Shares in Cardno Limited (ASX: CDD) have tanked more than 11% in early trade, despite the company beating guidance in its financial results for the year ended 30 June 2020 (FY20).

How has Cardno performed for FY20?

Earlier today, Cardno released its results for FY20.

The company’s report was headlined by an 11.1% surge in earnings before interest, taxes, depreciation and amortisation (EBITDA) for the full year of $43 million. The result marked the 4th consecutive year in which Cardno has hit or exceeded market guidance. Cardno’s result was fuelled by cash flow from operations of $43.5 million for the full year. In addition, the company reported a 4.4% increase in gross revenue of $978.3 million.

Cardno’s management noted that the company has been able to continue to deliver it services despite the COVID-19 pandemic. Fee revenue for the full year increased 11% to $677 million, with the Americas being Cardno’s strongest region. However, Cardno saw fee revenue down 4% in the Asia Pacific region with the company citing a longer than normal reset.

The company attributed its performance to its speciality offerings in health sciences, natural resources and asset management. Cardno highlighted that the company has zero net debt, however did not declare a final dividend for FY20.

What is the outlook for Cardno?

Cardno is a professional infrastructure and environmental services consultancy company. Despite reporting results that are both up on last year and ahead of market guidance, the Cardno share price has tanked more than 11% in early trade. The sell-off follows the company’s softer outlook for FY21.

According to Cardno’s management, the company’s operations will undoubtedly be impacted by the COVID-19 pandemic. As a result, the company provided conservative guidance for its outlook. For FY21, Cardno anticipates EBITDA to be in the range of $40 million to $45 million.

Operations in the Americas will continue to remain in focus, as the company looks to maintain momentum during the pandemic. Cardno noted that its Asia Pacific business is in the first year of a 2-year rebuilding plan, with the company focusing on lifting margins in FY21.

Foolish takeaway

At the time of writing the Cardno share price is down more than 11.5% and is currently trading near its intra-day low of 29 cents. The Cardno share price has struggled in 2020 and is down more than 36% for the year.

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Motley Fool contributor Nikhil Gangaram 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 Flexigroup Limited (ASX: FXL) share price is on the sidelines today after the company announced a trading halt for equity raising. The news comes alongside Flexigroup’s release of its FY20 results, as the company looks to pivot its strategy in the coming 12 months.

The Flexigroup share price was $1.30 at close of trade yesterday, after clawing back from a 52-week low of 38 cents when it bottomed out in March.

So what were the FY20 highlights for the buy now, pay later (BNPL) group? And what are the details of its strategy update?

Flexigroup FY20 result

There were some positive takeaways from the Flexigroup result overall. Its FY20 net profits remained in the black at $21.4 million, active customers were up 30% to 2.3 million compared to FY19, and transaction volumes lifted 17% on last year’s levels to $2.5 billion.

Its BNPL operations delivered as much as 18% volume growth, reflecting strong performances from Australia, New Zealand and Ireland. Notably, Flexigroup’s Australian online volume increased by 172% overall in FY20 and 262% in the second half of this financial year. This is reflected in booming online retail sales via BNPL more broadly.

On the other hand, revenues for the company slumped 5% to $450 million and the net profit result was 6.5% lower. This weaker overall financial performance has prompted Flexigroup to scrap its dividend payout for the time being.

As a result, Flexigroup has initiated a 1 for 3.20 entitlement offer, expecting to raise $140 million in additional equity. $115 million of this figure will be underwritten. The company said these added funds would provide “balance sheet flexibility and support the sustainable and profitable growth outlook”.

Strategic update

The company’s new strategy will focus around the humm platform. To maximise the platform’s profitability potential, Flexigroup and its flagship products will be rebranded under the one name. This would simplify the business around “a unifying value proposition of interest-free instalment payments for consumers and SMEs”.

Flexigroup CEO Rebecca James said:

FY20 has seen Flexigroup make significant progress against its strategy, with the company now primed for sustainable and profitable growth. With the simplification of the business nearly complete, and a common credit decision platform in place across our core consumer product suite, we are ready to put our firepower into larger ticket buy now pay later, and expand our offering with humm90 and bundll.

