The Nanosonics Ltd (ASX: NAN) share price has been out of form in recent weeks.

Since peaking at $6.87 in late August, the infection control specialist’s shares have tumbled 14% lower to $5.89.

Why is the Nanosonics share price down 14% in four weeks?

Investors have been hitting the sell button since the release of its full year results for FY 2020.

However, rather than selling shares because of the pandemic’s impact on its performance, I suspect the real driver of this decline was yet another delay with the company’s plans to launch new products.

Management warned: “Commercialisation of the new technology is no longer expected to be in FY21 but will likely be in FY22, with the ultimate launch timing continuing to be dependent on the necessary technical milestones being met as well as the timing of individual market regulatory approvals.”

This was very disappointing, especially given how many times the company has now failed to deliver on its new product promises.

Is this a buying opportunity?

While Nanosonics certainly isn’t a bargain buy, I still believe it could be a good long term investment.

Though, given the tough trading conditions with COVID-19 and the further delay in its new product launches, I wouldn’t be expecting too much from its shares over the next 12 months.

Sharing a similar view is Goldman Sachs. This morning its analysts put a neutral rating and $5.50 price target on the company’s shares.

It commented: “We believe NAN has successfully transitioned from a disruptive, niche technology provider to a proven leader in its field. However, as a result, there are many facets of execution which this management team must now deliver on to justify the current premium valuation. In particular, we see risk around the timing/impact of new product(s), penetration trajectory, and capital replacement cycle.”

The broker also spoke about its premium valuation and the aforementioned product pipeline.

“The stock trades on 72x NTM EV/EBITDA for 26% growth (vs. sector on 22x for 10%). We like the base business for what it is, and, purely on a DCF basis, we believe it is worth A$2.0/sh. As such, current valuation implies the market is allocating A$4.0/sh, i.e. 66% of total, to future product(s) which were first promised in FY17 but have so far shown negligible progress (the latest expectation is FY22).”

“We note that many ASX HC stocks do not stack up well purely on DCF, but we are not aware of any other example in global healthcare where the market has placed such a high value on a pipeline product with so much uncertainty. That is not to say that we believe it is overvalued, we just don’t have the data to assess either way, and after many delays, we would advocate prudence,” it concluded.

Food for thought.

More reading

• Why the Cyclopharma (ASX:CYC) share price surged to record high today
• Rhinomed (ASX:RNO) share price tries following Starpharma’s path to COVID glory
• A practical guide on how to invest in ASX shares
• Broker picks best ASX small cap stocks to buy from the reporting season
• 5 ASX shares I will never sell

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 Nanosonics Limited. The Motley Fool Australia has recommended Nanosonics 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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Although the Australian share market tumbled notably lower on Thursday, this didn’t stop a number of shares from charging higher.

Some of these ASX shares even managed to climb to 52-week highs or better despite the market weakness.

Three ASX shares which achieved this are listed below. Here’s why they are scaling new heights:

Galaxy Resources Limited (ASX: GXY)

The Galaxy share price hit a 52-week high of $1.50 on Thursday. Investors have been fighting to get hold of Galaxy and other lithium miners recently on the belief that the price of the battery making ingredient has now bottomed. This would be a big positive for Galaxy after a sustained and severe drop in lithium prices over the last couple of years. One broker that feels Galaxy’s run could be over is Ord Minnett. Earlier this week it downgraded the company’s shares to a sell rating with a 90 cents price target. It feels a recovery in lithium prices is more than priced into its shares now.

Netwealth Group Ltd (ASX: NWL)

The Netwealth share price continued its positive run and reached a new record high of $15.56 yesterday. This has been driven largely by the investment platform provider’s strong performance in FY 2020 despite the pandemic. In FY 2020, Netwealth delivered an impressive 21.7% increase in underlying net profit after tax to $43.8 million. The catalyst for this was a 35% increase in funds under administration over the 12 months to $31.5 billion. More recently, investors responded positively to an announcement yesterday which revealed that it has made a strategic investment in specialist fintech data solutions provider, Xeppo.

