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July’s looming economic risk: Morning Brief
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Banks Face $300 Million Shortfall on Luckin Coffee Margin Loans
(Bloomberg) — Banks including Credit Suisse Group AG and Morgan Stanley face a $300 million shortfall on margin loans to the embattled founder of Luckin Coffee Inc., after they sold shares he had pledged as collateral for deeply depressed prices.The lenders, which also include Haitong International Securities Group and Goldman Sachs Group Inc., raised about $210 million from Luckin stock disposals over the past two months, people familiar with the matter said. Luckin Chairman Lu Zhengyao defaulted on $518 million of margin debt in early April, Goldman said in a statement at the time, after revelations of accounting fraud caused shares of the Chinese coffee chain to plunge.The stock sales represent the latest attempt by Lu’s creditors to limit losses from a scandal that has fueled calls in Washington for tougher scrutiny of financial ties between the U.S. and China. Luckin’s fall from grace blindsided some of the biggest names on Wall Street just as they were gearing up for a historic expansion into Asia’s largest economy.Spokespeople for the lenders declined to comment. Luckin didn’t immediately respond to multiple requests.Goldman, tapped by lenders to oversee the stake disposal, said in April that it would sell as many as 76.35 million of Luckin’s U.S.-listed shares. The firm has now liquidated the entire position, one of the people said, asking not to be identified discussing private information.A back of the envelope calculation suggests the shares were sold for $2.75 apiece on average. That compares with the closing price of $26.20 before the Luckin scandal emerged and the $3.18 average price since April 6, when Goldman announced plans to offload the stake.Credit Suisse and Morgan Stanley each put up about $97 million for the margin loans, while Haitong International lent about $134 million, one of the people said. Goldman and Barclays Plc lent $73 million and $78 million, respectively, while China International Capital Corp. contributed $39 million.It’s still unclear whether the banks will ultimately lose money. They’re also pursuing the assets of an investment company controlled by Lu’s family trust, Bloomberg News reported last month. The investment company has disputed that it’s in default and has requested an injunction in Hong Kong to prevent liquidation proceedings, according to a May 6 court filing.Lu became a billionaire after his fast-growing Starbucks rival went public in the U.S. last year. Much of his wealth has since been wiped out by the 85% plunge in Luckin’s stock since April, when the company disclosed that some of its employees may have fabricated billions of yuan in sales.Chinese regulators have obtained emails purporting to show Lu instructed financial fraud, business news outlet Caixin reported this month, citing unidentified people close to the agencies. Regulators found evidence of fraud at Luckin in their investigation, Caixin cited several people as saying.Lu has previously denied deceiving investors. “My personal style may have been too aggressive and led the companies to run too fast, which has triggered many problems,” he said in a statement last month. “But I never lied to investors with the idea of ‘selling concepts.’ I’m working hard to make the company bigger and better to create value for society.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
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Chesapeake Energy To File For Bankruptcy, Potentially This Week- Report
Fracking pioneer Chesapeake Energy Corp (CHK) is preparing to file for bankruptcy as soon as this week, three people familiar with the matter have told Reuters.According to the Reuters sources, CHK is now wrapping up negotiations for a $900 million debtor-in-possession loan. It is also discussing with creditors the potential to “roll up” its existing debt and make it part of the bankruptcy loan, bringing the total debtor-in-possession financing closer to $2 billion, the sources said.At the same time the company is also looking for an equity infusion from creditors. Chesapeake plans to file for bankruptcy on Thursday, but if the financing required further discussions this could move to next week, the sources added.If the company lives on post-bankruptcy, creditors like Franklin Resources Inc will take over Chesapeake in exchange for deleting over $7 billion of debt, Reuters reports.With a massive debt burden of around $9 billion, CHK missed an interest payment on Monday, the sources said, and there is another payment-date fast approaching on July 1.Unsurprisingly, the stock shows a Strong Sell Street consensus, with 5 recent sell ratings vs just 1 hold rating. Meanwhile the average analyst price target stands at $16.50 (13% downside potential).Shares have plunged a whopping 89% year-to-date, with the oil and gas giant reporting a “going concern” warning in its May quarterly financial filing.“We do not expect [Chesapeake] to be in compliance with its financial covenants beginning in Q4 2020, which would result in an act of default on the credit facility,” CFRA analyst Paige Meyer told investors back in May.“With a default on the credit facility, we believe other lenders are likely to call debt due as well using ‘cross default’ clauses.” She downgraded the stock to Strong Sell with a $0 price target. (See Chesapeake stock analysis on TipRanks).Related News: Debt-Laden Chesapeake Rolls Out $25 Million Incentive Executive Pay Plan Chesapeake Energy Gearing Up For Bankruptcy Filing- Report Bankrupt Hertz Tanks 24% Amid Plans To Sell $500 Million In New Shares More recent articles from Smarter Analyst: * Facebook’s WhatsApp Rolls Out Digital Payment Service In Brazil * Delta To Add 1,000 Flights In July; Resuming China Flights Next Week * United Airlines Secures $5 Billion Loan To Shore Up $17 Billion Liquidity Chest * Nio Completes $428M ADS Offering, Stock Now Up 70% YTD
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3 exciting small cap ASX healthcare shares to watch
The Australian share market is home to a number of world class healthcare companies such as Ramsay Health Care Limited (ASX: RHC) and Cochlear Limited (ASX: COH).
