I think there are a number of ASX growth share opportunities in September 2020.

The growth delivered by businesses like Afterpay Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P) is impressive – but who knows if they are worth buying today after the meteoric rise?

There are still plenty of other opportunities that aren’t priced to the moon.

Here are four ASX growth shares I’d buy in September:

Citadel Group Ltd (ASX: CGL)

Citadel is a technology business that provides software to help organisations manage data. It serves clients in sectors like education, defence and healthcare.

Its underlying FY20 result was impressive in my opinion. Total revenue grew by 29.4% to $128.4 million and total software revenue increased by 35.7% to $47.5 million.

I expect FY21 to be a bumper year for the ASX growth share with the Wellbeing business under Citadel’s ownership for the full year. Wellbeing is a UK healthcare software business with high levels of recurring revenue and an attractively high earnings before interest, tax, depreciation and amortisation (EBITDA) margin.

The world is becoming increasingly reliant on software and I think Citadel is a good ASX growth share to get exposure to this trend.

At the current Citadel share price it’s trading at under 14x FY22’s estimated earnings.

Pushpay Holdings Ltd (ASX: PPH)

I think Pushpay is one of the most promising ASX growth shares around.

It’s an electronic donation payment business that facilitates digital giving to not-for-profits. Its current client base is largely medium and large US churches. This provides exposure to a large (and growing) amount of electronic donations. The opportunity so large that Pushpay is targeting annual revenue of US$1 billion per annum over the long-term.

In FY20 alone it grew its gross margin from 60% to 65%, which shows the business has excellent profit margin improvement potential over the long-term as it scales. As it grows its revenue it should be able to become much more profitable, at the net profit after tax level, as time goes on.

The ASX growth share is looking to double its earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) to at least US$50 million in FY21.

At the current Pushpay share price it’s trading at 35x FY22’s estimated earnings.

City Chic Collective Ltd (ASX: CCX)

City Chic is steadily becoming a world leader in the retailing of plus-size women’s clothes, footwear and accessories. It has a national footprint of City Chic stores across Australia. It also has websites in Australia and the northern hemisphere. The company has partnerships with northern hemisphere partners like ASOS.

I particularly like the ASX growth share’s strategy of buying distressed competitors in the US. The United States is a huge market compared to Australia. City Chic aims to turn the acquired US retailers into online-only offerings – which would have lower costs and still have a national footprint. The latest target is a business called Catherines.

In FY20 City Chic grew revenue by 31% to $194.5 million. Around 65% of total sales were online and 42% of global sales were in the northern hemisphere. I think City Chic has plenty of pleasing factors which will help long-term growth.

At the current City Chic share price it’s trading at 22x FY22’s estimated earnings.

BWX Ltd (ASX: BWX)

BWX is one of the world’s leading natural beauty businesses. The ASX growth share sells a number of brands including Sukin, Mineral Fusion and Andalou Naturals.

The company has really turned things around under new management. FY20 was a strong year with revenue growth of 26%, EBITDA growth of 30% and statutory net profit growth of 59% to $15.2 million.

BWX continues to increase its market share and gross profit margin, so I think it’s definitely an ASX growth share to watch because increasing profitability as it grows revenue is very attractive for market-beating returns.

It’s expecting double digit revenue and EBITDA growth in FY21. At the current BWX share price it’s trading at 31x FY22’s estimated earnings.

Foolish takeaway

I think each of these ASX growth shares have very good outlooks for the next few years. Their valuations look reasonable for their growth prospects and they have plenty of international avenues for growth. At the current prices I think Citadel and Pushpay looks particularly good value for the long-term.

More reading

• Afterpay and Zip shares sink lower after PayPal announces Pay in 4 BNPL product
• Why the Zip Co share price rocketed 54% higher in August
• 2 financial services for the fiscal cliff
• The Afterpay share price jumped 33% in August: Is it too late to invest?
• These market veterans believe a share market pullback is coming. Here’s their surprising advice…

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 ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended BWX Limited and PUSHPAY FPO NZX. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Citadel Group Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Starpharma Holdings Limited (ASX: SPL) share price has been a positive performer on Tuesday.

In morning trade the dendrimer products developer’s shares have jumped 12% to a record high of $1.70.

Why is the Starpharma share price storming higher?

