Tag: Motley Fool Australia

The Catapult Group International Ltd (ASX: CAT) share price will be one to watch on Tuesday after a late announcement on Monday.

What did Catapult announce?

After the market close on Monday, Catapult announced that it has commenced the lifting of its COVID-19 operating cost mitigation measures.

The sports analytics and wearables company revealed that it is able to make the move sooner than planned because the negative impact to its business from the pandemic was less than anticipated.

According to the release, management has been closely monitoring its performance, controlling costs, and managing working capital to ensure it maintained a strong cash position while minimising disruption to the business during a period where sport around the world was put on hold.

These cost measures included implementing furlough leave for staff in some regions, and reducing salaries for others. But as of 13 July 2020, Catapult has begun ending these measures.

The company’s CEO, Will Lopes, commented: “Entering the COVID-19 crisis we took preventative measures anticipating a worst-case scenario impact to our global business. I am glad such impact was less than anticipated and we are able to remove such measures earlier than expected.”

What now?

This news could give the Catapult share price a much-needed lift.

Although its shares have rebounded strongly from their March low, they are still down materially from their 52-week high. Based on Monday’s close price, Catapult’s shares are down 45.5% from their high.

I suspect that investors were expecting the suspension of professional and amateur sports globally to weigh heavily on its performance during the second half. But given its update today, things don’t appear to have been anywhere near as bad as they could have been.

It is also worth noting that approximately 75% of Catapult’s revenue is subscriptions-based, supported by long term contracts and customer relationships. This could arguably mean the Catapult share price weakness in 2020 has been severely overdone.

More reading

• De Grey Mining share price plunges another 13% lower today
• ASX 200 goes up 1%, big 4 ASX banks rise
• Is the REA Group share price in the buy zone?
• 2 ASX shares I would buy for growth and income
• Bubs and 1 other exciting small cap ASX share to buy

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

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Over in the United States (US), the distinction between growth shares and dividend income shares is far starker than on our own ASX. Perhaps because they don’t have the same dividend franking system that we enjoy, US shares tend to only start paying a dividend when their growth opportunities begin to narrow.

Apple, for example, only started paying a dividend in 2012 (5 years after the iPhone debuted). Other massive tech companies like Amazon.com, Alphabet (also known as Google) and Facebook still offer no income to their shareholders to this day.

But perhaps fortunately for Aussie investors, no such canyon exists between ‘growth’ shares and ‘dividend’ shares down under. The lure of fully franked dividends is too much for many ASX companies (and their shareholders) to ignore.

So here are 2 ASX share that I believe offer a healthy mix between growth prospects and dividend income potential.

Cleanaway Waste Management Ltd (ASX: CWY) 

On the surface, Cleanaway seems like a pretty boring company. It operates within the rather unappealing waste management sector and basically cleans up our waste and garbage for a crust. But it’s this ‘boring’ nature that makes Cleanaway such an attractive investment opportunity, in my view. No matter our level of societal and commercial sophistication, we’re always going to produce waste of various kinds, through thick and thin, boom and bust.

Waste management used to be a fractured and decentralised market, but Cleanaway has done a phenomenal job of accumulating market share and scale through contracts with local governments all around the country. This has resulted in its share price rising from 70 cents in 2015 to $2.17 at the time of writing.

But Cleanaway has also been quietly growing its dividend payouts as well. Right now, this dividend will net you a yield of 1.80%. Considering Cleanaway has been growing this dividend by an average of 12.13% per annum since 2015, I think it’s a good future dividend bet to make.

WAM Global Ltd (ASX: WGB)

WAM Global is a listed investment company (LIC) that aims to hold a portfolio of undervalued growth shares from around the world (hence the name). It is modelled after WAM Capital Ltd (ASX: WAM), an ASX-focused LIC that has returned an average of 15.7% per annum (after fees and taxes) since its inception in 1999.

Some of the names WAM Global is currently investing in include Tencent Holdings, Costco, Activision Blizzard and HelloFresh. It only started life back in 2018, but since then, WAM Global has already built up a strong track record of dividend payments, the last of which came in at 6 cents per share (annualised).

