It might sound crazy, but this company has returned more than 1,200% in the last 6 months alone.

Prompted by massive demand during the coronavirus pandemic, this meal-kit provider has captured a flood of new business.

It’s a name you might already be familiar with in your own home if you are the kind of person who appreciates a little evening convenience.

Marley Spoon AG (ASX: MMM) is one ASX small-cap company that Australia has fallen in love with during a time of crisis. However, it’s not just Aussies that are signing up, our American and European friends are just as partial to the dinner-time hero.

The global pandemic hit the whole world at the same time, causing people from all cultures, locations and backgrounds to remain indoors far more than they normally would. Marley Spoon was in a prime position to step up to the plate and save us all from eating cans of baked beans for dinner during lockdown.

About Marley Spoon

Marley Spoon creates and distributes meal kits with the goal of bringing healthy seasonal ingredients to people who want a little more convenience at dinner time. Meal kits are a perfect compromise between doing everything yourself and getting a takeaway.

Marley Spoon offer a meal delivery app, which allows subscribers to order what they want, when they want. 

Marley Spoon share price

This company is relatively new to the ASX, listing in July 2018 at around $1.25. The first 18 months or so were a little rough on the Marley Spoon share price. After some volatility, the price settled at an all time low of around 20 cents – a far cry from IPO day. However, Marley Spoon pressed on and when the coronavirus pandemic struck, it really moved into a higher gear.

While other companies began bleeding, Marley Spoon shares soared.

In fact, in the same 30-day period from 24 February to 23 March that the S&P/ASX 200 Index (ASX: XJO) fell almost 40%, the Marley Spoon share price rose a staggering 150%! This was only the beginning for the meal kit provider, as it has continued in a strong upward trend thereafter.

Recent results

During the 2nd quarter of this year, Marley Spoon reported a 103% increase in revenue in Australia alone.

The quarterly report reads like a battle summary, describing how the company has pushed hard to achieve results in spite of bush fires, floods and a global pandemic interfering with its supply chain and operations.

Likewise, the American business reported a revenue increase of 171% and Europe reported an 83% increase. Certainly good news all round.

Is the Marley Spoon share price still a buy?

Normally I wouldn’t be interested in a company after it has experienced this amount of growth, as it’s very often unsustainable. Usually I would wait for a pullback in price to a place of more value to me as an investor. However, in this case, I don’t see anything other than a positive future for Marley Spoon. Even if a short-term pullback should occur, I can’t see it lasting.

Foolish takeaway

With a such a convenient and high quality product, I can’t see subscription customers leaving Marley Spoon anytime soon. In Australia, Victoria is still struggling to contain the spread of coronavirus and its residents are in the middle of a Stage 4 lockdown. As a relevant point here, only one person per household is currently permitted to visit a grocery store. It makes far more sense for the food to come to you.

Sydney is also making an attempt to control growing daily cases as well. If the pandemic continues, this company should see ongoing strength in revenue. If the pandemic ends tomorrow, I can’t see loyal user simply cancelling a product that’s so convenient. Either way, the future looks bright for this meal prep superstar.

More reading

• Even after the meteoric rise in the Marley Spoon share price, here’s why it remains a core holding for one leading fund manager
• 3 ASX small cap shares with serious growth potential
• Can the Bubs share price go higher in 2020?
• ASX shares that could get a boost from Victoria’s shutdown
• Up 1,000% in 2020! Is it too late to buy Marley Spoon shares?

Motley Fool contributor glennleese 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.

The post If you invested $8,500 in this ASX share 6 months ago, you’d have $100,000 now appeared first on Motley Fool Australia.

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Wesfarmers Ltd (ASX: WES) has admitted that the empty shelves seen in Kmart this year occurred from a deliberate decision to cut supply.

As the first wave of COVID-19 hit in Australia, news and social media reported annoyed customers at Kmart stores staring at rows of cleared out shelves.

Many of us would have personally visited a Kmart this year to see a desired item not in stock. The retail chain even apologised for the phenomenon on Facebook back in June.

