Tag: Motley Fool Australia

Australian lithium producer Pilbara Minerals Ltd‘s (ASX: PLS) share price surged 40.0% in July. That compares to a 0.9% gain from the broader All Ordinaries (INDEXASX: XAO).

Like almost every other share on the ASX, Pilbara’s shares plummeted during the selloff following the rapid spread of COVID-19. From 21 February through 23 March, Pilbara’s share price plunged 55%.

Following its 23 March low, the Pilbara Minerals share price recovered rapidly and strongly, gaining 150% by the final trading day of July.

Year to date, the company’s shares are up 24% to 38 cents per share. That gives it a market capitalisation of $856.5 million. Over the last year, Pilbara has traded at a 52-week low of 14 cents, and a 52-week high of 52 cents per share.

What does Pilbara Minerals do?

Headquarter in Perth, Western Australia, Pilbara is a lithium-tantalum producer. It owns 100% of the Pilgangoora Project in Western Australia. The region is believed to contain some of the largest deposits of hard-rock lithium-tantalum in the world.

Currently in production, Pilbara Minerals is commencing the expansion of its Pilgangoora Project. This Stage 2 expansion will see a substantial increase in its processing capacity.

With lithium helping power electric vehicles and the wider transition away from carbon-based fuels, Pilbara Minerals aims to become one of the biggest producers in the world.

Why did the Pilbara Minerals share price surge 40% in July?

The Pilbara Minerals share price gained steadily throughout July without any major announcement that would have clearly drawn in new investors. Atop that, the lithium price didn’t make any major moves to warrant the 40% increase either.

It’s likely that many investors are speculating on the longer-term transition away from fossil fuels and towards more environmentally friendly energy sources like rechargeable batteries. And lithium is a key element in batteries that will drive tomorrow’s fleet of electric vehicles. It will also help fuel the growing market for home battery energy storage from solar and wind power.

Pilbara Minerals’ share price did gain 8% in a single day’s trading on 30 July, following its ASX media announcement that the company had secured a new US$110 million (AU$153 million) low-cost debt facility.

The new financing is being provided by international bank BNP Paribas and Australia’s Clean Energy Finance Corporation (CEFC). Both companies are long-term Pilbara supporters.

More reading

• Are ASX lithium shares the next big thing?
• These were last week’s best performing ASX shares
• Here’s how to start investing with $5k
• Why the Pilbara Minerals share price surged 8% today
• Up 38% in July! Is the Orocobre share price a buy?

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

The post Why the Pilbara Minerals share price surged 40% in July appeared first on Motley Fool Australia.

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There’s an unmistakable air of optimism around this reporting season. If this is putting you in a buying sort of mood, there are the latest ASX stock “buy” ideas from leading brokers.

It’s also safer to buy stocks when the tide is rising, and this certainly was the case today with the S&P/ASX 200 Index (Index:^AXJO) gaining 0.5%.

Investors seem to have forgotten their COVID-19 fears as the early profit result releases are better than what many have feared. Let’s hope this continues.

While this isn’t typically the ideal time to be buying stocks (not so early into the reporting season), brokers think now is the right time to be buying these ASX stocks.

Bargain properties

The GPT Group (ASX: GPT) share price may appeal to value buyers with a stomach for volatility. JPMorgan reiterated its “overweight” recommendation on the retail and office property group even after its interim results missed its mark.

But the broker isn’t concerned even though it warned that GPT’s properties is likely to suffer more write downs due to the COVID-19 fallout.

The group reported a net tangible asset (NTA) of $5.52 a share, which is 5% lower than in December. This is likely to fall again with JPMorgan forecasting a 30% drop in the value of GPT’s retail properties and a 20% decline in its office portfolio.

Even then, GPT’s NTA should come in at around $4.50 a share, which is well ahead of GPT’s last closing price of $4.03.

JPMorgan’s price target on the group is $4.70 a share.

On the right track

Meanwhile Morgans is sticking to its “add” recommendation on the Aurizon Holdings Ltd (ASX: AZJ) share price.

The rail operator’s full year results came in ahead of expectations, although its FY21 outlook was softer than what the broker would have liked.

Higher dividends

But Aurizon’s defensively positioned business is ideal in this volatile environment. What’s more, Morgans believes it can lift its dividend from 27 cents a share to 31 cents in FY22.

Even on the current dividend, the stock’s yielding close to 6% before its 70% franking credit.

Aurizon’s strong balance sheet is another thing to like about the stock with management using its excess firepower to fund a $300 million on-market share buyback.