On current prices, WAM Global shares are offering a dividend yield of 2.58%. Since the last dividend increase came in at 50%, I have high expectations for WAM Global in becoming a dividend heavyweight in the years to come, with plenty of capital growth thrown in.

More reading

• 3 ASX dividend shares growing their payouts fast
• ASX income stalwart WAM Capital announces 8.2% dividend
• Leading brokers name 3 ASX shares to buy today
• How to turn $20,000 into over $200,000 in 10 years with ASX shares
• 3 ASX cleantech shares to consider buying now

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 WAMGLOBAL FPO. 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 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.

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The ASX offers investors the opportunity to purchase a growing number of exciting small cap shares with strong growth potential.

Here we examine 2 of my top small cap ASX share picks right now: Bubs Australia Ltd (ASX: BUB) and Bigtincan Holdings Ltd (ASX: BTH).

It’s important to keep in mind that small cap ASX shares can experience high share price volatility over the short term. It is therefore advisable only to purchase them as part of a diversified share portfolio.

Bubs

Goat milk producer Bubs has established a very strong position in the Australian market. It has become Australia’s only vertically integrated producer of goat milk formula, and has been a star performer in terms of revenue growth throughout the coronavirus pandemic.

Bubs delivered a massive 67% increase in revenue to $19.7 million during Q3 FY20 to 31 March 2020, compared to the prior corresponding period. In addition, sales have now pleasingly risen to a point where Bubs is generating positive operating cashflow. This is a significant milestone for a small cap ASX share.

Bubs has now shifted its focus to the massive Asian market – a strategy that is already starting to see results. The company’s Chinese revenues soared 104% higher in the third quarter of FY 2020. Infant formula scandals in China have seen a preference for Australian made products, due to the perception of higher safety and higher quality. In addition, the rising demand for Chinese e-commerce platforms such as JD.com and Alibaba’s TMall is enabling a large and growing number of buyers and sellers to connect with each other.

I believe that Bubs’ Asian growth strategy positions the company well for strong growth over the next 2 to 3 years.

Bigtincan

Small cap technology ASX share Bigtincan operates in an IT software niche commonly referred to as ‘sales enablement’.

Bigtincan’s financial performance continues to be strong. It posted annualised recurring revenue (ARR) of $32.4 million for the first half of FY20, which was a massive 55% increase on the prior corresponding period. Bigtincan also reported a 2% increase in its customer retention rate to 89%.

The Bigtincan share price was hit hard in the early phase of the coronavirus pandemic, up until late March. It fell by more than 70% during that time. Since then, Bigtincan has regained over two-thirds of those share price losses, and is currently trading at $0.83.

Bigtincan continues to win new deals in its quest for further expansion of its customer base. Earlier this month, Bigtincan announced the signing of a major new customer contract with global beverage giant Red Bull.

Despite not yet becoming cash flow positive, I am optimistic about Bigtincan’s long-term future, driven by the fast-growing sales enablement market.

More reading

• 2 fantastic ASX growth shares to buy with $2,000
• 3 ASX shares I’d invest $1,000 into right now
• 5 exciting small cap ASX shares to watch
• 3 ASX shares I’d buy with $6,000 today
• Have $10,000 to invest? I’d pick these ASX shares

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 BIGTINCAN FPO. The Motley Fool Australia owns shares of and has recommended BUBS AUST FPO. The Motley Fool Australia 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 Star Entertainment Group Ltd (ASX: SGR) share price rallied 7.8% in early trade today. This was after the company announced the Queensland Government has ended negotiations surrounding the licensing of a second Gold Coast casino. This came before another announcement surrounding COVID-19 that caused the share price to give back its earlier gains.  

Star is an Australian gambling and entertainment company. It owns The Star Sydney and Gold Coast as well as the Treasury Brisbane. It also acquired the Sheraton Grand Mirage in a joint venture and manages the Convention and Exhibition Centre for the Queensland government. It was formerly known as Echo Entertainment Group. 

End of negotiations

Star Entertainment made an announcement to the ASX prior to this morning’s market open. It advised that the company and the Queensland Government have mutually agreed to end negotiations regarding a second Gold Coast casino licence. Naturally, the company welcomed the decision made by the government. 