Investors have been buying Starpharma’s shares this morning after it announced the development of a slow release soluble DEP remdesivir nanoparticle.

According to the release, the company has applied its novel DEP drug delivery technology to create a long-acting, water soluble version of remdesivir.

Remdesivir is an antiviral drug which is currently being developed by US giant Gilead to treat COVID-19. It has emergency use authorisation from the US Food and Drug Administration for the treatment of COVID-19 in adults and children hospitalised with severe disease.

It has broad-spectrum antiviral activity. However, current formulations of remdesivir are required to be administered intravenously due to the drug’s low solubility, with each infusion taking up to two hours and requiring daily administration for either 5 or 10 days.

Whereas, Starpharma’s DEP remdesivir is a highly water-soluble nanoparticle formulation of remdesivir with controlled release properties. This would potentially allow for less frequent dosing and use in a non-hospital setting, such as aged care. Furthermore, the solubility of DEP remdesivir is 100-fold higher than standard remdesivir.

This means that DEP remdesivir’s enhanced aqueous solubility would enable subcutaneous (under the skin) injection rather than intravenous infusion. This is a positive as it allows for outpatient treatment and would reduce the burden on hospitals.

Management commentary.

The company’s CEO, Dr Jackie Fairley, was very pleased with the development.

She said: “Given the limited treatment options available for COVID-19 patients, Starpharma has been actively reviewing development programs globally, and evaluating where Starpharma’s proprietary DEP technology has potential to improve delivery, expand use or reduce frequency of dosing.”

“The ability to deliver remdesivir via a long-acting, subcutaneous injection has the potential to expand its application outside hospitals, into settings like aged care, and also facilitate its use in countries with less developed healthcare systems. It would also improve patient convenience and reduce the burden on the healthcare system. We’re pleased to be able to utilise the DEP platform to improve the delivery of this important antiviral medicine,” she added.

More reading

• Starpharma share price rockets to 52-week high on full year update
• Starpharma share price bolts 14% on COVID-19 nasal spray
• The Starpharma share price jumps on new partnership deal
• Why Altium, Beach, JB Hi-Fi, & Starpharma shares are charging higher

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 Starpharma Holdings Limited. The Motley Fool Australia has recommended Starpharma Holdings 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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The QBE Insurance Group Ltd (ASX: QBE) share price has come under pressure on Tuesday.

At the time of writing the insurance giant’s shares are down 5.5% to $10.03.

Why is the QBE share price under pressure today?

Investors have been selling the company’s shares after the shock announcement of the departure of its chief executive officer, Pat Regan.

According to the release, Mr Regan will be departing the company after almost three years in the role following an external investigation concerning workplace communications.

The outcome of this investigation found these communications did not meet the standards set out in the company’s code of ethics and conduct, leading to the board taking decisive action.

QBE Chairman, Mike Wilkins, commented: “We are committed to having a respectful and inclusive environment for everyone at QBE. The Board concluded that he had exercised poor judgement in this regard.”

“While these are challenging circumstances the Board recognises and thanks Mr Regan for his hard work and contribution to strengthening QBE. However, all employees must be held to the same standards.”

What now?

Mr Wilkins will now assume the role of Executive Chairman, taking on day-to-day oversight of QBE, while an extensive internal and external international search process is underway to appoint a new chief executive officer.

The new executive chairman appears confident that this change won’t disrupt the company’s performance.

He commented: “The fundamentals of our business are strong, supported by cell reviews and Brilliant Basics which continue to grow in sophistication and remain key drivers of our performance. Alongside this, we are accelerating our program of work to build best-in-class data and digital capabilities to meet the evolving needs of our customers. Coupled with a greatly improved external pricing environment, these factors give me great confidence in our future.”

Mr Wilkins also notes that the company is navigating through the COVID-19 pandemic successfully.

“While COVID-19 has created significant challenges, QBE is successfully navigating this period of uncertainty, and the Group’s demonstrable financial strength positions us well to capitalise on accelerating pricing momentum and emerging organic growth opportunities,” he explained.

Culture changes.

The company also advised that the board will put in place additional initiatives in the coming weeks to further develop a vibrant and inclusive culture.

This will commence with a board sponsored and externally supported culture review and the creation of an additional avenue for employees to safely raise concerns and receive support that will supplement existing channels.