Morgan’s price target on the stock is $15.14 a share.

New highs likely

Finally, don’t let the rocketing James Hardie Industries plc (ASX: JHX) share price put you off even as it hits a new record high of $32.22 on Tuesday.

Goldman Sachs believes there’s more upside following the building materials group’s latest quarterly earnings update.

The broker was particularly taken by James Hardie’s outlook for its North American business, which appears to be taking market share.

The outperformance of this division is behind management’s upbeat FY21 net profit guidance of US$330 million to US$390 million. This compares with consensus estimates at US$344 million.

The broker’s 12-month price target on the stock is $34.38 a share.

More reading

• ASX 200 rises 0.5%, Mesoblast plunges
• Why the Coles share price just hit a new record high
• Here’s why the OZ Minerals share price rocketed 24% in July
• These record breaking ASX stocks just got downgraded by top brokers
• Has the ASX 200 finally taken off?

Motley Fool contributor Brendon Lau owns shares of James Hardie Industries plc. The Motley Fool Australia has recommended Aurizon Holdings Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) rose by almost 0.5% today with the ASX continuing to climb.

There was one major plunge on the ASX:

Mesoblast Limited (ASX: MSB) share price crashes lower by 30.6%

Mesoblast released an announcement today on the scheduled meeting of the Oncologic Drugs Advisory Committee (ODAC) of the US FDA for the approval of Ryoncil in the treatment of steroid-refractory acute graft versus host disease in children.

The meeting is scheduled to take place on 13 August 2020. The ODAC will vote on whether the available data support the efficacy of the treatment of patients.

However, the US healthcare regulator released a document which seemed to cast doubt on whether Mesoblast will get approval, which is why the ASX 200 share dropped so hard.

According to the briefing, the FDA has concerns about the clinical performance of the drug product (DP).

It stated: “FDA’s position is that the product attributes the Applicant has identified as related to potency and activity, however, do not have a demonstrated relationship to the clinical performance of specific DP lots, and that the product’s proposed immunomodulatory mechanism of action has not been demonstrated in vivo in study subjects receiving remestemcel-L.”

“Without a demonstrated relationship with clinical effectiveness and/or in vivo potency/activity, controlling these CQAs [critical quality attributes] may not be sufficient to ensure the manufacturing process consistently produces remestemcel-L lots of acceptable quality.”

Challenger Ltd (ASX: CGF) share price drops 7.6%

Challenger announced a troubled FY20 result today which showed a statutory loss after tax of $416 million after significant investment declines in its ‘life’ business due to the pandemic market sell-off.

Normalised net profit before tax was down 8% to $507 million and normalised net profit after tax was down 13% to $344 million.

Challenger’s assets under management (AUM) went up 4% to $85.2 billion. With funds management net flows of $2.5 billion. Life sales went up 13% during the year.

Challenger CEO and managing director Richard Howes said: “Our domestic annuities sales continue to be impacted by structural changes to the wealth management market, and this year have been additionally affected by new age pension means test rules and the COVID-19 disruption. We are quickly evolving our business in response to the changes, and we are seeing positive signs that we are well positioned to rebuild momentum in the new market environment. One example is the growth we are now achieving in lifetime annuity sales via independent financial advisers.”

The board of the ASX 200 share decided not to pay a final FY20 dividend. There is still a lot of uncertainty. The company wants to ensure it remains robust during this period. 

In FY21 the company is expecting normalised net profit before tax in the range of $390 million to $440 million.

Sydney Airport Holdings Pty Ltd (ASX: SYD) FY20 result and capital raising

Sydney Airport is looking to raise $2 billion in a capital raising. Existing shareholders will be able to buy one new Sydney Airport security for every 5.15 securities at a price of $4.56 per new share. The new shares are being offered at a 13.2% discount to the theoretical ex-entitlement price of $5.26.

The money will be used to pay down the ASX 200 share’s debt, strengthen the balance sheet, maintain its investment grade credit rating and increase the liquidity available. Sydney Airport will have a lot of liquidity after the raising. But the company is reducing its capital expenditure plans. 

Sydney Airport reported a loss after income tax of $53.6 million. Net operating receipts dropped 79% to $90.4 million and earnings before interest, tax, depreciation and amortisation (EBITDA) was down 35.4% to $300.4 million.

Total passengers in the first quarter of 2020 was down 18% to 9 million. Total passengers in the second quarter was down 96.6% to 0.4 million.

