Investing is a tricky game to become accomplished at, let alone master. Even the best investors in the world like Warren Buffett speak of being constant learners. Much like the wonderful powers of compound interest, proficiency in investing builds on your past successes as well as your mistakes (or lack of repeating them). Thus, I’ve found that harking back to the basics can often give your returns a boost.

So, here are 2 investing lessons that I think many investors have forgotten about during an unprecedented year in the markets.

Investing lesson 1) Winners often keep winning

This is a popular concept here at the Fool. Usually, if a company is doing something right (that might cause its share price to rise), it will keep at it. Too often, investors sell out of a top-performing company in order to ‘take profits off the table’. Whilst it’s true that no one goes broke taking a profit, it’s also true that winners often keep on winning.

As a past victim of this phenomenon (I sold CSL Limited (ASX: CSL) shares at $180 after doubling my money), I can tell you about the lost benefits of not sticking with a winner firsthand. So if you have a company that’s doing everything right, you don’t want to cut yourself loose chasing a hollow gain.

Think about how silly someone who sold out of Xero Limited (ASX: XRO) at $20 would feel today. Or Afterpay Ltd (ASX: APT) at $12. Or Amazon.com at $100. If you have a winner, don’t kill the goose if it keeps laying the golden eggs.

Investing lesson 2) Using debt is often a bad idea

Proponents of gearing and leverage (other names for investing with borrowed money) will tell you its the best thing they’ve ever done. But the reality is that investing with debt is a high-risk strategy – and one that could see you go back to square one very easily. Remember, borrowing to invest can magnify your gains in a bull market, which can be intoxicating. But it can also magnify your losses if things go south. And in these uncertain times, I think making a leveraged bet that the share market will continue to rise uninterrupted in the coming months and years is a big call.

Keep in mind that if you have a margin loan, it can always be called in by your lender, especially during a share market crash. Having to sell your shares at the bottom of a market cycle can undo years of progress. You don’t want to end up where you were 5, 20 or 20 years ago, just because you took on too much debt.

More reading

• Why I would buy CSL and these ASX 200 blue chip ASX shares
• 2 easy ASX shares for a beginner to buy today
• Why Baby Bunting, Evolution, Mesoblast, & Xero shares are zooming higher
• Mesoblast share price on watch after US regulatory approval
• Should you invest in Splitit shares?

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. and Xero. 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.

The post 2 important investing lessons you might have forgotten appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/30TiRmX

The Waypoint REIT Ltd (ASX: WPR) share price is up by 3.98% today following a market update. The company has upgraded its 2020 financial year guidance for distributable earnings growth over the 2019 financial year from 3–3.75% to 4–4.25%.

Waypoint reported its US Private Placement (USPP) has been priced with US$178 million (AU$245 million) of notes to be issued, split across 7, 10- and 12-year tranches with a weighted average maturity of 9.2 years.

Waypoint will use the USPP proceeds to pay down a combination of term and revolving credit facilities. The transaction is expected to be funded on 29 October 2020

Hadyn Stephens, CEO of VER Manager (which manages the Waypoint REIT), said:

With the USPP transaction now priced, we are very pleased to be able to upgrade our FY20 guidance. We look forward to sharing further details on our half year performance and outlook at our half year results presentation on 20 August 2020.

Kerri Leech, CFO of VER Manager, added:

Following Moody’s assignment of a Baa1 credit rating in December 2019, we are pleased to have executed on our strategy of extending our debt maturity to more closely align to the weighted average lease expiry of our portfolio and diversifying our debt platform, particularly in the current economic environment.

What does Waypoint REIT do?

Waypoint REIT (formerly Viva Energy REIT Ltd) is Australia’s largest listed real estate investment trust (REIT) with a market cap of $2 billion. It owns a portfolio of service stations around Australia, with more than 400 Shell-branded service station properties around Australia. Waypoint REIT’s properties are typically operated by Coles Group Ltd (ASX: COL) as Coles Express service stations.

Buying shares in a company like Waypoint REIT provides investors with exposure to commercial property without the complications that come with direct property ownership.

Waypoint REIT shares first listed in 2016. Since then it has grown to sit comfortably within the S&P/ASX 200 Index (ASX: XJO).

How has the Waypoint REIT share price performed?

With a portfolio of service stations, the Waypoint REIT share price took a hard hit from the lockdowns and state border closings put in place to eliminate the spread of COVID-19.