The state Tourism Minister, Kate Jones said: “Global market conditions are clearly impacting investment at present and I can confirm that this government has no intention of reviving the market process for a new integrated resort – including a second casino – on the Gold Coast”. The Star Entertainment share price climbed as high as $2.91 before the second announcement came around lunch time.

COVID-19 update

Star Entertainment’s second announcement of the day reported that a patron who visited The Star Sydney on Saturday 4 July has returned a positive test for coronavirus. As a result, the group is working with the relevant authorities and conducting contact tracing which includes staff members. The infection happened soon after the next stage of re-opening at the start of this month. 

With the recent easing of restrictions, attendances at the group’s casinos have increased and trading performance has understandably improved. However, the re-openings are under strict government controls regarding social distancing and the number of patrons. Although the rally in the Star Entertainment share price had already peaked by the time of the second announcement, the bad news accelerated the downward trend.

Foolish takeaway

The Queensland Government’s decision to end negotiations is definitely positive news for The Star Entertainment Group. However, the recent coronavirus case in its Sydney casino has had a negative impact overall on its share price today. The Star Entertainment share price closed at $2.68 which represents a 0.74% fall for the day. 

Additionally, the group’s share price has been hit hard by coronavirus restrictions, falling nearly 35% over the past 12 months. 

With the risks of a second wave of the pandemic and tougher restrictions still looming large, it might not be the end of the rollercoaster ride just yet for the Star Entertainment share price. 

More reading

• Star Entertainment Group shares lift with news of reopenings
• ABS reveals which industries (and ASX shares) may rebound hard after COVID-19
• These 5 ASX shares saw the biggest losses last week
• Why Air NZ, Carsales, Pendal, & Star shares are dropping lower
• Leading brokers name 3 ASX 200 shares to sell today

Motley Fool contributor Matthew Donald 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 Why the Star Entertainment share price has been on a rollercoaster today appeared first on Motley Fool Australia.

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They might be multi-billion companies now, but that wasn’t always the case for Afterpay Ltd (ASX: APT) and Appen Ltd (ASX: APX).

Just a few years ago they were small cap ASX shares flying under the radar of most investors. Anyone that invested in their shares at that point and held onto them today, will have made a small fortune.

With that in mind, I thought I would pick out two small cap ASX shares which I feel could be future stars. Here’s why I think they should be on your watchlists right now:

ELMO Software Ltd (ASX: ELO)

The first small cap ASX tech share to watch is this cloud-based human resources and payroll software company. ELMO provides users with a unified platform that streamlines processes such as recruitment, on-boarding, learning, and payroll.

It has a $2.4 billion market opportunity in the ANZ region and the potential to expand globally in the future thanks to its platform being jurisdiction agnostic. One market the company has its eyes on is the UK, which it estimates to be worth ~$6.8 billion.

Whispir (ASX: WSP)

Another small cap ASX share to add to your watchlist is Whispir. It is a software-as-a-service communications company which provides an industry-leading software platform. This platform allows users to deliver actionable two-way interactions (SMS, voice messages, email) at scale using automated multi-channel communication workflows.

During the first half of FY 2020, Whispir’s annualised recurring revenue grew by an impressive 22% to $36.7 million. The good news is that since then, the pandemic has accelerated demand for its platform due to the work from home initiative. This looks likely to lead to Whispir delivering an even stronger full year result in August.

More reading

• The difficulty of investing in shares right now
• ASX shares tapping into the US market
• Why the RPMGlobal share price could be a bargain buy right now
• The rise and rise of ASX SaaS shares
• Can the Afterpay share price go higher from here?

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 Whispir Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO and Appen Ltd. The Motley Fool Australia has recommended Elmo Software and Whispir 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 Are these small cap ASX shares future tech stars? appeared first on Motley Fool Australia.

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The TechnologyOne Ltd (ASX: TNE) share price has started the week on a very disappointing note.

The enterprise software company’s shares dropped as much as 8% at one stage before ending the day down 6.8% at $8.15.

Why did the TechnologyOne share price crash lower?

Investors were selling TechnologyOne’s shares on Monday after it became the subject of short attack by Hong Kong based research firm GMT Research.