Sydney Airport CEO Geoff Culbert said: “Sydney Airport is taking further decisive action to strengthen its balance sheet and to help ensure it remains well capitalised to meet the challenges presented by an uncertain COVID-19 operating environment, and to ensure it is positioned for growth in the future.”

More reading

• The latest ASX stocks leading brokers are urging you to buy today
• Why the Coles share price just hit a new record high
• Here’s why the OZ Minerals share price rocketed 24% in July
• These record breaking ASX stocks just got downgraded by top brokers
• Has the ASX 200 finally taken off?

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Challenger 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’re considering a few changes to your portfolio in the near future, then you might want to take a look at the shares listed below.

I believe these five ASX shares would be great options for investors right now:

a2 Milk Company Ltd (ASX: A2M)

The first quality ASX share to consider buying is this fresh milk and infant nutrition company. It has really caught the eye over the last few years thanks to its rapid earnings growth. Pleasingly, I‘m confident this strong form can continue for some time to come thanks to the increasing demand for its infant formula products in the massive China market.

Altium Limited (ASX: ALU)

Altium is an electronic design software provider that I would buy. I think it could be a great long term option due to the Internet of Things and artificial intelligence booms which are driving strong demand for its Altium Designer software. It also has other businesses, such as Octopart, that have a lot of potential. I expect them to support its overall growth in the 2020s.

CSL Limited (ASX: CSL)

I think this biotherapeutics company is a standout buy. Thanks to its world class CSL Behring and Seqirus businesses, I continue to believe CSL can be a market beater for some time to come. Especially considering the increasing demand for immunoglobulins, its growing plasma collection network, and its lucrative product development pipeline.

Nanosonics Ltd (ASX: NAN)

This infection control specialist could be a quality long term option for investors. It is the company behind the industry-leading trophon EPR disinfection system for ultrasound probes. I expect this product and the upcoming launch of several new products to underpin solid earnings growth over the next decade.

Pushpay Holdings Group Ltd (ASX: PPH)

A final option to consider is Pushpay. It is a donor management platform provider for the faith sector that has been growing at a rapid rate thanks to its leadership position in a niche but lucrative market. Management has set itself a target to win a 50% share of the medium to large church market in the future. This represents a US$1 billion revenue opportunity and is many times greater than FY 2020’s revenue of US$127.5 million.

More reading

• 3 quality ASX shares to buy in August
• ASX 200 up 1%: Challenger disappoints, Sydney Airport to raise $2bn, a2 Milk names new CEO
• Has the CSL share price lost its ASX 200 market darling status?
• 3 tips for beginners investing in ASX shares
• If you invested $10,000 in Afterpay shares last year, you’d have this much today…

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 CSL Ltd., Nanosonics Limited, and PUSHPAY FPO NZX. The Motley Fool Australia owns shares of A2 Milk. The Motley Fool Australia has recommended Nanosonics Limited and 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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If you have $2,000 to invest, I think it’s well worth looking at ASX growth shares.

Growth shares may not suit a retiree that relies on their ASX share portfolio to produce dividend income. But for a younger investor with a long time horizon ahead, I think having at least some growth shares in your portfolio is a great idea.

That’s because these are the kinds of shares that can offer real outperformance potential by virtue of their nature. So with this in mind, here are 2 ASX growth shares you can consider for a $2,000 investment today.

1) Xero Limited (ASX: XRO)

Xero is a cloud-based, software-as-a-service (SaaS) company. It provides its accounting software on a subscription basis, which has proven highly lucrative for the company. Over the past 5 years, Xero shares have rocketed from around $14 a share to more than $90 today.

This massive appreciation has been driven by both Xero’s rapid customer acquisition and the stickiness of its product. Put simply, lots of customers are trying out Xero’s products and most of them keep paying. Back in May, the company told us that subscription growth had come in at 26% for the 12 months to 31 March 2020. That helped push revenues up by 30%.

Of course, it’s hard to judge what the effects of the coronavirus pandemic will be for Xero. But government subsidies and support programs for individuals and businesses all need to be tracked and reported. As such, I think we won’t see any huge hits to Xero’s long-term viability. Considering all of this, I think Xero is a great ASX growth share to put $2,000 towards today.

2) Afterpay Ltd (ASX: APT)

By now, Afterpay should be a growth share every ASX investor is familiar with. Never far from the headlines it seems, Afterpay has had a year of share price insanity, for want of a better word. How else would you describe a company that, in the space of 6 months, goes from $30 a share to $40, down to $8, back up to $40 and then to $76? It’s probably a good time to warn you that this share can be volatile.

