• The Clean TeQ share price is on a rollercoaster ride right now

    The Clean TeQ Holdings Limited (ASX: CLQ) share price has been on a rollercoaster ride over the past few days of trading.

    Yesterday, Clean TeQ shares rose 19% despite no news coming out of the company on Monday. However, last Friday the company announced its activities and cash flow report for the quarter ending June 2020, which saw its share price jump 13% that day.

    Today, however, the Clean TeQ share price opened early trade down 6.25% to 15 cents per share, before pushing up slightly to be trading flat at the time of writing.

    What does Clean TeQ do?

    Clean TeQ is involved in metals recovery and industrial water treatment through its ‘Clean-iX’ continuous ion exchange technology. The company aims to help reduce the world’s environmental burden and become a leading supplier of clean energy solutions.

    Project updates

    On Friday, the company released an update regarding its current projects, which drove the Clean TeQ share price higher on Friday and across yesterday’s trade.

    Clean TeQ reported it has made strong progress towards the formal completion of the Fosterville Gold Mine water treatment plant, which is located in Victoria. Since the end of June, the operation of the plant has been handed over to the customer and is running on waste water continuously.

    Clean TeQ confirmed it also continued to advance the development of the Sunrise Battery Materials Complex in New South Wales. The Sunrise Project is one of the world’s largest and most cobalt-rich laterite deposits and is tipped to be a significant producer of nickel sulphate and cobalt sulphate – key materials for the electric vehicle battery market.

    The company has been progressing the project in conjunction with the Fluor global engineering group, which is headquartered in Texas. While the project was originally slated to be completed in the second quarter of FY20, it has been announced that the project’s completion date has been pushed later to Q3 FY20. The company cited Covid-19 as the reason for the delay.

    What now for Clean TeQ

    As at the end of June, Clean TeQ’s cash balance was $40.1 million. The company announced that it had received a cash rebate of approximately $4.4 million after being eligible for the government’s research and development tax incentive for FY19. Clean TeQ was also granted a large new exploration licence for base and precious metals near Dubbo and Narromine.

    The Clean TeQ share price is down 26%, year to date, and 60% since this time last year. Despite its recent rally, the current Clean TeQ share price represents a sharp drop on its highs of $1.65 in late 2017. 

    Where to invest $1,000 right now

    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 Daniel Ewing 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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  • Kogan share price rockets higher after delivering impressive Q4 growth

    Miniature shopping trolley filled with parcels next to laptop computer

    The Kogan.com Ltd (ASX: KGN) share price is rocketing higher following an update on its fourth quarter performance.

    In morning trade the ecommerce company’s shares are up 7.5% to a new record high of $18.65.

    How did Kogan perform in the fourth quarter?

    For the three months ending 30 June 2020, Kogan delivered further strong sales and profit growth compared to the prior corresponding period.

    According to the release, gross sales grew by more than 95% and gross profit increased by over 115%.

    Things were even better for its adjusted earnings before interest, tax, depreciation, and amortisation (EBITDA). Kogan’s adjusted EBITDA increased by more than 149% during the fourth quarter. This took its adjusted EBITDA growth to over 57% for the full year.

    Pleasingly, although retail stores are now open largely as normal, this hasn’t slowed Kogan’s growth.

    In the final month of the fourth quarter, Kogan reported gross sales of more than $94 million, gross profit of more than $17 million, and adjusted EBITDA of more than $7.9 million.

    As a comparison, during the first two months of the fourth quarter, Kogan’s average run-rate of adjusted EBITDA was $7 million per month.

    At the end of the financial year Kogan’s cash balance stood at $147 million. This includes the $100 million raised from its institutional placement, but not the $20 million from its share purchase plan.

    Total inventories were $113.1 million at the end of the period, with $80.6 million in its warehouse and $32.5 million in transit.

    What were the drivers of this growth?

    The shift to online shopping and another solid increase in customer numbers helped drive this strong quarterly result.

    Kogan’s active customers grew to 2,183,000 at the end of June, with net 109,000 active customers added during the month.

    Founder and CEO of Kogan, Ruslan Kogan, commented: “In early July we celebrated four years since listing the Company on the ASX, and we are now proud to have delivered four consecutive years of significant growth in sales and earnings. Our business is booming as more customers than ever choose Kogan.com.”

