Surging tech stocks are hiding the opportunity in some beaten-down names, says Fundstrat's Tom Lee.
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(Bloomberg) — European diplomats have moved to seize back the initiative on one of their continent’s most intractable fronts after U.S. efforts under President Donald Trump for a diplomatic victory unraveled last month.It’s the latest salvo between the U.S. and the European Union in the Balkans, where officials have accused the Trump administration of freezing them out of talks between Serbia and Kosovo that were to culminate in a White House meeting between the leaders.That June 27 summit fell apart after the president of Kosovo, Hashim Thaci, was accused of war crimes just days before. Now, Chancellor Angela Merkel and French President Emmanuel Macron will join the leaders of Serbia and Kosovo in a video conference Friday, with an EU summit planned two days later in a bid to resuscitate the stalled efforts.The EU needs to wrest control over the Balkan diplomacy and can’t afford to surrender a key matter of European interests to the U.S. as Serbia and Kosovo both seek a path to join the 27-member bloc, according to four officials familiar with the discussions. U.S. special envoy Richard Grenell says he supports the EU initiative.For the last decade, the Greek debt crisis, Brexit and now Covid-19 have fueled resistance among some of the bloc’s more established members toward letting both its poorer ex-communist newcomers and those waiting for membership deeper into the fold.That’s given the U.S., Russia and China an opening to increase their influence in the region. But there are signs that reluctance may be easing.In March, EU governments unblocked the membership path for North Macedonia and Albania by overcoming a French roadblock after months of deliberations. And Croatia, another country that emerged from the wars that broke up the former Yugoslavia in the early 1990s, will peg its currency to the euro in the coming days along with fellow EU newcomer Bulgaria — a step they consider vital to joining the richer West.Serbia and Kosovo have made much less progress in their accession efforts, in large measure due to a standoff following a 1998-1999 war that led to the latter declaring independence in 2008. There’s no compromise in sight as both nations stick to their positions while grappling with political challenges at home. Kosovo, a country suffering from a leadership vacuum, demands international recognition. Serbia, whose all-powerful president is facing violent protests, refuses to let it go.The EU officials said no settlement between the two is possible without the U.S. and that American engagement is welcome. But they’ve been critical of the Trump administration, including Grenell, accusing the U.S. of going it alone and damaging years of diplomatic work with ad-hoc efforts aimed at scoring a quick win for Trump.The Balkan jostling is a flashpoint in transatlantic tensions and underscores the growing chasm between the EU and Trump on issues ranging from trade to defense spending. It comes at a time when leaders such as Merkel are insisting that Europe forge its own path as strong post-World War II ties to the U.S. weaken.Grenell, who served as the U.S. ambassador to Germany until last month, has rebuffed the accusation of quick-win diplomacy, saying that the U.S. is mainly focused on an economic settlement and would leave the political talks to the Europeans.Grenell oversaw an agreement in February under which Serbia and Kosovo pledged to develop road and rail links to boost economic cooperation before resolving their long-lasting enmity. A month before, they signed a letter of intent to restore direct flights between their capitals, Belgrade and Pristina.U.S. officials have also pointed to EU failures in foundering talks in recent years — and the fact that five EU members don’t recognize Kosovo’s sovereignty.“We have never believed in a quick election-year deal between Kosovo and Serbia,” Grenell said in a series of tweets early Wednesday embracing the EU initiative. “And we never thought our sole focus on economic normalization would be a quick fix.”Still, Europeans have taken a dim view of U.S. overtures, viewing the Trump administration as treading on territory previously occupied by Merkel, who’s championed EU expansion in the Balkans. Last month, Merkel’s office and the EU’s special envoy, Miroslav Lajcak, responded with a flurry of shuttle diplomacy.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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Walgreens Boots Alliance Inc. (WBA) reported a $1.71 billion quarterly loss and announced 4,000 jobs cuts due to the impact of the coronavirus pandemic sending shares down 8%.The stock dropped to $39.01 at the close on Thursday after the drugstore chain operator announced that it will also suspend its share repurchase program and will need to take a non-cash impairment charge of $2 billion mainly as result of the COVID-19 impact on its Boots UK business. As part of a restructuring plan to cut costs, Walgreens said it will close 48 of its Boots opticians stores and lay off 4,000 employees, or 7% of its workforce.Net loss was $1.71 billion, or $1.95 per share, in the three months ended May 31, versus a profit of $1.03 billion, or $1.13 per share, in the year-earlier period. Analysts on average had expected adjusted earnings of $1.19 per share. Revenue rose 0.1% to $34.6 billion.