly strong as customers spent more time undertaking projects around the home. Excluding metro Melbourne stores, total sales growth of 29.3% was recorded for the year to date.

Management are pleased with Bunnings’ digital strategy, with online sales penetration excluding metro Melbourne of 1.5% during the year to date, and digital engagement with both consumer and trade customers continuing to increase.

According to Commsec, the Wesfarmers share price is valued at 29x FY21’s estimated earnings.

Premier Investments Limited (ASX: PMV)

Premier Investments is another ASX 200 retail share. It owns various brands like Just Jeans, Jay Jays, Peter Alexander and Smiggle.

FY20 was a year of disruption and transition as Premier Investments adapted to the COVID-19 impacts on retail.

In a trading update for the first 24 weeks of FY21, it generated $146.2 million of online sales, which was up 60% compared to the prior corresponding period. This contribution was 20.4% of total sales, up from 13.4% in the prior corresponding period.

Premier Retail said that its online sales delivered a significantly higher earnings before interest and tax (EBIT) margin than the retail store network.

The ASX 200 share now expects Premier retail EBIT for the 27-week period to 30 January 2021 to be in the range of $221 million to $233 million, up between 75% and 85%.

Total global like for like sales for the 24 weeks to 9 January 2021 were up 18%, with Australian like for like sales growth of 26.2%. Premier said that there has been “outstanding” sales and gross margin growth in Peter Alexander, Just Jeans and Jay Jays in both Australia and New Zealand.

The company has also been focused on reducing its rental costs. In the trading update, Premier Investments said that it had achieved strong cost controls, including reaching agreements with key landlords on COVID-19 rent abatements.

According to Commsec, the Premier Investments share price is valued at 15x FY21’s estimated earnings.

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• ASX 200 Weekly Wrap: Reality (and GameStop) finally hits ASX
• RBA to cut the cash rate again? These ASX dividend shares have attractive yields
• What to expect from the Wesfarmers (ASX:WES) first half result
• These ASX clothing retailers’ share prices are storming to record highs

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Premier Investments Limited. 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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