    5 stocks under $5

    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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    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 Kogan.com ltd. The Motley Fool Australia has recommended Kogan.com ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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  • Saracen share price on watch as production guidance exceeded

    Gold mining shares

    The Saracen Mineral Holdings Limited (ASX: SAR) share price is on watch this morning after the miner announced gold production above guidance. Saracen released its June quarterly activities report which revealed FY20 production of 520,414 ounces of gold, ahead of FY20 guidance of +500,000 ounces. 

    What does Saracen Mineral Holdings do? 

    Saracen is an Australian gold miner with 3 mines on the doorstep of Kalgoorlie. The company mines from the Carosue Dam and Thunderbox operations, and has a half share in the Super Pit, the biggest open pit gold mine in Australia.

    The Saracen share price is up 41% over the past year and 102% from its March low. The rise in the share price has been assisted by the rising price of gold, which has increased from around $2,200 an ounce at the start of 2020 to closer to $2,600 an ounce currently. 

    What did Saracen Mineral Holdings announce? 

    Saracen released its June quarterly activities report, which showed quarterly production of 145,830 ounces of gold at an all-in sustaining cost of $1,152 an ounce. Over the full year, Saracen produced 520,414 ounces of gold at an all-in sustaining cost of $1,101 an ounce. This was ahead of FY20 guidance of +500,000 ounces. 

    Saracen sold 148,011 ounces of gold during the June quarter at an average price of $2,280 an ounce, generating sales receipts of $338 million. The company had cash and bullion of $369 million at 30 June, up from $339 million at 31 March. Debt was $321 million at the end of the June quarter, giving net cash of $48 million up from net debt of $21 million at 31 March 2020. 

    What is the outlook for Saracen Mineral Holdings? 

    Saracen has announced unaudited FY20 sales revenue of $1,072 million, with unaudited statutory net profit after tax of $190 million to $200 million. In FY21, Saracen has forecast production of +600,000 ounces of gold. The company has large ore stockpiles of 1.7 million ounces, which will help insulate the business should mining be restricted due to COVID-19 or other impacts. 

    Where to invest $1,000 right now

    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.

    *Returns as of June 30th

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    Motley Fool contributor Kate O’Brien 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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  • 2 ASX shares for growth and dividends

    blocks trending up

    ASX shares are a great option for both growth and dividend income.

    Businesses have the ability to make good profit and pay out some of it in the form a dividend whilst keeping the rest of the profit to re-invest for more growth in the future. 

    It’s hard to find businesses with the right mix of income and growth. There are some businesses like Telstra Corporation Ltd (ASX: TLS) that pay out a large proportion of their earnings, but the earnings and share price aren’t growing.

    Others have great growth potential but don’t pay a dividend like A2 Milk Company Ltd (ASX: A2M) and Pushpay Holdings Ltd (ASX: PPH).

    But there are some businesses that offer a good mix of both growth and dividend income:

    Share 1: WCM Global Growth Ltd (ASX: WQG)

    This is a listed investment company (LIC) which invests in global shares, not ASX shares. The name ‘WCM’ refers to WCM Asset Management, a manager based in California which was founded in 1976.

    WCM looks for two key attributes for companies to make it into its global growth portfolio. The first is an improving competitive advantage, or in other words an expanding ‘economic moat’. The second attribute is a corporate culture that supports the expansion of this moat. WCM believes that the direction of a company’s economic moat is of more importance than its absolute width or size.

    The fund manager looks for companies with a rising return on invested capital (ROIC), rather than businesses with a large but static or declining moat. The corporate culture is a key factor for a business’ ability to achieve a constantly growing moat.

    So what are some shares that make it into WCM’s portfolio? The ASX share has positions in: Shopify, West Parmaceuticals, MercadoLibre, Visa, Stryker, Tencent, Lululemon Athletica, Taiwan Semiconductor, Crown Castle International and Ecolab.

    As you may have noticed, there’s a focus on technology and healthcare businesses. These two sectors offer investors growth and (usually) fairly defensive earnings.

    The investment returns have been strong to June 2020. The ASX share said that its portfolio has returned 20.15% per annum after management fees over the past three years – don’t forget this includes the COVID-19 market selloff a few months ago.

    The dividend income part comes in with the biannual dividend that the LIC pays to shareholders. At the moment it’s committed to paying a 2 cents per share dividend as its final FY20 dividend, partially franked to 50%. That means the grossed-up dividend yield is currently 3.8%. At the current WCM Global Growth share price, the ASX share is trading at a 14% discount to its pre-tax net tangible assets (NTA) at 17 July 2020.