“Prior to the pandemic our financial performance for fiscal 2020 was on track with our expectations. However, this unprecedented global crisis led to a loss in the quarter as stay-at-home orders affected all of our markets,” Walgreens CEO Stefano Pessina said. “Shopping patterns are evolving more rapidly than ever as consumers further embrace digital options, spurring us to accelerate our ongoing investments in digital transformation and neighborhood health destinations.”Walgreens total digitally initiated sales rose 22.7% in the third quarter, compared with the same period last year. The drugstore chain recently formed a strategic partnership with Microsoft (MSFT) and Adobe to launch a marketing technology and customer data platform for personalized healthcare and shopping experiences.Earlier this week, Walgreens announced that it will be expanding the size of its care clinics by nearly 700 retail stores over the next few years as part of an overhaul of its business model from being primarily a drug pharmacy to a primary care clinic.With Walgreens’ stock down now 34% year-to-date, analysts are sidelined on the stock. The Hold analyst consensus shows an unanimous 4 Hold ratings. Looking ahead, the $47.75 average price target implies 22% upside potential from current levels. (See Walgreens stock analysis on TipRanks).Morgan Stanley analyst Ricky Goldwasser earlier this month cut the stock’s price target to $45 from $49 and reiterated a Hold rating, saying that investors are weighing whether, or not the challenges the company is exposed to are valued into the shares.Goldwasser remains cautious for now and lowered her full-year per share earnings forecast by 8 cents to $5.48. The analyst expects Walgreens to report EPS of $1.16 in the fourth quarter, which is slightly below consensus estimates.Related News: Costco June Sales Beat Estimates As Shoppers Go Online; Top Analyst Raises PT Lookout Walmart, Amazon Is Coming for Your Grocery Customers, Says Analyst Walmart To Launch Online Subscription Service For $98 Per Year- Report More recent articles from Smarter Analyst: * Moderna Inks Deal With Rovi To Supply Potential Covid-19 Vaccine Outside U.S. * Sony Invests $250M For Minority Stake In Fortnite Maker Epic Games * Amazon: Top Analyst Raises Estimates… Again * GenMark Diagnostics (GNMK) Stock Is a Winner, But How Much Higher Can It Go?
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Building a dividend share portfolio may seem like a risky move at the present time. However, with the income returns from other assets such as cash and bonds being relatively low, dividend shares could prove to be a sound means of obtaining a passive income in the long run.
Through spreading your capital across a wide range of companies that offer dividend growth potential and solid financial positions, you could obtain a favourable risk/reward opportunity that produces an attractive income return in the coming years.
A dividend share portfolio should contain a wide range of businesses that operate in a variety of industries and economies. If it doesn’t, you are likely to be reliant on a small number of shares for your income. Should even a small number of them experience a challenging financial period, it could lead to disappointing returns that hurt your financial position.
Diversifying across multiple sectors and regions is likely to be even more important than usual at the present time. Some countries are experiencing greater challenges from coronavirus than others, while some industries are feeling the effects of lockdown to a greater extent than others. As such, by simply owning a range of businesses you not only reduce risks but also achieve a higher income return in what is likely to be an uncertain period for the world economy.
When building a dividend share portfolio, it may be tempting to simply purchase those businesses that offer the highest yields. While this may produce an attractive income return in the current year, over the long run it may not be a sound move due to their lack of dividend growth.
As such, it may be a good idea to focus on yield and dividend growth potential. This may ensure that your passive income growth beats inflation and that you are able to improve your spending power. If this goal is not achieved, your passive income may be able to buy fewer goods and services as factors such as low-interest rates and quantitative easing could lead to higher inflation across the world economy.
At the present time, some shares may offer high yields for a good reason. For example, they may face challenging operating conditions that have caused their share prices to fall.
As such, before buying high-yielding companies within a dividend share portfolio it could be worth assessing their financial strength and outlook. By analysing their balance sheet strength, cash flow and economic moat, you can assess whether they offer a solid passive income over the long run.
By focusing your capital on the highest-quality companies available, you can reduce risk and increase your chances of obtaining a generous income return that improves your financial freedom in what could be a challenging period for the global economy.
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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Motley Fool contributor Peter Stephens 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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At the end of February we announced the arrival of the first US recession since 2009 and we predicted that the market will decline by at least 20% in (see why hell is coming). In these volatile markets we scrutinize hedge fund filings to get a reading on which direction each stock might be going. […]
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Aston Martin’s first sport utility vehicle rolled off the production line on Thursday, key to hopes of a turnaround at the luxury carmaker which has seen changes in management and ownership over the last few months amid a torrid performance. Popular for being James Bond’s carmaker of choice, the firm has had a difficult time since it floated in 2018 as sales disappointed and it burnt through cash, prompting it to seek fresh investment from billionaire Lawrence Stroll. The DBX vehicle is the company’s first foray into the lucrative sport utility vehicle market, a late entrant compared to many rivals such as Volkswagen-owned Bentley and BMW’s Rolls-Royce.