Parent company Wesfarmers, during its results briefing on Thursday, revealed that the lack of Kmart stock actually arose from a deliberate move.

“What we know in our business is too much inventory is a difficult problem for us to manage. And it lasts for a long period of time,” said Kmart managing director Ian Bailey.

“We made a call when COVID-19 hit, we looked around the world at particularly like-retailers… We could see issues with inventory and too much of it.”

The department store thus immediately decided to reduce supply “in anticipation of lower demand” during the pandemic.

And while sales did drop off in April, Kmart was unprepared for shoppers coming back in massive numbers in May.

“We didn’t anticipate the speed of improvement in Australia,” Bailey said.

“[Customers] shopped with a vengeance during that period and cleaned our shelves out.”

Would Australian-made products have solved the problem?

Bailey made the comments in response to accusations that Kmart might have a supply chain problem.

At the height of the low-stock period, shoppers criticised the store on social media for relying too much on overseas manufacturing.

But retailers and economists know those people want their cake and eat it too – because they will not dare pay $100 for a baby onesie.

Founder of Australian confectionery maker Poppy’s Chocolate, Lynda Pedder, explains this perfectly.

“I feel that in Australia, we have a double standard. We want Australian quality but we want it at Chinese prices,” she said on her blog.

“Australia has the highest wages in the world. That means that if you want something that is Australian made, that is handmade, it will take a lot of that ‘expensive’ labour to make it. We don’t pay people a minimum of $2 a day in Australia, we pay them closer to $200 per day.”

Wesfarmers reported a 5.4% lift in revenue at Kmart, hitting $6,068 million for the 2020 financial year.

The share price for Wesfarmers dipped 0.2% on Thursday, to rest at $48.78 at market close.

More reading

• Should you buy ASX shares before or after reporting season?
• ASX 200 down 0.8%, IDP Education soars
• Where to hunt for ASX dividend share income in 2020
• ACCC nod for Metcash acquisition of Total Tools
• Why it may not be too late to chase ASX reporting season record breakers

Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Tony Yoo 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 Facebook. The Motley Fool Australia owns shares of Wesfarmers Limited. The Motley Fool Australia has recommended Facebook. 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 Mayne Pharma Group Ltd (ASX: MYX) share price is one to watch this morning after reporting its latest full-year results.

Why is the Mayne Pharma share price on watch?

The Aussie pharma group reported revenue down 13% on FY19 to $457.0 million for the year ended 30 June 2020 (FY20).

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) fell 27% to $95.3 million.

That saw Mayne Pharma reported a net loss after tax of $92.8 million. That was still a 66.7% improvement on FY19 figures even accounting for a $99.0 million impairment.

The pharma company reduced operating expenses by $16 million to optimise global infrastructure with a $15 million reduction in product development spend.

Net operating cash flow was up 16% on the first-half but down 6% for the year to $99.8 million.

On the operations side, there were some important updates that make the Mayne Pharma share price worth watching.

The company’s generic products division stabilised in the second half. Sales were down 21% on FY19 to $253 million, however, gross profit was up 10% on the first half.

Metrics contracts services delivered solid revenue growth, up 15% on FY19 to $82.8 million. That saw gross profit climb 11% to $39.4 million with 5 commercial manufacturing clients now locked in.

The speciality brands division saw sales slump 14% to $78.8 million with gross profit down 18% to $65.4 million. The coronavirus pandemic hurt the business segment with fewer patient visits to doctors.

Positively, Mayne Pharma International sales were up 4% on FY19 to $42.4 million with gross profit flat at $11.0 million.

What did management have to say?

CEO Scott Richards noted the “unprecedented challenges” in dealing with COVID-19. The company focused on maintaining an uninterrupted supply of medicines and services during the second half.

That saw the half-year revenue flat on 1H FY20 numbers with net operating cash flow climbing 16% higher in the last 6 months.

The pharma group is looking to restructure its cost base, rationalise its generic portfolio and explore new areas of growth.

The Mayne Pharma share price will be one to watch in early trade as investors weigh up the latest strategy.

