Reporting season is starting. It’s like Christmas but for share investors. There may be some lumps of coal in some reports this year. But I think there are some ASX shares that are worth buying for growth investor portfolios in August 2020.

Here are my three ASX share picks:

Share 1: Pushpay Holdings Ltd (ASX: PPH)

Pushpay is one of my preferred ASX growth share ideas at the moment.

I think it could be unwise to try to guess when some growth shares in COVID-19-affected industries will return to fast growth. At this stage I’d prefer to go for businesses that are seeing uninterrupted growth or faster growth through this difficult time.

Pushpay is one of those ASX shares that I think are seeing faster growth. It’s an electronic donation business which facilitates digital giving to large and medium US churches. But it’s not just a simple payments business. It offers churches a number of useful management tools – that’s why the Church Community Builder acquisition was a good move. One of the services Pushpay can offer is livestreaming the service. That’s very useful in the current world.

In FY20 the company achieved a higher gross margin and a higher earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) margin. It will be even more profitable as it grows its revenue.

In FY21 the company is aiming to at least double its EBITDAF. Over the long-term it’s aiming for US$1 billion of annual revenue just from the US church sector.

At the current Pushpay share price it’s trading at 29x FY23’s estimated earnings.

Share 2: WAM Microcap Limited (ASX: WMI)

WAM Microcap is a listed investment company (LIC) which targets small cap ASX growth shares. It normally does quite well during reporting season with its investment picks.

It can be hard to know which growth shares to go for yourself. I think Wilson Asset Management is one of the best investing teams at picking the right shares. Over the past 12 months its portfolio has returned 11.8% before expenses, fees and taxes. I think that’s a solid return during a year which included the COVID-19 selloff.

The LIC is building a reputation as a good ASX dividend share as well. It’s quite important for WAM Microcap to keep paying a dividend so that it doesn’t become too large, otherwise its performance may be affected.

At the current WAM Microcap share price it offers a grossed-up dividend yield of 6.2%.

Share 3: Bubs Australia Ltd (ASX: BUB)

I believe that Bubs is one of the most promising ASX shares with a market cap under $1 billion. Over the next decade I believe it could become one the ASX’s smaller blue chips.

Bubs sells a variety of products including infant formula, baby food and products for adults. It also owns its own Chinese-approved manufacturing facilities called Deloraine. Having a high level of control over your supply chain could be important to Bubs for exporting to China and to ensure product supply during the current difficult COVID-19 conditions.

I think there’s a lot to like about Bubs. It boasts of a steadily-rising gross profit margin. Infant formula has a margin of around 40%, so the more of total revenue that infant formula represents, the more profitable that Bubs will be.

In FY20 Bubs saw infant formula revenue increase by 69% during the year. The company is growing rapidly overseas, particularly in countries with large populations like China and Vietnam – I think Asia is a long growth runway for Bubs.

The ASX growth share also has a good revenue trajectory. It recently expanded its distribution network in Australia, adding Bubs products to hundreds of Woolworths Group Ltd (ASX: WOW), Coles Group Limited (ASX: COL) and Baby Bunting Group Ltd (ASX: BBN) stores.

Foolish takeaway

I think each of these shares will produce very good total returns over the next five to ten years. At the current prices I think I’m drawn to Bubs and Pushpay the most, but WAM Microcap could be an excellent dividend share over the long-term. 

More reading

• Coles and Wesfarmers share prices reach for new highs. Should you invest?
• Why these ASX mid cap shares could smash the market over the next 5 years
• 2 ASX shares I’d buy in a heartbeat
• 3 top small cap ASX shares to buy now
• Buy Coles and this safe ASX dividend share for income in August

Tristan Harrison owns shares of WAM MICRO FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of PUSHPAY FPO NZX. The Motley Fool Australia owns shares of and has recommended BUBS AUST FPO. The Motley Fool Australia owns shares of COLESGROUP DEF SET. The Motley Fool Australia has recommended PUSHPAY FPO NZX. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The FirstWave Cloud Technology Ltd (ASX: FCT) share price jumped 28% today after the appointment of a new specialist adviser.

What does FirstWave Cloud do?

FirstWave is a global cybersecurity company established in 2004. The company provides security-as-a-service (SaaS) solutions to tier 1 telcos and service providers around the world.

FirstWave has deployed 11 cloud content security platforms across North America, South America, Africa, Europe, Asia and Oceania.