GMT Research has previously released scathing reports on engineering company Cimic Group Ltd (ASX: CIM) and logistics solutions company WiseTech Global Ltd (ASX: WTC).

According to the AFR, GMT Research claims TechnologyOne used accounting tricks to pull forward revenue and profits. This resulted in the company “artificially creating growth and hiding a major slowdown.”

The company’s analyst, Nigel Stevenson, has suggested that its FY 2019’s net profit before tax of $76.4 million was inflated by more than 200%. It also believes that revenue growth was actually flat in FY 2018 and then up just 1% in FY 2019.

TechnologyOne’s response.

This morning the company admitted that it had met with GMT Research, but that it only spent 30 minutes with its team. It also stressed that it was not contacted about the allegations prior to publishing.

It said: “GMT Research spent only 30 minutes with us, so we are very surprised with their limited knowledge that they would have published a report in the first place, and more importantly without verifying the accuracy of the report with us. TechnologyOne was at no time shown the report.”

Management also confirmed that “the claims made in the AFR by GMT Research are false and misleading.”

Adding: “TechnologyOne unreservedly stands 100% behind our Audited Accounts as being a true and accurate reflection of our business over the last 21 years.” The company advised that it will now refer the matter to ASIC.

It concluded by confirming that it remains on track to achieve its guidance in FY 2020. That guidance is for net profit before tax growth of 8% to 12% year on year.

More reading

• The rise and rise of ASX SaaS shares
• ASX 200 jumps 0.8%: Big four banks storm higher, TechnologyOne sinks
• Why Domain, OceanaGold, Praemium, & TechnologyOne are tumbling lower
• 5 things to watch on the ASX 200 on Monday
• 3 ASX tech shares to buy and hold

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of WiseTech Global. 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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Don’t let the recent share market rally fool you in thinking that the COVID-19 blues are fading. If anything, ASX banks are on the cusp of a consecutive multi-year bad debt hit to earnings and dividends.

The warning comes from fund manager Janus Henderson who told the Australian Financial Review that banks will be forced to shore up their capital buffers by cutting capital management programs and dividends.

ASX banks’ dividend threat

This isn’t what ASX bank investors want to hear, especially when investors are looking forward to Westpac Banking Corp (ASX: WBC) and Australia and New Zealand Banking GrpLtd (ASX: ANZ) resume dividend payments.

Both banks suspended the payout at the recent half year profit reporting season, while National Australia Bank (ASX: NAB) slashed its interim dividend by nearly two-thirds.

Investors are nervously watching Commonwealth Bank of Australia (ASX: CBA), which will show its dividend hand next month when it turns in its full year report card. CBA’s financial year end is different from the other three big banks.

Is CBA next to cut dividends?

Experts are divided on what CBA will do. Some believe it will take the conservative approach and defer its dividend decision till November to get a better idea of the earnings impact from coronavirus.

Others are more bullish and believe the worst of the economic impact from the pandemic is behind us and CBA will only cut its dividend by a relatively modest amount. This bullish outcome will likely fire-up the CBA share price.

I was in the more bullish camp, but that was before Victoria was forced into a second lock-down. Now there’re fears that New South Wales may follow suit with community transmission of the virus at Star Entertainment Group Ltd (ASX: SGR) and the Crossroad Hotel.

Start of the bad debt downgrade cycle

“We think that banks will continue to need to shore up capital,” the AFR quoted Janus Henderson’s head of Australian fixed interest, Jay Sivapalan, as saying.

“They will go through a multi-year reporting period and cycle of reporting a higher level of provisioning.”

The provisioning for bad debt will need to rise as the chance of loan delinquencies rise. Around 800,000 mortgagees and small businesses have asked Australian banks for a repayment holiday.

These borrowers are struggling to service their loans due to widespread job losses and a drop in consumer spending from the COVID-19 fallout.

Foolish takeaway

However, the situation on the ground may not be as dire as the number suggests. Many mortgagees have suspended loan repayments as a precaution even though they aren’t impacted by the COVID-19 shutdown.

These customers are starting to commence paying their loans again and I think the circa $6 billion in provisioning set aside by the big four may about enough to see them through.