Flexigroup’s rebranding to humm remains subject to a shareholder vote at the company’s FY20 AGM. A reservation of the ASX ticker “HUM” has already taken place.

James said the rebrand would “simplify our story to our customers and retailers, and clarify our significant market position as a leading BNPL player and provider of long-term interest-free solutions”.

Foolish takeaway

I think a parallel can be drawn between the boom of the buy now, pay later sector and the Australian gold rush that began in 1851.

Companies like Flexigroup are flocking to capitalise on this ‘golden’ opportunity, but to be honest I believe the bigger BNPL players like Zip Co Ltd (ASX: Z1P), Afterpay Ltd (ASX: APT) and Sezzle Inc (ASX: SZL) are a better buy at this point. 

More reading

• Why Bigtincan, Cleanaway, Worley, & Zip Co shares are storming higher
• Zip share price surges 20% on eBay partnership
• The Afterpay share price is up 1,000% in 6 months
• Afterpay share price leaps 7% today after 3 broker upgrades
• Leading brokers name 3 ASX shares to sell today

Toby Thomas owns shares of Sezzle Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended FlexiGroup Limited and Sezzle Inc. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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In late morning trade on Wednesday the S&P/ASX 200 Index (ASX: XJO) is on course to record a disappointing decline. At the time of writing the benchmark index is down 1.2% to 6,086 points.

Four shares that have not let that hold them back are listed below. Here’s why they are storming higher:

The Bigtincan Holdings Ltd (ASX: BTH) share price is up 3.5% to 90.5 cents. Investors have been buying the AI-powered sales enablement automation platform provider’s shares after the release of its full year results. Bigtincan reported revenue growth of 56% to $31 million and annualised recurring revenue (ARR) growth of 53% year on year to $35.8 million. Pleasingly, management expects this strong form to continue in FY 2021. It has forecast ARR growth of 36.9% to 48% year on year.

The Cleanaway Waste Management Ltd (ASX: CWY) share price has jumped 8% to $2.42. This follows the release of the waste management company’s full year results. Cleanaway was a solid performer in FY 2020 despite the pandemic. It reported an 8% increase in underlying net profit after tax to $152.9 million. This positive form allowed the company to increase its full year dividend by 15.5% to 4.1 cents per share.

The Worley Ltd (ASX: WOR) share price is up 6.5% to $9.71 after delivering strong profit growth in FY 2020. The global engineering company reported a 66% increase in underlying NPATA to $432 million. Also growing strongly was its underlying operating cash flow. It came in at $881 million, up from $239 million a year earlier. This was driven largely by the first full year contribution of the recently acquired Jacobs ECR business.

The Zip Co Ltd (ASX: Z1P) share price has surged 18.5% higher to $8.97. This morning the payments company announced a deal with eBay Australia. That deal will see the newly launched Zip Business offer eBay’s 40,000 Australian small and medium-sized businesses the opportunity to access working capital via the eBay marketplace.

More reading

• Flexigroup share price in trade halt ahead of capital raise
• Zip share price surges 20% on eBay partnership
• Cleanaway Waste share price climbs after earnings, dividend up
• Bigtincan share price storms higher on strong FY 2020 result and guidance
• Investors to look beyond Worley’s big jump in earnings and dividend

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’s parent company Motley Fool Holdings Inc. recommends BIGTINCAN FPO. The Motley Fool Australia owns shares of and has recommended BIGTINCAN 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 Jumbo Interactive Ltd (ASX: JIN) share price has come under pressure on Wednesday following the release of its full year results.

At the time of writing the online lottery ticket seller’s shares are down 4% to $13.10.

What happened in FY 2020?

It was a bit of a mixed year for Jumbo. After years of explosive growth and margin expansion, Jumbo’s earnings growth came to an end in FY 2020.

For the 12 months ended 30 June 2020, the company posted a 9% increase in total transaction value to $349 million and a 9% lift in revenue to $71 million.