    I believe it looks like a compelling buy today.

    Share 2: Brickworks Limited (ASX: BKW)

    I think Brickworks is one of the most promising non-technology ASX shares for growth.

    There are three sections to Brickworks, each of them look like they have good growth prospects.

    One section is its industrial property trust which it owns half of along with Goodman Group (ASX: GMG). The trust has built industrial properties on excess land that Brickworks used to own. Just like other quality real estate investment trusts (REITs), this property trust is generating reliable rental profit each year. Over the next few years the trust will see two large distribution warehouses completed and leased to Amazon and Coles Group Limited (ASX: COL). The completion of these assets should see a pleasing uptick in rental income and valuation uplift for the property trust.

    Another section is Brickworks’ large shareholding of investment conglomerate ASX share Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). The investment house has been a strong dividend share for a long time and it’s steadily building its asset base with diversified businesses like TPG Telecom Ltd (ASX: TPG), Clover Corporation Limited (ASX: CLV) and Palla Pharma Ltd (ASX: PAL). Soul Patts has been delivering solid total shareholder returns for decades, so Brickworks should be able to keep benefiting here.

    The last section may be the most important one. Brickworks owns building product businesses in both Australia and the US. COVID-19 has made it harder for construction businesses in the short-term, but Brickworks has set the foundations for good growth in the future when construction rebounds in both countries. I really like the company’s long-term growth plan in the US to make the operations there more efficient and profitable. I think the best time to buy a somewhat cyclical business is during the downturn. 

    At the current Brickworks share price it has a grossed-up dividend yield of 5%. It hasn’t cut its dividend for over four decades.

    Foolish takeaway

    I think both of these ASX shares are trading at good value, have good growth potential and have decent starting dividend yields. I’d be happy to buy both of them for my portfolio at the current share prices.

    Where to invest $1,000 right now

    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.

    *Returns as of June 30th

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    Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited and WCM Global Growth Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Clover Limited and PUSHPAY FPO NZX. The Motley Fool Australia owns shares of and has recommended Brickworks, Telstra Limited, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of A2 Milk. The Motley Fool Australia has recommended PUSHPAY FPO NZX. 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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  • Market Recap: Monday, July 20

    Market Recap: Monday, July 20Stocks rose Monday as investors looked ahead to a packed week of earnings, stimulus talks and congressional testimony from Covid-19 vaccine developers. The Nasdaq logged a record close after rising 1% as shares of Amazon jumped 5% after Goldman Sachs raised its price target on the e-commerce stock to $3800 from $3000.

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  • This is how the Hungarian Grand Prix affects you as an ASX investor

    Formula one racing flag waving in the air

    Lewis Hamilton has just won his third Hungarian Grand Prix (GP) in a row and S&P/ASX 200 Index (ASX: XJO) investors should be paying attention.

    Why? Because in the words of The Motley Fool Co-founder David Gardner, “winners win”.

    For those of you who don’t follow Formula One, Hamilton is one of the most successful drivers ever with 6 world championships under his belt. He currently drives for Mercedes, which has won the last 6 constructors’ championships. Prior to that Sebastian Vettel and Red Bull Racing won 4 championships in a row.

    When investing in ASX 200 shares, I think investors can draw inspiration from Hamilton’s Hungarian GP win. Although prior performance is not a guarantee of future returns or success, companies and athletes that win tend to have a competitive advantage. Even if a company’s share price has appreciated faster than the share market in the past, if the total addressable market or optionality of the business allows, that advantage can mean a stock can continue to deliver outsized returns for investors.

    2 ASX 200 shares that can keep winning

    Altium Limited (ASX: ALU)

    If Hamilton has won 3 Hungarian GPs in a row, Altium has won 10, at least. The printed circuit board software company current trades at around 57x earnings and pays a dividend on a yield of 1.16%. That’s quite a lofty valuation, but it is deserved. Over the last decade, the Altium share price has risen at a compound annual growth rate (CAGR) of 64.33% per annum, including dividends.

    Just like the book makers had Hamilton on extremely low odds to win, investors have pushed up the valuation of Altium on the expectation it will continue to deliver results. I think this expectation is deserved, as Altium continues to deliver as a business and as an investment. Altium management has a long-term focus on dominating its industry.