Temple & Webster Group Ltd (ASX: TPW)

The Temple & Webster share price stormed to a record high of $10.35 on Thursday. When the online furniture and homewares retailer’s shares hit that level, it meant they were up a remarkable 292% since the start of the year. A strong performance in FY 2020 thanks to the shift to online shopping has largely been responsible for this incredible rise. Also supporting its ascent on Thursday was a broker note out of Goldman Sachs. Its analysts retained their buy rating and lifted their price target to $11.50. They believe Temple & Webster is well-positioned for growth over the coming years thanks to structural tailwinds.

More reading

• ASX 200 drops 1.2%, Mineral Resources (ASX:MIN) fell 9%
• Temple & Webster (ASX:TPW) share price hits record high after broker lifts its price target
• Why De Grey, Scentre, Splitit, & Temple & Webster shares are pushing higher
• Netwealth share price on watch after strategic investment in Xeppo
• Leading brokers name 3 ASX shares to sell today

James Mickleboro owns shares of Galaxy Resources Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Temple & Webster Group Ltd. The Motley Fool Australia owns shares of Netwealth. The Motley Fool Australia has recommended Temple & Webster Group Ltd. 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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On Thursday the S&P/ASX 200 Index (ASX: XJO) was out of form and tumbled notably lower. The benchmark index dropped 1.2% to 5,883.2 points.

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

ASX 200 expected to rise.

The ASX 200 index is expected to rise on Friday despite some sizeable declines on Wall Street overnight. According to the latest SPI futures, the benchmark index is poised to open the day 21 points or 0.35% higher this morning. On Wall Street the Dow Jones fell 0.5%, the S&P 500 dropped 0.85%, and the Nasdaq tumbled 1.3% lower.

Tech shares to fall again?

The main drag on U.S. markets overnight was the tech sector once again. Tech giants Apple and Microsoft weighed heavily on the major indices and particularly the Nasdaq. Given how the Australian tech sector has a tendency to follow its lead, Friday could be another difficult day of trade for the likes of Afterpay Ltd (ASX: APT) and Nearmap Ltd (ASX: NEA).

Oil prices rise again.

Energy producers such as Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could be on the rise today after oil prices pushed higher again. According to Bloomberg, the WTI crude oil price is up 2% to US$40.98 a barrel and the Brent crude oil price is up 2.6% to US$43.30 a barrel. This follows comments out of OPEC urging producers to comply with output cuts.

Gold price tumbles lower.

Gold miners including Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) could end the week in the red after the gold price tumbled lower. According to CNBC, the spot gold price is down 0.9% to US$1,952.30 an ounce. The precious metal dropped lower after the U.S. Federal Reserve offered no pointers on further potential stimulus.

Sydney Airport update.

The Sydney Airport Holdings Pty Ltd (ASX: SYD) share price will be on watch this morning when it releases its traffic numbers for the month of August. Last month the airport operator revealed that passenger numbers were down 91.8% in July compared to the prior corresponding period. It looks likely to be a similar story in August due to border restrictions.

More reading

• ASX 200 drops 1.2%, Mineral Resources (ASX:MIN) fell 9%
• What’s moving the Scentre (ASX:SCG) share price today?
• Why the Cyclopharma (ASX:CYC) share price surged to record high today
• ASX 200 gender inequality lets the team down
• 3 ASX growth shares I’d buy right now

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 Nearmap Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Nearmap Ltd. 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 lucky enough to have $3,000 to invest into ASX growth shares, then I would suggest you consider putting these funds into the ones listed below.

Here’s why I think they could provide strong returns for investors over the 2020s:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

Given the recent weakness on the Nasdaq index, I think this exchange traded fund would be a fantastic option for investors. It gives investors exposure to a group of the highest quality growth shares the world has to offer in a single investment. This includes the likes of Amazon, Apple, Facebook, Microsoft, Netflix, Nvidia, Tesla, and Google parent, Alphabet. Given the exceptionally positive long term growth prospects of the majority of companies in the fund, I believe it has the potential to outperform over the 2020s.