Why is the FirstWave Cloud share price surging?

Earlier today, the Aussie technology company announced a new advisory committee to drive sales and product maturity.

The new Technology and Markets Board Committee (TMC) will be headed by FirstWave founder Scott Lidgett, alongside the company’s existing executive chair, chief operating officer, chief technology officer (CTO) and strategy director.

Former Cisco Systems ANZ CTO Kevin Bloch was also appointed as an adviser. Mr Bloch left Cisco at the end of June to launch his own advisory firm, Bloch Advisory.

TMC’s first order of business will be to review FirstWave’s current product and commercialisation strategy and help the company deliver on its FY21 plan. Mr Bloch and the TMC will also work to position the company for long-term, sustained success.

The news was well-received by shareholders with the FirstWave share price rocketing up 28%. 

FirstWave executive chair John Grant welcomed the specialist appointment, describing Mr Bloch’s move as a “significant coup” for the company.

What else has been happening for FirstWave?

The FirstWave share price is up 28% today following a 19.0% increase in yesterday’s trade.

That came ahead of the company’s extraordinary general meeting and the release of the chair’s address.

Shareholders voted to approve the service rights proposal to issue shares to executives. Notably, part of Mr Bloch’s fees will be paid as service rights under the recently-approved rights plan.

More reading

• These could be outstanding buy and hold options for ASX investors
• Ava Risk Group share price rockets 45% on quarterly report
• ASX 200 rises 0.75%, Fortescue impresses and Macquarie remains robust
• 3 underperforming ASX 200 stocks that could beat earnings expectations
• Elsight share price soars 65% on news of significant US order

Motley Fool contributor Ken Hall 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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I believe that one of the best ways to grow your wealth is to invest consistently and with a long term view.

After all, investors that buy and hold quality shares are able to maximise their returns through the power of compounding.

But which ASX shares would be good buy and hold options? These ASX shares tick a lot of boxes for me:

Altium Limited (ASX: ALU)

I think this electronic design software platform provider could be one of the best buy and hold options on the ASX. I’m a big fan of Altium due to its exposure to the Internet of Things (IoT) and artificial intelligence (AI) markets. The rapidly growing IoT and AI markets have been driving strong demand for its design software in recent years. This is because these markets are supporting the proliferation of electronic devices, which require software like Altium Designer and Altium 365 during the design process.

Management appears confident in its outlook and is aiming for 100,000 subscriptions by FY 2025. This compares to the ~50,000 subscriptions it is achieved in FY 2020. It expects this to be the key to market domination and helping it achieve its US$500 million revenue target in five years. This compares to revenue of ~US$189 million in FY 2020. If it achieves this, which I believe it will, then the Altium share price is likely to be materially higher than where it trades today.

BetaShares NASDAQ 100 ETF (ASX: NDQ)

I think the BetaShares NASDAQ 100 ETF would be a great long term option for investors. It is my favourite exchange traded fund on the ASX and for a very good reason. The BetaShares NASDAQ 100 ETF gives investors exposure to the 100 largest non-financial shares on the world-famous NASDAQ index.

This means that through a single investment, you’ll be buying a piece of tech giants such as Amazon, Apple, Facebook, Microsoft, Netflix, and Google parent, Alphabet. Given the very positive long term outlooks of these companies, I believe the Nasdaq 100 index is likely to outperform most markets over the next decade. This could make it a great buy and hold option.

More reading

• 2 ASX shares to buy and 2 to avoid as deflation bites
• These ASX ETFs could generate strong long term returns
• WAAAX or FAANG? Which ASX tech shares to buy in 2020
• 3 of the best ASX tech shares to buy and hold until 2030
• WAAAX shares see mixed recovery from COVID-19

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 Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended BETANASDAQ ETF UNITS. 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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On Thursday, the Ava Risk Group Ltd (ASX: AVA) share price rocketed 45.71% to 26 cents per share, following the release of the company’s quarterly report.

What was in the announcement?

Ava Risk Group announced that it had positive operating cash flow of $4 million for the quarter to 30 June 2020. The company’s cash balance increased to $7,878,000 from $3,742,000 at the end of the previous quarter.

The announcement stated: “Our strategies for delivering profitable growth and generating positive cashflow produced an increase of $4.1 million in net cash holdings as at 30 June 2020, reflective of a growth in revenues, customer cash collections and positive EBITDA performance.”