While I believe both companies still have a lot of growth left in them, the law of large numbers would indicate that the impressive growth rates they have achieved over the last decade or two will be hard to replicate in the future.
So, if you’re looking for outsized returns in the healthcare sector, you might want to look at a few up and coming healthcare companies that could be stars of the future.
Three small cap healthcare shares that I think are worth watching closely are listed below:
Mach7 Technologies Ltd (ASX: M7T)
The first small cap healthcare share to look at is Mach7. It is a medical imaging data management solutions provider which uses software to create a clear and complete view of the patient. This helps inform diagnosis, reduce care delivery delays and costs, and improve patient outcomes. The company has also just expanded its offering with the acquisition of Client Outlook. It is a leading provider of an enterprise image viewing technology and increases Mach7’s total addressable market from US$0.75 billion to US$2.75 billion. This is significantly more than the revenue of $9.1 million it recorded during the first half.
Medadvisor Ltd (ASX: MDR)
A second small cap healthcare share to watch is this healthcare technology company. Medadvisor has a focus on personal medication adherence and offers an app that connects to pharmacy dispensing systems. It has been designed to ensure correct and reliable medication use. In Australia it has connected over one million users through nearly 60% of Australian pharmacies and a network of thousands of GPs. In addition to this, the company is operating in the United States, Asia, and UK markets.
Volpara Health Technologies Ltd (ASX: VHT)
A final small cap ASX healthcare share to watch is Volpara Health Technologies. It is a growing technology company that offers cost-effective, mission-critical software that help radiologists deliver the highest-quality breast imaging services. Volpara’s software also uses artificial intelligence imaging algorithms to assist with the early detection of breast cancer. Management estimates that it currently has a US$750 million annual recurring revenue (ARR) opportunity in breast cancer screening. This compares to the ARR of NZ$18 million it recorded in FY 2020.
And here are more exciting shares which could be stars of the future…
We hear it over and over from investors, “I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!” And it’s true.
And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!
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More reading
- 2 ASX healthcare shares to buy for long-term growth
- 3 fantastic ASX 200 shares to buy right now
- Ramsay Health Care and 1 other ASX share I would buy for both growth and income
- Why you should watch these ASX small cap shares closely in the 2020s
- Insiders have been buying these ASX 200 shares
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd., MACH7 FPO, MedAdvisor, and VOLPARA FPO NZ. The Motley Fool Australia has recommended Cochlear Ltd., MedAdvisor, Ramsay Health Care Limited, and VOLPARA FPO NZ. 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 200 jumps almost 4%, Webjet share price soars
The S&P/ASX 200 Index (ASX: XJO) jumped almost 4% today, it rose to 5,942 points.
The share market is rebounding again as the US Federal Reserve moved to start buying individual corporate bonds to add liquidity to the market.
The best ASX 200 performer
The strongest growth in the ASX 200 today came from Viva Energy Group Ltd (ASX: VEA). The share price went up by 15.5% after it announced profit guidance and gave a business update.