Bravura Solutions Ltd (ASX: BVS)

Another option to consider is Bravura Solutions. As with the Nasdaq 100 ETF above, I feel a sharp pullback in the Bravura share price has created a buying opportunity for investors. Especially given its very positive long term growth potential. Bravura is the financial technology company responsible for the Sonata wealth management platform. This popular wealth management platform allows advisers to connect and engage with clients via computers, tablets, or smartphones. Demand for the platform has been growing very strongly in the past few years and I expect more of the same once the pandemic passes. This should be supported by recent acquisitions, which have bolstered its offering and opened it up to new and lucrative markets.

ResMed Inc. (ASX: RMD)

A final growth share to consider buying is ResMed. It is a sleep treatment focused medical device company which I believe is well-placed for growth over the next decade. This is thanks to its high quality product portfolio and leadership position in a growing market. I believe ResMed’s masks and software-as-a-service solution are among the best on the market and likely to experience a surge in demand in the coming years as more and more people are diagnosed with sleep disorders. Management estimates that there could be upwards of 1 in 7 people impacted by sleep apnoea. However, the vast majority of these sufferers are undiagnosed at present.

More reading

• Why the Cyclopharma (ASX:CYC) share price surged to record high today
• 3 ASX shares to buy before this window of opportunity closes
• Why you should invest $5,000 into these ASX shares right now
• Interest rates to stay low for years? Buy these ASX dividend shares
• Buy BetaShares NASDAQ 100 ETF (ASX:NDQ) and these outstanding ETFs today

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 BETANASDAQ ETF UNITS and Bravura Solutions Ltd. The Motley Fool Australia has recommended BETANASDAQ ETF UNITS, Bravura Solutions Ltd, and ResMed Inc. 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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Fortunately in this low interest rate environment, there are plenty of quality dividend shares trading on the Australian share market.

Three which I would buy today are listed below. Here’s why I think they are top options for income investors:

Accent Group Ltd (ASX: AX1)

Accent is the company behind retail store brands such as Athlete’s Foot, HYPE DC, and Platypus. It was a positive performer in FY 2020 despite the pandemic and posted a 7.5% increase in net profit after tax to $58 million. I’m confident there will be more of the same over the coming years thanks to its expansion plans, strong online business, and its on trend offering. In FY 2021, I expect the company to pay a 9 cents per share fully franked dividend. Based on the current Accent share price, this equates to a 5.7% dividend yield.

Dicker Data Ltd (ASX: DDR)

Dicker Data is a wholesale distributor of computer hardware, software, and cloud solutions to a partner base of over 5,500 resellers. It distributes a wide portfolio of products from the world’s leading technology vendors. This includes Cisco, Citrix, Dell, HP, Lenovo, Microsoft, and other Tier 1 global brands. Demand for this offering has been strong in recent years, underpinning solid earnings and dividend growth. This has continued in FY 2020 and put the company in a position to increase its dividend materially. Based on the current Dicker Data share price, it offers a forward fully franked 4.6% yield.

National Storage REIT (ASX: NSR)

National Storage is a leading self storage operator and could be a great option for income investors. Although the company is expecting its earnings to be flat at best in FY 2021, I still expect it to provide investors with a generous yield. After which, I’m optimistic a combination of organic growth and its growth through acquisition strategy will support solid earnings and distribution growth in the years that follow. Based on the current National Storage share price, I estimate that it offers a forward 4.2% distribution yield.

More reading

• Top ASX dividend shares to buy in September 2020
• 2 high quality ASX dividend shares with generous yields
• Smash low interest rates with these ASX dividend shares
• Why I would buy Coles (ASX:COL) and this ASX dividend share
• Why Accent, Afterpay, Nine, & PointsBet shares are dropping lower today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Dicker Data 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 S&P/ASX 200 Index (ASX: XJO) dropped by more than 1% today, falling to 5,883 points.

Here were some of the highlights from the ASX 200:

Biggest movers and shakers

At the bottom of the ASX 200 performance table the Mineral Resources Limited (ASX: MIN) share price fell by 9.4%.

There were businesses that dropped heavily. The Breville Group Ltd (ASX: BRG) share price fell by 7.5%, the Fortescue Metals Group Limited (ASX: FMG) share price dropped 6.4%, the Whitehaven Coal Ltd (ASX: WHC) share price declined by 5.5% and the Afterpay Ltd (ASX: APT) share price dropped 5.4%.

