Tag: Motley Fool Australia

This morning, the Iluka Resources Limited (ASX: ILU) share price rose 1.24% to $9.42 following the release of the company’s quarterly review. The Iluka share price has since retreated slightly to sit at $9.35 per share at the time of writing, up 0.54% on yesterday’s close

What was in the announcement?

Illuka reported total zircon, rutile and synthetic rutile production of 135,000 tonnes in the quarter ended June 2020. Iluka’s Zircon production was down 16% compared to the first quarter of the year, as the company intentionally reduced production due to economic uncertainty.

The company’s rutile production was down 29% compared to the first quarter of the year, due to lower run time and throughput at the company’s Sierra rutile asset. Synthetic rutile production was up 10%, which the company attributed to higher ilmenite quality and plant upgrades.

Iluka sold 242,000 tonnes of zircon, rutile and synthetic rutile during the first half of 2020, a reduction of 19.87% compared to the first half of 2019 when the company sold 302,000 tonnes of the same materials.

The company sold 53,000 tonnes of zircon in the second quarter of 2020 compared to 25,000 tonnes in the first quarter of the year, however, sales were affected by the impacts of the coronavirus pandemic on Chinese and European markets. 

Iluka sold 66,000 tonnes of titanium in the second quarter of 2020, compared to 98,000 tonnes in the first quarter. The company announced that rutile prices were up 7% since the first half of 2019. It also announced that Zircon prices fell 6% in the first half of 2020.

Iluka also announced that it had completed commissioning of its Eneabba operation during the quarter, with 9,000 tonnes of monazite-zircon concentrate material shipped ahead of schedule.

The company had net cash of $62 million at 30 June 2020. It had free cash flow of $46 million in the first half of 2020, and invested $50 million into capital expenditure. 

Iluka also announced that all mining and processing sites were operational in the current environment.

About the Iluka share price

Iluka is an Australian-based resources company that explores and develops mineral sands assets. The company is the world’s largest producer of zircon, titanium-based rutile and synthetic rutile.

In June, Iluka announced that one of its customers had defaulted on its obligation to take and pay for 20,000 tonnes of synthetic rutile. Proceedings have since been made by Iluka in the Supreme Court in the state of New York.

The Iluka share price is up 63.46% since its 52-week low of $5.72. It has risen 1.52% since the beginning of the year. The Iluka share price is down 1.3% since this time last year.

More reading

• Where to invest $500 into ASX shares immediately
• Top broker warns earnings expectations for the ASX reporting season are too high
• Credit Corp share price jumps 13%, should you invest?
• Afterpay and Immuron were among the most traded shares on the ASX last week
• Why PolyNovo and these ASX healthcare shares could be long term market beaters

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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I think the healthcare sector is a great place to invest with a long term view due to the favourable tailwinds that it is experiencing.

These include ageing populations around the globe, increased chronic disease burden, and better technologies. But with so many options for investors to choose from, which ones should you be buying?

Below are three ASX healthcare shares I believe could provide stellar returns for investors over the long term:

Nanosonics Ltd (ASX: NAN)

The first healthcare share to consider buying is Nanosonics. It is an infection prevention specialist best known for its trophon EPR disinfection system for ultrasound probes. It is also the first high level disinfection system for ultrasound probes that is effective against high-risk, cancer causing strains of Human Papilloma Virus. This has gone down very well with healthcare institutions, leading to its installed base growing at a rapid rate over the last few years. The good news is that there’s still a large addressable market for it to grow into in the coming years. This should be supported by the launch of new products targeting unmet needs which have similar market opportunities. If they are anywhere near as successful, Nanosonics will have a very bright future ahead of it.

PolyNovo Ltd (ASX: PNV)

Another healthcare share which I think could have a bright future ahead of it is PolyNovo. It is the medical device company behind the NovoSorb Biodegradable Temporising Matrix (BTM) product. This synthetic polymer was developed at CSIRO and is used by clinicians to treat serious burn and skin trauma patients. It can be used in surgical procedures and will eventually biodegrade safely and be excreted by the body. The company’s current target market has a sizeable $1.5 billion addressable opportunity. However, management is looking to expand BTM’s use into the hernia and breast treatment markets. This would lift its addressable market to a total of $7.5 billion if successful.