Ava announced that it had shipped 800 units as part of its IMOD contract for Future Fibre Technology’s data network security technology. The company has already recognised $5.0 million from this contract in the 2020 financial year with the remaining balance of around $10 million to be received in financial year 2021.

Ava received a loan from the US Government of $333,000 as part of its coronavirus support measures in the 2020 financial year. It expects this loan to be forgiven, which will result in a $333,000 improvement to the company’s income in the first half of the 2021 financial year.

Operating expenditure in the final quarter of the 2020 financial year was $11.7 million with product and manufacturing costs of $7.6 million, staff costs of $2.9 million, together with administration and corporate costs of $900,000.

The company paid $203,000 to its directors during the final quarter of the 2020 financial year.

About the Ava Risk Group share price

Ava Risk Group is a technology company that provides risk management services and technologies to commercial, government, military and industrial clients around the world. Its solutions include intrusion detection, electronic access control, data networks, secure international logistics and storage of high value assets. Ava’s team is spread across 6 continents and according to the company, protects thousands of sites.

Ava Risk Group shares are up 225% since their 52-week low of 8 cents and have returned 62.5% since the beginning of the year. The Ava Risk Group share price is up 85.71% since this time last year.

More reading

• FirstWave share price jumps 28% as tech heavyweight joins the team
• These could be outstanding buy and hold options for ASX investors
• ASX 200 rises 0.75%, Fortescue impresses and Macquarie remains robust
• 3 underperforming ASX 200 stocks that could beat earnings expectations
• Elsight share price soars 65% on news of significant US order

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

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The S&P/ASX 200 Index (ASX: XJO) rose by 0.74% today to 6,051 points. The overseas share markets rallied after the US Federal Reserve indicated that it would continue to support the economy through these COVID-19 times and keep interest rates low for some time.

Victoria reported 723 new confirmed COVID-19 cases whilst both Queensland and NSW reported a few more cases.

Fortescue Metals Group Limited (ASX: FMG) share price rises 4%

Fortescue is now bigger than both Australia and New Zealand Banking Group (ASX: ANZ) and Wesfarmers Ltd (ASX: WES). It has been an incredible 12 months for the ASX 200 miner.

The iron ore miner announced its June 2020 production update today.

It saw a record 178.2 million tonnes (mt) of iron ore shipments in FY20. Iron ore shipments were 47.3mt for the quarter. This beat the top end of Fortescue’s FY20 guidance of 177mt. FY20 shipments were 6% higher than FY19.

Fortescue said that its average revenue was US$81 per dry metric tonne (dmt) in the fourth quarter. This brought the average revenue for FY20 to US$79 per dmt.

C1 costs for the fourth quarter were around US$13 per wet metric tonne (wmt). C1 costs for FY20 were just under US$13 per wmt including US$0.22 per wmt of COVID-19 related costs.

The ASX 200 miner has cash on hand of US$4.9 billion at 30 June 2020 and net debt of US$0.3 billion.

In FY20 it had capital expenditure of US$2 billion in FY20 and in FY21 it expects capital expenditure of between US$3 billion and US$3.4 billion including investment in growth projects and energy infrastructure.

In FY21 guidance for shipments is between 175mt to 180mt and C1 costs of US$13 per wmt to US$13.50 per wmt.

Macquarie Group Ltd (ASX: MQG) FY21 first quarter

Macquarie announced its FY21 first quarter to investors today as it held its annual general meeting (AGM) today.

The ASX 200 investment bank said that its operating groups have been impacted by mixed trading conditions. Operating net profit was down slightly compared to the first quarter of FY20.

In terms of the regulatory minimum requirements, the group capital surplus was $8.1 billion at 30 June 2020. The bank CET1 ratio was 13.2%.

Macquarie CEO Shemara Wikramanayake said: “Macquarie’s annuity-style businesses were up on 1Q20 with Macquarie Asset Management (MAM) up primarily due to the sale of its rail operating lease business, partially offset by lower income in banking and financial services which included higher provisions. Macquarie’s market-facing businesses were down on 1Q20 primarily due to significantly lower investment-related income in Macquarie Capital, partially offset by stronger contributions from certain divisions in commodities and global markets.”

The Macquarie share price went up 0.8%. 

Splitit Ltd (ASX: SPT) rises on FY20 second quarter

Splitit announced record quarter growth of merchant sales volume to US$65.4 million. This was up 260% year on year.

Quarterly gross revenue was US$2.4 million, up 460% year on year – this was higher than the entire revenue from FY19.