However, this assumes that the current lockdown in Victoria isn’t as damaging as the first and the rest of Australia continues to stay relatively coronavirus free.

But I will admit, this assumption is starting to look a tat optimistic right now.

More reading

• Why the Domino’s share price gained 30% in the first half of 2020
• Where to invest $10,000 into ASX 200 shares right now
• Will the ASX share price climb higher this year?
• Why the Fortescue share price rallied over 40% to a record high in 2020
• Is the CBA share price a buy?

Motley Fool contributor Brendon Lau owns shares of Australia & New Zealand Banking Group Limited, Commonwealth Bank of Australia, National Australia Bank Limited, and Westpac Banking. 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 Domino’s Pizza Enterprises Ltd (ASX: DMP) share price has been a particularly positive performer in 2020.

During the first half of 2020, the pizza chain operator’s shares rose by an impressive 30%.

This compares to a decline of ~12% for the S&P/ASX 200 Index (ASX: XJO) over the same period.

Since then the Domino’s share price has continued to rise and even hit a record high of $75.00 last week.

Why is the Domino’s share price on fire in 2020?

Investors have been buying the company’s shares in 2020 after it continued to deliver solid sales growth from the majority of its businesses during the pandemic.

In its update at the end of April, Domino’s revealed that its operations in Japan and Germany have continued their strong sales performance since the end of the first half. Sales in Japan were particularly strong according to management.

And in Australia and Europe (excluding France), its same store sales have been positive during the second half. The company’s French stores were closed for a period during the pandemic, as were its New Zealand stores.

All in all, combined with its strong first half performance, this appears to have positioned Domino’s to be one of the few companies on the ASX 200 that will deliver a solid full year result in August.

Positive long term outlook.

In addition to its near term performance, investors have also been buying Domino’s due to its positive long term outlook.

Management has reiterated its plan to target new store openings of 7% to 9% per annum and same stores sales growth of 3% to 6% per year over the next five years.

If it delivers on these targets, it should underpin solid earnings growth over the period and could drive the Domino’s share price notably higher.

It is for this reason, that I would still be a buyer of its shares even after its strong gains in 2020.

More reading

• Fund manager warns that ASX bank dividends facing multi-year bad debt hit
• Where to invest $10,000 into ASX 200 shares right now
• Will the ASX share price climb higher this year?
• Why the Fortescue share price rallied over 40% to a record high in 2020
• Oil Search share price drops on impairment hit of up to US$400 million

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Domino’s Pizza Enterprises 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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I think it’s getting harder to invest in shares right now.

Many ASX shares have performed very strongly ever since the market bottomed on 23 March 2020.

Look at some of the strongest performing ASX shares. The Afterpay Ltd (ASX: APT) share price has gone above $70. The Appen Ltd (ASX: APX) share price is above $35. The Xero Limited (ASX: XRO) share price is above $90.

Those three names I mentioned are three of the ASX’s most promising businesses. They’re growing internationally very strongly. Those three are above where they were just before COVID-19 impacted the share market.

Shares like Wesfarmers Ltd (ASX: WES) and APA Group (ASX: APA) have recovered from the selloff and are now almost back to previous levels.

I think the recovery is largely justified for plenty of shares. Many shares have reported that customer activity is the same, if not higher, than pre-COVID levels. Add in the incredibly low official interest rates – valuations should be higher due to that.

Shares such as Adairs Ltd (ASX: ADH), Nick Scali Limited (ASX: NCK), JB Hi-Fi Limited (ASX: JBH) and Harvey Norman Holdings Limited (ASX: HVN) are reporting higher sales. Perhaps that can be put down to all of the government stimulus, but their revenue is going up nonetheless. I would have expected revenue to fall for those types of consumer discretionary businesses during a pandemic and a recession. If a business is doing better than expected then its share price should rise. 

How do you invest during this environment?

During the time of the COVID-19 share market selloff in March I was encouraging investors to try to pick up bargains. Some ASX shares like Pro Medicus Limited (ASX: PME) looked as though they had been too heavily sold off.