Even so, I’m pretty bullish on this company’s long-term future. It has pioneered a truly innovative product in buy now, pay later (BNPL). Not only that, but it has also managed to fight off a bevvy of potential competitors like Zip Co Ltd (ASX: Z1P) and Splitit Ltd (ASX: SPT) and kept it’s first-mover’s advantage.

It has also conquered the seemingly-impossible feat of cracking both the United States and the United Kingdom markets. Afterpay’s share price might look expensive right now, but I think this company’s potential growth runway can easily justify this. As such, I think Afterpay is another prime candidate in ASX growth shares for a $2,000 investment today.

More reading

• Flight Centre and Zip Co were among the most traded shares on the ASX last week
• Why I would buy and hold Afterpay and Xero shares
• ASX stock of the day: Moneyme share price surges 36% as lender enters buy now, pay later space
• Why Afterpay, Challenger, IVE Group, & Mesoblast shares are dropping lower
• 3 tips for beginners investing in ASX shares

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

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One of the biggest investing success stories over the last few months has been the unlikely rise of iron ore. After dropping off somewhat during March and April, the iron ore price has been on a tear since – seemingly defying gravity and reaching new highs every few weeks. Just this week alone, iron ore has careened past US$115 a tonne to around US$117 at the time of writing.

As you might expect, this has been great news for the companies that dig up iron ore from the ground and sell it.

The ASX’s biggest miner BHP Group Ltd (ASX: BHP) is up almost 60% since 16 March. Rio Tinto Limited (ASX: RIO) hasn’t disappointed with a 33% rise over the same period. And Fortescue Metals Group Limited (ASX: FMG) has exploded to new all-time highs after rising more than 90% – undoubtedly making its founder (and significant shareholder) Andrew Forrest a very happy man.

So what’s next for iron ore miners?

Well, one brokering firm remains very bullish on iron’s future prospects. That broker is the US-based JPMorgan.

According to reporting in the Australian Financial Review (AFR), JPMorgan believes the major iron ore miners are still offering compelling returns for shareholders, even at the current pricing. This stems from the firm increasing its iron ore pricing forecasts for 2021 and 2022 by 19% and 10% respectively. It builds this thesis on the assumption that Brazilian mining giant Vale won’t be able to increase its iron ore production above the current level of 1 million tonnes per day over the next 12 months.

Vale was forced to shut its production facilities in the face of the coronavirus crises in Brazil and has only reopened production recently.

The AFR quotes JPMorgan analyst Lyndon Fagan, who stated:

“The Vale recovery was previously seen as a catalyst to see iron ore prices trade lower. However, with the production now back in the market, and iron ore continuing to rally, we struggle to see what releases the pricing tension. We are now starting to think prices could remain well above cost curve support levels until Simandou [a new mine in Guinea] comes to market, which could be five to seven years away.”

In the meantime, JPMorgan is tipping BHP and Rio as the best bets for iron ore right now, saying these two companies haven’t realised their upside the way Fortescue has:

“At current trading levels we see compelling valuation support, 5 to 6 per cent dividend yield, and material consensus EPS upgrades to come through”

JPMorgan has a $43 price target for BHP and a $120 target for Rio. It remains neutral on Fortescue with an $18.60 target.

More reading

• Has the ASX 200 finally taken off?
• ASX iron ore miners jump on broker upgrades
• Are ASX lithium shares the next big thing?
• 3 tips for beginners investing in ASX shares
• BHP and 2 more ASX dividend shares for beginners

Motley Fool contributor Sebastian Bowen owns shares of JPMorgan Chase. 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 Coles Group Ltd (ASX: COL) share price has hit a new record high today. The company’s shares started off the trading day at $18.85, just below the previous record high of $18.99. But the Coles share price shot the lights in the few hours after open and stormed past $19 to print a new record high of $19.16 just after midday. Since then, it seems to have cooled off somewhat and was going for $18.97 at the market’s close.

It’s been a topsy-turvy year for the ASX’s second-largest grocer. Between 1 January and 14 May, the Coles share price was essentially flat, despite the broader S&P/ASX 200 Index (ASX: XJO) going on a wild ride in the meantime, which included a ~35% plunge. But since 22 May, the Coles share price really took off, rising more than 26% as of today’s pricing.