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Buying bargain stocks could prove to be a risky strategy over the coming months. Many industries face hugely challenging operating conditions across the world economy that may persist over the short run. As such, the stock market’s performance could be somewhat disappointing after its recent market crash.
However, investors with long-term time horizons could benefit from the wide margins of safety currently on offer. There may be favourable risk/reward opportunities across many sectors that lead to impressive long-term returns. They could boost your financial prospects and help you to retire early.
Buying bargain stocks may allow you to access more attractive risk/reward opportunities. In some cases, low valuations are merited at the present time. For example, companies trading in sectors such as retail and travel & leisure could experience difficult trading conditions that negatively impact their financial performances. However, in other cases weak investor sentiment towards the wider stock market means that you can buy high-quality businesses at a large discount to their intrinsic values.
A strategy of buying undervalued stocks has historically been highly successful. The stock market has never experienced perpetual bear markets, with it having produced high single-digit annual returns despite a number of downturns, crashes and bear markets. Through buying stocks when they offer wide margins of safety, investors can benefit from the cyclicality of the stock market, as well as its recovery potential.
It may be tempting to ignore bargain stocks at the present time due to the uncertain economic outlook. Investors may even decide to focus their capital on lower-risk assets such as bonds and cash. They may outperform the stock market should it experience a further crash in the coming months due to challenges such as a weak economic outlook or a second wave of coronavirus.
However, over the long run a portfolio of stocks is very likely to beat the returns of cash and bonds. That’s especially the case since the prospects for a hawkish monetary policy, where interest rate rises are commonplace, seem to be low. Policymakers may look to provide support to the wider economy through lower interest rates, which could cause the performance of bargain stocks to be significantly more attractive than the returns available from other popular assets such as cash and bonds.
Therefore, investors with a long time horizon could improve their retirement prospects through buying bargain stocks today. Certainly, they may not produce paper gains over the coming months due to the uncertainties facing the world economy. However, over the long run the favourable risk/reward opportunities available due to weak investor sentiment and the growth potential of the world economy mean that they may help to bring your retirement date a step closer.
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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Motley Fool contributor Peter Stephens 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 Fluence Corporation Ltd (ASX: FLC) share price soared 20% higher today after announcing a positive operating cash flow for the quarter ended June (Q2 2020).
The company’s mission is to provide breakthrough water-treatment technologies. It does this by developing water, wastewater and reuse solutions that are efficient and unique.
The company’s positive cash flow was in line with its previous guidance which helped boost the Fluence share price today. Furthermore, Fluence’s cash balance at the end of Q2 was approximately US$20 million. This was up from US$16.9 million at the end of Q1 2020.
When commenting about the update, Managing Director and CEO, Henry Charrabe said: “Streamlining our operations and focusing on timely collections from customers enabled us to turn our operating cash flow positive. Despite global challenges and the economic slowdown, the company is now in a stronger cash position…”
A further update about its financial and operating performance will be provided at the end of this month.
With headquarters in New York and a global staff consisting of 300 water specialists, Fluence Corporation is a leader in the decentralised water, wastewater and reuse treatment markets. The group was created in 2017 after a series of mergers and acquisitions. It now has an international presence in over 70 countries. This includes in North and South America, the Middle East, Europe and China.
As per an announcement on 19 June, the company’s key, Ivory Coast Project has been impacted by administrative delays resulting from the coronavirus pandemic. Positively, however, Fluence expects the delay to be resolved fairly quickly.
Henry Charrabe said in the June update, “This water treatment plant is a key infrastructure project for the Ivory Coast Government, and all parties are working hard so that the people in Abidjan will be able to access clean drinking water…“
Fluence also announced its earnings before interest, tax, depreciation and amortisation (EBITDA) turned positive in Q1 2020 and is expected to remain positive for FY20.
The Fluence share price is currently trading at 24 cents with a market cap of approximately $146.84 million. The group’s share price has, however, fallen more than 55% in the past 12 months.
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
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Motley Fool contributor Matthew Donald has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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The S&P/ASX 200 Index (ASX: XJO) fell by 0.6% today to 5,919 points.
The alarming COVID-19 spread continues in Melbourne with Victoria reporting 288 new cases today. However, two new infections in NSW that seemingly came from a Sydney pub last weekend may cause more concern for the market next week if there is still community transmission occurring in Sydney.
Just after midday the Afterpay share price rose to above $76.50, hitting a new record.
The ASX 200 buy now, pay later business has been unstoppable over the past few months as it recovered from the March 2020 share market selloff.
Over the past month alone the Afterpay share price has gone up by almost 39%.