Ramsay Health Care Limited (ASX: RHC)

A final healthcare share to look at is Ramsay Health Care. This global private hospital operator currently has 480 facilities across 11 countries. Although the near future is not going to be easy for Ramsay due to both the pandemic and general tough trading conditions in the private hospital space, I believe its long term outlook is very positive. This could make it worth considering a long term and patient investment in its shares. Especially given the aforementioned tailwinds that the sector is experiencing. This is likely to lead to a strong increase in demand for its services over the next decade and beyond.

More reading

• Leading brokers name 3 ASX shares to sell today
• 3 junior ASX healthcare shares with explosive growth potential
• These ASX shares could be great additions to a retirement portfolio
• Here are easy ways to diversify your ASX portfolio
• Why I would buy Ramsay and this ASX blue chip share

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 Nanosonics Limited and POLYNOVO FPO. The Motley Fool Australia has recommended Nanosonics Limited and Ramsay Health Care 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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If you are looking for some ASX share suggestions,  I believe that the following 2 companies are well worth considering.

Both Pushpay Holdings Ltd (ASX: PPH) and Macquarie Telecom Group Ltd (ASX: MAQ) have seen very strong share price gains over the last 6 months, driven by their impressive recent financial performances.

Macquarie Telecom

Macquarie Telecom has continued to grow at a rate well ahead of some of its larger telco rivals such as Telstra Corporation Ltd (ASX: TLS).

For the 6 months ended 31 December, Macquarie delivered a 9% rise in revenue on the prior corresponding period. The telco’s earnings before interest, tax, depreciation and amortisation (EBITDA) grew even more strongly, by 24% in the first half. The main driver of this growth was the company’s hosting business, which offers cloud computing-related services including data centre services. This division reported an 18% increase in revenue to $62.7 million. 

This strong revenue growth is reflected in Macquarie Telecom’s recent share price growth. The Macquarie Telecom share price has risen from $23.21 at the beginning of 2020 to now be trading at $46.25.

Macquarie Telecom has also indicated it will continue to invest in and drive growth from 3 key megatrends: data centres, cloud computing and cyber security. These 3 market segments are now driving growth in IT markets worldwide.

The local Australian telco is particularly focused on capturing the growing demand for data centre services through the expansion of its data centre portfolio. Earlier this year, the company commenced construction of its IC3 East data centre at the Macquarie Park Data Centre Campus. This expansion will help to meet the growing demand from its corporate, wholesale, and government customers.

Pushpay

Pushpay offers a donor management platform provider for the faith, not-for-profit, and education sectors. The company operates in the large-to-medium church sector of the massive US market.

After trending sideways since the beginning of 2018, the Pushpay share price has been on fire in recent months. The company’s share price has risen from $2.94 in late March to now be trading at $7.54. That’s a gain of 156%. Its share price did reach as high as $8.90 in late June, but has since lost some of those gains in recent weeks.

This share price growth comes on the back of strong recent expansion in its customer base. Pushpay achieved an impressive 39% increase in its total processing volume to US$5 billion for the 12 months to 31 March 2020.

I believe that Pushpay is well positioned for continued growth, driven by the growing demand for its donor management platform in the large (and mainly untapped) US market.

Foolish takeaway

Both Macquarie Telecom and Pushpay operate in two very different markets. However, both are quality companies and I am confident that both have strong growth prospects over the next few years.

More reading

• Why Telstra is a top ASX dividend share to buy in August
• Why I would buy Pushpay and these ASX growth shares in August
• These shares were the ASX 200’s biggest losers last week
• ASX 200 Weekly Wrap: ASX has week of high volatility
• Replace your term deposit with these ASX dividend 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 PUSHPAY FPO NZX. 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.