However, a 38.9% increase in administrative expenses to $17.6 million weighed heavily on its profit margins. This increase was predominantly due to the Gatherwell acquisition and positioning the business to underpin planned future growth.

As a result, Jumbo’s underlying net profit after tax came in flat at $26.5 million in FY 2020.

What were the drivers of its results?

During the 12 months the company had to contend with a period of lower jackpot activity. In FY 2019 there were 49 large jackpots, whereas in FY 2020 this reduced to 39 large jackpots.

This lower activity was offset by the shift to online playing during the pandemic, which underpinned a 9% increase in active customers to 827,411.

The company’s founder and CEO, Mike Veverka, commented: “Covid-19 restrictions helped drive players online which helped deliver an increase in ticket sales despite lower jackpots compared to the previous strong year.”

“In addition, the Software as a Service business continues to grow with the signing of our 5th contract with the “Classics for a Cause” lottery and the completion of the onboarding process for the Mater Lottery”, he added.

Dividend.

The Jumbo board declared a final fully franked dividend of 17 cents per share, down from 21.5 cents per share a year earlier.

This took its full year dividend to a total of 35.5 cents, down 1 cent from 36.5 cents in FY 2019.

Outlook.

No guidance was given for FY 2021 with today’s result.

Instead, the company spoke about its long term prospects, reminding investors that it has signed a 10 year reseller agreement with Tabcorp Holdings Limited (ASX: TAH). It notes that 28% of lottery ticket sales are made online in Australia, which gives it a long runway for growth.

It also spoke about its large global total addressable market (TAM) for its SaaS business. It estimates that the business has a $26 billion TAM in Australia, UK, Canada, and USA.

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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 and recommends Jumbo Interactive Limited. The Motley Fool Australia has recommended Jumbo Interactive 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 Zip Co Ltd (ASX: Z1P) share price has soared by 19.53% in morning trade today. At the time of writing, the Zip share price has rocketed to $9.06 after closing yesterday’s session at $7.58 This follows the company’s announcement of a new major partnership with eBay Australia.

New partnership driving Zip share price

The new partnership announced today gives businesses the opportunity to directly access working capital through the eBay Australian marketplace. It also aligns with the official launch today of Zip Business. There are currently 40,000 Australian small and medium-sized businesses (SMBs) that have access to this service.

By being part of the eBay marketplace, merchants will now have access to a flexible line of credit. This can be used to purchase inventory while also covering their short-term expense needs for activities such as marketing campaigns. The new tool also has the ability to help merchants manage their cash flow requirements. This is done through online access to a range of credit options.

Zip has also integrated the Spotcap brand into the Zip Business portfolio, as part of the official launch. The Spotcap business will be combined with Zip Co’s risk decisioning and real-time onboarding capability. This will fast track the scaling of the SMB buy now, pay later (BNPL) offering.

Zip is set to roll-out further products in the coming months as part of the Zip Business launch. These new offerings will support both its SMB network, and its retail and channel partnerships.

New debt funding facility

The Zip share price is surging after the company also announced it has finalised a $100 million debt funding facility arrangement with United States firm, Victory Park Capital Advisors. This debt arrangement will be utilised for the Zip Business receivables. It will provide Zip Co with additional capacity to support the launch of its new business announcement.

Peter Gray, Zip Co founder and Chief Operating Officer, commented:

Zip is extremely excited to formally launch its Zip Business platform to create a suite of products for the small business community, a segment that has been underserved by the traditional lenders in recent years. This comes at a time when Australia’s small businesses are confronting the extreme challenge of COVID-19, which has created enormous pressure on cashflow and ongoing business investment. A thriving small business community is critical to the health of the Australian economy and we are deeply committed to supporting the growth of these important businesses.

The announcement by Zip Co today, follows a trading update two days ago regarding New York-based BNPL provider QuadPay, which Zip has acquired. Zip revealed that QuadPay ended the month of July with record monthly transaction volumes, 30% up on the June quarter average. 