That includes completing the licensing of its NEXTSTELLIS product in the United States and Australia having received FDA filing acceptance for the novel contraceptive product.

The group also expects to commence a phase 3 trial in basal cell carcinoma nevus syndrome (BCCNS or Gorlin Syndrome) patients in FY21.

Outlook

There was no specific guidance provided by Mayne Pharma other than reiterating its near-term goals.

That included repositioning the company into “sustainable products, distribution channels and therapeutic areas.”

Prior to the open, the Mayne Pharma share price was down 22.2% for the year versus an 8.5% decline in the S&P/ASX 200 Index (ASX: XJO).

More reading

• Why these Charter Hall REITs are outperforming in FY20
• 5 things to watch on the ASX 200 on Friday
• ASX 200 down 0.8%, IDP Education soars
• The latest ASX 200 stocks hit by broker downgrades
• Is now a good time to buy Fortescue shares?

Motley Fool contributor Ken Hall 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 Healius Ltd (ASX: HLS) share price is one to watch today after the Aussie healthcare group reported full-year results in line with guidance.

Why is the Healius share price worth watching?

For the year ended 30 June 2020 (FY20), Healius reported a 2.2% increase in underlying revenue to $1,600.4 million.

Underlying earnings before interest and tax (EBIT) fell 18.4% lower to $102.7 million. That saw underlying net profit after tax (NPAT) from continuing operations fall 21.2% lower to $55.4 million.

Both of these figures were in line with Healius’ 27 July 2020 trading update with underlying NPAT in line with its mid-March guidance.

The coronavirus pandemic did weigh on earnings but strong pathology trading and subsequent initiatives underpinned the result. That strong pathology performance was aided by COVID-19 testing which is increasing in FY21.

Healius also booked a $142.5 million loss relating to the in-year impart of its Healius Primary Care business, largely relating to goodwill.

The company also reported strong performance up to March 2020 across its Pathology, Imaging and Montserrat Day Hospitals.

FY20 operating cash flow was up on FY19 figures to $153.4 million despite COVID-19. That saw the company’s net debt position improve to $666 million with $424 million in liquidity.

What’s happening with the final dividend?

Despite some strong earnings, the board declined to pay a full-year dividend. That makes the Healius share price worth watching as investors consider the capital management decision.

The first half dividend of 2.6 cents per share has been delayed due to COVID-19 until October.

Healius decided it was “not considered appropriate” given the assistance received. That includes significant government support, with other ASX companies coming under pressure this August.

An out-of-cycle dividend will be considered as part of a capital structure review following the Healius Primary Care sale.

Trading update

In a good sign for the Healius share price, the company reported a strong start to FY21.

Pathology revenues were up by 25% in July compared to last year thanks to significant community COVID-19 testing. Pathology has commercial contracts for COVID-19 screening with entities like the Federal Government and the AFL.

Imaging revenues were down 4% from July 2019 with further declines in August. Day Hospital has started the year strongly with Montserrat revenue up 27% compared to July 2019 and Adora Fertility up more than 50%.

Healius Primary Care revenues were up 7.5% on pcp with the dental business now recording results to receive the earn-out on completion of the Healius Primary Care sale.

Outlook

Management did cite a “strong outlook” for FY21 largely underpinned by the pathology business.

The board expects regular dividends to recommence in the first half of next year which is good news for the Healius share price.

Healius will provide a further trading update on 22 October when it holds its annual general meeting.

More reading

• Sonic share price surges to record high as its profit results defy sceptics
• The ASX stocks that could enjoy a consensus earnings upgrade this reporting season
• Healius share price edges higher on update

Motley Fool contributor Ken Hall 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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On Wednesday the Commonwealth Bank of Australia (ASX: CBA) share price traded ex-dividend for its fully franked 98 cents per share final dividend.

This means that eligible shareholders can now look forward to receiving this dividend in their nominated accounts on 30 September.

While many shareholders will use this for income, some are likely to want to reinvest the funds back into the share market.