The post Pushpay and 1 other 5-star ASX share to buy right now appeared first on Motley Fool Australia.

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The Chesser Resources Limited (ASX: CHZ) share price has bolted more than 180% higher in today’s trade after the company reported spectacular drilling results from its Gold Project in West Africa.

Highlights from Chesser’s drilling report

Earlier today, Chesser reported drilling results from its flagship Diamba Sud gold project in Senegal, West Africa. The company’s drill results were from 17 reverse circulation (RC) holes, with 9 holes coming from Area D, 4 holes from Area B and the remaining 4 holes from the Western Splay area.

Chesser reported high-grade intersections of up to 67.80 grams per tonne (g/t) gold within Area D. The best results from this area included: 48 metres at 6.70 g/t gold from 24 metres, including 10 metres at 25.14 g/t gold from 62 metres; and 55 metres at 4.27 g/t gold from 16 metres.

Chesser also reported promising results from the Western Splay area with significant intersections including: 2 metres at 19.80 g/t gold from 4 metres; 6 metres at 1.79 g/t gold from 28 metres; and 10 metres at 1.10 g/t gold from 111 metres. The company also noted positive results from Area B, with mineralisation noted in hole DSR162 and intersected 10 metres at 1.26 g/t gold from 50 metres and one metre at 3.44 g/t gold from 89 metres.

The company’s management noted the exceptional and rare high grade, consistency and thickness of the drilling results. Chesser also informed investors that results from 6 holes in Area A are pending and assured shareholders of the company’s strong cash balance.

Background on Chesser Resources

Chesser Resources is a listed gold exploration company with projects located in Senegal, West Africa. The company’s flagship Diamba Sud project is expected to host numerous multimillion-ounce gold deposits. Earlier this month the company completed a $6 million capital raising in order to fund the large-scale drilling at the Diamba Sud project.

Foolish takeaway

The Chesser share price soared more than 180% higher in early trade, hitting an intra-day high of 30.5 cents. At the time of writing the company’s shares have dipped to 30 cents, up 180.95% for the day.

More reading

• Why PolyNovo and these ASX healthcare shares could be long term market beaters
• Pushpay and 1 other 5-star ASX share to buy right now
• Leading brokers name 3 ASX shares to sell today
• Don’t be blinded by gold fever…consider these ASX dividend shares instead
• Latest ASX entrant mixes BNPL with eCommerce

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 Chesser Resources share price blasts 180% higher on drill results appeared first on Motley Fool Australia.

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On Monday I looked at three ASX shares that brokers have given buy ratings to this week.

Unfortunately, not all shares are in favour with them right now. Three that have just been given sell ratings are listed below.

Here’s why these brokers are bearish on these ASX shares:

Ramsay Health Care Limited (ASX: RHC)

According to a note out Morgan Stanley, its analysts have retained their underweight rating but lifted their price target on this private hospital operator’s shares slightly to $56.00. Morgan Stanley has been looking into elective surgeries and notes that rates had recovered to 75% of pre-pandemic levels at the end of June (excluding Victoria). While this is a positive and it expects Ramsay’s utilisation rates to be solid during the first half of FY 2021, it continues to have concerns over private health insurance affordability issues. Especially given the prospect of high unemployment levels. The Ramsay share price is changing hands for $62.32 this afternoon.

Reece Ltd (ASX: REH)

Analysts at Citi have downgraded this plumbing parts company’s shares to a sell rating with a reduced price target of $8.55. According to the note, the broker expects the pandemic to result in tough trading conditions that stifle its earnings growth over the next couple of years. Particularly given the weakening housing market activity and softening house prices. The Reece share price is trading at $9.79 on Tuesday.

South32 Ltd (ASX: S32)

A note out of the Macquarie equities desk reveals that its analysts have retained their underperform rating and $1.80 price target on this mining giant’s shares. Although the broker notes that South32 has exposure to the strengthening silver price, it remains concerned that weak coal and manganese prices will offset this and weigh on its earnings. In light of this, it sees no reason to change its rating at this point. The South32 share price is changing hands at $2.23 this afternoon.