With today’s rise, the Zip share price has increased more than 155% in year-to-date trading. Zip is scheduled to release its FY 2020 results to the market tomorrow.

More reading

• Flexigroup share price in trade halt ahead of capital raise
• Why Bigtincan, Cleanaway, Worley, & Zip Co shares are storming higher
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Phil Harpur 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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The APA Group (ASX: APA) share price is sliding this morning after the company released its financial results for the year ended 30 June 2020 (FY20).

At the time of writing, the APA Group share price is down 2.90% to $10.54 per share.

FY20 highlights

In today’s announcement, APA Group revealed revenue of $2.59 billion for FY20 – a 5.6% increase on the 2019 financial year.

The company reported profit after tax of $317 million in the 2020 financial year, up 10.1% on 2019. According to APA Group chair Michael Fraser, earnings were safeguarded by the company’s strong balance sheet and its long-term contracts.

APA Group reported earnings before interest, tax, depreciation and amortisation (EBITDA) of $1.65 billion in FY20, an increase of 5.1% on FY19.

The company had operating cash flow of $1.1 billion in FY20, an increase of 8.3% compared to FY19. As at 30 June 2020, APA Group had around $2.5 billion in cash and undrawn debt facilities.

The company stated that it will pay a final distribution of 27 cents, the dividend component of which will be fully franked.

Outlook

Looking to the next financial year, APA Group advised it is expecting an EBITDA of $1.63 billion to $1.67 billion in FY21. It also expects distributions to be in line with the 2020 financial year.

Commenting on the outlook for FY21, Mr Fraser stated: 

While our capacity contracts and regulated revenues mean that our business is somewhat resilient through economic cycles, APA’s revenues are still subject to recontracting decisions by customers, throughput volumes on certain assets, the timing of customer FID decisions, as well as lower CPI across the contracts portfolio.

He also stated that practical completion of the company’s Orbost gas processing plant would not take place until the end of the 2021 financial year.

About the APA Group share price

APA Group is a natural gas and electricity infrastructure business. It is the largest provider of natural gas infrastructure in Australia and has been listed on the ASX since 2000.

APA Group shares are up 30.76% since their 52-week low of $8.06, however, they have fallen 5% since the beginning of the year. The APA Group share price is down more than 4% since this time last year. 

More reading

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Motley Fool contributor Chris Chitty has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of APA Group. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Cleanaway Waste Management Ltd (ASX: CWY) share price has soared in early trade today after the company released its FY2020 earnings results. The Cleanaway share price is up more than 8% at the time of writing to $2.42 a share after closing at $2.24 yesterday.

What does Cleanaway do?

Cleanaway is the largest waste management company on the ASX, with a market capitalisation of $4.6 billion. The company is active in the residential, commercial and industrial waste industries, with an especially large presence in the collection of residential waste. Cleanaway has contracts with more than 95 municipal councils for waste collection. It also boasts the largest hydrocarbon (oil) recycling program in the country.

What did Cleanaway report this morning?

The company reported that revenue increased to $2.33 billion, up 2.1% from FY2019.

Earnings before interest, tax, depreciation and amortisation (EBITDA) also rose by 2.5% to $473 million over FY19’s earnings. That translates into an 8.7% increase to 7.5 cents in earnings per share (EPS).

That helped boost underlying net profit after tax by 8.7% to $152.9 million, although statutory net profit slipped 6.6% from FY19’s result to $112.6 million. This was largely due to underlying costs from the recent acquisitions of Toxfree and SKM.

The company also reported that its free cash flow was up 11.5% for FY20 to $230.1 million.

Dividend reward

Dividend investors will be pleased by Cleanaway’s results this morning. The company has announced a 10.5% increase in its final dividend to 2.1 cents per share. That pulls its total dividend payments up to a fully franked 4.1 cents per share for the financial year, up 15.5% on FY19’s payout of 2.55 cents per share. The final dividend will be paid on 14 September, with the option of participating in the company’s dividend reinvestment plan at no discount.

This dividend gives Cleanaway a trailing yield of 1.83% on yesterday’s closing share price.