Here’s where I would invest these dividends:

Altium Limited (ASX: ALU)

If you’re looking to invest these funds into a growth share, then I think Altium would be a fantastic option. I believe the electronic design software provider has the potential to generate strong returns for investors over the next decade thanks to its exposure to the growing Internet of Things and artificial intelligence markets.

These markets are supporting the proliferation of electronic devices globally and driving strong demand for software subscriptions and the services of its other businesses. Management remains confident on its outlook and reaffirmed its expectation to achieve revenue of US$500 million in five to six years. This compares to FY 2020’s revenue of US$189 million.

BWP Trust (ASX: BWP) 

Investors that are on the lookout for even more income might want to consider BWP Trust. It is the largest owner of Bunnings properties in the Australian market with 68 warehouses leased to the home improvement giant. Bunnings has proven to be a fantastic tenant for BWP, particularly during the pandemic. At a time when many property companies are posting heavy declines in profits and property valuations, BWP is growing both.

In its FY 2020 full year results the company revealed a 1% increase in profit before gains on investment properties to $117.1 million. Including property gains, BWP’s profit was up 24.4% to $210.6 million. This put the company in a privileged position to be able to increase its distribution in FY 2020 despite the crisis. In FY 2021, the company expects to pay shareholders a distribution in the region of 18.29 cents per unit. This works out to be an attractive 4.6% yield.

More reading

• 3 stellar ASX growth shares to buy in FY 2021
• Which ASX bank share is the best buy for dividend income?
• Why I would buy Telstra and this ASX dividend share today
• This ASX fund manager is going back to value in a post-COVID world. Here’s why.
• Top brokers name 3 ASX 200 shares to buy 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 and recommends Altium. 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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Charter Hall Group (ASX: CHC) shares were among the biggest gainers in the S&P/ASX 200 Index (ASX: XJO) yesterday. In fact, Charter Hall’s real estate investment trusts (REITs) have all been performing strongly in the August earnings season.

So, why is it that Charter Hall is managing to surprise investors right now?

How the Charter Hall REITs have performed in August

The Charter Hall Group share price jumped 6.7% higher yesterday to close the day at $12.00 per share. That came as the Aussie real estate manager reported its full-year earnings headlined by a 33% increase in funds under management to $40.5 billion.

Operating earnings jumped 46.3% to $322.8 million with net profit climbing 47% higher and distributions up 6% to 35.7 cents per share.

It’s not just the group that reported strong earnings, but its underlying REITs on the market.

The Charter Hall Long WALE REIT (ASX: CLW) share price is up 6.3% in August. That came on the back of a strong earnings result bolstered by lengthy weighted average lease expiries (WALEs) and strong distributions.

Shares in the Charter Hall Social Infrastructure REIT (ASX: CQE) have also been on the move. This Charter Hall REIT is up 12.1% in 2 weeks after another good FY20 result.

The Social Infrastructure REIT increased its WALE by 28.3% to 12.7 years with gross asset values up 4.4% to $1.3 billion.

What’s causing the share price surges?

For one, it’s a fairly pessimistic market out there. I would say that many investors are bearish on the real estate sector as evidenced by heavy share price falls for the Aussie REITs.

However, Charter Hall REITs have thus far been able to deliver stable earnings and/or solid growth forecasts.

Asset values have held up despite the coronavirus pandemic, which is good for the Aussie REITs. It helps that Charter Hall doesn’t have significant exposure to under pressure industries like retail.

I think the long WALEs across Charter Hall’s portfolios are also a big benefit. By locking in revenue for the long-term, short-term fluctuations in the business cycle have less of an impact.

Strong anchor tenants and focus on high-growth areas like logistics and social infrastructure are also good for earnings.

Overall, I think there is a lot to like about the Charter Hall REITs, particularly given the big falls in 2020. We’re seeing some momentum build in August and that may continue into 2021.

Foolish takeaway

I think the fundamentals for Charter Hall REITs are solid right now. However, the big test will be how the portfolios hold up when the government stimulus safety net is removed in the coming months.