From 6 March to 19 June, Waypoint shares fell 28%. The share price has since gained 29%. Year-to-date, the Waypoint REIT share price is almost back to where it started, down just 1.8% despite the huge hit to travel and petrol use.

More reading

• Why I would buy CSL and these ASX 200 blue chip ASX shares
• Why today is a great day to add to your ASX share portfolio
• Brokers just downgraded the Telstra share price and these other ASX 200 stocks
• ASX 200 up 0.3%: NAB Q3 update, Mesoblast rockets, Newcrest guidance disappoints
• How investing in ASX shares could help you grow $10,000 into $100,000

Motley Fool contributor Bernd Struben 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.

The post Waypoint REIT share price gets a boost from financial guidance upgrade appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3kJ8OJ9

If you’re looking to add a few ASX 200 blue chip shares to your portfolio in August, then the three listed below could be worth considering.

I believe these blue chips could generate solid returns for investors over the next few years. Here’s why I would buy them:

CSL Limited (ASX: CSL)

The first blue chip I would buy is this global biotherapeutics company. I think it has the potential to provide investors with strong returns over the next decade, especially after recent weakness in the CSL share price. This has been caused by concerns over plasma collections during the pandemic and the impact this could have on its FY 2021 results. However, I’m optimistic this will be offset by other sides of the business, such as flu vaccine sales. In light of this, I think investors should focus on the long term, which remains very positive. This is due to its leading therapies and lucrative research and development pipeline.

Goodman Group (ASX: GMG)

Another blue chip ASX 200 share to consider buying is Goodman Group. It is an integrated commercial and industrial property group with a high quality portfolio of assets. It remains my favourite option in the property sector due to its exposure to industries benefiting from structural tailwinds such as ecommerce. These assets are likely to be in demand for many years to come, which I believe leaves it well-positioned for solid long term growth.

REA Group Limited (ASX: REA)

A final option to consider buying is this property listings company. Times have been hard to REA Group over the last few years, but thanks to its high quality business model, it has still managed to deliver strong profits. And although the tough trading conditions are likely to remain for at least the next couple of quarters, I wouldn’t let that put you off investing. I expect REA Group’s growth to accelerate materially once things return to normal. Especially given its leadership position, growing global operations, new revenue streams, potential price increases, and cost cutting.

More reading

• 2 important investing lessons you might have forgotten
• Waypoint REIT share price gets a boost from financial guidance upgrade
• 2 easy ASX shares for a beginner to buy today
• Why today is a great day to add to your ASX share portfolio
• Brokers name 3 ASX shares to buy right now

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia has recommended REA Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Why I would buy CSL and these ASX 200 blue chip ASX shares appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2XYNcie

The Hills Ltd (ASX: HIL) share price soared by as much as 13% earlier today, after the company released a market update.  

At the time of writing, the Hills share price has pulled back to 16 cents per share, up 1.29% on yesterday’s close.

What did Hills announce?

Hills provided shareholders with a market update earlier today.

The company noted that it expected to report a loss for FY20 in the range of $6 million to $7 million. Hills cited one-off costs of $7 million to $8 million in FX adjustments, redundancies and inventory provisions for the result.

In addition, Hills noted that the company has significantly improved its balanced sheet and is well positioned to emerge stronger. The company noted that net debt for FY20 is expected to be below $9 million, down from $28.4 million the year prior.

The update also highlighted that the company’s core markets have shown relative resilience through the COVID-19 pandemic, with solid trading in July. Management from Hills cited the company’s improved balance sheet and assured investors that the business will emerge from the pandemic in a competitive position.

In the update Hills noted that its ongoing cost reduction program and Job Keeper payments have allowed the company to retain employees during the pandemic.

Hills also noted that these estimations are unaudited, with more details expected with the release of the company’s FY20 results.

More on Hills 

Hills is an Australian-owned company that consists of 2 businesses.

Hills Health Solutions provides nurse call solutions, patient engagement and wifi networks in hospitals and aged care facilities throughout Australia and New Zealand. The company’s second business is Hills Distribution, which provides integrated security and IT services to consumers.

According to its trading update today, Hills has been able to reduce its net debt after divesting from its non-core businesses. The divestment in 2019 has allowed the company to focus on its healthcare and distribution businesses.

In addition, Hills has looked to limit the damage of the COVID-19 pandemic by asking its staff to take pay cuts. In April, the company saw staff on the lowest salaries experience a 10% cut, whilst a 35% cut was given to those on the highest salaries.