Cleanaway’s segments were a mixed bag. Revenue from Solid Waste was up 0.8% to $1.37 billion, while revenue from Industrial & Waste was down 8.3% to $313.4 million. Liquid Waste & Health reported a 3.8% increase to $513.6 million.

Cleanaway share price outlook for FY21

Looking to FY21, the company told investors that “trading conditions remain too variable to provide guidance currently”. A trading update will be provided at the company’s annual general meeting on 14 October instead.

However, the company’s CEO Vik Bansal has this to say on the FY20 results:

Our financial results highlight the defensive characteristics of our revenue streams. Each of our operating segments – Solid Waste Services, Industrial & Waste Services and Liquid Waste & Health Services – performed well during the year despite the effect of COVID-19, which highlights the diversification benefit of our operating segments and strength of our business.

More reading

• Why Bigtincan, Cleanaway, Worley, & Zip Co shares are storming higher
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Motley Fool contributor Sebastian Bowen 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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A millionaire executive director of Simonds Group Ltd (ASX: SIO) will be forced to go into hotel quarantine after authorities revoked his exemption.

Mark Simonds, the son of founder Gary, escaped Melbourne’s strict COVID-19 lockdown on 9 August with his family on their luxury super-yacht Lady Pamela.

They sailed towards the Gold Coast armed with an exemption from the Queensland government that they didn’t have to quarantine on arrival.

But according to Nine, the family and their guest had stopped off multiple times in Victoria and NSW as it sailed up north.

Queensland Health confirmed to The Motley Fool that the exemption had now been withdrawn.

“Attempting to bypass or manipulate Queensland’s border direction is unacceptable,” stated Queensland Health.

“All seven people are now required to quarantine in a government approved hotel for 14 days at their own expense.”

The Motley Fool has contacted Simonds Group for comment.

It is understood the exemption was originally granted with what is now known to be incomplete information.

Police reportedly took 7 people off the boat into a mini-van on Tuesday evening. The group included crew and Hannah Fox, the daughter of Linfox executive chair Peter Fox.

Simonds Group is an ASX-listed company with a market capitalisation of $51 million. The Simonds share price held steady at 36 cents before trading opened on Wednesday morning.

It operates Simonds Homes, a Melbourne residential construction brand founded in 1949 by Gary Simonds.

Mark ran the company privately with father Gary until its public listing in 2014. Mark Simonds holds a building licence in Victoria, NSW, Queensland and South Australia.

The company is now jointly run by Gary’s grandson Rhett Simonds in a unique timeshare chief executive role with Kelvin Ryan.

More reading

• Flexigroup share price in trade halt ahead of capital raise
• Why Bigtincan, Cleanaway, Worley, & Zip Co shares are storming higher
• Jumbo share price drops lower on flat FY 2020 profits
• Zip share price surges 20% on eBay partnership
• APA Group share price dips despite FY20 earnings growth

Motley Fool contributor Tony Yoo 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 Bigtincan Holdings Ltd (ASX: BTH) share price has been a positive performer on Wednesday following its full year results release.

At the time of writing the AI-powered sales enablement automation platform provider’s shares are up 5% to 92 cents.

How did Bigtincan perform in FY 2020?

Bigtincan was a strong performer in FY 2020 despite the pandemic and continued its meteoric growth.

For the 12 months ended 30 June 2020, Bigtincan reported revenue growth of 56% to $31 million. This includes organic growth of 38%, which was at the top end of guidance range. Also supporting its top line growth were the acquisitions of the Veelo, Asdeq Labs, and XINN businesses.

The company’s annualised recurring revenue (ARR) also grew at a rapid rate in FY 2020. It increased 53% year on year to $35.8 million.

Key drivers of this growth were a 57% lift in subscription revenue to $29.5 million and a 2-percentage point improvement in its retention rate to 89%.

At the end of the period the company’s lifetime value metric grew 70% from $112 million to $270 million.

Management commentary.