More reading

• Mayne Pharma share price on watch as earnings slump 27%
• 5 things to watch on the ASX 200 on Friday
• ASX 200 down 0.8%, IDP Education soars
• Charter Hall share price jumps 6% on FY20 results
• The latest ASX 200 stocks hit by broker downgrades

Motley Fool contributor Ken Hall 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 Suncorp Group Ltd (ASX: SUN) share price will be in focus today after the release of the insurance and banking giant’s full year results for FY 2020.

How did Suncorp perform in FY 2020?

For the 12 months ended 30 June 2020, Suncorp delivered a group net profit after tax of $913 million. This was up $738 million or 421.7% on the prior corresponding period.

However, this includes the profit after tax on the sale of Capital S.M.A.R.T and ACM Parts to AMA Group Limited (ASX: AMA) of $285 million and a $89 million non-cash impairment charge relating to the core banking platform.

It is also worth noting that the prior corresponding period was impacted by a $910 million after tax non-cash loss on the sale of the Australian Life business.

The company’s cash earnings came in at $749 million, down 32.8% on the prior corresponding period. This was the result of lower prior year reserve releases, higher reinsurance costs, and the impact of the low yield environment in the general insurance businesses.

Also weighing on its cash profits were significantly higher credit provisioning in the banking business and higher operating expenses.

How did its segments perform?

It was a difficult year for much of the Suncorp business. Both its Australian Insurance and its Banking & Wealth businesses posted heavy declines in profits.

They recorded profit declines of 33.9% to $384 million and a 33.5% to $242 million, respectively, in FY 2020. Positively, its New Zealand business performed better and delivered flat profits of $245 million.

COVID-19 impacts.

Management advised that COVID-19 had a $140 million pre-tax negative impact on the company’s FY 2020 result.

The pandemic had a positive $20 million impact on its Australian Insurance business thanks to lower motor claims frequency due to mobility restrictions. However, this was partially offset by lower new business volumes and customer relief packages.

The Banking and Wealth business was negatively impacted by $160 million. This was the result of COVID-19 impairment losses driven by a significant increase in its collective provision.

Finally, the pandemic had a neutral impact on the New Zealand business. The benefits of lower motor claims were offset by provisions for premium relief and hardship funds.

Dividend.

Unlike a few of its banking peers, Suncorp will be paying a final dividend in FY 2020.

The Suncorp board has determined a fully franked final dividend of 10 cents per share, bringing its total FY 2020 dividends to 36 cents per share. This reflects a payout ratio of 60.7% of cash earnings.

Management advised that the company remains well capitalised, with excess common equity tier 1 (CET1) of $823 million after adjusting for the final dividend.

Outlook.

The company warned that the operating environment remains highly uncertain as a result of the COVID-19 pandemic and the associated economic impacts. As a result, no guidance has been given for FY 2021.

In addition to this, management explained that while the board remains committed to its long-standing ordinary dividend payout ratio policy of 60-80% of cash earnings, this cannot be guaranteed. Future distributions will be informed by the outlook for the economy, the results of stress testing, and the operational needs of the business.

More reading

• 5 things to watch on the ASX 200 on Friday
• Leading brokers name 3 ASX shares to sell today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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ASX reporting season is in full swing, with some of the most widely held shares like Wesfarmers Ltd (ASX: WES) and CSL Limited (ASX: CSL) releasing results this week. ASX shares can be highly volatile during the reporting season. This raises a few questions about buying and selling ASX shares during this time:

1. Why do some ASX shares like Monadelphous Group Limited (ASX: MND) go up when they report earnings? And why do other ASX shares like Qantas Airways Limited (ASX: QAN) go down or stay flat?
2. Should you buy or sell ASX shares before or after they report earnings?
3. Should you care more about the results or the share price movements when making investment decisions?

Reporting season or expectations season?

Some ASX investors like to call reporting season “expectations season”. That’s because share price movements are mostly dictated by the difference between analyst expectations and actual results. This makes sense as institutional investors have billions of dollars to invest into the market.