Viva Energy said that the group underlying earnings before interest, tax, depreciation and amortisation (EBITDA) for the first half of FY20 is expected to be approximately $257.5 million to $287.5 million.
The underlying net profit after tax (NPAT) is expected to be approximately $20 million to $50 million.
The ASX 200 business said that the announced on-market share buyback will commence in June 2020.
The company is going to proceed with its major maintenance of the residual catalytlic cracking unit during 2020 at a reduced cost and over an extended timeframe, with total capital expenditure of the event expected to be between $85 million to $100 million, down from $110 million to $140 million previously.
Total sales volumes for the first half of FY20 are expected to be approximately 6,100 million to 6,200 million litres. However, this has been offset by cost reductions and improvements in retail fuel margins.
Volatile shares jump higher
A number of volatile ASX shares bounced back today.
The Webjet Limited (ASX: WEB) share price rose by 11.4%. EML Payments Ltd (ASX: EML) saw its share price grow by 11.4%. The Afterpay Ltd (ASX: APT) share price climbed 10.5%. Zip Co Ltd (ASX: Z1P) experienced a 9.5% share price rise of. The Challenger Ltd (ASX: CGF) share price jumped 10%. The Flight Centre Travel Group Ltd (ASX: FLT) share price grew 7.8%.
According to the ASX, there were only two shares that fell in the ASX 200. The Saracen Mineral Holdings Limited (ASX: SAR) share price dropped 0.9% and the Pro Medicus Limited (ASX: PME) share price dropped 0.4%.
Pharmaceutical supply agreement
The pharmaceutical industry announced some positive news today. The government and health department has reached an agreement about an additional $92 million of funding through the community service obligation (CSO) as well as an introduction of a floor price to continue to support medicine supply through the wholesaler network over the next five years.
This new funding is effective from 1 July 2020. Both Australian Pharmaceutical Industries Ltd (ASX: API) and Sigma Healthcare Ltd (ASX: SIG) are part of the National Pharmaceutical Services Association (NPSA) industry body which made the announcement. The API share price went up more than 5% today. The Sigma share price also climbed 5% today.
Special dividend and capital return announced by Orora Ltd (ASX: ORA)
ASX 200 packaging business Orora held an extraordinary general meeting (EGM) today to approve a capital return and share consolidation. Both of these items were approved in the meeting today.
The sale of Orora’s Australasian fibre business to Nippon Paper Industries for $1.72 billion resulted in net proceeds after tax and costs of approximately $1.55 billion.
The Orora board decided that best thing to do with $600 million of that capital is to return it to shareholders. A special dividend of $450 million is the main element of the plan, which equates to 37.3 cents per share, partially franked at a rate of 50%.
The other $150 million will be delivered to shareholders by way of a capital return. It will be a cash payment of 12.4 cents per share. This was payment approved today at the meeting. The special dividend and capital return will be paid to shareholders on 29 June 2020.
The company now has little to no debt. The directors said they’d prefer the remaining proceeds are used for potential growth investment opportunities. However, if no opportunity is found then directors will consider an additional return of excess capital to shareholders.
3 “Double Down” stocks to ride the bull market higher
Motley Fool resident tech stock expert Dr. Anirban Mahanti has identified three stocks he thinks can ride the bull market even higher, potentially supercharging your wealth in 2020 and beyond.
Doc Mahanti likes them so much he has issued “double down” buy alerts on all three stocks to members of his Motley Fool Extreme Opportunities stock picking service.
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More reading
- Top brokers just upgraded these ASX 200 shares today
- 2 unloved ASX shares that could stage a big turnaround
- ASX tech shares are soaring – these are my top 3 today
- 3 ASX 200 shares to buy for income and growth
- Why I think this ASX 200 rally is fake
Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Emerchants Limited and ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Challenger Limited, Pro Medicus Ltd., and Webjet Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Emerchants Limited and Flight Centre Travel Group 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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Rox Resources share price skyrockets 108% on strong drilling results
The Rox Resources Limited (ASX: RXL) share price was a standout performer on the ASX today after the company announced a high-grade gold hit at one its mines.