More reading

• Why PolyNovo and these ASX healthcare shares could be long term market beaters
• These ASX shares could be great additions to a retirement portfolio
• Here are easy ways to diversify your ASX portfolio
• Why I would buy Ramsay and this ASX blue chip share
• The ASX sector that’s heading for a V-shape recovery

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Ramsay Health Care 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 Leading brokers name 3 ASX shares to sell today appeared first on Motley Fool Australia.

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The financial headlines today are awash with gold.

You’ve likely already been inundated with that news, so I’ll keep this part brief.

The yellow metal hit an all-time high in US dollars overnight. At time of writing it’s trading for US$1,962 (AU$2,725) per troy ounce.

Gold’s current bull run is being driven by record low interest rates, ballooning government debts, and growing geopolitical uncertainty surrounding western relations with China. And, of course, the insecurity thrown up by the COVID-19 pandemic.

In short, a cornucopia of tailwinds is seeing retail and institutional investors — not to mention major central banks — add to their gold holdings. Some of that is in the form of physical bullion, though many retail investors are turning to gold exchange-traded funds (ETFs).

As you’d expect, this has seen the share price of most gold miners rocket.

Northern Star Resources Ltd (ASX: NST), for example, is up 44.3% so far in 2020.

And gold mining giant Newcrest Mining Limited (ASX: NCM), with a market cap of $30.4 billion, has gained 24.8% year to date.

Both shares are up in intraday trading today as well.

Should you jump on the gold bandwagon?

It’s tempting to buy gold and gold shares following a new wave of good news. But as the old investor adage goes, ‘If it’s in the news, it’s in the price’.

That doesn’t mean gold, and the companies that mine it, can’t go higher from here. But with greed abounding, it brings up unpleasant memories of bitcoin in the latter months of 2017. That greed saw the cryptocurrency soar to unprecedented heights before crashing hard in 2018.

At the moment, most analysts — and everyone I spoke to at last weekend’s barbecue — are greedy for a piece of the gold profits.

But as legendary value investor Warren Buffett advises, you should be, “fearful when others are greedy, and greedy when others are fearful.”

Noting that equities outperform gold over time, Buffett has also labelled investors buying gold when the price is rising as ‘foolish’. Of course that’s foolish without the capital F!

While I don’t expect gold to fall by more than 80%, like bitcoin did, it may well be approaching its peak. And I certainly wouldn’t rule out a fall of 10% or more from the current price.

That means gold miners’ share prices will again be determined by how much and how affordably they can dig the yellow metal from the ground. And not by a lot of hype over its new record prices.

A Foolish alternative

If you don’t have a high appetite for risk and aren’t comfortable jumping in and out of ASX shares, you’re probably better off turning your attention to yield shares.

These are shares that pay regular dividends. And if you invest in the right ones, you’ll ideally see their share prices rise as well.

Sydney-based Kardinia Capital has increased its exposure to ASX dividend shares. And the fund has an admirable track record. Since launching in May 2006, the Bennelong Kardinia Absolute Return Fund has an annualised return of 8.36%.

As quoted by Bloomberg, co-founder and portfolio manager Kristiaan Rehder said, “We are not just looking at companies that offer an attractive yield, we are also looking for companies that have a sustainable dividend yield. They are both important.”

Rehder went on to explain the fund is going beyond the traditional ASX dividend shares, like Atlas Arteria Group (ASX: ALX). It also holds JB Hi-Fi Limited (ASX: JBH) and Fortescue Metals Group Limited (ASX: FMG). He likes these shares because, “they offer heightened dividends with relative certainty of payouts due to resilient and strong earnings.”

If you’re looking to add an ASX dividend paying share to your portfolio, you may want to consider Collins Foods Ltd (ASX: CKF).