This reporting season has been quite different to those previous. Because of the uncertainty surrounding the coronavirus pandemic, a lot of ASX shares withdrew their guidance earlier in the year. However, once these ASX shares had some more clarity on their liquidity and forecasts, many provided trading updates ahead of reporting season. This has meant that investors had significant visibility on some ASX shares’ results, but next to none on others.

Qantas is a perfect example of an ASX share that met expectations. Qantas produced an underlying profit before tax of $124 million for FY20. This was a huge 91% drop on the prior year. Despite this, the Qantas share price traded flat to close at $3.76 on Thursday.

Should you buy ASX shares before or after reporting season?

Buying before reporting season can provide great short-term gains, but also comes with the risk of quick losses. This strategy can be implemented if you believe that the markets’ (and analysts’) expectations are wrong. In other words, if you think you know something that very few others do.

Unless a company has pre-guided or released a recent trading update, my preference is to wait and see. As a long term buy-and-hold investor, a pop in the share price is nice but is not fundamental to my investment thesis or the business’ future.

Stick to the fundamentals during reporting season

Reporting season is exciting! I must admit to checking the share market and my portfolio daily during the month. But it is important to keep a long-term focus when investing in ASX shares. Analysing both a company’s results, as well as its earnings, is fundamental to understanding the long-term prospects and relative value of a business. 

If you have a portfolio of shares, this can be hard to do. My fellow Motley Fool writers do a great job of summarising and reporting all of the important information you should be reviewing in a timely manner.

More reading

• Buy CSL and these quality ASX blue chip shares today
• ASX 200 down 0.8%, IDP Education soars
• Is the CSL share price a buy?
• Where to hunt for ASX dividend share income in 2020
• Why CSL, Iress, Santos, & Webjet shares are dropping lower

Lloyd Prout owns shares of Monadelphous Group Limited and expresses his own opinions. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of Wesfarmers 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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Domino’s Pizza Enterprises Ltd (ASX: DMP) shares are on fire right now. The Domino’s share price rocketed 2.3% higher yesterday to a new record high of $86.16 per share.

This comes on the back of a bumper full-year earnings result and a strong growth outlook for the years ahead.

Many investors may be wary of buying ASX shares at record highs, especially in the current market. Here’s why I still like the Domino’s share price even at its lofty valuation.

What’s moving the Domino’s share price?

The big catalyst for the recent moves was a strong annual earnings release on Wednesday.

Domino’s reported a 5.8% increase in same-store sales growth with revenue of $5,624.9 million for the year ended 30 June 2020 (FY20).

Earnings before interest, tax, depreciation and amortisation (EBITDA) climbed 7.3% to $303 million while net profit after tax (NPAT) was up 3.3% to $145.8 million.

The Domino’s share price surged higher after reporting a 90.6% increase in free cash flow and a 3.3% dividend per share increase to 119.3 cents.

Those are some strong headline earnings figures particularly given the current challenges. Investors have responded by buying up big and sending the Domino’s share price surging to a new record high.

Why I think Domino’s is still a buy

There are a few things I like about the current outlook. The first one is a strong growth profile underpinned by core markets.

Sales across Australia and New Zealand, Japan and Europe were all up in FY20. Japan looks to be a particularly strong market with a further 75 stores added last year.

That’s good news for Domino’s shareholders who are seeking out future growth. There’s no doubt that needs to be realised with the Domino’s share price trading at a price-to-earnings (P/E) ratio of 55.8.

Investors will be naturally wary of buying in at an all-time high. Domino’s has previously been on a strong growth trajectory (back in 2014–2016) before falling off the wagon.

That means shareholders will understandably be cautiously optimistic about the current outlook. The coronavirus pandemic presents some challenges but Domino’s earnings have been resilient thus far.

That to me says the Domino’s share price could continue to climb based on careful expansion and strong cash flow.

Foolish takeaway

The Domino’s share price has positive momentum behind it but there is some substance there.

An increased dividend reflects management’s confidence in future cash flow and I think that’s good news for investors.

I think Domino’s is ticking the boxes for organic growth and strong earnings that make it worth a look.