As the market recovered I also pointed out shares like Pushpay Holdings Ltd (ASX: PPH) which seemed unfairly sold off and the terrible circumstances may in-fact accelerate Pushpay’s growth. Pushpay has rocketed since then, so I’m not sure that it’s an obvious buy anymore, though I still believe it has a great long-term future. These types of accelerated-growth opportunities are disappearing as the market bids them up. 

For the rest of the share market, there is still so much uncertainty.

How much is the unemployment rate and consumer spending being supported by the jobkeeper program? Jobkeeper is due to finish in less than three months. Jobkeeper can’t go on forever, but there are worries that the country faces a financial cliff.

How much will the new Victorian COVID-19 outbreak setback the overall economic national picture?

Is the NSW outbreak on the verge of turning into something like Victoria’s in a couple of weeks?

Will the US’ massive infection numbers start overwhelming certain areas of the country like how New York was overwhelmed a few months ago?

It’s important to recognise that there is always going to be uncertainty with the share market. There has always been something to worry about over the past decade. Greece, ISIS, Brexit, the trade war and so on. That’s why you have to think long-term with shares. Sometimes investors have to climb a ‘wall of worry’.

You don’t have to invest right away

We live in a world of instant news, instant reactions – an information overload. You may feel like you need to do something with your portfolio in July. But you don’t have to. No-one is forcing you to push the ‘buy’ button on shares. You can be patient.

Warren Buffett has a great quote – he has a quote for everything, right? – saying that you don’t have to swing at every pitch:

“The trick in investing is just to sit there and watch pitch after pitch go by and wait for the one right in your sweet spot. And if people are yelling, ‘Swing, you bum!,’ ignore them.”

Your 30-year returns aren’t going to be massively impacted whether you decided to invest in July 2020 or November 2020. I think there are going to be more opportunities later this year, particularly when the US election comes around.

I will keep investing each month if I see long-term opportunities, such as Bubs Australia Ltd (ASX: BUB). If you see a good opportunity, go for it. But I’m now saving some investing cash for later in the year.

More reading

• 3 ASX shares with incredible cost moats
• These ASX dividend shares will help you beat low interest rates
• ASX shares tapping into the US market
• The rise and rise of ASX SaaS shares
• The Wesfarmers share price gets support from spin-off rumours

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of PUSHPAY FPO NZX and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO, APA Group, Appen Ltd, and Wesfarmers Limited. 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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With many savings accounts offering base rates of just 0.05% per annum, if I had $10,000 in an account I would consider putting it to work in the share market.

After all, if you invest wisely, you could generate a return many, many times greater with shares.

But where should you invest $10,000 right now? Two top ASX 200 shares to consider buying are listed below:

a2 Milk Company Ltd (ASX: A2M)

I think a2 Milk could be a great place to invest $10,000. The infant formula and fresh milk company has been an impressive performer in FY 2020 despite the pandemic. In April, the company revealed that demand for its products had been very strong, particularly in respect of infant nutrition products. So much so, the company expects revenue in the range of NZ$1,700 million to NZ$1,750 million in FY 2020. It also forecast stronger than expected EBITDA margins of 31% to 32%, despite investing NZ$200 million into marketing activities.

The top end of its guidance range implies year on year revenue growth of 34.1% and EBITDA growth of 35.4%. The good news is that based on its relatively modest market share and increasingly popular products, I believe there is still a long runway for growth in the China market. This is likely to be complemented by the launch of new products or even acquisitions in the near future. As a result, I think the a2 Milk share price has the potential to continue its market-beating ways for a long time to come.

CSL Limited (ASX: CSL)

With the CSL share price down 18% from its 52-week high, I think now could be an opportune time to invest in this biotherapeutics giant. This share price weakness has been caused by concerns over the impact that the pandemic will have on plasma collections. These collections are vital for the production of some key products and lower levels could weigh on its performance a little in FY 2021.

While this is certainly a risk, I believe other areas of the business will offset this. Particularly its Seqirus business, which looks set to benefit greatly from increasing demand for flu shots. Looking further ahead, I believe its burgeoning research and development (R&D) pipeline will be very supportive of growth. This pipeline contains a number of therapies that have the potential to generate billions of dollars in sales over the next decade if their trials are successful.

More reading

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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 CSL Ltd. The Motley Fool Australia owns shares of A2 Milk. 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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