Foolish takeaway

The Hills Limited share price is currently trading 1.29% higher for the day at 16 cents. Shares in the company have been sold down after hitting an intra-day high of 18 cents.

More reading

• Top broker tips the Breville share price to rise beyond $30
• Wage growth is plummeting – here are 3 ASX dividend shares to start a second income
• 2 ASX growth shares to buy with $2,000
• 2 important investing lessons you might have forgotten
• Waypoint REIT share price gets a boost from financial guidance upgrade

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.

The post What sent the Hills share price flying today? appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/344fKuJ

Starting your investing journey as a beginner can be difficult. You might have high expectations, perhaps after seeing a social media post about buying expensive cars with a month of day-trading profits. You might have heard how the whole thing is a giant casino, primed to rob the ordinary investor. Some investors do view the share market through these kinds of lenses, but it’s rarer than popular culture would have you believe.

I always think the best way to start investing is by selecting passive, managed investments that outsource the hard work for you. That way, you can begin to see the immediate benefits of holding a growth asset, without becoming disillusioned that your mate’s stock pick hasn’t doubled up by now. So here are 2 easy ASX shares that I think any aspiring investor can start out with today.

Magellan High Conviction Trust (ASX: MHH)

This investment is a listed investment trust (LIT), which basically means it’s a fund that invests in other shares for you. In this case, Magellan High Conviction Trust looks to hold around 8–12 ‘of the world’s best companies’. It primarily focuses on the US share market. Some of its recent holdings including Alphabet (owner of Google), Tencent Holdings, Facebook and Microsoft.

The flexibility of this LIT’s mandate, as well as its focus on the ‘best of the best’, makes this investment a great one for a beginner investor in my view. Its targeted 3% annual cash distribution is also a plus.

Australian Foundation Investment Co Ltd (ASX: AFI)

AFIC (as it’s easily known) is an old soul of the ASX, having been around since 1928. It’s a listed investment company (LIC), which is similar to a LIT, but with a slightly different legal structure. But it shares an LIT’s ability to act as an investor on your behalf buy buying and selling other shares.

AFIC has a reputation for conservative, long-term investing, particularly through ASX blue-chip shares. You’ll find most of the famous ASX blue chips in AFIC’s portfolio, including CSL Limited (ASX: CSL), Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd (ASX: BHP).

AFIC may not be the kind of high-risk investment that has the potential to make you rich overnight. But this is precisely why it’s a top choice for a beginner in my view. AFIC is also known for its robust, fully franked dividends. On current prices, you can expect a trailing dividend yield of 3.8% from this company.

Foolish takeaway

In my view, either (or both) of these shares would make perfect investments for a beginner. AFIC is a domestically-focused company, whereas the Magellan High Conviction Trust looks overseas for its investments, so choose your preference!

More reading

• 2 important investing lessons you might have forgotten
• Why I would buy CSL and these ASX 200 blue chip ASX shares
• Mesoblast share price on watch after US regulatory approval
• Forget CBA and buy these quality ASX dividend shares
• Why the rise of electric vehicles could benefit ASX mining shares

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Sebastian Bowen owns shares of Alphabet (A shares), Facebook, and Magellan High Conviction Trust. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares) and Facebook. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia has recommended Alphabet (A shares) and Facebook. 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 2 easy ASX shares for a beginner to buy today appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3kLTcob

The Alicanto Minerals Ltd (ASX: AQI) share price is today soaring up 20% despite no major news out of the company.

What does Alicanto do?

Alicanto Minerals is an emerging mineral exploration company focused on creating shareholder wealth through exploration and discovery in the mining districts of Scandinavia. The company has multiple projects in Sweden, including the Greater Falun Project in the highly endowed Bergslagen mining district of Southern Sweden. The company mines minerals such as copper, gold, zinc, lead and silver.

What has been driving the Alicanto share price higher?

The company announced its quarterly activities report on 30 July. This release saw the Alicanto share price jump 10% as the miner announced progress on its Swedish projects. However, the real growth started a week later after a trading halt was announced.

What followed was the announcement that Alicanto is planning to raise $1.43 million by way of a private placement. Funds raised from the placement will be used for exploration activities in Sweden and Guyana and general working capital. Perhaps the news that got investors most excited, however, was the calibre of investor taking part in the placement.