“We want our people to have the avenues they need to safely speak up, with the confidence that they will be heard and that all concerns raised will be treated consistently across our workforce,” Mr Wilkins concluded.

More reading

• Telstra and 2 more ASX dividend shares I like in August
• Why AMP, Premier Investments, QBE, & Treasury Wine shares are storming higher
• QBE share price surges 7% despite reporting first-half loss
• Link share price buoyed by appointment of new CEO

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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B), the conglomerate led by billionaire investor Warren Buffett, just announced a relatively large investment in five Japanese companies. The investment, which is meant to be a long-term holding, is the latest in a string of billion-dollar buys Berkshire has made that we’ve learned about in recent weeks.

With that in mind, here’s what we know about Berkshire’s investment and why shareholders should be excited about it.

Berkshire is putting billions to work in Japan

Berkshire Hathaway just announced that it has acquired a little more than a 5% stake in five Japanese companies: Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo. All five trade on the Tokyo Stock Exchange, where Berkshire made its purchases over the course of the past year, according to the Berkshire press release. They’re all trading companies (diverse conglomerates – known as “sogo shosha” in Japan) with operations in a variety of industries.

Just to name one example, Mitsubishi Corporation (not to be confused with the automaker of the same name) has operations in information technology, infrastructure, finance, metal mining, energy, heavy machinery, chemicals, and consumer products.

While we don’t know how much Berkshire paid for its shares in each company, the current value of Berkshire’s investment is roughly $6.5 billion (depending on how much more than 5% of the shares Berkshire bought).

Berkshire made it clear in its press release that these are intended as long-term investments, meaning that Buffett isn’t simply attempting to capitalise on a short-term mispricing or anything like that. And Berkshire says that it may buy even more – up to 9.9% of each, with larger stakes possible with the permission of each company’s board of directors.

It’s also worth mentioning that although these are technically five separate investments, they are very similar in nature. Think of this in the same manner as Berkshire owning shares of several different bank stocks, or (until recently) all four major US airlines. Buffett seems to have identified a market opportunity, so instead of trying to pick a winner, he’s using the idea that a rising tide will lift all ships and spreading his money around.

A relatively small piece of Berkshire, but here’s why it matters

Now, an investment of more than $6 billion may sound like a large amount of money, and to most people and companies it is. However, it’s important to point out that this represents just over 1% of Berkshire’s total market capitalization. So even if they’re very successful, these Japanese stock investments aren’t likely to be a major needle-mover for Berkshire all by themselves. But that’s not the point.

The key takeaway here is that this tells us a few things that Berkshire shareholders desperately needed to hear. First, it shows that the recent investments in Dominion‘s (NYSE: D) natural gas assets and Bank of America (NYSE: BAC) stock weren’t just a blip – Buffett seems truly ready and committed to putting Berkshire’s 12-figure cash hoard to work. After all, while this is technically five different investments, in terms of actual cash spent, this is the most Buffett has put to work in a single type of investment in some time.

Furthermore, it tells investors that when the US and world stock markets were in a tailspin earlier this year, Berkshire may not have been as inactive as it seemed. From the press release, we learned that the company had built these stakes over a period of about 12 months – it didn’t just buy shares, it acquired them over a period of time, including the turbulent first half of 2020.

The bottom line is that investors have been frustrated by Berkshire’s lack of investment action for some time, but this move just goes to show that Buffett has some tricks up his sleeves – even at 90 years old.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• Why Alphabet should split its stock
• 2 Warren Buffett quotes you need to read this week
• Why Warren Buffett regrets buying Berkshire Hathaway
• Warren Buffett is dumping banks and buying gold, should you?
• Buffett’s Berkshire Hathaway reveals some surprise moves

Matthew Frankel, CFP owns shares of Bank of America and Berkshire Hathaway (B shares) and has the following options: short January 2021 $23 puts on Bank of America. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Berkshire Hathaway (B shares) and recommends the following options: long January 2021 $200 calls on Berkshire Hathaway (B shares), short January 2021 $200 puts on Berkshire Hathaway (B shares), and short September 2020 $200 calls on Berkshire Hathaway (B shares). The Motley Fool Australia has recommended Berkshire Hathaway (B shares). 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 Zip Co Ltd (ASX: Z1P) share price was among the best performers on the Australian share market last month.