This announcement saw the Rox Resources share price more than double, with shares closing 108.33% higher at 5 cents. This jump takes the company’s current market capitalisation to around $91 million.
Rox Resources is an emerging Australian minerals exploration company, with advanced gold and nickel projects in Australia.
The company owns a 70% interest in the Youanmi Gold Mine, and wholly-owns the Mt Fisher Gold Project, Fisher East Nickel Project and Colluabbie Nickel Project, all located in Western Australia.
What did Rox Resources announce?
This morning, Rox reported further results from the drilling program being undertaken at the Grace prospect at Youanmi. The current drill program commenced in late May and assay results have now started to flow in.
Rox stated that deepest drilling completed at Grace has intersected impressive gold grades, including:
- 25 metres at 34.79 grams per tonne (g/t) gold from 143 metres, including:
- 6 metres at 140.7 g/t gold from 150 metres.
According to the company, this was the deepest intercept to date, extending mineralisation both along strike and down-dip.
Commenting on the drilling results, managing director Alex Passmore said:
“These very impressive results are the best we’ve seen and significantly, are from the deepest drilling at Grace to date. The exploration model we are applying at Grace is continuing to work well, delivering what is shaping up to be a substantial high-grade deposit. We look forward to updating the market on further assays as they become available.”
Recent developments
Today’s announcement follows Rox’s share placement and share purchase plan (SPP) recently undertaken to raise $12.7 million. In late May, the company completed a $8.74 million institutional placement at an offer price of 2.4 cents per share. And yesterday evening, Rox announced it has closed its SPP over-subscribed, accepting a total of $4 million.
The funds will be used to underpin the company’s growth plans at the Youanmi Gold Mine and Fisher East Nickel Project. Additionally, Rox has used some of the capital to increase its interest in the Youanmi joint venture from 50% to 70%. As announced on 11 June, the company exercised its option to acquire an additional 20% interest in the joint venture for $2 million cash and $1 million in shares.
The company’s joint venture partner for Youanmi, Venus Metals Corporation Limited (ASX: VMC), also saw its shares rise today, notching a 38.24% gain.
3 “Double Down” stocks to ride the bull market higher
Motley Fool resident tech stock expert Dr. Anirban Mahanti has identified three stocks he thinks can ride the bull market even higher, potentially supercharging your wealth in 2020 and beyond.
Doc Mahanti likes them so much he has issued “double down” buy alerts on all three stocks to members of his Motley Fool Extreme Opportunities stock picking service.
*Extreme Opportunities returns as of June 5th 2020
More reading
- 3 exciting small cap ASX healthcare shares to watch
- ASX 200 jumps almost 4%, Webjet share price soars
- Why I would buy CSL and these ASX blue chip shares
- 2 ASX healthcare shares to buy for long-term growth
- Top brokers just upgraded these ASX 200 shares today
Motley Fool contributor Cathryn Goh 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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- 25 metres at 34.79 grams per tonne (g/t) gold from 143 metres, including:
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Nio Completes $428M ADS Offering, Stock Now Up 70% YTD
China’s electric-vehicle maker Nio Inc (NIO) has announced the completion of the offering of 72 million American depositary shares (ADS) at $5.95 per ADS, raising $428.4 million.The company has also granted the underwriters a 30-day option to purchase up to an additional 10.8 million ADSs.Morgan Stanley & Co. LLC, Credit Suisse Securities (USA) LLC and China International Capital Corporation Hong Kong Securities Limited are acting as the joint book-running managers for the ADS offering.NIO plans to use the net proceeds mainly to fund its cash investments in NIO China, as well as other working capital needs.The company “expects NIO China to use the cash investments for research and development of products, services and technology, development of manufacturing facilities and roll-out of its supply chain, operation and development of sales