The name Ray Shorrocks is well known around micro cap miners and it is he who will now chair the company. In 2016, explorer Bellevue Gold Ltd (ASX: BGL) acquired a tiny Western Australian gold project. This ‘tiny’ project has since seen the Bellevue share price return around 4900%. You may be wondering why this is relevant, and it is because Ray Shorrock was the investor behind this turnaround. So it is understandable that investors are once again excited by the prospect of a mining unicorn in his latest investment, Alicanto.

What now for Alicanto?

It was recently announced that drilling is set to start next month in Sweden. The program will target extensions to known mineralisation as part of a strategy to underpin a central processing hub in this mining area. The greater Falun area has never been properly explored as, through the area, was a VMS (volcanogenic massive sulfide) system, making mining futile. However, it is now believed that the dominant mineralisation is in fact copper and gold skarn with high grade by-products of silver, zinc and lead.

The Alicanto share price has been exploding this year and is up 521% from its March lows. At the time of writing, the Alicanto share price has smashed through its 52-week high and is sitting at 18 cents.

More reading

• Why today is a great day to add to your ASX share portfolio
• Emerald Clinics share price soars 30% on new record
• These exciting ASX tech shares could be perfect buy and hold options
• Brokers name 3 ASX shares to buy right now
• ASX shares that could take a hit from New Zealand lockdowns

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.

The post Alicanto share price exploding 20%, here’s why appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2DJ1Y61

We kick this article off with a question.

When was the last time you added to your shareholdings? And I don’t mean through your superannuation account. I mean buying ASX shares or international shares with your cash holdings.

If you’re like many Australian investors, your answer may well be sometime in June.

You see, that’s when the huge relief rally in ASX share prices that followed on the COVID-19-driven market rout petered out. On 10 June, to be precise, the All Ordinaries Index (ASX: XAO) closed at 6,269 points. That represented a phenomenal gain of 37.5% from its post-crash level on 23 February.

Since then it’s been trading in a much tighter range, gaining a few percent some weeks and giving it back on others. At time of writing, the All Ords is up again for the day, but still down 0.3% from 10 June.

That’s okay though. As you’ll read often here at The Motley Fool, we encourage you not to get overly caught up in the shorter-term price moves. And yes, even monthly price moves are fairly short-term if you’re a buy-and-hold investor with a 3 to 5-year (or longer) investment horizon.

But many investors have a hard time seeing it that way. They look at today’s share prices and realise they’re not the bargain they were in March and April. And the financial news headlines once trumpeting the remarkable run higher for ASX share prices have shifted focus to rising unemployment figures and potential increases in bankruptcies.

All that fuels uncertainty and fear. And while that’s understandable, I believe what most investors should fear the most is missing out on the big share price gains that can still be made in the markets.

2 ASX 200 blue chips that have smashed the market

The S&P/ASX 200 Index (ASX: XJO) — comprised of the 200 largest companies on the ASX — closed down 0.7%. yesterday.

But, of course, that doesn’t mean every stock closed down. Far from it.

Take Treasury Wine Estates Ltd (ASX: TWE), for example. The global winemaking and distribution company released its results for the 2020 financial year yesterday.

It reported a 6% decline in net sales revenue, largely due to a slowdown in its US market and broader negative impacts from COVID-19. But investors had largely already priced that news in. What came as a welcome surprise was the strong growth in its China business in June.

The Treasury Wine share price closed the day up 12.3%, giving it a market cap of $9.2 billion.

Financial services company AMP Limited (ASX: AMP) also had a cracker of a day on Thursday. The AMP share price closed up 10.9%. That came despite the company announcing a massive 42% drop in profits in its half year results.

Again, the market had already largely priced in the impact of COVID-19 on the wealth manager’s earnings. Instead, investors look to have focused on AMP’s announcement that it held $1.4 billion in surplus capital above target requirements. And that it would issue a fully franked special dividend.

Why the share market looks poised for more big gains

Now these are just 2 ASX shares. And admittedly these are one day share price moves. Though I believe the Treasury Wine share price could enjoy a long-term run, particularly if it’s successful in tapping the massive growth opportunity represented by the increasing number of Chinese wine drinkers.

But there are many other companies out there with the potential for strong share price gains over the mid to long-term.

Yes, we’re still faced with the blustery headwinds of the coronavirus pandemic and festering global trade disputes. But unprecedented levels of government stimulus, record low interest rates, and significant institutional and retail investor cash holdings should continue to support share prices. And eventually see them fly higher.