With a market capitalisation of $1.15 billion, the company is a KFC franchisee in Australia, the Netherlands and Germany. It’s also a Taco Bell franchisee in Australia and Sizzler franchisee in Asia. Collins is the owner of Sizzler restaurants in Australia.

In its annual results, released in June, Collins’ final dividend remained flat at 10.5 cents per share. That works out to a trailing yield of 2.1%, fully franked, meaning you can deduct the corporate tax rate from any taxes you may owe. Or even get some money back from the ATO depending on your personal financial situation.

Like most ASX shares, the Collins Foods share price tumbled from late February into mid-March. But it’s since rebounded strongly. From its low on 23 March, Collins’ shares are up 127.8%. Year-to-date the share price is up 11.1%.

As for gold fever? Avert your eyes.

More reading

• 3 ASX shares to cash in on the record high gold price
• 5 things to watch on the ASX 200 on Tuesday
• ASX 200 up 0.25%: Lynas rockets on U.S. deal, gold miners surge, bank shares tumble
• Why Lynas, Northern Star, REA Group, & Sezzle shares are storming higher
• JB HiFi and 1 other quality ASX share to buy right now

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Collins Foods 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 Don’t be blinded by gold fever…consider these ASX dividend shares instead appeared first on Motley Fool Australia.

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United States-based Zebit is the the latest buy now, pay later (BNPL) entrant to seek a place on the ASX, with a listing planned for September. According to the Australian Financial Review (AFR), Zebit will be looking to raise $42 million which would value the company at $200 million. But Zebit is not just looking to muscle in on the BNPL space, it is also an eCommerce retailer a la Kogan.com Ltd (ASX: KGN), selling some 90,000 products. 

Strong growth in eCommerce and BNPL

BNPL providers have seen an upswing in already strong transaction volumes as a result of the shift to eCommerce and a renewed focus on budgeting in the wake of COVID-19. The likes of Afterpay Ltd (ASX:APT), Sezzle Inc (ASX: SZL), and Openpay Group Ltd (ASX: OPY) have reported increasing customer numbers and revenue in recent market updates. Kogan, too, has benefitted from the move to online shopping, with sales increasing 103% year on year in April and May. 

New listing combines eCommerce and BNPL 

Zebit is like a combination of Afterpay and Kogan operating in the US market. It offers products from some 75 suppliers through its website with an in-house BNPL solution available to customers. The company does not actually have any inventory or warehouses of its own, but instead puts customer orders through to suppliers which then despatch products on Zebit’s behalf. 

Zebit’s BNPL offering specifically targets customers who can’t get credit elsewhere, according to the AFR, with almost all customers using it because their credit ratings aren’t high enough to qualify for mainstream credit products. According to Zebit, this market is underserved by BNPL operators such as Afterpay and Sezzle. 

Zebit could be on to something – it estimates this market consists of 154 million underserved US customers creating a US$85 billion market. But bad debts are a fact of life in this market and Zebit saw bad debts of 17.4% as a proportion of revenue in FY19. According to the AFR, the company is in the process of rolling out a new registration system to reduce the proportion of bad debts. 

Will Zebit work?

Zebit is seeking to combine BNPL services with something like an online department store selling everything from fridges and beauty products to jewellery and electronics. By targeting a traditionally underserved market, it may be able to expand market share rapidly. In order to grow profitably, however, Zebit will need to carefully manage bad debts. 

More reading

• Is CommBank the BNPL killer?
• 3 Warren Buffett quotes to start the week off right
• Why these brokers are telling you to buy the crashing IAG share price today
• Is it time to dollar-cost average into ASX shares?
• All Technology Index celebrates 6 months with stunning outperformance

Kate O’Brien has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Kogan.com ltd and Sezzle Inc. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Latest ASX entrant mixes BNPL with eCommerce appeared first on Motley Fool Australia.