Splitit said that it has seen continued strong demand from merchants in key verticals, with new brands accepting Splitit including Puffy, Waves, Braun, OCM and Ecosa.

Management said it is well funded. It had US$18.3 million of net cash and US$32 million of unused borrowing capacity to fund further growth.

Splitit CEO Brad Paterson said: “Accelerating merchant demand, strong foundations and a great shopper experience have set Splitit on a rapid growth trajectory, with record MSV and revenue during the quarter. We are seeing the benefits of tightening our product-market fit, attracting world class talent, partnering with Stripe, Visa and Mastercard and supporting our scalable solution with the right merchant funding model. This is an exciting time and we are only just getting started. We expect this growth to continue as we focus on delivering significant benefit and value to our customers.”

The Splitit share price rose almost 3% today. 

More reading

• 3 underperforming ASX 200 stocks that could beat earnings expectations
• A dirt-cheap ASX dividend share to add to your portfolio today
• Why the Sandfire share price is the worst performer on the ASX 200 today
• 3 latest ASX 200 stocks to be downgraded by top brokers today
• ASX 200 jumps 0.7%: Fortescue impresses, Macquarie’s tough Q1, big four banks rise

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia owns shares of Wesfarmers 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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Getting through this reporting season is akin to tiptoeing through a field of landmines. Perhaps one good way to get through the reporting season is to back ASX stocks that are underperforming the market.

This is because expectations are set pretty low for these S&P/ASX 200 Index (Index:^AXJO) laggards when the same can’t be said for the market in general.

Some experts are warning of a painful correction as profit results are unlikely to sustain the rapid recovery in the ASX 200 since it hit a COVID-19 low back in March.

Seeds of a turnaround recovery

One stock that’s weighed down by bad news is the Nufarm Limited (ASX: NUF) share price. Shares in the crop protection and seed distributor fell nearly 30% since the start of calendar 2020.

A series of disappointing profit updates robbed confidence from the stock, but it may be at a point where sentiment is worse than reality.

UBS believes it’s Nufarm’s troublesome European business that’s dragging on stock and that the worst is likely behind the group when it upgraded Nufarm to “buy” recently.

I also believe that the market is pricing in very little upside for its newly launched omega-3 infused canola seeds.

Management said today that Canadian authorities have granted the group permission to sell the seeds in that country.

Further, easing drought conditions in Australia should mean that we will start seeing better results in Nufarm’s local business.

The company is expected to report its full year results in late September.

Down but not out

Another dog that might be worth betting on is the Downer EDI Limited (ASX: DOW) share price. Shares in the engineering and industrial services group nearly halved since January.

Fears that it will need to raise capital and the earnings hit from fallout from COVID-19 on its hospitality business prompted investors to shun the stock.

It turned out that the market was right about the capital raise with management tapping investors on the shoulder for $400 million.

There’s also slightly more confidence about the outlook for the economy in the post COVID-19 world.

This could be the right time to get back into this heavily discounted stock, particularly after Goldman Sachs upgraded Downer to “buy” yesterday.

“All-in we view DOW as an attractive defensive complement to our more resource-focused E&C coverage, with the company among the most recession-resilient in the case of an uneven macro/commodity recovery coming out of COVID,” said Goldman.

“We believe the stock’s valuation fails to reflect this defensive profile.”

Looking cheap with a strong balance sheet

Finally, I think the CSR Limited (ASX: CSR) share price is also looking interesting after its 23% fall in 2020.

Worries about housing construction falling off a cliff during the coronavirus turmoil looks overblown to me when federal and state governments are pumping stimulus into the sector.

Management also impressed me when it handed in their full year earnings report card in May, which was ahead of market expectations.

CSR also has a strong balance sheet with around $95 million in cash to buffer it from the uncertain industry outlook.

The building materials company will report its half year numbers in November.

More reading

• ASX 200 rises 0.75%, Fortescue impresses and Macquarie remains robust
• A dirt-cheap ASX dividend share to add to your portfolio today
• Why the Sandfire share price is the worst performer on the ASX 200 today
• 3 latest ASX 200 stocks to be downgraded by top brokers today
• ASX 200 jumps 0.7%: Fortescue impresses, Macquarie’s tough Q1, big four banks rise

Motley Fool contributor Brendon Lau owns shares of Nufarm Limited. Connect with me on Twitter @brenlau.

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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