    NextDC Ltd (ASX: NXT)

    As an innovative data centre-as-a-service provider, NextDC has been growing its number of data centres in strategic locations across Australia. The NextDC share price has had a stellar year, going from $6.53 to $10.95 at the time of writing. Look back 5 years, and the stock has grown at a CAGR of 35.66%. 

    One reason for the recent NextDC share price growth is that the company has benefitted from the digitisation trend caused by COVID-19. The shift towards digitisation isn’t over though, COVID-19 or not. Over the long-term, the shift towards cloud computing will increase the demand for NextDC data centres. 

    Although building data centres can be capital intensive, the strong industry tailwinds should provide investors with strong returns if the business is able to manage its balance sheet and allocate capital well.

    Foolish bottom line

    These ASX 200 growth shares are slowly maturing. In my opinion, they are still small enough, in large enough addressable markets, to continue growing (and compounding) for years.

    5 stocks under $5

    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!

    *Extreme Opportunities returns as of June 5th 2020

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    Lloyd Prout owns shares of Altium Limited and expresses his own opinions. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of 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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  • BHP share price on watch after robust FY 2020 update

    2 people at mining site, bhp share price, mining shares

    The BHP Group Ltd (ASX: BHP) share price will be on watch on Tuesday after the release of its fourth quarter and full year production update.

    How did BHP perform?

    BHP has just completed a solid 12 months with production guidance met for iron ore, metallurgical coal, and operated copper and energy coal assets.

    Petroleum production fell a touch short of guidance due to lower than expected demand due to the impact of COVID-19. Whereas production at Antamina and Cerrejon was lower than guidance due to the temporary suspension of operations due to the pandemic. Both operations are now ramping back up.

    Here’s a summary of its production for FY 2020 and expectations for next year:

    Petroleum production was 109 MMboe, down 10% on the prior corresponding period. This was despite a strong finish to the year thanks to increased production at Bass Strait due to higher seasonal demand. In FY 2021, BHP is forecasting production of 95 to 102 MMboe. This represents a 6% to 13% decline.

    Copper production was up 2% in FY 2020 to 1,724 kt. This was despite lower production in the fourth quarter due to the aforementioned temporary operating suspensions. Copper production is expected to decline by 13% to 21% in FY 2021 to 1,480 kt to 1,645 kt. This is due largely to a sharp reduction at the key Escondida operation.

    Iron ore production was the highlight of FY 2020 with 248 Mt. This was up 4% on the prior corresponding period thanks to a strong fourth quarter performance at Mining Area C and Yandi. Pleasingly, production costs are expected to be in line with guidance at WAIO and BHP has benefited greatly from a 16% increase in average price realised to US$77.36 a tonne. In FY 2021 production is forecast to be 244 Mt to 253 Mt. This will be a 2% decline to a 2% increase.

    Metallurgical Coal production came in a 41 Mt in FY 2020, down 3% year on year. A very strong performance in the fourth quarter prevented a much worse result. Looking ahead, in FY 2021 production is expected to be in the region of 40 Mt to 44 Mt. The low end represents a 3% decline and the high end represents a 7% gain.

    Elsewhere, Energy Coal production was down 16% to 23 Mt and Nickel production fell 8% to 80 kt. The latter is expected to rebound with production growth of 6% to 19% in FY 2021. Whereas Energy Coal production guidance for the new financial year ranges from a 5% decline to 4% growth.

    What else did BHP announce?

    The Big Australian also gave investors an idea of what its finances will look like when it reports its full year results next month.

    Management advised that its unit costs are expected to be in line with guidance for its WAIO, Queensland Coal, and NSWEC operations. Whereas Petroleum and Escondida costs are expected to slightly better than guidance.

    There will be an increase in closure and rehabilitation provisions for closed mines of US$600 million to US$700 million and impairments of US$450 million to US$500 million to property, plant and equipment at Cerro Colorado.

    It also has forecast costs directly attributable to COVID-19 of US$100 million to US$150 million after tax.

    Nevertheless, BHP’s net debt is expected to be at the lower end of its target range of US$12 billion to US$17 billion.

    BHP Chief Executive Officer, Mike Henry, commented: “Our diversified portfolio and high quality assets, together with our strong balance sheet, make us resilient to the ongoing uncertainty in the markets for our commodities. We expect to continue to generate solid cash flow through the cycle and we remain confident in the outlook for demand for our products over the medium to long-term.”