The buy now pay later provider’s shares stormed a remarkable 54% during the month of August.

Why did Zip Co share price smash the market in August?

There were a couple of reasons for Zip Co’s incredibly strong performance last month.

The first was its impressive performance in FY 2020, which led to the company reporting an 87% increase in transaction volume to $2.1 billion and a 91% lift in revenue to $161 million.

Key drivers of this growth were strong increases in customer and merchant numbers in the ANZ region during the 12 months. At the end of the period, Zip Co had more than 2.1 million customers and 24,500 partners on the Zip platform. This was an increase of 62% and 51%, respectively, year on year.

Another positive from the result was its bad debt. Zip Co reported a strong credit performance with net bad debt write-offs of 2.24% and arrears at 1.33%. This was in line with management’s expectations and significantly outperforming the market.

Zip Business and eBay Partnership.

Also getting investors excited in August was the announcement of the launch of Zip Business and a partnership with eBay Australia.

This new partnership gives 40,000 Australian small and medium-sized businesses the opportunity to access working capital via the eBay marketplace.

Management notes that it has been designed to give merchants the freedom to purchase inventory, cover short-term expenses such as marketing campaigns, and manage their cashflows, via access to flexible lines of credit.

As part of the launch, the company is bringing its Spotcap brand into the Zip Business portfolio. Zip Business will be leveraging the deep credit experience in the Spotcap business and combining it with Zip’s sophisticated risk decisioning and real-time onboarding to rapidly scale the SMB Buy Now Pay Later offering.

Pleasingly, management appears to have more products up its sleeve. It advised that this is the first in a series of exciting integrated products and solutions Zip will progressively roll out as it launches Zip Business.

This could mean more positive news flow in September, further supporting the Zip share price.

More reading

• Afterpay and Zip shares sink lower after PayPal announces Pay in 4 BNPL product
• 4 ASX growth shares I’d buy in September
• 2 financial services for the fiscal cliff
• 2 Warren Buffett quotes you need to read this week
• 5 ASX shares better than banks

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 ZIPCOLTD FPO. 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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We are now racing towards the fiscal cliff caused by the coronavirus pandemic.  Many things either change, or finish at the end of September. This includes loan deferrals, changes to JobSeeker and JobKeeper, as well as the changes to allow trading while insolvent. We are facing a few waves of bad news. Moreover, the nation is going to be in dire need of financial services to help people get through this period.

Short term credit is where banks have taken their eye off the ball. The sector’s principal financial service in this area has been credit cards. A product that now appears to be in terminal decline. For example, from 2017 to June 2020 the number of credit card accounts dropped by 16%. Buy now, pay later (BNPL) services such as AfterPay Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P) have filled part of this gap. 

In addition, these two personal financial services companies are also likely to see a benefit during the months to come. 

Personal financial services

The market for personal financial services is filled with a range of short-term credit providers. Often derided as payday lenders, these companies are providing a high value of loans outside of the banking system. Particularly in small loans for services or products where a BNPL provider doesn’t apply.

Moneyme Ltd (ASX: MME) is a consumer lender with more than $133.6 million in current loans. Over the past month, the share price has jumped up by 57.41%. It has a very swift credit evaluation process enabling it to award up to $50,000 relatively swiftly. Its annual report touches on a few metrics that tell me it knows what its business is. For example, they report that greater than 90% of calls are answered within 9 seconds. That is pretty impressive customer service. 

With an average loan term of 24 months, MoneyMe is well placed to provide support in the months to come. Moreover, the company recently took a step into the BNPL space, and has undertaken $6 million in loans already.

Credit Corp Group Limited (ASX: CCP) buys and collects debt within Australia, New Zealand and the USA. The company also provides non bank personal loans to customers in Australia and New Zealand. In FY20, the company delivered an NPAT before abnormals of $79.6 million, 13% higher than the previous year. However, the financial services company has made provisions for a lower loan portfolio due to employment risks. This reduces the statutory NPAT to $15.5 million. It is a provision, however, the cash has not left the company.

Credit Corp noted that its clients across Australia and the US have indicated higher volumes of debt for sale. In the period to come, this is where the company will profit. It has a strong balance sheet and is able to purchase debt with a higher risk profile. However, it will be in a position to negotiate prices, thus increasing profits. 