There were some businesses that saw gains. The ASX 200 leader was the Orora Ltd (ASX: ORA) share price which climbed around 3%.

Netwealth Group Ltd (ASX: NWL)

Fintech business Netwealth announced today that it was making a strategic investment and partnership with Xeppo. Initially, Netwealth is buying a 25% stake, though it has an option to increase its investment to 50%.

The ASX 200 business said that Xeppo specialises in connecting, matching and reconciling data from a wide range of sources to support the wealth management, accounting and mortgage industries.

Netwealth said that the investment, although not initially financially material, will enable and accelerate a number of key initiatives Netwealth has previously announced and is expected to create a unique and market-leading proposition for multi-disciplinary and integrates wealth practices.

Matt Heine, joint managing director of Netwealth, said: “A key element of Netwealth’s strategy is to expand and enrich the data which underpins our current and future technology and which sits at the core of our ‘whole of wealth’ and client portal offering.

“From our recent research, we found that advice firms on average use between 12 and 15 technology systems in their business, all of which have different data models, significant data discrepancies and often overlap from a features perspective. For example, the Netwealth platform captures customer details as does an advice firm’s CRM, planning software, fact find and client portal.

“Working closely with Xeppo we can solve this challenge and enable systems to better connect and integrate with each other driving business efficiency and great client experiences.”

Heartland Group Holdings Ltd (ASX: HGH)

Heartland announced its FY20 result today.

It said that it generated net profit after tax (NPAT) of $72 million. It also said it made adjusted NPAT of $78.9 million (after removing the economic overlay of (pre-tax) $9.6 million) which was up 7.2%.

Its gross finance receivables was $4.6 billion, up 4.9%. The financial business said that its net interest margin (NIM) was 4.33%, flat compared to FY19. Net operating income increased by 13.2% to $235.3 million.

It declared a final dividend of 2.5 cents per share, taking the full year dividend to 7 cents per share. However, that was a reduction of 3 cents per share due to the restrictions imposed by the Reserve Bank of New Zealand.

In FY21 the company is expecting its net profit after tax for FY21 to be in the range of $83 million to $85 million.

Splitit Ltd (ASX: SPT)

Buy now, pay later business Splitit announced that it is forming a partnership with QuickFee Ltd (ASX: QFE). It will see ‘advice now, pay later’ interest-free instalments launched for accounting firms and law firms.

No applications are required as no new credit is being offered to clients. Splitit will be integrated directly into Quickfee’s payments portal. This service will initially be available to more than 1,000 accounting and law firms already using Quickfee.

Quickfee sees this as an opportunity because it expands its customer base to include smaller firms that typically fall outside of its credit risk framework. Advice businesses’ clients will be able to more easily access legal, accounting and financial advice.

Splitit said it was not able to determine how material this partnership will be.

The Splitit share price finished flat today.

More reading

• What’s moving the Scentre (ASX:SCG) share price today?
• Why the Cyclopharma (ASX:CYC) share price surged to record high today
• ASX 200 gender inequality lets the team down
• Why the Splitit (ASX:SPT) share price is on the move today
• Why City Chic, Fortescue, Nearmap, & Zip shares are dropping lower today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO and Netwealth. 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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How does an ASX share turn $100 into $1,000?

That’s a good question. Returns are what we’re all here for, at the end of the day. We all invest our hard-earned money into the share market because we hope to get even more money back in the future. And it’s not exactly uncommon for ASX shares to give investors the kind of returns it takes to turn $100 into $1,000 either (That’s a 10-bagger return, or 900% if you want to get technical). Some ASX shares have given investors this kind of return in 2020 alone. Just think of Sezzle Inc (ASX: SZL). If you bought $100 worth of Sezzle shares on 23 March this year, that $100 would be worth around $1,790 today.

But how does this actually happen? Well, first things first. Short-term share gains like Sezzle’s are extremely uncommon – 2020 has produced a few of them only because we’ve had a massive share market crash this year. Investors who invested at or near the bottom of this crash have enjoyed gains not normally available on an ‘average year’ on the share market. And investors who make a full-time habit of chasing these kinds of returns usually don’t go home wealthy at the end of the day.