It seems like an eternity ago that Coles was spun-off from its old parent company Wesfarmers Ltd (ASX: WES) for $12.49 back in November 2018. Given that any Wesfarmers shareholder who kept their issued Coles shares is now up around 52% in 18 months, it has to go down as one of the most successful spin-offs in recent times. Also, consider that Wesfarmers shares are up almost 50% on their own accord over the same period as well.

Why is the Coles share price hitting the roof?

There has been no major news out of the grocery giant this week, so we can probably put today’s new record high down to some good old-fashioned earnings expectations fever. Coles is due to report its full-year results on 18 August (next Tuesday). It will no doubt be reporting something of a mixed bag. It’s likely (in my opinion) that sales will still be up as a result of the coronavirus pandemic, not to mention the second lockdown that is unfortunately afflicting Victoria right now.

On the other hand, it’s also likely that the company will be carrying some extra costs associated with the pandemic, such as cleaning expenses, increased staff sick leave and in-store protective measures like cashier barriers.

Clearly, investors are betting that the former will outweigh the latter next week if today’s Coles share price is anything to go by.

Should you buy today?

Looking at the Coels share price right now, I don’t see much I like. I think the shares are fairly valued at best, if not a little expensive. With a price-to-earnings (P/E) ratio of 21.34 and a trailing dividend yield of 2.21%, I don’t see much upside from either a growth or income perspective.

Saying that, I recognise that the relative safety of Coles’ dividend is still attractive in a year that has been defined by dividend cuts. So if you want to add or top up your Coles shares within a diversified dividend portfolio, go for it.

More reading

• The latest ASX stocks leading brokers are urging you to buy today
• ASX 200 rises 0.5%, Mesoblast plunges
• ASX dividend investors! Ignore shares in consumer staples at your peril
• 2 ASX dividend shares for income investors to buy right now
• Here’s why the OZ Minerals share price rocketed 24% in July

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET and 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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If you’re aiming to diversify your portfolio and optimism your future returns, then I think exchange traded funds could be worth considering.

Three exchange traded funds that I believe have the potential to provide strong returns for investors over the next decade are listed below. Here’s why I like them:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

If you were to buy just one exchange traded fund, I would recommend you pick the BetaShares NASDAQ 100 ETF. This is because this fund gives investors access to the 100 shares that are trading on the famous NASDAQ 100 index. These include many of the biggest and brightest companies in the world such as Amazon, Apple, Facebook, Microsoft, Netflix, and Google parent, Alphabet. It is also worth noting that the fund has no exposure to the financial sector, which could make it ideal for investors that are invested heavily in the big four banks.

VanEck Vectors Australian Banks ETF (ASX: MVB)

But if you don’t have any exposure to the big four banks, and want some, then you might want to consider the VanEck Vectors Australian Banks ETF. I think this exchange traded fund is great for investors that want exposure to the sector but aren’t sure which of the banks to buy. This is because this fund gives investors access to all of the big four, the regional banks, and investment bank Macquarie Group Ltd (ASX: MQG) through a single investment.

VanEck Vectors China New Economy ETF (ASX: CNEW)

A final exchange traded fund to consider buying is the VanEck Vectors China New Economy ETF. This fund gives investors access to a portfolio of companies in China which have outstanding growth prospects. The companies are in sectors which are making up “the New Economy.”  This includes the technology, health care, consumer staples, and consumer discretionary sectors. The VanEck Vectors China New Economy ETF is invested in 120 companies, which it believes represent growth at a reasonable price.  

More reading

• Here’s why the OZ Minerals share price rocketed 24% in July
• ASX 200 Weekly Wrap: Surging commodity prices snap ASX 200’s losing streak
• 3 quality ASX shares for a beginner’s share portfolio
• With global share markets soaring, here’s why it’s still a good time to buy ASX shares
• The latest ASX stocks to be hit by broker downgrades today

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 BETANASDAQ ETF UNITS. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. 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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The Metalstech Ltd (ASX: MTC) share price rose 9.52% to 23 cents today after the company released a presentation to be given at the NWR Virtual Small Caps Conference.

What was in the presentation

The company outlined that its gold resources are over 1 million ounces with 76% measured and indicated. Metalstech identified that, when comparing its market capitalisation to resource ounces, its resources were valued at $24 per ounce.

Metalstech’s Sturec mine was highlighted with the company advising 1.5 million ounces of gold and 6.7 million ounces of silver had been historically produced there. 

In 2012, the Joint Ore Reserves Committee found that the Sturec gold mine had a resource of 21.2 million tonnes at 1.50 grams per tonne of gold and 11.6 grams per tonne of silver. Metalstech also stated that there was significant resource expansion potential.