More reading

• Afterpay and Zip shares sink lower after PayPal announces Pay in 4 BNPL product
• 4 ASX growth shares I’d buy in September
• Why the Zip Co share price rocketed 54% higher in August
• The Afterpay share price jumped 33% in August: Is it too late to invest?
• These market veterans believe a share market pullback is coming. Here’s their surprising advice…

Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. 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) was on form in August and overcame a difficult earnings season to record a solid gain.

The benchmark index climbed a sizeable 132.7 points or 2.2% during the month to end it at 6,060.5 points.

While a good number of shares pushed higher with the market, some climbed more than most. Here’s why these were the best performing ASX 200 shares in August:

Corporate Travel Management Ltd (ASX: CTD)

The Corporate Travel Management share price was the best performer on the ASX 200 last month with a stunning 83% gain. Investors were fighting to get hold of the corporate travel specialist’s shares following the release of its full year results. Although Corporate Travel Management posted a loss of $8.2 million for the year, investors appear to have been pleased with its performance early in FY 2021. Management revealed that bookings in July were greater than in June. It believes this suggests that a broad-based recovery in corporate travel activity is underway. This could mean the worst is over for the company.

IDP Education Ltd (ASX: IEL)

The IDP Education share price was some way behind as the next best performer on the index with a 51% gain. Investors were buying the student placement and language testing company’s shares following the release of a strong full year result. Although IDP Education has been disrupted significantly by the pandemic, it still managed to deliver profit growth that many companies would be envious of in a normal year. The company posted a 2% decline in revenue to $587.1 million but an impressive 29% increase in EBITDA to $148.6 million. The latter was driven by excellent cost control.

Reliance Worldwide Corporation Ltd (ASX: RWC)

The Reliance Worldwide share price wasn’t far behind with a 42.5% gain in August. The catalyst for this was the plumbing parts company’s release of its FY 2020 results. As was expected, Reliance delivered a weak result in FY 2020. It reported a 5% increase in sales to $1.16 billion but a 33% decline in net profit after tax to $89.4 million. However, investors were pleased to hear that FY 2021 has started positively. Management advised that its sales were strong in the United States in July, with other regions also performing well. This has continued during the first three weeks of August.

Mesoblast limited (ASX: MSB)

The Mesoblast share price was on form and stormed 40.5% higher last month. Investors were buying the biotechnology company’s shares following a very positive outcome from its meeting with the Oncologic Drugs Advisory Committee (ODAC). This meeting was to discuss its remestemcel-L product candidate as a potential treatment for paediatric steroid-resistance acute graft versus host disease (paediatric SR-aGvHD). The ODAC was supportive of remestemcel-L. In light of this, the likelihood of the U.S. FDA approving the drug on 30 September looks strong.

More reading

• Up 38% in August, is the Mesoblast share price a buy?
• ASX 200 Weekly Wrap: Earnings drag ASX back to reality
• These are the 10 most shorted ASX shares
• These were the best performing ASX 200 shares last week
• The Corporate Travel share price has nearly doubled in August

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 Idp Education Pty Ltd and Reliance Worldwide Limited. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited. The Motley Fool Australia has recommended Reliance Worldwide 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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The Treasury Wine Estates Ltd (ASX: TWE) share price slumped 13.9% lower in August, but is the Aussie company in the buy zone today?

Why is the Treasury Wine share price down 14%?

Geopolitical tensions have been rising for some time now and that has affected Treasury Wine’s valuation in 2020.

China has been dialling up the pressure on Aussie agriculture in recent months with wine the latest product in its firing line.

Just yesterday, China’s Ministry of Commerce announced an investigation into wine subsidies which could put the Treasury Wine share price under pressure.

This follows an anti-dumping probe initiated on 18 August following a similar investigation into Australia’s barley exports.

The coronavirus pandemic has impacted exports and caused a slump in sales. Treasury Wine reported its full-year results in August with net sales revenue falling 6% to $2,649.5 million.

Those soft sales flowed to the bottom line with the Aussie winemaker reporting a 25% drop in net profit after tax to $315.8 million.