But it’s still possible to turn $100 into $1,000 using ASX shares, even if it doesn’t happen in the space of 6 months.

A compounding miracle

How this happens is through the miracle of compound interest. Compound interest is one of the most misunderstood, yet powerful, forces you can harness in the world of investing. If an ASX company can grow its earnings at 20% per annum for 10 years, it might sound ok to your ears. But picture this: if a company that might have earnings of $50 million in 1 year, and grows this figure by 20% each year for 10 years, will end up with earnings of $310 million. If it continues this growth streak, even at a lower rate of 15% for another 10 years, it will be pulling in $1.25 billion.

Now, let’s assume that you bought $100 worth of this company’s shares and the shares trade at a consistent price-to-earnings (P/E) ratio. It would then take 14 years to turn your $100 worth of shares into $1,000. That might not sound like too much of a big deal. But the maths is the same no matter the amount. Say you had $1,000 initially invested in our wunderkind company. After 14 years, this would be worth $10,000. And if you had $10,000, then 14 years later you’d have $100,000. $100k? $1 million. You can see how quickly this would add up.

If you were lucky enough to have been invested in a company or 2 of this kind of calibre, you would be extremely wealthy before you knew it. Investing is about discipline, and accepting that compound interest will make you rich if you give it enough time. No wonder Einstein reportedly described it as the ‘8th wonder of the world’.

More reading

• Why the Sezzle share price is zooming 8% higher today
• BNPL shares like Afterpay (ASX:APT) and Zip (ASX:Z1P) are soaring today. Here’s why
• The Sezzle (ASX:SZL) share price has now fallen 45% in 2 weeks as air continues to go out of the BNPL sector
• Are higher P/E ratios really here to stay?
• 3 exotic ASX tech ETFs you might want to add to your portfolio today

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia has recommended Sezzle Inc. 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 MGM Wireless Limited (ASX: MWR) share price bounced today as the company announced that Amazon.com, Inc. (NASDAQ: AMZN) would be selling MGM’s Spacetalk device on its platform. The MGM Wireless share price flew 6.25% higher in intraday trade, before closing flat for the day at 16 cents.

What MGM Wireless does

MGM Wireless is a software company that designs and develops technology and wearable devices for connections between families, schools and society.

In 2017, the company shifted to wearables, developing the market leading ‘Spacetalk’ children’s smartphone watch, which is now the significant share of the overall business. Spacetalk is a mobile phone built into a smartwatch designed just for kids from the age of 5 to 12. It allows two-way phone calls and SMS messaging for children to a parent-controlled list of contacts, among other GPS tracking features.

The subscription based ‘AllMyTribe’ mobile app enables parents to manage their devices.

Amazon deal

Amazon will initially sell the Spacetalk device on Amazon.co.uk. Impressively, Amazon.co.uk is the most visited ecommerce website in the UK reaching 51% of the population, receiving 453 million total visits in August 2020, with Consumer Electronics and Technology being the highest audience interest category. With the UK population beimg 3 times that of Australia, this opportunity opens up a huge market for MGM Wireless as it seeks to expand its footprint.

In addition to building out this new sales channel on Amazon.co.uk, the company continues to invest in other online and brick-and-mortar sales and distribution channels in the UK. In August 2019, Sky began selling Spacetalk through Sky Mobile on monthly plans. Closer to home, MGM Wireless boasts sales partnerships with companies such as TPG Telecom Limited (ASX: TPG).

What now for the MGM Wireless share price

The MGM Wireless share price has not had a good year so far, falling a huge 45%. Shareholders will be hoping that this deal with Amazon provides the impetus to turn its fortunes around as it seeks to return to its former highs of 30 cents. The MGM Wireless share price is currently trading at 16 cents.

More reading

• 3 ASX shares to buy before this window of opportunity closes
• Better buy: Amazon vs Netflix
• Amazon’s Luxury Stores just dealt another blow to department stores
• Better buy: Slack Technologies vs Microsoft
• Apple, Amazon, Microsoft are bigger than EVERY unicorn combined

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Daniel Ewing 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 Amazon and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia has recommended Amazon. 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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