The company is currently drilling at its Sturec site with assay results expected intermittently over the next three months.

About the Metalstech share price

Metalstech is a resources exploration development company with projects in Slovakia and Canada. Currently, the company is focused on its Sturec gold resource in Slovakia. Metaltech is listed on the ASX and the Paris Stock Exchange.

In the quarter to 30 June 2020, Metalstech used $495,000 of cash for operating activities. It had $1,017,000 cash at 30 June, up from $587,000 at the end of the previous quarter.

The company outlined its 2021 mineral resource estimate for Sturec in its June 2020 quarterly report which matched the estimates from today’s presentation. However, it also included an estimated 388,000 tonnes at 3.45 grams per tonne gold and 21.6 grams per tonne silver.

In a recent drilling update, Metalstech announced that it had identified a very prospective zone of intense quartz stockwork from 182.5 metres to 185.4 metres.

The Metalstech share price is up more than 1800% since its 52 week low of 1.2 cents, it has returned 475% since the beginning of the year. The Metalstech share price is up 1050% since this time last year.

More reading

• Why the Metalstech share price is up 10% today

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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It’s been a tough year for ASX dividend investors so far in 2020. Former income heavyweights like Transurban Group (ASX: TCL) and National Australia Bank Ltd (ASX: NAB) have substantially slashed their payouts.

Other popular dividend shares like Westpac Banking Corp (ASX: WBC), Scentre Group (ASX: SCG) and Australia and New Zealand Banking GrpLtd (ASX: ANZ) have ‘deferred’ or cancelled their dividends entirely.

The coronavirus crisis has affected most sectors of the economy. This, in turn, has led to a wide range of dividend shares unable to provide income for their shareholders in 2020.

But one of the consequences of the pandemic for this writer has been a newfound appreciation of the consumer staples sector. So much so that I think it is a grave mistake for any ASX dividend investor not to have significant exposure to it going forward.

What are consumer staples shares?

Consumer staples describe the range of products that are ‘staples’ of modern living. In other words, the kinds of goods and services we simply can’t live without. Food and drinks are the first things that come to mind. But consumer staples also include household essentials like dishwashing liquid, toothpaste, razors, laundry detergent and toilet paper (you can probably gather where I’m going with this).

I think we can all agree that one of the most striking and confronting moments of the coronavirus pandemic was seeing the bare supermarket shelves of our local supermarkets. Seeing the value that all Australians were placing on owning enough consumer staples products highlights their importance in our lives. As Joni Mitchell once sang, “Don’t it always seem to go, you don’t know what you’ve got ’til it’s gone”. I reckon we all felt that way when seeing those bare shelves.

Casting aside the unsavoury social aspects of panic buying, I think the pandemic has proved that dividend investors should ignore consumer staples shares for their income portfolios at their peril.

Choosing dividend shares in a post-COVID world

So it’s one thing saying ‘we should invest in the necessities of life’ and another thing finding good companies with which to do so. You can always start with the giants of the Australian grocery scene, Woolworths Group Ltd (ASX: WOW) and Coles Group Ltd (ASX: COL). With trailing dividend yields of 2.57% and 2.2% respectively, these companies are nothing to write home about on current pricing. But a 2.2% yield is a lot better than what Westpac is offering right now.

You could also consider Metcash Limited (ASX: MTS) – the owner of the IGA chain of ‘independent grocers’. Metcash may not be as dominant as Coles or Woolies. But it does offer a higher trailing dividend yield of 4.24% in compensation.

Another option to consider is the iShares Global Consumer Staples ETF (ASX: IXI). This exchange-traded fund (EFT) holds a basket of consumer staples shares from around the world. Its holdings include Procter & Gamble (owner of the Gillette and Oral-B brands), Nestle, Coca-Cola, PepsiCo, Colgate-Palmolive and Walmart.

Foolish takeaway

Consumer staples companies may not offer the best dividend yields on the market. But in this uncertain world, I think any dividend investor out there ignores these ‘essential’ companies at their own detriment. As such, I think all dividend investors should consider their own allocation to consumer staples shares today.

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Motley Fool contributor Sebastian Bowen owns shares of National Australia Bank Limited and PepsiCo. The Motley Fool Australia owns shares of COLESGROUP DEF SET, iShares Global Consumer Staples ETF, Transurban Group, and Woolworths Limited. The Motley Fool Australia has recommended Scentre Group. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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