Despite rising tensions, Treasury reported a 40% increase in volumes sold to the Chinese market compared to May 2020.

Is Treasury Wine in the buy zone?

It’s been a challenging year for Treasury Wine and August was just the latest setback for shareholders.

In fact, the Treasury Wine share price is down 42.9% in 2020 and lags behind the S&P/ASX 200 Index (ASX: XJO).

However, the Aussie company’s Penfolds and Wolf Blass labels are top-quality. I think this is just a blip on the radar while the long-term outlook remains strong.

Treasury Wine shares trade at a price-to-earnings (P/E) ratio of 25.6 right now with a 3.0% dividend yield.

It’s now trading 10.1% above its 52-week low at $9.25 per share. Despite the current headwinds, I think there could still be long-term upside.

After all, Treasury Wine is still a solid business that generated $315.8 million in profit and paid a full-year 28 cents per share dividend in FY20.

If investors are willing to roll the dice on short-term volatility, I think the Treasury Wine share price could be cheap in September.

More reading

• These were the worst performing ASX 200 shares in August
• Top ASX Stock Picks for September 2020
• ASX 200 drops 0.2%, Scentre soars
• Beat low interest rates with Coles and this ASX dividend share
• Top fund manager says ASX share mania is at a turning point

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Treasury Wine Estates 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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The S&P/ASX 20 Index (ASX: XTL) is also referred to as the blue-chip index as it covers the 20 largest companies on the ASX by market capitalisation.

With all of the daily activity, sometimes investors can’t see the wood for the trees. Nevertheless, when you step back and look at trends over a longer period of time, the quality and resilience of blue-chip shares really stands out. 

In the past year, only 7 of the ASX 20 companies have made a positive share price return. Most of the 13 that returned negative growth were impacted by the coronavirus pandemic. For example, Scentre Group (ASX: SCG) has seen its share price drop by 43.32%. More than anything else, this was caused by the government’s code of conduct for commercial landlords. However, the shopping centre giant likely has more hard days to come, with the country approaching a fiscal cliff at the end of September when the government’s coronavirus-related wage subsidies are due to expire. 

Of the 7 blue-chip shares that turned a positive result, here are the top 3 performers.

Blue-chip property shares

Goodman Group (ASX: GMG) is the best performing ASX blue-chip share in the past year. Up to the end of August, this company had seen its share price rise by 28.4%. Given the security saw a collapse in price by 38% from 5 March to 19 March, this is clearly a very resilient company. The Goodman Group owns, develops and manages real estate. 

The reason why this company saw less impact than, say, Scentre, is because it operates predominantly in industrial real estate – properties such as warehouses, distribution centres, offices and what are known as ‘urban infill developments’.

In FY20, Goodman Group saw an increase in operating profit of 12.5%. The company also saw an increase in valuations by $2.9 billion.

The work from home boom

The Wesfarmers Ltd (ASX: WES) share price has risen by 23.08% over the past 12 months. In FY20, the blue-chip share reported a 10.5% growth in revenues, as well as an 8.2% increase in net profits after taxes (NPAT).

Wesfarmers operates a range of brands that benefitted greatly from the sudden change to work from home. In particular Bunnings, Office Works, and Kmart saw increases in revenues directly attributable to activity through the lockdown.

However, its newest brand Catch.com also saw a dramatic upturn in revenue. Catch is an online marketplace in the style of Amazon.com, Inc. (NASDAQ: AMZN) and Kogan.com Ltd (ASX: KGN). Across the entire company it saw growth in online sales of 60%, including Catch. By itself, Catch saw a growth on gross transaction value of 49.2%.

The medical sector

Across the board the healthcare sector had mixed results. Cancellation of elective surgeries caused problems for Ramsay Health Care Limited (ASX: RHC), while Ansell Limited (ASX: ANN) did very well due to increased demand for PPE. However, CSL Limited (ASX: CSL) is the bluest of blue-chip shares on the ASX. It saw an increase in overall revenue by 9%. This extended to a 17% increase in NPAT.

Demand for the company’s therapies strengthened this financial year, particularly for immunoglobulins and influenza vaccines. Governments around the world recognise CSL as an essential service, meaning its plasma centres and manufacturing facilities remained open.

During FY21, CSL expects to see increased volumes as governments look to protect their populations from catching influenza and coronavirus at the same time.