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Looking to expand your ASX 200 share portfolio? Here, I’ll take you through two of my top picks right now. Both S&P/ASX 200 Index (ASX: XJO) shares have experienced strong recent share price gains. However I’m still confident in their ability to deliver robust, long-term growth for investors.

Keep in mind, it’s always advisable to expand your ASX share portfolio over time to ensure you have sufficient market diversification. This will also ensure that you do not have too much portfolio weighting in any one ASX share.

2 ASX 200 shares to buy and hold

a2 Milk Company Ltd (ASX: A2M)

a2 Milk has been one of the top performing ASX growth share of recent years. From the beginning of 2017, the a2 Milk share price has risen from $2.05 to now be trading at $19.76. That’s a whopping increase of over 860%!

Strong share price growth has continued into 2020, despite the challenges posed by the coronavirus pandemic. a2 Milk recently revealed that it has been experiencing continued strong growth across all regions. Demand for a2 Milk’s infant nutrition products sold in China and Australia has been particularly strong.

a2 Milk continues on its expansion plans in the massive United States and China markets. I believe that a2 Milk is reasonably well placed to make significant further inroads into these markets over the next five years. This is likely to flow though to above average shareholder returns during this time period in my view. 

Domino’s Pizza Enterprises Ltd (ASX: DMP)

The Domino’s share price has experienced a strong rally since March, rising from $44.75 on 19 March to now be trading at $75.73.

Domino’s appears to have been less impacted by the pandemic than many of its competitors. The company doesn’t typically offer its customers a sit-down service. Another competitive advantage the pizza chain has is that its in-store pick-ups tend to be very quick. They are optimised with an online ordering app which offers patrons accurate pick-up times. Domino’s also has an extensive home delivery service.

Over the medium term, Domino’s is forecasting new store openings to grow in the range of between 7% to 9% per year. Same store sales growth is forecast to between 3% to 6% per year.

I’m confident that the Domino’s share price is well placed for strong growth over the next five years, driven by its expanding international operations.

Foolish takeaway

a2 Milk and Domino’s are both quality ASX 200 shares that I believe are well placed for strong growth over the medium term.

Despite strong recent share price growth, I am confident that both companies are well placed to outperform the market over the next five years.

More reading

• UBS picks the best ASX gold miners to buy today
• ASX 200 jumps 0.75%: Westpac tumbles on AUSTRAC update, Credit Corp surges
• Why Telstra is a top ASX dividend share to buy in August
• The blue chip ASX shares to buy in August
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor Phil Harpur owns shares of A2 Milk. The Motley Fool Australia owns shares of A2 Milk. 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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Investors may be struggling to find value buys among ASX gold mining stocks even as the price of the precious metal surged to a record high.

The spot gold price strengthened by 1.6% to US$1,973 an ounce this morning as gold stocks outperform the S&P/ASX 200 Index (Index:^AXJO).

There’s good news for ASX investors who worry that they might have missed the opportunity to buy gold mining shares – UBS thinks it isn’t too late.

Gold price upgrade

The broker upgraded its forecast for the safe haven commodity. It is now expecting gold to average US$1,850 an ounce this financial year, or US$200 ahead of its previous prediction.

UBS’ expectations for FY22 is for the yellow metal to fetch US$1,750 an ounce compared to its last forecast of US$1,650 an ounce.

“The upgrade to our gold price forecasts drives a substantial ~30-60% uplift in our 2021e NPAT forecasts,” said UBS.

“All our coverage is investing in growth initiatives, but the strong gold price means they have positive FCF [free cash flow] yields.”

Upside might even be higher

But even then, the broker’s estimates may still prove to be too conservative. I believe the gold price could be averaging around US$2,000 an ounce over the next year for a few reasons outlined here. The gold bull run may be closer to the beginning than the end.

If you are wondering which stocks are best leveraged to the big rise in the shiny metal, UBS has picked the best placed ASX miners to outperform.

Best ASX gold stocks to buy

The Newcrest Mining Limited (ASX: NCM) share price is its top “buy” idea for the sector.