Brokers have been increasing their share price targets for Afterpay with the company continuing to generate strong underlying sales growth each month.
The healthcare company gave a business update for the fourth quarter of its FY20 and also for the full year.
In the fourth quarter, sales for the RECELL system in the US was US$3.79 million, an increase of 0.2% from the third quarter. Total global net revenue for the fourth quarter was US$3.88 million, a decrease of 1.6% compared to the previous quarter.
For the full year the ASX 200 company’s total sales were approximately US$14.3 million, which was an increase of 160% compared to the previous year. FY20 RECELL system sales were US$13.8 million, up 213% compared to last year.
Polynovo provided a trading update today and also updated the market about the Pivotal trial protocol.
The US FDA has given formal feedback to the company, including a request for some additional information including a formalisation of the review points through the trial.
The company is working through a response to the FDA, which may delay the commencement of the trial recruitment.
In terms of the trading update, June 2020 was a record sales month in the US. The company has opened seven new hospital accounts. Over the past 12 months there has been a 67% increase in hospital accounts in the US. PolyNovo was able to achieve this growth despite the COVID-19 impacts on many businesses.
The ASX 200 company also announced its first sale in the UK. There have been six operations in England and Scotland, therefore the company is expecting additional new term sales.
In the EU there have been numerous applications of the BTM in the DACH countries of Germany, Austria and Switzerland. Sales are growing as PolyNovo gains traction across the region.
FY20 product sales are likely to be at least twice as high compared to FY19. Sales in the quarter to 30 June 2020 were 33% greater than the previous quarter.
The ASX 200 New Zealand telco suffered a fall after telling the market that the lockdown period had a significant impact on its fourth quarter.
Restrictions on non-essential activity reduced fibre installations by around 15,000 and halted the UFB2 rollout.
The lockdowns also reduced fibre installations and constraints on door to door marketing saw Q4 fibre connection growth drop to 27,000 from 32,000 in the third quarter.
Chorus provided $5 million of financial support to service companies to assist with reduced field force workflow and revenue and help retain the workforce for rapid resumption of work in ‘alert level 3’.
Total fixed line connections declined by 4,000 to 1,415,000 and broadband connections returned to the second quarter level of 1,206,000 with growth of 4,000.
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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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 Avita Medical Limited and POLYNOVO FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Avita Medical 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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2020 has been a tough year for ASX dividend shares. Former dividend heavyweights like Transurban Group (ASX: TCL), Ramsay Health Care Limited (ASX: RHC) and Sydney Airport Holdings Pty Ltd (ASX: SYD) have slashed, deferred or cancelled their shareholder payments. And let’s not even mention the fallen angels of the dividend world, the ASX banks.
So here are 2 ASX shares that currently offer grossed-up dividend yields of over 9% per annum. Furthermore, I think both will continue to fund said dividends throughout 2020 and beyond.
This iron ore giant has been making headlines throughout 2020 as it defies the coronavirus pandemic to hit new, all-time highs. At today’s close, the Fortescue share price was sitting at $14.85 after reaching as high as $15.25 a month ago. The company’s current share price puts it nearly 38% up for the year so far. The sky-high price of iron ore is the main driver behind this surge, with production issues in the Brazilian iron industry causing a supply squeeze in 2020.
Thankfully, Fortescue’s dividend is still extremely lucrative, despite the share price’s massive surge this year. On current prices, it’s worth a 6.73% trailing yield, which grosses-up to 9.61% with full franking credits. If iron ore prices stay around the US$100 per tonne mark, I fully expect this dividend to be maintained in 2020 and beyond.
WAM Research is a listed investment company (LIC) that invests in the small to mid-cap space of the ASX, with a particular focus on ‘industrial’ shares. This company’s modus operandi is to find companies it believes are undervalued or have significant growth catalysts ahead of them. Once this pricing opportunity or catalyst has been realised, the shares are sold and the profits banked in the company’s reserve. The LIC then uses this reserve to pay out a stream of fully franked dividends. Some of WAM Research’s current holdings include REA Group Limited (ASX: REA), Cleanaway Waste Management Ltd (ASX: CWY) and Adairs Ltd (ASX: ADH).
Speaking of dividends, WAM Research has a doozy. On current prices, the company is offering a trailing yield of 7.04%, which grosses-up to 10.06% with full franking. The best thing? WAM Research’s latest dividend came in a 4.9 cents per share, but the company has 26.2 cents per share left in its profit reserves. That should ensure this dividend can be maintained for at least the next couple of years.
I love a good ASX dividend share. If you’re looking to add some long-term, income producing shares to your portfolio, I think both those mentioned represent great options.
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.
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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Transurban Group. The Motley Fool Australia has recommended Ramsay Health Care Limited and REA 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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