    “We continue to focus on becoming even safer, delivering exceptional operational performance, maintaining disciplined capital allocation, creating and securing more options in future facing commodities and building social value. We have learned new ways of working, both internally and with others, through the COVID-19 pandemic. We will seek to embed these in a way that helps to reinforce these priorities,” he concluded.

    Where to invest $1,000 right now

    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.

    *Returns as of June 30th

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    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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  • Is Novavax’s (NVAX) Super-High Valuation Justified? This Analyst Says ‘Yes’

    Is Novavax’s (NVAX) Super-High Valuation Justified? This Analyst Says ‘Yes’Can any superlatives be added to the increasingly long list of ones already used to describe Novavax’ (NVAX) progress in 2020? Words such as stupendous, incredible, and amazing can by now hardly do justice by to the meteoric- there’s another one – rise of the vaccine specialist. The evidence: Novavax’ share price has increased by 3,370% year-to-date.Apart from the early promise shown by its COVID-19 vaccine candidate, NVX-CoV2373, Novavax’ surge has been built on accelerating momentum. Eventually though, the vaccine player will have to back up the share gains, government grants and analysts’ ratings with positive trial results.NVAX’ latest surge (Friday’s 17% uptick) came following another price target raise from a long time NVAX bull. B Riley FBR analyst Mayank Mamtani raised his Novavax price target from $106 to $155, while reiterating a Buy rating on the stock. (To watch Mamtani’s track record, click here)Mamtani believes the biotech is most likely to "emerge as strongest among peers," and explains why he believes Novavax’ has the upper hand: “We believe MRNA's recent Ph. I 45-subject NEJM-published data sets a low bar for NVAX to meet/exceed, including with the low dose, 5 μg + 50 μg Matrix-M, prime/booster regimen… Prior successful experiences with NVAX's adjuvanted nanoparticle protein platform, notably in terms of eliciting broad antibody (B cell) and cell-mediated (T cell) response, reflects highly de-risked nature of clinical development with the incremental benefit of applying trial execution learnings from relatively more advanced Ph. III programs, notably from MRNA and AZ.”So, Mamtani argues Novavax lagging behind its peers might be a good thing. While Moderna, Oxford Uni/AstraZeneca and Chinese company Sinovac’s programs have already advanced or are advancing to phase 3, NVX-CoV2373 is currently in a Phase 1 trial with a data readout expected by the end of the month.Additionally, the prior success Mamtani argues stands in Novavax’ favor relates to another drug in its vaccine pipeline.Influenza candidate NanoFlu includes the same proprietary Matrix-M adjuvant as NVX-CoV2373 and in a Phase 3 trial proved it was “safe, scalable, and key to eliciting responses in elderly.”Mamtani believes “this bodes favorably for '2373 to demonstrate a differentiated profile, relative to mRNA-1273 with the prioritized 100 μg dose level associated with high rates of solicited adverse events, local (pain) and systemic (fever, fatigue, chills, headache).”All in all, Novavax has a Moderate Buy consensus rating based on 3 Buys and 2 Holds. However, with an average price target of $117.2, the analysts expect shares to decline by 15%, implying most think Novavax has surged enough for now. (See Novavax stock analysis on TipRanks)To find good ideas for healthcare stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

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  • You probably shop at these 7 ASX retailers. Should you buy shares in them too?

    hands at keyboard with ecommerce icons

    If you’re a fan of a particular brand or retail outlet, it can pay to look into the company behind it. Many of the products and services we consume are produced by companies trading on the ASX. As our consumption habits shift, so do the fortunes of the companies catering to them. By monitoring your own consumption you can gain insights into long term trends that can influence the way ASX shares perform.

    Here we take a look at 7 ASX shares you probably already buy from. 

    Wesfarmers Ltd (ASX: WES) 

    Wesfarmers is behind a stable of retail brands including Bunnings, Officeworks, Kmart, and Target. The Wesfarmers share price has recovered strongly from the March downturn and it is now trading on par with February levels, i.e. near record highs.

    Bunnings and Officeworks both saw a surge in sales as a result of lockdowns and the move to remote working. Consumers spent time and money setting up home offices and getting stuck into DIY. As a result, Officeworks’ sales grew 27.8% in the second half and Bunnings’ grew 19.2%. 