More reading

• The latest ASX 200 stocks hit by broker downgrades
• ASX 200 rises 0.7%, CSL soars 6.4%
• Why Corp Travel, CSL, Domino’s, & WiseTech Global shares are storming higher
• The latest ASX stocks upgraded by brokers to “buy” today
• Domino’s share price on watch as free cash flow surges 90%

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Domino’s Pizza Enterprises 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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One of the easiest ways to invest in ASX shares is just to regularly invest. 

Market timing can be very difficult, and it may not make that much difference over the long-term. You don’t know when/if shares are going to drop back to a valuation that looks too good to miss. Even when there is a large fall – like March this year – it may be hard to commit to investing when things look shaky.

Unless you’re going to commit a lot of time to investing in shares, the best strategy could be to try to make the timing of your investing as automated as possible.

But there aren’t that many shares that you can easily commit to investing in every month because valuations can change so much. I like the idea of going for diversified options so that the risk from any particular business is lower.

Here are two ASX shares that could be worth buying with $1,000 every single month:

Share 1: Betashares Global Sustainability Leaders ETF (ASX: ETHI)

This is an exchange-traded fund (ETF) which aims to give investors exposure to businesses which rank well on ethical considerations.

There are a number of eligibility screens that companies have to pass to make it into this ETF’s holdings.

It removes companies which have any direct involvement in the fossil fuel industry as well as ones with material direct exposure and those with a particularly high use of fossil fuels. Businesses have to rank well when it comes to climate factors.

It also excludes a number of other activities that aren’t deemed to be responsible such as gambling companies, tobacco, armaments, alcohol, junk foods and pornography.

This ETF is invested in 200 global shares, they aren’t ASX shares. Its top 10 holdings are full of businesses that are quality names like: Apple, Nvidia, Mastercard, Home Depot, Visa, Adobe, Paypal, Tesla, Toyota and Netflix. Thankfully, a large portion of the ETF – more than a third – is invested in tech shares. I think that’s good because technology is where the most earnings growth is coming from these days.

The ASX share has performed strongly since inception in January 2017, with net returns per annum of 20.3%. These shares have recovered strongly since the COVID-19 crash. 

I think this ETF offers a lot of attractive attributes. I’d be willing to regularly buy this ETF because of how many shares it’s invested in. It offers good diversification, and its businesses are seemingly high quality.

Share 2: MFF Capital Investments Ltd (ASX: MFF)

MFF Capital is a listed investment company (LIC). It’s operated by Magellan Financial Group Ltd (ASX: MFG) co-founder Chris Mackay. I think he has proven to be one of the best investors in Australia.

Over the past decade MFF Capital has delivered average total shareholder returns per annum of 17.8% per annum. Past performance isn’t a guarantee of future performance, but I think it shows the level of returns that MFF Capital can produce.

The ASX share has been invested in high-quality businesses like Visa and Mastercard for years. They continue to be great investments and represent around a third of the MFF Capital portfolio. It currently has a large cash position which can be used for protection against a near-term market downturn and more importantly the cash can be used to purchase good value shares.

MFF Capital regularly trades at a discount to its net tangible assets (NTA) per share. The fact that it always trades at a discount means that we can always buy it at a decent price. On 14 August 2020 it had an NTA per share of $2.82. That means it’s trading at a 7% discount to the last known NTA.

The ASX share’s board has recently announced it intends to keep increasing the dividend – which means shareholders will steadily get bigger payments over time.

Foolish takeaway

I really like both of these ASX shares. The ETF has a lot of great investments with good diversification. I think MFF Capital is one of the best LICs. I believe they’re both worth investing in regularly.

More reading

• The smartest 7 ASX shares to buy if you have $2,000
• My ASX share of the week
• Got $3,000? Buy these 3 top ASX shares right now
• 3 quality ETFs I’d buy for my portfolio
• Got $1,500? Here are 3 ASX shares I’d buy

Motley Fool contributor Tristan Harrison owns shares of Magellan Flagship Fund Ltd. 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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