Now there are fears that the government debt pile is becoming unsustainable. But today Reserve Bank of Australia governor Philip Lowe moved to assuage those fears, stating:

The expected increase in public debt is entirely manageable and is affordable. It is the right thing to do to borrow today to help people, keep them in jobs and boost public investment at a time when private investment is very weak. There will always be debates about the precise nature of programs and about how much support should be provided, but the general strategy that we have is the right one.

There is also a lot of cash still waiting on the sidelines. Including an extra $10 billion in cash held by the Future Fund since 30 March. As the Australian Financial Review notes:

At June 30, the Future Fund held about $24 billion in cash, up from $15.5 billion at March 30. This means cash holdings have moved to about 15 per cent of the portfolio. A full disclosure of the fund’s 2020 financial year performance and asset allocation will be released in September.

Many Australians have also used their early access to superannuation under the government’s COVID-19 response to bolster their savings.

According to the latest Treasury estimates, by 31 December some $42 billion will have been withdrawn from super accounts. A lot of that is being used to pay daily bills. But according to Treasurer Josh Frydenberg, 36% of Aussies are using the money to add to their savings.

With interest rates remaining near zero, retail and institutional investors are going to be looking for a way to grow their cash. And if much of it flows into the ASX, as I believe it will, it should see some big share price gains for well-managed Aussie companies.

More reading

• Brokers just downgraded the Telstra share price and these other ASX 200 stocks
• ASX 200 up 0.3%: NAB Q3 update, Mesoblast rockets, Newcrest guidance disappoints
• How investing in ASX shares could help you grow $10,000 into $100,000
• Iluka share price on watch as half-year profit falls 17%
• Mesoblast share price on watch after US regulatory approval

Motley Fool contributor Bernd Struben 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.

The post Why today is a great day to add to your ASX share portfolio appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/30TQkO6

Shares in Emerald Clinics Ltd (ASX: EMD) have surged nearly 30% in early trade following an announcement from the company. At the time of writing, the Emerald Clinics share price had risen 29.5% to currently trade at 7.9 cents.

What did Emerald Clinics announce?

Earlier today, Emerald Clinics released an announcement which highlighted record appointments in Australia, plans for international expansion and a proposed name change.

Despite the restrictions induced by COVID-19, Emerald Clinics reported a record 795 appointments in July. The company noted continued month-on-month growth in comparison to subdued demand in the majority of health services.

As a result, Emerald Clinics informed investors that the company is actively hiring clinicians in order to meet growing demand for its services. In addition, the company is expanding its remote monitoring capabilities and increasing its data insight platforms.

Emerald Clinics also announced that the company intends to change its name to Emyria Limited. According to the company, the proposed name change is consistent with its global ambitions and rebranding, the latter of which better communicates its scope of practice. The planned name change follows the company’s data collaboration with a United Kingdom partner. 

What does Emerald Clinics do?

Emerald Clinics is network of specialist and referral only medical clinics. The company’s clinicians are trained specialists in the application of unregistered medicines, which include cannabinoid products.

The company also focuses on collecting and developing high quality, real-world evidence (RWE) data. Emerald’s RWE data platform aims to improve patient care, identify novel uses for existing therapies and explore the performance of certain medicines.

As a result, the data insights from Emerald’s RWE platforms can also be provided to pharmaceutical companies on a subscription payment model.

Emerald Clinics recently signed with Spectrum Biomedical, a UK-based subsidiary of the world’s largest cannabis company Canopy Growth Corp. Under the agreement, Emerald will design and deliver RWE focused on the safety and clinical outcomes of cannabis-based medicines produced by Spectrum. 

Foolish takeaway

At the time of writing, the Emerald Clinics share price is trading nearly 30% higher at 7.9 cents. Shares in the company were up nearly 40% earlier today after hitting an intra-day high of 8.5 cents.

More reading

• Alicanto share price exploding 20%, here’s why
• Why today is a great day to add to your ASX share portfolio
• These exciting ASX tech shares could be perfect buy and hold options
• Brokers name 3 ASX shares to buy right now
• ASX shares that could take a hit from New Zealand lockdowns

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.

The post Emerald Clinics share price soars 30% on new record appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3iIEdd5

I believe the tech sector is a great place to look for long term investment options. This is particularly the case at the mid cap side of the sector, where there are a number of companies which could grow materially in the future.