Bigtincan’s CEO, David Keane, commented: “FY20 was a successful year for Bigtincan as the Company continued to grow through the pandemic, with a focus on enterprise customers and on our technology, to take advantage of the tailwinds of digital and mobility adoption that are impacting the world.”

“During FY20, Bigtincan won the coveted CODiE Award for best sales enablement automation platform and continued its growth path with key metrics growing strongly, including ARR growth of 53% over last year, retention up to 89%, subscription revenue up 57%, and LTV up 70% demonstrating efficient growth with LTV/CAC at 3.9,” he added.

FY 2021 outlook.

Although the company acknowledges that the medium to long term impact of the pandemic is uncertain, it remains confident in its growth prospects.

Management notes that Bigtincan enters FY 2021 in a strong position with a leading technology platform and pipeline of innovations for the year ahead and beyond, an established and growing go to market team, and a well-funded M&A program.

In light of this, it is forecasting further strong growth in FY 2020.

It has provided ARR guidance of $49 million to $53 million and revenue guidance of $41 million to $44 million with stable retention.

In respect to its ARR guidance, this represents 36.9% to 48% year on year growth. Whereas its revenue guidance implies growth of 32.3% to 42% year on year.

More reading

• 3 exciting mid cap ASX tech shares to buy for the long term
• Bigtincan joins list of junior ASX tech companies adapting to COVID-19
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• 2 exciting ASX tech shares to buy and hold till 2025

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends BIGTINCAN FPO. The Motley Fool Australia owns shares of and has recommended BIGTINCAN 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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If you are looking for 2 quality ASX shares to add to your portfolio, I can recommend the following two.

I think JB Hi-Fi Limited (ASX: JBH) and Vocus Group Ltd (ASX: VOC) are good ASX shares to buy for long-term capital growth. Here’s why.

JB Hi-Fi

Electronics retailer JB Hi-Fi has been a solid and consistent performer from a financial perspective over the past decade. The company’s  full year financial results came in last week, and it has been a particularly strong year for the group.

Total sales grew solidly by 11.6% to $7.9 billion during FY 2020. Meanwhile, underlying EBIT growth was very impressive, up by 30.5% to $486.5 million.

Online sales have been very strong during the last 12 months. They totalled nearly $600 million for the group. That was up a whopping 50% on the prior year. The fourth quarter was a standout quarter for JB Hi-Fi, up with online revenues up 134%, driven by increased interest in online sales during the coronavirus pandemic.

The JB Hi-Fi share price was hit hard in the first wave of the the pandemic. However, since then it has soared and now is well above pre-COVID-19 levels.

I believe that JB Hi-Fi is well-positioned to grow strongly over the next five years, underpinned by an expanding online channel. This makes it a quality ASX share to add to your portfolio.

Vocus

Fixed broadband provider Vocus also released its full year financial results recently. And like JB Hi-Fi’s, they were very well received by financial markets. The Vocus share price has surged from $2.93 prior the results release, to now be trading  at $3.50. That’s an increase of 19.5% in just over a week.

Vocus’ three year turn-around strategy now appears to be well and truly on track. Record sales were recorded across all of the Vocus operating segments. Also, the newly launched Vocus brand has been well-received by the market so far.

Vocus Network Services achieved EBITDA growth of 10% to reach $223 million for FY 2020. Meanwhile, recurring revenue for this division grew solidly by 6%. However, overall recurring revenue for the group fell by 1%. Total revenues were impacted by a 9% decline in the consumer division. This was due to the impact of migration of legacy fixed-line services to lower margin NBN revenues.

Despite overall decline in overall revenue, I believe that there is potential for further growth in the Vocus share price over the next one to two years. This is likely to be be driven by further progress on the telco’s turnaround strategy.

Foolish Takeaway

JB HiFi and Vocus are 2 ASX shares that I believe are well-positioned for long-term growth over the next few years. This could lead to above average share price growth during this time.

More reading

• This rising sentiment is spurring the share market’s bull run
• Is this ASX 200 market too greedy right now?
• Here are the highlights of this ASX reporting season
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Motley Fool contributor Phil Harpur 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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