“We recently changed our thesis on Newcrest based on our in-depth work on Red Chris and Havieron,” explained the broker.

“The inclusion of these projects challenges market perceptions that production is peaking in 2020-21. We recently upgraded NCM to Buy, the first time since Aug 2012.”

The next 3 top buy ideas

The next three best ideas are the Regis Resources Limited (ASX: RRL) share price, OceanaGold Corp (ASX: OGC) share price and Saracen Mineral Holdings Limited (ASX: SAR) share price, in that order.

“Regis and Oceana are trading at a significant discount to peers on earnings multiples, and offer an alternative to some of the larger names for gold exposure,” said UBS.

“We believe Saracen offers a superior growth profile, with a 5-year production CAGR of ~5% ahead of peers (0-5%) and trading on a similar EBITDA multiple of 9x to large peers on 9-10x.”

UBS upgraded Newcrest’s price target by 6% to $40.60, Regis by 8% to $6.50, OceanaGold by 9% to $4.70 and Saracen by 10% to $6.90 a share.

More reading

• ASX 200 jumps 0.75%: Westpac tumbles on AUSTRAC update, Credit Corp surges
• Why Credit Corp, Nufarm, Regis, & Temple & Webster shares are jumping higher
• 3 ASX shares to cash in on the record high gold price
• Why Telstra is a top ASX dividend share to buy in August
• Why 5G Networks and these ASX shares just hit record highs

Motley Fool contributor Brendon Lau owns shares of Newcrest Mining Limited and Regis Resources Limited. 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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At lunch on Tuesday the S&P/ASX 200 Index (ASX: XJO) is on course to record a strong gain. The benchmark index is currently up 0.75% to 6,088.8 points.

Here’s what has been happening on the market today:

Westpac provides money laundering update.

The Westpac Banking Corp (ASX: WBC) share price is dropping lower today after the release of an update on its dealings with AUSTRAC. The banking giant revealed that it has increased the number of Threshold Transaction Reports (TTRs) that it has provided AUSTRAC with information on. This includes approximately 175,000 transactions that were not reported to AUSTRAC and approximately 365,000 TTRs that were reported to AUSTRAC but may have contained incomplete or inaccurate information. TTRs are bank transfers of more than $10,000 into and out of the country.

Gold miners charge higher again.

It has been another positive day of trade for gold miners such as Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL). They are pushing higher on Tuesday after the gold price continued its ascent. Also supporting the Regis Resources share price was the release of its fourth quarter update. Regis achieved quarterly production of 87,260 ounces, lifting its full year gold production to 352,042 ounces. This helped drive record cash flow from operations of $109 million for the final quarter.

Credit Corp impresses.

The Credit Corp Group Limited (ASX: CCP) share price is rocketing higher following the release of its full year results. Excluding one-off adjustments, the debt collector reported a 13% year on year increase in net profit after tax to $79.6 million. This compares to its guidance of $75 million to $80 million. In FY 2021 the company expects to report a net profit after tax of $60 million to $75 million.

Best and worst ASX 200 shares.

The best performer on the ASX 200 has been the Credit Corp share price with a sizeable 12% gain following its full year results release. The worst performer has been the Waypoint REIT Ltd (ASX: WPR) share price with a 4% decline. This morning Charter Hall Long WALE REIT (ASX: CLW) revealed that it had offloaded its 5% stake in the service station owner for $2.61 per security. This equates to a total of $101.6 million.

More reading

• UBS picks the best ASX gold miners to buy today
• Why Credit Corp, Nufarm, Regis, & Temple & Webster shares are jumping higher
• Why Bubs, PointsBet, Perpetual, & Waypoint shares are dropping lower
• Westpac share price on watch after AUSTRAC money laundering update
• Why Telstra is a top ASX dividend share to buy in August

Motley Fool contributor James Mickleboro owns shares of 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.

The post ASX 200 jumps 0.75%: Westpac tumbles on AUSTRAC update, Credit Corp surges appeared first on Motley Fool Australia.

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