and service network and general business support purpose.”Shares in NIO surged 12% in Monday’s trading, and 2% after-hours following the announcement. This brings the stock’s year-to-date rally to an impressive 70%. As a result the average analyst price target of $5.40 now indicates 21% downside potential from current levels.This comes with a cautiously optimistic Moderate Buy Street consensus. Merrill Lynch’s Ming-Hsun Lee is taking a bullish stance, and has just reiterated a NIO buy rating while ramping up the price target from $5.50 to $7.30 (7% upside potential).According to Lee, Nio is now enjoying stronger orders and should benefit from China’s favorable EV purchase subsidy scheme. The analyst expects Nio to show vehicle gross profit improvement in Q2, as well as better free cash flow.Indeed Goldman Sachs’ Fei Fang expects NIO to break even in 2022 once it can deliver 10,000 cars per month. Encouragingly, the company recently revealed that it delivered 3,436 vehicles in May 2020, representing a strong 215.5% growth year-over-year. (See Nio stock analysis on TipRanks).Related News: Tesla Sales Triple For China Model 3 Vehicle In May Bankrupt Hertz Tanks 24% Amid Plans To Sell $500 Million In New Shares Can Tesla Provide the Million Mile EV Battery? Top Analyst Weighs In More recent articles from Smarter Analyst: * Delta To Add 1,000 Flights In July; Resuming China Flights Next Week * United Airlines Secures $5 Billion Loan To Shore Up $17 Billion Liquidity Chest * Apple’s App Ecosystem Generated Over Half A Trillion Dollars In 2019 * Bankrupt Hertz Tanks 24% Amid Plans To Sell $500 Million In New Shares
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Why I would buy CSL and these ASX blue chip shares
Are you looking to add some blue chip shares to your portfolio this month? Then you could do a lot worse than the three ASX shares listed below.
Here’s why I think these are blue chip shares to buy:
CSL Limited (ASX: CSL)
The first blue chip share I would buy is this biotherapeutics company. I believe a recent pullback in its share price has created a buying opportunity for investors. Especially those that are interested in making a long term investment. I believe CSL has an extremely bright future ahead of it thanks to its strong portfolio of therapies and its pipeline of lucrative products. Should some of the latter products hit the market in the future, I believe they have the potential to underpin strong sales and profit growth.
Macquarie Group Ltd (ASX: MQG)
Another blue chip ASX share I would buy is Macquarie. I’m a big fan of the investment bank due to the quality and diversity of its operations and its talented management team. And although its near term performance is likely to be impacted by the pandemic, I expect the company to bounce back once the crisis passes. This is just like it has done in the past through similar events like the global financial crisis. Another bonus is that the company’s shares offer a decent estimated forward yield of 3.75%.
Transurban Group (ASX: TCL)
A final blue chip share to consider buying is this toll road operator. Transurban owns a number of key toll roads roads in Australia and North America. As you would expect, the pandemic has had a negative impact on its performance this year, with traffic volumes falling heavily. However, with restrictions easing, I expect volumes to start to normalise over the coming months and for its earnings to rebound in 2021. I believe this makes it a good time to pick up its shares with a long term view.
And here are more highly rated shares to consider adding to your portfolio in June…
3 “Double Down” Stocks To Ride The Bull Market
Motley Fool resident tech stock expert Dr. Anirban Mahanti has stumbled upon three under-the-radar stock picks he believes could be some of the greatest discoveries of his investing career.
He’s so confident in their future prospects that he has issued “double down” buy alerts on each of these three stocks to members of his Motley Fool Extreme Opportunities stock picking service.
*Extreme Opportunities returns as of June 5th 2020
More reading
- The ASX winners and losers from the latest S&P index shake-up
- 2 ASX blue chip shares I think every portfolio should hold
- Got $5,000 spare? Consider Wesfarmers shares and these 2 other ASX companies
- Is the Transurban share price a secret bargain?