    Coles Group Ltd (ASX: COL)

    Spun off from Wesfamers in 2018, Coles is behind 2,500 retail outlets nationally. This includes 800 supermarkets, 900 liquor stores, and more than 700 fuel and convenience retailers. The Coles share price remained relatively robust in the March correction, losing around 17% from peak to trough. Coles shares have now surpassed pre-Covid-19 levels and are trading near all-time highs.

    Coles saw significant sales growth in the third quarter as the result of stockpiling and panic buying. Supermarkets sales grew 13.8%, with overall sales revenue up 12.9% to $9.2 billion. 

    Woolworths Group Ltd (ASX: WOW) 

    If you don’t shop at Coles, there’s a strong chance you shop at Woolworths, Australia’s other major supermarket chain. Woolworths operates some 995 supermarkets across Australia. Including its liquor and Big W brands, Woolworths is behind some 3,000 stores across the country. The Woolworths share price fell 20% in the March dip, but has since recovered somewhat. It is still, however, trading down 10% from its February high.

    Woolworths experienced a similar rush in sales to Coles in the third quarter. The Australian food business saw growth of 11.3%, Big W grew sales by 9.5%, and liquor also grew 9.5%. The Hotels business saw a 12.9% drop in sales with the closure of venues. 

    JB Hi-Fi Limited (ASX: JBH)

    JB Hi-Fi is Australia’s largest home entertainment retailer with almost 200 stores throughout Australia and New Zealand. JB Hi-Fi acquired The Good Guys in 2016, a home appliances retailer with a network of over 100 stores. The JB Hi-Fi share price has recovered strongly from the March downturn and is now just 3% down from its February peak.

    JB Hi-Fi also saw a surge in sales in the third quarter as consumers set up home offices and searched for in-home entertainment. Australian JB Hi-Fi sales were up 20% in the half year to June. The Good Guys sales were up 23.5%. JB Hi-Fi New Zealand sales fell 19.3% as a result of closures during lockdowns. 

    Kogan.com Ltd (ASX: KGN)

    Kogan is an online retailer selling a wide range of products from consumer electronics, to appliances, homewares, hardware, and toys. The company sells its own stock and provides for third party sellers via Kogan Marketplace. The company also owns and operates a suite of private label brands. The Kogan share price has surged since its March low of $4.16 with shares currently trading at $17.34.

    The company grew gross sales by more than 100% in April and May with gross profit growing by more than 103% over the same period. Kogan is benefitting from the ongoing shift to ecommerce, which has been hastened by the onset of coronavirus. 

    Premier Investments Limited (ASX: PMV)

    Premier Investments is the company behind popular brands Peter Alexander, Smiggle, Portmans, Just Jeans, Jay Jays, Jacque E, and Dotti. The company also holds a 28% stake in Breville Group Limited (ASX: BRG). The Premier Investments share price is up 82% from its March low but remains 23% below its February high.

    Premier Investments closed stores during the first lockdown and took the hard line with landlords on rental payments. Pleasingly, during temporary store closures the retailer’s online sales surged. Online sales for Peter Alexander during the store closure period were up 295%. Incredibly, during the week ended 2 May, the brand’s online sales alone were up 18% on the previous years total sales across online and the 122 store network. 

    Adairs Ltd (ASX: ADH)

    Adairs is an omni-channel home furnishings retailer operating in Australia and New Zealand. Its product range includes bed linen, towels, homewares, soft and children’s furnishings, and some furniture. The Adairs share price has recovered strongly from the March downturn and is now close to reaching its pre-Covid-19 peak.

    The retailer was forced to close stores during the first lockdown, but its online sales surged. Customers spending more time at home took the opportunity to upgrade home furnishings. Adairs reported a 92.6% increase in online sales in the 24 weeks to 14 June 2020. This led to a 27.4% increase in total sales for the period. Online furniture subsidiary Mocka saw sales growth of 52.1% over the same period. 

    Foolish takeaway

    Observing your own spending patterns can help you identify trends that will impact ASX shares in both the short and long term. If you’re a believer in the products or services produced by a certain company, you may want to consider investing. That way, you could stand to earn a portion of the money you spend on its products in the form of dividends.  

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    Kate O’Brien has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd. The Motley Fool Australia owns shares of and has recommended Premier Investments Limited. The Motley Fool Australia owns shares of COLESGROUP DEF SET, Wesfarmers Limited, and Woolworths Limited. The Motley Fool Australia has recommended Kogan.com ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

    The post You probably shop at these 7 ASX retailers. Should you buy shares in them too? appeared first on Motley Fool Australia.

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