Two that I would consider buying are listed below. Here’s why I’m a fan:

ELMO Software Ltd (ASX: ELO)

The first ASX tech share to look at is ELMO Software. It is a growing cloud-based human resources and payroll software company which provides a unified platform to streamline a wide range of processes. It recently released its full year results and revealed annualised recurring revenue (ARR) of $55.1 million and statutory revenue of $50.1 million. This was a 19.7% and 25% year on year increase, respectively, which I thought was very strong given the pandemic.

The good news is that management is confident this strong form can continue in FY 2021. It has provided guidance for ARR of between $65 million and $70 million this financial year. This represents year on year growth of 18% to 27%. However, it is worth noting that this guidance is purely organic and is likely to be boosted greatly by acquisitions. ELMO has a cash balance of $140 million that it intends to deploy for acquisitions in the near future. Looking further ahead, I believe the company has a massive opportunity in new geographies for its jurisdiction agnostic platform.

Nearmap Ltd (ASX: NEA)

Another ASX tech share to consider buying is this aerial imagery technology and location data company. Over the last few years Nearmap has been growing its recurring revenues at a strong rate thanks to increasing demand for its services in both the ANZ and North American markets.

And while its growth has slowed in FY 2020 because of some large churn events, I’m confident that it will accelerate again once the coronavirus crisis passes. Especially given its material opportunity in a highly fragmented market and its high quality product offering. This has been bolstered by an artificial intelligence product which looks like it has the potential to be a game changer. Overall, I think Nearmap shares would be great long term options.

More reading

• Are these ASX small cap shares heading for big things?
• Where to invest $500 into ASX shares immediately
• Leading brokers name 3 ASX shares to buy today
• Here’s the best mid-cap growth share to buy on the ASX
• These are the 10 most shorted shares on the ASX

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 Elmo Software. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Nearmap Ltd. The Motley Fool Australia has recommended Elmo Software and Nearmap 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 These exciting ASX tech shares could be perfect buy and hold options appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3iRizU7

Australia’s top brokers have been busy adjusting their estimates and recommendations again, leading to the release of a large number of broker notes this week.

Three broker buy ratings that have caught my eye are summarised below. Here’s why brokers think these ASX 200 shares are in the buy zone:

Appen Ltd (ASX: APX)

According to a note out of UBS, its analysts have retained their buy rating and lifted the price target on this artificial intelligence (AI) company’s shares to $41.00. The broker has been looking into the industry and believes that Appen’s second half outlook is very positive. Especially given recent hiring activity, which it feels indicates that its government business is performing well. Overall, the broker remains very positive on its growth prospects over the medium term. I agree with UBS and think Appen would be a fantastic buy and hold option.

Goodman Group (ASX: GMG)

Analysts at Morgan Stanley have retained their overweight rating and lifted the price target on this property company’s shares to $20.00. According to the note, Goodman Group delivered an FY 2020 result in line with its expectations. And while its guidance for the year ahead is a little lower than the broker is forecasting, it notes that the company has consistently outperformed its guidance for a number of years. Furthermore, with the ecommerce tailwind in its sails, Morgan Stanley expects its strong form to continue into FY 2022 as well. I think Morgan Stanley is spot on and would be a buyer of Goodman Group’s shares.

Telstra Corporation Ltd (ASX: TLS)

A note out of Goldman Sachs reveals that its analysts have retained their conviction buy rating but trimmed their price target slightly on this telco giant’s shares to $3.90. According to the note, the broker was pleased with its FY 2020 result, but notes that its guidance has caused dividend doubts. However, the broker believes Telstra could shift its dividend policy to be based on free cash flow rather than earnings. If it does this, it would be able to sustain its 16 cents per share dividend. As such, it holds firm with its forecast for no dividend cuts in FY 2021. I agree with Goldman Sachs and feel Telstra would be a good option for income investors after its pullback.

More reading

• Brokers just downgraded the Telstra share price and these other ASX 200 stocks
• How investing in ASX shares could help you grow $10,000 into $100,000
• Is the Telstra dividend in danger? This leading broker thinks it’s safe
• 3 ASX shares that could grow rapidly during the 2020s
• ASX 200 drops 0.7%, Telstra falls 7.7%

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia owns shares of Appen 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 Brokers name 3 ASX shares to buy right now appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3ameTGR