More reading

• Up 38% in August, is the Mesoblast share price a buy?
• ASX 200 drops 0.2%, Scentre soars
• 2 ASX shares I would buy right now for both growth and income
• The Mosaic Brands share price surges 21% on lease deal
• Are ASX banks or miners buys for dividends?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and Kogan.com ltd and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia owns shares of Wesfarmers Limited. The Motley Fool Australia has recommended Amazon, Ansell Ltd., Kogan.com ltd, Ramsay Health Care Limited, and Scentre 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.

The post 3 market-beating ASX blue-chip shares appeared first on Motley Fool Australia.

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The S&P/ASX 20 Index (ASX: XTL) is also referred to as the blue-chip index as it covers the 20 largest companies on the ASX by market capitalisation.

With all of the daily activity, sometimes investors can’t see the wood for the trees. Nevertheless, when you step back and look at trends over a longer period of time, the quality and resilience of blue-chip shares really stands out. 

In the past year, only 7 of the ASX 20 companies have made a positive share price return. Most of the 13 that returned negative growth were impacted by the coronavirus pandemic. For example, Scentre Group (ASX: SCG) has seen its share price drop by 43.32%. More than anything else, this was caused by the government’s code of conduct for commercial landlords. However, the shopping centre giant likely has more hard days to come, with the country approaching a fiscal cliff at the end of September when the government’s coronavirus-related wage subsidies are due to expire. 

Of the 7 blue-chip shares that turned a positive result, here are the top 3 performers.

Blue-chip property shares

Goodman Group (ASX: GMG) is the best performing ASX blue-chip share in the past year. Up to the end of August, this company had seen its share price rise by 28.4%. Given the security saw a collapse in price by 38% from 5 March to 19 March, this is clearly a very resilient company. The Goodman Group owns, develops and manages real estate. 

The reason why this company saw less impact than, say, Scentre, is because it operates predominantly in industrial real estate – properties such as warehouses, distribution centres, offices and what are known as ‘urban infill developments’.

In FY20, Goodman Group saw an increase in operating profit of 12.5%. The company also saw an increase in valuations by $2.9 billion.

The work from home boom

The Wesfarmers Ltd (ASX: WES) share price has risen by 23.08% over the past 12 months. In FY20, the blue-chip share reported a 10.5% growth in revenues, as well as an 8.2% increase in net profits after taxes (NPAT).

Wesfarmers operates a range of brands that benefitted greatly from the sudden change to work from home. In particular Bunnings, Office Works, and Kmart saw increases in revenues directly attributable to activity through the lockdown.

However, its newest brand Catch.com also saw a dramatic upturn in revenue. Catch is an online marketplace in the style of Amazon.com, Inc. (NASDAQ: AMZN) and Kogan.com Ltd (ASX: KGN). Across the entire company it saw growth in online sales of 60%, including Catch. By itself, Catch saw a growth on gross transaction value of 49.2%.

The medical sector

Across the board the healthcare sector had mixed results. Cancellation of elective surgeries caused problems for Ramsay Health Care Limited (ASX: RHC), while Ansell Limited (ASX: ANN) did very well due to increased demand for PPE. However, CSL Limited (ASX: CSL) is the bluest of blue-chip shares on the ASX. It saw an increase in overall revenue by 9%. This extended to a 17% increase in NPAT.

Demand for the company’s therapies strengthened this financial year, particularly for immunoglobulins and influenza vaccines. Governments around the world recognise CSL as an essential service, meaning its plasma centres and manufacturing facilities remained open.

During FY21, CSL expects to see increased volumes as governments look to protect their populations from catching influenza and coronavirus at the same time.

More reading

• Up 38% in August, is the Mesoblast share price a buy?
• ASX 200 drops 0.2%, Scentre soars
• 2 ASX shares I would buy right now for both growth and income
• The Mosaic Brands share price surges 21% on lease deal
• Are ASX banks or miners buys for dividends?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and Kogan.com ltd and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia owns shares of Wesfarmers Limited. The Motley Fool Australia has recommended Amazon, Ansell Ltd., Kogan.com ltd, Ramsay Health Care Limited, and Scentre 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.

The post 3 market-beating ASX blue-chip shares appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/31K48LF