- ASX 200 Weekly Wrap: ASX bears take control as market volatility returns
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 CSL Ltd. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia owns shares of Transurban 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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UAE Says OPEC+ Deal Will Soon Restore Oil Prices to ‘Normal’
(Bloomberg) — Oil-production limits adopted by a group of major crude suppliers will soon bring prices back to “normal,” according to the energy minister of the United Arab Emirates.When markets were collapsing as the coronavirus pandemic crushed demand in March and early April, the idea that crude could rise again to $40 a barrel was “a dream,” the UAE’s Suhail Al Mazrouei said during a conference call on Monday. That was before the OPEC+ alliance agreed unprecedented cuts in output.Prices could return to “normal” within a year or two as curbs approaching 10 million barrels a day drain excess barrels from the market, Mazrouei said during the call hosted by the Atlantic Council, a Washington-based research institute.“We have seen very good signs of demand picking up,” Mazrouei said. “We have seen numbers of driving vehicles are picking up,” he said, citing demand growth in China, India and Europe.Hinging on LockdownsStill, the direction of oil prices will hinge to a large extent on whether a second round of infections forces economies into lockdowns once again, he said.“Are we going to have a second wave or not?” he said. “I hope not. I hope we’re not going to limit travel and we will go back to at least a consumption level that is reasonable. Now we are back to the consumption level of 2013, believe it or not.”Mazrouei didn’t specify what he meant by “normal” prices. However, benchmark Brent crude averaged about $64 a barrel last year. OPEC+ producers negotiated cuts in April to counter the pandemic’s impact and this month extended the reductions through July.Led by Saudi Arabia and Russia, the group aims to support a rally that’s seen Brent more than double to around $40 a barrel since late April, paring its loss this year to 40%. For that success to continue, all OPEC+ members must adhere to their production quotas, while other suppliers must refrain from resuming output too quickly, Mazrouei said.“In previous deals we had countries cheat because there was no rule. Now there is a rule, so countries are coming and stating their commitments,” Mazrouei said. The OPEC+ agreement has effectively created a “permanent” group of nations — one bigger than the Organization of Petroleum Exporting Countries — that will coordinate to manage crude markets, he said.(Updates from fifth paragraph with quotes.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
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2 ASX healthcare shares to buy for long-term growth
I believe that healthcare is an excellent sector to invest in and the ASX is home to a number of exciting healthcare shares.
The world’s population continues to age, which will help drive growing demand for additional healthcare services over the next few decades. Alongside this, the cost of healthcare services continues to rise.
Here we look at 2 ASX healthcare shares that I believe have strong long-term growth potential: Ramsay Health Care Limited (ASX: RHC) and ResMed Inc (ASX: RMD).
Ramsay
Ramsay has evolved significantly over the past few decades. It has transitioned from a small Australian operation to become Australia’s largest private healthcare provider, with operations in 11 countries including the United Kingdom, France and Italy. The company is also significantly larger than the number two hospital operator in Australia, Healthscope Limited.
Ramsay’s size and scale enable it to spread its operating costs. This also provides it with a competitive advantage in negotiations with health insurers. Although Ramsay’s overall debt position is relatively high, in my opinion it appears to be manageable.
This ASX healthcare share has been impacted by the ban on non-essential surgeries. As a result, its share price was hit hard in the early phase of the crisis. However, elective surgeries are now beginning to recommence in Australia with other markets set to follow. Therefore, Ramsay may emerge from its current issues faster than first anticipated.
Also, Ramsay has successfully closed a number of key government deals in Australia and the United Kingdom during the pandemic. These deals will ensure that the company’s hospitals do not run at a loss during the current period.
ResMed
ResMed manufactures devices and cloud-based software solutions for the treatment of sleep apnoea and other chronic respiratory illnesses.
ResMed has grown to become one of the world’s leading sleep treatment companies and is now a major US-based global company. The company employs more than 7,000 people worldwide.
It provides end-to-end connected health solutions that can be used in the home, reducing the financial and resource burden of in-hospital treatment.
The global potential market for sleep apnea is huge. It is estimated that there are one billion people impacted by sleep apnoea worldwide and more than 80% undiagnosed cased globally.
New product launches and successful targeted acquisitions have all helped drive revenue growth during the past few years. This growth has continued recently, with Ramsay recording a very strong 47% increase in net income during the third quarter of FY 2020.
For more shares set for bumper growth, don’t miss the free report below.
We hear it over and over from investors, “I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!” And it’s true.
And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!
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More reading
- 3 fantastic ASX 200 shares to buy right now
- Ramsay Health Care and 1 other ASX share I would buy for both growth and income
- Insiders have been buying these ASX 200 shares
- Why the Healius share price will be in the spotlight tomorrow morning
- You could beat the market in the 2020s with these ASX healthcare shares
Motley Fool contributor Phil Harpur owns shares of ResMed Inc. The Motley Fool Australia has recommended Ramsay Health Care Limited 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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